Growing economy shores up services

Sector rose by 9.4 percent in first eight months of year to hit 3.27 trillion RMB

The fast growing digital economy and accelerated restructuring of the global value chain will shore up China's trade in services this year, helping contribute to the world's economic recovery from the COVID-19 pandemic, said experts and business leaders.

With the government extending the opening-up of fields in the services sector, businesses such as digital-related innovation activities, logistics, finance and marketing have all become more prominent in China's economic growth, said Xing Houyuan, director of the Beijing-based China Service Outsourcing Research Center.

China's trade in services surged 9.4 percent on a yearly basis to 3.27 trillion yuan ($504 billion) in the first eight months of 2021, data released by the Ministry of Commerce showed.

In the meantime, the country's service exports amounted to 1.55 trillion yuan, up 25.3 percent year-on-year, while service imports stood at 1.72 trillion yuan, dropping 1.8 percent.

Trade in services refers to the sale and delivery of intangible services, such as transportation, tourism, telecommunications, research and development, human resources, education, healthcare, construction, advertising, computing and accounting.

The high growth momentum was pushed by digital technologies like mobile internet, big data, internet of things and cloud computing, together with industrial solutions and retail at the home market, as well as rising exports of culture and entertainment services, intellectual property royalties, telecommunications and information services, said Bai Ming, deputy director of international market research department at the Chinese Academy of International Trade and Economic Cooperation.

China's trade in knowledge-intensive services reached nearly 1.48 trillion yuan between January and August, soaring 12 percent year-on-year, accounting for 45.1 percent of its total trade in services, said the Ministry of Commerce.

He said China's trade in services will continue its strong run in the coming years, thanks to the country's pursuit of innovative high-quality growth and the expansion of its domestic market.

Eager to seize more share from this lucrative market, global companies have been rushing to transform from simply being manufacturing companies to becoming service-oriented manufacturers to better adapt to the nation's changing market environment.

Supported by an investment of 140 million yuan, Germany's Merck Group will open a research center for electronics technology in Shanghai in the first half of 2022, providing solutions and materials to the semiconductor industry to drive its growth.

"A golden age for China's semiconductor industry has just begun－no doubt the fastest growing market in the coming decade," said Anand Nambiar, global head of semiconductor materials for EMD Electronics, one of Merck's business units.

He said the company will further invest in innovation services and build local capabilities in China to remain competitive.

China's service sector attracted nearly 600 billion yuan in foreign direct investment in the first eight months of this year, soaring 25.8 percent year-on-year, with foreign investment in the high-tech service sector rising 35.2 percent, according to Ministry of Commerce data.