Metropolis' service industry outpaces six-month GDP growth

By Yuan Shenggao | China Daily | Updated: 2019-07-26 07:57

The service industry has played a key role in spurring Beijing's development, contributing more than 85 percent to the city's economic growth during the first half of 2019, according to the latest data from the Beijing Bureau of Statistics.

The industry reported a 6.5 percent rise in its added value from January to June, outpacing the city's GDP growth by 0.2 percentage points, the bureau announced at a news conference last week.

Behind the upswing in the service industry, crucial sectors are gaining momentum, said Pang Jiangqing, deputy head of the bureau. Finance, information and tech services contributed nearly 70 percent of the city's economic growth during the past six months.

The sectors of information transmission, software and information realized a double-digit year-on-year growth in added industrial output value, and the financial sector's added value came close to 300 billion yuan ($43.6 billion).

Consumption services also felt the momentum. More than 40 percent of total residential consumption came from telecommunication, education, culture, entertainment and healthcare service sectors.

Beijing residents paid increasing attention to quality, brands and eco-friendliness, officials said. The change partially explains the rise in service expenditures.

Another reason behind the booming market consumption was the popularity of new business modes that brought about dramatic changes in personal spending.

Online sales increased 25.1 percent to 149.58 billion yuan in Beijing from January to June, data from the bureau showed. The combination of the internet and the service industry has expanded consumption service offerings. "Online services in education, tourism bookings, payment and healthcare facilitate consumption and help providers expand their outreach," Pang said.

As the only comprehensive pilot city in the country for expanding opening-up in the service industry, Beijing has unique strengths in developing the sector.

In 2018, the city's trade in services accounted for one-fifth of the nation's total, and nearly 90 percent of service businesses in the capital involved foreign investment, People's Daily reported.

With restrictions on foreign-funded projects lifted, an influx of investment from abroad flocked to Beijing's service industry, including finance, culture and healthcare.

Renowned credit rating agencies such as Moody's, Standard & Poor's and Fitch have made a presence in Beijing. The number of foreign-funded travel agencies that are qualified to run overseas businesses has increased to five in the city.

The country's first foreign-controlled joint ventures focusing on aircraft maintenance and securities business are operating in Beijing.

Government data show that more than 95 percent of new foreign-funded companies in the city in the first five months of this year involve the service industry. They have attracted a total of $6 billion in overseas investment, accounting for nearly 91 percent of the city's total.

Beijing has been exploring innovations in policies and practices to expand market access to the service industry, local officials said.

The innovations covered a wide range, including foreign trade facilitation, streamlined administrative services, policy favors targeting foreign experts, and finance leases on intellectual property such as patents, trademarks and copyrights. Some of them have been promoted nationwide.

Cui Weijie, director of the Institute of Industry Development and Strategy at the Chinese Academy of International Trade and Economic Cooperation, told People's Daily that Beijing's exploration provides invaluable experiences for further expanding the opening-up of the service industry nationwide.