Expanding imports of services aids trade growth

China's expanding demand for overseas services is creating new opportunities for foreign providers, with experts and business executives saying the trend reflects strong domestic demand and the country's continued efforts to develop a competitive services sector, promote a more balanced trade structure and deepen high-standard opening-up.

China's services trade deficit — covering sectors such as transportation, tourism, telecommunications and computing — reached 131.8 billion yuan ($19.52 billion) in June, the largest monthly deficit in three months, while the cumulative deficit totaled 770.3 billion yuan in the first half of the year, according to the State Administration of Foreign Exchange.

Guan Lixin, a researcher at the Chinese Academy of International Trade and Economic Cooperation in Beijing, said the widening services trade deficit reflects a more open and interconnected Chinese economy, in which services are playing a greater role in cross-border economic activities.

Guan said the increase in services imports reflects stronger demand from Chinese consumers and businesses for specialized overseas services and expertise.

Between January and June, China's trade in travel services stood at 177.3 billion yuan, followed by transportation services at 157.9 billion yuan, other business services at 146.7 billion yuan, and telecommunications, computer and information services at 73.1 billion yuan, data from the State Administration of Foreign Exchange showed.

He Shaojun, deputy director-general of the department of foreign trade at the Ministry of Commerce, said that from the perspective of overall balance of payments, China's large goods trade surplus is being partly offset by deficits in trade in services and the capital and financial account.

Zhao Jinping, vice-president of the China Association of Trade in Services, said, "By developing high-value and knowledge-intensive services, enhancing service quality and expanding exports of professional services, China can further promote more balanced growth in trade in services."

The push to develop a more competitive services sector comes as China steps up efforts to expand trade in services and deepen opening-up.

A meeting of the Political Bureau of the Communist Party of China Central Committee last week called for efforts to expand mutually beneficial international economic and trade cooperation, vigorously develop trade in services, promote more balanced trade growth, and actively attract and utilize foreign investment.

Xiong Yi, chief economist for China at Deutsche Bank, said the recovery of domestic demand, particularly in the services sector, would be a key driver of China's economic growth in the second half of the year.

Policy support for domestic demand, combined with declining oil prices, is expected to provide additional support for the economy, Xiong said.

Kilian Aviles, executive vice-president of German testing and certification company Dekra Group, said that China's efforts to promote services development and attract foreign investment will open up more opportunities for global businesses.

zhongnan@chinadaily.com.cn