Tap­ping into China’s Ser­vice Econ­omy

China Today (English) - - CONTENTS - By LIU LIN & ZHANG ZHIMEI

The just con­cluded Fourth China (Bei­jing) In­ter­na­tional Fair for Trade and Ser­vices her­alded the com­ing of a new era for the ser­vice trade.

THE Fourth China (Bei­jing) In­ter­na­tional Fair for Trade in Ser­vices (CIFTIS) con­vened at the Na­tional Con­ven­tion Cen­ter in Bei­jing from May 28 to June 1, 2016. A large-scale in­ter­na­tional fair for trade in ser­vices, it fea­tures a 50,000 squareme­ter ex­hi­bi­tion space with 122 pro­fes­sional fo­rums. The fair wel­comed nearly 2,000 ex­hibitors from 100-odd coun­tries and re­gions around the world who came on a quest for busi­ness op­por­tu­ni­ties. The fair en­com­passed all 12 sec­tors of the ser­vice trade as clas­si­fied by the World Trade Or­ga­ni­za­tion: Busi­ness and pro­fes­sional ser­vices, Com­mu­ni­ca­tion ser­vices, Con­struc­tion and re­lated ser­vices, Dis­tri­bu­tion ser­vices, Ed­u­ca­tional ser­vices, En­ergy ser­vices, En­vi­ron­men­tal ser­vices, Fi­nan­cial ser­vices, Health and so­cial ser­vices, Tourism ser­vices, Trans­port ser­vices and Move­ment of nat­u­ral per­sons.

A Grand Fair for Trade in Ser­vices

With its pro­por­tion of global GDP nudg­ing 70 per­cent – a pro­por­tion near­ing 80 per­cent even in ma­jor de­vel­oped economies – the ser­vice in­dus­try is a pri­mary prop of to­day’s world econ­omy. In­creas­ingly the new dy­namo for eco­nomic growth, the ser­vice in­dus­try and trade stand in the lime­light of in­ter­na­tional eco­nomic co­op­er­a­tion to­day.

Es­tab­lished in 2012, CIFTIS is not sim­ply a trade show. Com­merce Min­is­ter Gao Hucheng re­marked that the CIFTIS serves as a new en­gine for China’s eco­nomic trans­for­ma­tion, a “weath­er­vane” of global trade in ser­vices, and a new arena for in­ter­na­tional ex­changes and co­op­er­a­tion. “The vi­tal­ity of CIFTIS in­heres in its func­tion of fa­cil­i­tat­ing deals by set­ting up a cor­re­spond­ing plat­form. Both be­fore and dur­ing the fair, much ef­fort has gone into invit­ing pro­fes­sional buy­ers, and match­ing sell­ers with these buy­ers,” said Qiu Lixin, di­rec­tor of the Depart­ment of Trade in Ser­vices and Com­mer­cial Ser­vices of the Min­istry of Com­merce.

The pre­vi­ous three CIFTIS have helped arouse ac­tive trans­ac­tional de­mand and tapped into a huge po­ten­tial mar­ket, and thus at­tained a re­sound­ing suc­cess. Wen Ji­abao, China’s then premier and Li Ke­qiang, China’s in­cum­bent premier, at­tended the first and sec­ond CIFTIS re­spec­tively, and ad­dressed their sum­mits. Wang Yang, China’s vice premier, pre­sented a writ­ten ad­dress to the third CIFTIS, ex­press­ing his con­fi­dence and re­solve that China will fur­ther

ex­pand and open its ser­vice in­dus­try. He has also twice per­son­ally vis­ited the CIFTIS venue to in­form him­self of new de­vel­op­ments in the trade in ser­vices. The pre­vi­ous three CIFTIS at­tracted 50-odd in­ter­na­tional or­ga­ni­za­tions and in­dus­try as­so­ci­a­tions, as well as some 6,100 en­ter­prises from 154 coun­tries and re­gions to par­take of its 411 tradere­lated ac­tiv­i­ties, re­al­iz­ing an in­tended turnover of more than US $220 bil­lion, with in­ter­na­tional deals scoop­ing up over 30 per­cent of to­tal vol­ume.

What’s New about This Year’s Event

Ac­cord­ing to Yan Li­gang, di­rec­tor of the Bei­jing Mu­nic­i­pal Com­mis­sion of Com­merce – in­ci­den­tally in charge of this year’s CIFTIS – many in­no­va­tions greeted this year’s event. An in­ter­na­tional co­op­er­a­tion depart­ment is in place to at­tract more su­pe­rior re­sources in the ser­vice trade sec­tor. Coun­tries that are de­vel­oped in the ser­vice trade and do­mes­tic cities that en­joy ad­van­tages therein were the sub­ject of espe­cial pro­mo­tion dur­ing the event, which also fo­cused on na­tional macro-pol­icy by set­ting up ex­hi­bi­tion zones to show­case the re­sults of China’s co­op­er­a­tion with coun­tries along the Belt and Road in in­fra­struc­ture, in­dus­trial in­vest­ment, trade and lo­gis­tics, tourism, cul­ture and other ser­vice trade sec­tors, as well as other in­no­va­tions and the re­form re­sults of the Bei­jing-Tian­jin-He­bei in­te­gra­tion.

