Trade in services experiencing exponential growth

The value of China's trade in services grew by 10 percent year-on-year to 6.57 trillion yuan in 2023, said the Ministry of Commerce.

This momentum has continued in the first seven months, with China's total value of services trade growing 14.7 percent on a yearly basis to 4.23 trillion yuan.

To further open up its services sector and facilitate convenient cross-border flow of various innovation elements, the State Council, China's Cabinet, released a policy document in early September regarding promotion of the development of trade in services through high-standard opening-up. They are crucial to supporting the expansion of companies like FedEx and Shenyang North Aircraft Maintenance.

The guideline addressed key points in supporting the development of trade in services and is expected to encourage an innovative environment for the growth of the sector.

Since joining the World Trade Organization in 2001, China has been fulfilling its commitments, accelerating the opening-up of its services sector to the outside world, and successfully boosting trade in services, said Tang Wenhong, assistant minister of commerce.

Tang said that the government will fully implement the negative list for cross-border services trade, establish and improve the management system for the list, and strengthen links between various administrative approvals, licenses, filings and negative list adjustments.

A negative list refers to specific areas of industry where foreign investors are not allowed to operate. They can operate in areas not appearing on the list.

"Since China's manufacturing investment and goods trade have remained at a high level, trade in services plays an even more important role to drive high-quality economic growth and new quality productive forces," said Jiang Hao, a partner at global management consultancy Roland Berger.

New quality productive forces are advanced productivity freed from traditional economic growth modes and productivity development paths, featuring high-tech, high efficiency and high quality, and are in line with the new development philosophy.

Jiang noted that the top three categories of China's trade in services are tourism, transportation and other business services. They account for 60 percent of the nation's total services trade, while most developed countries' trade in services focuses on knowledge and technology-based areas.

"This means China has a lot of potential to expand services trade, particularly as more Chinese companies are going overseas and seeking high-end services to go along with them," he said, adding that as China continues promoting the Belt and Road Initiative and contributing to the growth of the Global South, services trade will be even more critical to help domestic firms achieve their goals.

Similar views were expressed by Mohammed al Ajlan, deputy chairman of Ajlan & Bros Group, a Saudi Arabia-based conglomerate. "Since entering the Chinese market, we have witnessed tremendous change and maintain long-term confidence in China's high-quality economic development and increasing openness, especially in the areas of trade in services and technology growth," he said.

With closer China-Saudi political and business ties, the deep integration of the BRI and Saudi Arabia's Vision 2030 program between Saudi and Chinese companies will deepen and solidify, said al Ajlan.

"We aim to facilitate the implementation of advanced concepts, technologies, products and services in Saudi Arabia through platforms such as the China International Fair for Trade in Services," he said. Al Ajlan is also chairman of the Saudi-Chinese Business Council.

China and Belarus also signed a trade agreement in services and investment in August, said the Ministry of Commerce. The agreement is poised to further unlock the potential for cooperation in these fields and support high-quality development of the BRI.

Attracted by China's high-level opening-up, culture and quality education service, Duke Kunshan University, a joint venture of Duke University in the US, Wuhan University in Hubei province and Kunshan, a city in Jiangsu province, witnessed its largest undergraduate class this year, up 25 percent from the previous year and doubling the size of its inaugural undergraduate class in 2018.

About 350 students are from China, with about 150 being international — a 50 percent increase over the previous year, doubling the size of its inaugural undergraduate class in 2018.

This year, the university received the highest number of international applications, with over 4,700 applicants from 123 countries competing for 150 spots. About half of these applicants were from the US, according to John Quelch, executive vice-chancellor of Duke Kunshan University.

"I believe that DKU will help me achieve my goals by not only immersing myself in Chinese culture, but also broadening my perspective through other students, faculty and courses," said Sara Salazar, a class of 2028 student from Texas, the US.

From 2013 to 2023, the average annual growth rate of global services exports reached 4.9 percent, which doubled the average growth rate for the world's goods exports, said the World Trade Organization.