The eyes of many of the world's business and financial institutions lit up recently when Chinese President Jiang Zemin outlined to the 15th national congress of the Chinese Communist Party, radical plans for selling off large numbers of state-run industries.

China has long been seen as the place wherein to invest with innumerable statistics being bandied about concerning the sheer size of the possible market and the vast amount of resources available. Many think that picking up a former state-owned operation cheaply could be a way into this potentially massive market, probably the world's largest new market of consumers.

Even leading financial institutions such as the IMF and the World Bank seem to be getting excited about the prospects for foreign investments and the opportunities to make a buck or two.

According to the World Bank, Chinese economic development has been so rapid that, if China's 30 provinces were counted as individual economies, the 20 fastest growing economies in the world between 1978 and 1995 would have been Chinese. The bank continues to forecast further growth.

And IMF directors told mainland officials that the accelerated rate of reform of state-owned enterprises would help to ensure a stable economy and improve efficiency and reform. Their official report stated, "[Directors] agreed that the key challenge was to take advantage of this favorable situation and undertake bold and comprehensive structural reforms, particularly to address deep-seated weaknesses in the state enterprises and the financial system in order to accelerate the country's transition to a more fully market-based economy."

But before you run off and put in your bids, there are many other institutions and companies advising extreme caution. Even the World Bank tempers its enthusiasm with the warning that the reform of poorly performing state industries is the only way to continue the economic progress seen over the past two decades. It goes on to highlight the deterioration of the financial sector, which faces huge potential bad debt through exposure to these problem state-run industries.

About 100 million people were employed in more than 300,000 state-owned businesses and many of these debt-ridden organizations already had collapsed before the historic announcement at the national congress.

There is, however, still an enormous number of workers involved in the production of Chinese cement. Even the small village shaft kiln operations are vastly overstaffed by western standards. The trick for the Chinese government will be to modernize while not increasing unemployment levels significantly.

There should be no problem in reviving China's flagging industrial bodies. The country has huge foreign exchange reserves and no shortage of foreign companies wishing to engage in joint ventures and partnership deals, which is lucky for China.

In another way it's not so lucky, because how will the state reconcile the sacking of millions of people, or at the very least abandoning them to their own fate, with the caring face of communism? How can it reconcile plans for drastic concentration in the market and not compromise the long-term modernization plans recently set out at the congress?

No one doubts the size of the potential market: 420 million consumers. No one doubts the demand for information and technology. No one doubts the will of the financial institutions and the readiness to supply the necessary funds. But can capitalism even get a foot hold, let alone survive, in this last bastion of old-style communism, or are we seeing the slow birth of what may one day become the biggest, loudest roaring Asian tiger of them all?