To alert the mar­ket to po­ten­tial busi­ness op­por­tu­ni­ties for fair par­tic­i­pants, two months be­fore the fair a raft of new prod­ucts were un­veiled to the pub­lic. These span the six key ser­vice ar­eas, namely science and tech­nol­ogy, in­ter­net and in­for­ma­tion, cul­ture and ed­u­ca­tion, fi­nance, busi­ness and tourism, and health and med­i­cal care. These prod­ucts cover such sec­tors as vir­tual re­al­ity (VR), In­ter­net plus e-com­merce, cross-border re­mit­tances, and telemedicine.

Among the 32 par­tic­i­pant coun­tries and re­gions, in­clud­ing Sin­ga­pore, South Korea, the Nether­lands and the Czech Re­pub­lic, 12 make the global top coun­try list for ser­vice trade, and nine of these lie along the Belt and Road. Over 10 African coun­tries banded into a group to par­tic­i­pate in this year’s fair, while 31 prov­inces, mu­nic­i­pal­i­ties and au­ton­o­mous re­gions in China’s main­land were pre­sent at this year’s event. With spec­tac­u­lar ex­hi­bi­tions and van­guard prod­ucts, the fair has drawn a global clien­tele, among them pro­fes­sional buy­ers who dis­cern a great mar­ket po­ten­tial and thriv­ing de­mand.

Added to the great num­ber of rep­re­sen­ta­tives of var­i­ous coun­tries and re­gions at­tend­ing, the fair is fur­ther note­wor­thy for en­tic­ing many com­pa­nies and in­sti­tu­tions of the ilk of For­tune

The logo of the Fourth China (Bei­jing) In­ter­na­tional Fair for Trade in Ser­vices (CIFTIS).

Global 500 com­pa­nies, multi­na­tion­als, fa­mous do­mes­tic en­ter­prises and some uni­corn com­pa­nies in sec­tors such as e-com­merce, sci-tech, fi­nance, med­i­cal care, couri­ers, and sales and dis­tri­bu­tion. These will de­but their lat­est prod­ucts and share their exclusive anal­y­sis on data or poli­cies as they at­tend the fair in a bid to se­cure co­op­er­a­tion.

New Era for Ser­vice Trade

In 2015, China’s to­tal ser­vice im­port and ex­port vol­ume hit US $713 bil­lion, rep­re­sent­ing a 14.6 per­cent year-on-year growth, much higher than the av­er­age growth rate of the global trade in ser­vices, which stood at 4.7 per­cent. China thereby took sec­ond slot – next to the U.S. – among coun­tries in terms of ser­vice trade.

In early 2015, the State Coun­cil pub­lished the Sev­eral Opin­ions on Ac­cel­er­at­ing the De­vel­op­ment of the Ser­vice Trade, which un­der­lined the need for ef­forts to erect plat­forms and or­ga­nize var­i­ous trade fairs to boost com­mu­ni­ca­tion and co­op­er­a­tion in the ser­vice trade, with CIFTIS tak­ing the lead.

The venue for CIFTIS is Bei­jing, which boasts the largest- scale ser­vice econ­omy of all cities in China’s main­land. Bei­jing is driv­ing ahead to cre­ate ser­vice-driven eco­nomic growth, and its de­vel­op­ment of the ser­vice in­dus­try and trade ranks it fore­most among China’s main­land cities. Since 2015, when the State Coun­cil ap­proved Bei­jing as the first pi­lot city for fur­ther open­ing- up of the ser­vice sec­tor, the mu­nic­i­pal gov­ern­ment has taken a slew of new mea­sures that have at­tained novel re­sults and de­vel­op­ments in such sec­tors as scitech, in­ter­net and in­for­ma­tion, cul­ture and ed­u­ca­tion, fi­nance, busi­ness and tourism, and health and med­i­cal care. In Fe­bru­ary 2016, the State Coun­cil re­solved to con­duct ser­vice trade in­no­va­tion de­vel­op­ment tri­als in 15 lo­cal­i­ties – among them Tian­jin – with grant of pol­icy sup­port to re­al­ize the goal of fur­ther­ing a trans­for­ma­tion in for­eign trade and bol­ster­ing the com­pet­i­tive­ness of the lo­cal ser­vice in­dus­try.

That dur­ing the 13th Five-Year Plan pe­riod China must em­brace a qual­ity rather than a quan­tity-cen­tered so­cio-eco­nomic de­vel­op­ment and shift its eco­nomic de­vel­op­ment from a man­u­fac­tur­ing to a ser­vice-driven one is em­i­nently fore­see­able. Ex­pand­ing two-way open­ing-up of the ser­vice in­dus­try and cul­ti­vat­ing new ad­van­tages that heighten the com­pet­i­tive­ness of the ser­vice in­dus­try is China’s only path for con­sum­mat­ing its tran­si­tion from man­u­fac­tur­ing to ser­vices.

The fourth CIFTIS not only her­alds the com­ing of a new era for the ser­vice trade, but also con­cretely man­i­fests China’s re­solve to de­velop its ser­vice econ­omy.

The Hong Kong zone on the first floor dur­ing the Fourth China (Bei­jing) In­ter­na­tional Fair for Trade in Ser­vices (CIFTIS) held in Bei­jing.

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