As traditional goods trade growth slows globally, service trade has emerged as the new battleground for economic competitiveness. Nations worldwide are racing to capitalize on this sector's potential, with structural optimization, momentum transformation, and institutional openness creating unprecedented opportunities.
I. Service Trade: The "Power Engine" Stabilizing Foreign Trade
China's service trade now ranks second globally, forming one of the "three pillars" of trade power alongside goods trade and digital trade. Recent data shows service imports and exports growing by 7.1% year-on-year, with exports surging 13.4%. The service trade deficit continues to narrow, contributing over 30% to overall foreign trade growth.
The sector is undergoing rapid structural upgrades, with knowledge-intensive services maintaining a stable 40% share. High-value segments like telecommunications, computer information services, and business services lead growth, signaling a shift from labor-intensive to technology-driven models. Travel services have rebounded strongly, with exports growing 51.4% amid policy incentives like visa exemptions and tax refunds.
II. Institutional Opening: The Key to Service Trade Advancement
The revised Foreign Trade Law introduced a negative list management system for cross-border service trade, marking a paradigm shift from positive lists and factor-flow openness to rules-based institutional openness. This aligns with high-standard international agreements like CPTPP and DEPA, providing legal safeguards for further opening in telecommunications, finance, education, and healthcare.
Future efforts will focus on shortening negative lists, easing market access, and enhancing regulatory coordination in emerging areas like digital trade, green trade, and professional services. Pilot zones including Hainan Free Trade Port will test innovative policies for nationwide replication.
III. Emerging Growth Drivers: Digital, Green, and AI-Powered Services
1. Digital Trade: The New Frontier
Leveraging robust e-commerce infrastructure, China is advancing data element marketization and cross-border flow regulations. Participation in global digital standard-setting is crucial for establishing governance influence.
2. Green Services: The Sustainable Opportunity
The "digital + green" dual transformation is accelerating exports of carbon accounting, environmental consulting, and certification services. This synergy between ecological and trade advantages creates competitive differentiation.
3. AI-Enhanced Services: The Next Evolution
Integration of AI with R&D, telemedicine, smart logistics, and cultural innovation is spawning new business models. This technological fusion drives service diversification and quality improvements.
IV. Structural Optimization: Building a Resilient Foundation
1. Revitalizing Traditional Services
Tourism services are being upgraded through digital cultural products and improved international flight connectivity, enhancing visitor experiences and spending.
2. Logistics Transformation
Cross-border e-commerce ecosystems are evolving into global supply chain hubs, developing high-value segments like shipping finance and multimodal transport.
3. Advancing Professional Services
Financial, legal, and IP services require balanced development through international collaboration and domestic capacity-building to reduce trade deficits.
V. Collaborative Ecosystem: Supporting Sustainable Growth
A comprehensive policy framework covering taxation, finance, and customs is being developed to reduce business costs. Talent development focuses on cultivating professionals versed in international rules and cross-border operations.
Platforms like the China International Fair for Trade in Services facilitate standard alignment and global partnerships. Support for SMEs' digital transformation and internationalization remains crucial, with industry associations playing coordinating roles in standard-setting and information exchange.
As nations transition toward trade leadership, service trade modernization represents a critical pathway. Through institutional innovation and structural upgrades, economies can achieve the historic shift from scale-driven to innovation-driven growth, contributing to global trade governance while strengthening domestic development.