Liu Suli, a graduate of the International Politics Department of Peking University, is one of Wansheng's founders. He views the store as a harbor for those who love the classics and tradition. "The greatest pleasure for me is that I am selling knowledge to those who really appreciate it."

But this well-known and respected store is struggling to stay in business.

Liu is vehement as he expresses his frustration. "This sector (book publication and distribution) is too backward in opening up. Private enterprises encounter too much unfairness in this field!" Because it is privately run, the bookstore has to go through more red tape and is bound by more restrictions than state-run outlets such as Xinhua.

In 1993, when Wansheng Shuyuan was established, the founders themselves could not legally own the store. They found another company to act as the parent, and registered it as a collective enterprise. "Our property rights were unclear, because legally the bookstore was collective property," Liu said.

The 15th National Congress of the Communist Party of China affirmed that "private economy is an important part of the socialist market economy." Wansheng Shuyuan could finally be owned and operated as a private enterprise. But it still faced limitations on the books it could sell.

Textbooks are among the most profitable items in the book trade, but private bookstores in China are forbidden to sell them. While private and state-run stores are on more equal footing in sales of other types of books, the government outlets are eligible for tax rebates that are denied their private counterparts.

On many occasions, book dealers overseas have invited Liu Suli to visit and inspect their operations. He has been denied approval because he is running a private bookstore.

But the greatest obstacle for a privately owned bookstore lies in financing. "In the book industry, it is widely recognized that state-run stores have poorer creditworthiness than private ones, but they can get loans while we can't," fumes Liu. As a result, many private bookstores have resorted to illegal financing and loans, sometimes leading to great losses.

The State Press and Publication Administration's issuance of the Publication Market Management Regulations in July last year indicates that China is further opening its publications market. The regulations allow private bookstores to participate in chain store and shareholding reform, and compete for general distribution and wholesale rights. However, they are still blocked from doing business in middle- and primary-school teaching materials.

There are now 78,000 private bookstores employing 400,000 workers in China. Non-state-owned stores accounted for 56.9 percent of the 99.4 billion yuan (US$1.2 billion) in total book sales in 2002. Clearly, private bookstores have become an important force in the Chinese book industry. With the implementation of the Publication Market Management Regulations from September 2003, competition in the book market is expected to surge in 2004. Book chain stores are likely to be a focus in the industry, as well as of foreign investors seeking partners in China.

Some countries have support policies specifically geared toward small, independent bookstores, just as they do for smaller ballet troupes or symphony orchestras. Bookstores like Wansheng Shuyuan have an important place in preserving and developing a nation's culture.

But Liu Suli says, "We don't look for support or preferential treatment in our operations. All we want is fairness. China is steadily merging into the world, so we see better policies every year. I've seen many signs of a promising future."

(China.org.cn by Li Jinhui February 24, 2004)