China expands opening-up in services sector

A crowd of visitors shops at the 4th China International Consumer Products Expo in Haikou, South China's Hainan Province, which closed on April 18, 2024, The event drew 4,019 exhibitors from 71 countries and regions and more than 55,000 professional buyers. A total of 373,3000 visitors participated in the expo. Photo: VCG

China's State Council, the cabinet, on Monday issued a guideline on high-level opening-up in the services sector, containing 20 specific measures including improving the negative list mechanism for cross-border trade in services.

The move further highlighted China's commitment to high-standard opening-up, and China's rapidly growing services market will offer greater opportunities for businesses from around the world, experts said, noting that the opening-up measures are also crucial to promote the high-quality development of China's services industry.

The guideline covers six areas, including promoting institutional opening-up in services trade, facilitating cross-border flows of resources such as talent and capital, advancing innovative development in key areas such as international shipping, and expanding the international market. 

Notably, the guideline said that China will fully implement a negative list for cross-border services trade and establish a corresponding management system. For cross-border services trade outside of the negative list, the principle of uniform treatment will be adopted in managing both domestic and foreign services providers, according to the guideline. 

China will further open up the services sector by giving full play at free trade pilot zones and the Hainan Free Trade Port, and strengthen regulatory coordination and compatibility with international trade rules so as to streamline approval procedures, improve regulatory and policy transparency, and reduce costs for cross-border services trade, the guideline said. 

"The guideline represents major measures in China's all-round opening-up," Li Yong, a senior research fellow at the China Association of International Trade, told the Global Times on Monday, noting the fast development in China's services industry.

The services industry plays an increasingly important role in China's high-quality development. In the first half of 2024, the value added of the services industry grew by 4.6 percent year-on-year, and contributed 52.6 percent of China's overall economic growth during the period. 

In terms of trade in services, total imports and exports by value jumped by 14 percent year-on-year, according to official data. 

Li said that as China has basically fully opened up the manufacturing industry to foreign businesses, the services sector is a critical area of China's continuous high-level opening-up. "Opening-up in the services industry will also be critical in China's efforts to attract foreign investment," he said. 

China has been steadily promoting opening-up in both the manufacturing and services industries. This year's Government Work Report, released in March, said that all market access restrictions on foreign investment in manufacturing will be abolished, and market access restrictions in the services sectors, such as telecommunications and healthcare, will be reduced.

Before the guideline on Monday, China in July announced a major step to further open up the services sector, allowing six cities, including Shenyang in Northeast China's Liaoning Province, Nanjing in East China's Jiangsu Province and Hangzhou in East China's Zhejiang Province, to offer greater market access for foreign services providers. 

For example, foreign investment will be granted greater access in the eldercare, travel, telecoms, entertainment and live performance businesses.

Li said the opening-up measures in the guideline on Monday cover a wide range of areas, including new emerging sectors such as cross-border data flows. "This is very significant in improving the business environment and creating greater opportunities for services providers," the expert said. 

According to the guideline, China will facilitate the effective, convenient and safe cross-border flows of data. China will also facilitate cross-border flows of talent, capital and technologies. 

In terms of services imports, China will increase imports of services in high demand, including healthcare, culture and entertainment. 

China will also promote international cooperation in the services industry through various platforms and initiatives, including the Belt and Road Initiative, the guideline said. 

In line with China's efforts to boost services cooperation, the 2024 China International Fair For Trade In Service will be held in Beijing from September 12 to 16, where more than 420 Fortune Global 500 and leading enterprises will participate, according to officials.