China witnesses thriving development of service industry

China’s service industry has enjoyed increasingly prosperity since the 13th Five-Year Plan (2016-2020) period. Its quality and profits have rocketed, while new business forms are emerging.

The country’s total parcel volume and growth ranked the first in the world for 5 years in a row, and its e-commerce and mobile payment transaction also topped the world.

Service industry taking more share in China’s economy

This is how a day of many Chinese goes – ordering a breakfast online before riding a shared bike to office, shopping on e-commerce platforms at noon, and studying or doing fitness practices on the “cloud” at night. The accelerated integration of internet, cloud computing and big data into the traditional service industry is changing people’s life.

In the past 5 years, the service industry has been taking an increasingly larger part in China’s economy, with producer service becoming more and more professional and consumer service gaining more quality. The efficient and high-quality service industry is promoting industrial upgrading and improving people’s livelihood. Last year, the added value of China’s service industry accounted for 53.9 percent of the country’s GDP, 3.4 percentage points higher than that in 2015, making the sector a major driver for China’s economic growth.

From online to offline, and from production to daily consumption, the service industry is constantly generating new vitality, and new services represented by the “Internet+” is growing rapidly. Since the beginning of the 13th Five-Year Plan period, the consumption on software information services expanded swiftly, and the service has been increasingly applied in key links such as industrial R&D and design, production, and enterprise management.

Service industry developing with high quality

Zhejiang Great Shengda Packaging Co., Ltd., a service, by optimizing its product design, has successfully developed a new carton box that saves 20 percent of materials, which made it one of the suppliers for SF Express, one of the leading express companies in China.

“Our clients can join the whole design process on our brand new design and management platform, which not only shortens the R&D cycle, but also improves customer satisfaction,” said one of the  executives of the company.

As an important part of modern service industry, producer service is showing robust momentum for growth, constantly driving the optimization of industrial structures. According to statistics, emerging producer services such as digital services, as well as relevant R&D and maintenance enjoyed rapid growth in the first half of this year. The total contract value signed by enterprises in the sector hit 679.53 billion yuan, 450.13 billion yuan of which has been executed, up 5.9 percent and 10.9 percent, respectively.

As producer services lifts its quality, consumer services are also stepping into a new era of higher quality and diversity. In recent years, intensified structural reform on the supply side has continuously upgraded the quality of consumer services, which better satisfied people’s upgrading consumption demand. In the past five years, tourism, culture, sports, health and elderly care industries developed in a stable and healthy manner. In 2018, the culture and tourism industries accounted for 4.48 percent and 4.51 percent of China’s GDP, respectively, up 0.22 and 0.05 percentage point from a year ago.

Service industry opening wider

China rolled out a cluster of policies to facilitate the opening-up in the financial sector in recent years, which enabled Chinese and foreign financial organizations to learn from each other for win-win results, said Ho Shun-wah, Executive Director and Chief Executive of the Bank of East Asia (China) Limited. As China’s financial service industry intensifies its effort to open up, foreign financial institutions have established increasingly closer relationship with Chinese enterprises. They also realized rapid development of themselves while helping Chinese enterprises expand overseas market.

In the past two years, China announced multiple opening-up measures for the financial industry which, as a representative industry of China’s tertiary sector, has become a key part of China’s opening-up. According to statistics, in the first 10 months of this year, the actual use of foreign capital in China’s service industry stood at 625.79 billion yuan, up 16.2 percent year on year.