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Abstract
China is poised to establish itself not only as a global manufacturing centre, but also aims to become a world centre for the information technology (IT) products within the next decade. This paper looks at China's software industry in particular, which has traditionally been neglected, and still accounts for only a minuscule share of the world software market. With empirical evidence, the paper shows that while China still faces major obstacles to the growth of its software industry, such as rampant piracy, shortage of professionals and strong external competition, it has been moving fast to bolster the industry in the post-WTO era. China has also a long way to go before catching up with its neighbouring IT giant, India. The paper concludes that China should capitalize on its own strengths, generated by a strong domestic demand, increasing pool of software professionals, including returnees from abroad, and capability to develop Chinese language-based software platform.