SHANGHAI -- Barely six months into his job as national sales director of U.S. flavors and spices giant McCormick in China, George Pu is already getting phone calls from headhunters luring him with other job prospects.

"They're still very aggressive," says Mr. Pu. He used to get two to three calls every month from various employers before being eventually persuaded to move from Gillette -- where he ran sales in north China -- to McCormick.

The 46-year-old Mr. Pu, with a combined 15 years of experience in Gillette and Coca-Cola, is one of the most sought-after local executives whom multinationals and Chinese companies are tempting to steer their operations in an increasingly competitive business environment ahead of the country's entry into the World Trade Organization next year.

Work experience at big foreign companies or technical and management degrees from overseas universities are becoming major pluses these days, with many 30- to 40-something Chinese climbing the corporate ladder faster and higher than ever before.

With China's entry into the WTO, more foreign companies -- especially small and mid-sized enterprises -- are expected to either set up shops or expand their operations in this vast country. This, coupled with domestic companies strengthening their management capabilities, will certainly intensify the search for suitable executives.

"Now, it's no longer a matter which nationality you want. What matters now is who can best do the job," said Helen Tantau, principal of international executive search firm Korn/Ferry International (China) Ltd.'s Shanghai representative office.

New Breed of Executives

Many multinational companies have started localizing their management positions as early as two years ago, when they realized that business wasn't as brisk as they expected, and costs, especially those for expatriates, were no longer justifiable.

An estimated 90% of midlevel managers in foreign companies are already local Chinese, with the salary gap between foreign and successful Chinese executives getting narrower, search consultants say.

"The line dividing local and expatriate talents is becoming blurred," said Louisa Wong-Rousseau, managing director of Asian-focused search firm Bo Le Associates.

Several large companies, such as Procter & Gamble and Unilever, started to invest and nurture local talents in the 1990s, she says.

Ms. Tantau says that except for country managers, chief financial comptrollers and marketing directors "the locals can do everything else...I am an extremely strong believer that the local people can do the job."

But she is quick to add that Chinese executives still lack the necessary "soft" skills such as managing, mentoring and motivating their staff.

The younger generation Chinese are driven and eager to learn, said Jane Jiang, manager of Alliance Consulting Ltd., one of the few registered Sino-foreign executive-search firms in Shanghai.

"If you're looking for bright people with local market knowledge, there is now a big pool of talent," Ms. Jiang said. "But if you're looking for people with local knowledge and with international mindsets, then it can be a big challenge for us to find such persons."

Alliance usually looks for such candidates among the growing number of western-educated Chinese returning from abroad.

Still On Recruiting Mode

Despite the global economic slowdown, China's executive market continues to be relatively robust. Aside from dotcom companies -- which spurred the executive search business two years ago but are now mostly dormant -- most firms are still on hiring mode.

And it's not only multinationals hunting for talent.

"Some of the biggest SOEs (state-owned enterprises) have in fact joined a fierce race to recruit the top talents available in the market," said Wong-Rousseau of Bo Le Associates. Private companies such as computer company Legend Holdings and consumer electronics group Haier Group are among the top recruiters.

She expects active recruiting in the insurance, banking, telecommunications, professional services and retailing sectors in the coming years.