Fast growth in services trade industry attracting more global investors

Published: 05.06.2019 Related countries:  China China

China's trade in services industry is entering a golden stage backed by favorable policies, making the country a compelling destination of choice for global investors, experts said.

China's trade in services industry is entering a golden stage backed by favorable policies, making the country a compelling destination of choice for global investors, experts said.

The trade in services is playing a more significant role in boosting China's economic growth, said Zhou Chenghu, head of the China Association of Trade in Services.

In 2018, China's trade in services hit a historic high of 5.24 trillion yuan (US$758.9 billion), up 11.5 percent year-on-year, making the country the world's second-largest in services trade for the fifth year running.

 

"Technology innovation is rising to be a major growth point in China's trade in services with global business partners," said Zhou. "Tech advancement is and will continue leading the future development of trade in services."

Zhou was speaking at the Belt and Road Forum for Cooperation in Trade in Services last Tuesday.

The statements came after a recent report on an impending negative list of management systems for cross-border service trade in designated areas. Contrary to the previous foreign investment negative list, the new one addresses a wider range of issues such as cross-border payment.

Former French Prime Minister Dominique de Villepin said at the same forum that Chinese companies are steering global development in services trade. The global economy has seen accelerating development after China joined the World Trade Organization in 2001, he added.

In the past few years, service and other emerging sectors have seen rapid development in China to meet consumers' increasingly varying demand, and tech advancement is the key, de Villepin said.

Tech giants such as Tencent, Alibaba, and Baidu have pushed China's development of emerging industries including e-commerce and telecommunications, he added.

China's trade in emerging services saw a 12.6 percent year-on-year increase in the first quarter of 2019, 10 percentage points higher than the total service trade growth.

The Belt and Road Initiative has provided opportunities for both China and global players in trade services, but the cooperation in the sector with BRI countries needs a series of global industry standards, de Villepin said.

Former Maltese President Marie-Louise Coleiro Preca partly echoed those sentiments.

 

Efforts to promote cross-border e-commerce among BRI economies are expected. Today the least developed countries are able to sell their products to the international markets, thanks to the advance of cross-border e-commerce, she said.

China has been an active facilitator in this sector. Its efforts, such as promoting training for workers to improve their skills and learning capability, are essential to more sustainable industry development, she said.

China has become the world's largest market for cross-border e-commerce, ringing up a 30 percent annual growth rate in the past few years. About 200,000 small and medium-sized businesses are involved in cross-border e-commence through different platforms with total transactions exceeding US$300 billion, said Long Yongtu, former vice-minister of the then Ministry of Foreign Trade and Economic Cooperation.