Trade in services experiencing exponential growth

For Koh Poh-Yian, senior vice-president of FedEx Express and president of FedEx China, 2024 is undoubtedly shaping up to be a busy year.

The United States-based logistics service provider launched two new flights to the US from Qingdao, Shandong province, and Xiamen, Fujian province, in June, and expanded its fast cross-border shipping services for parcels heading to the US and Europe from China in July.

"This year also marks the 40th anniversary of our operations in China," said Koh. "Since 1984, FedEx has been committed to expanding its logistics network and service portfolio to support the growth of China's supply chain and trade in services."

In contrast to goods trade, trade in services refers to the sales and delivery of intangible services like transportation, tourism, telecommunications, advertising, education, computing and accounting.

With multinational corporations such as FedEx, Denmark's Maersk Line and France's CMA CGM Group all expanding their logistics capabilities in China this year, their expansion is reflective of a broader trend in China's trade in services, a sector that has experienced exponential growth.

In 1982, during the early stages of reform and opening-up, China's services trade had a total value of just over $4 billion. By 2023, this figure had jumped to $933.1 billion, a 233-fold increase, data from the Ministry of Commerce show.

As global value chains undergo restructuring, market watchers said that both Chinese and foreign companies are positioning themselves to capitalize on growing demand for services such as innovation, finance, logistics, marketing and branding.