Trade in services totaled 2.2 trillion yuan in the first half of the year

Data from the Ministry of Commerce shows that China's total import and export of services from January to June this year was 2227.28 billion yuan (RMB, the same as below), down 14.7 percent year on year.

Among them, service exports performed significantly better than imports, the service trade deficit was greatly reduced, and the proportion of knowledge-intensive service trade increased.

However, since the outbreak of the epidemic, countries have taken strict measures to restrict the cross-border movement of people, which has greatly affected the import and export of travel services worldwide.

From January to June, the import and export of travel services in China was 558.08 billion yuan, down 42.9%, including a 45.0% drop in exports and a 42.6% drop in imports, which were the main factors leading to the decline in service trade. Excluding travel services, China's import and export of services grew 2.1% in the first half of the year, with exports up 3.7% and imports up 0.5%.

Cui Fan, dean of the Hainan Research Institute of the University of International Business and Economics and professor of the School of International Business and Economics, told China Business News that trade in services is one of the key points for opening up foreign investment.

"This year, a negative list on cross-border trade in services will also be issued for both the Hong Kong version and the national version, and a special list may also be issued for the Hainan Free Trade Hong Kong version. These are key areas for the rapid development of trade in services in the future." Cui fan revealed.

The proportion of knowledge-intensive service trade increased

The scale of China's service trade declined in the first half of the year, showing an overall trend of stabilization, with service exports significantly better than imports, trade deficit reduced and the proportion of knowledge-intensive service trade increased, said an official with the Service and trade Department of the Ministry of Commerce.

From January to June, China's service export reached 912.79 billion yuan, down 2.2%. Imports were 1.314.49 trillion yuan, down 21.7 percent.

Among them, as mentioned above, from January to June, the decline in China's service export stabilized, while the decline in import increased, and the decline in export was less than that of import by 19.5 percentage points, resulting in a 46.1% decrease in the service trade deficit to 401.71 billion yuan, a year-on-year decrease of 344.01 billion yuan.

At the same time, the proportion of knowledge-intensive service trade increased.

From January to June, the import and export of knowledge-intensive services reached 974.43 billion yuan, up 9.2%, accounting for 43.7% of the total, up 9.6%.

Among them, the export of knowledge-intensive services reached 512.87 billion yuan, up 9.7% and accounting for 56.2% of the total export of services, up 6.1 percentage points. The areas where exports grew rapidly were intellectual property rights fees, insurance services, telecommunications computers and information services, up 37.2 percent, 18.7 percent and 15.2 percent, respectively.

The import of knowledge-intensive services came to 461.56 billion yuan, up 8.6%, accounting for 35.1% of the total import of services, up 9.8 percentage points. The areas where imports grew rapidly were telecommunications, computer and information services, and financial services, up 31.1 percent and 15.7 percent, respectively.

Li Jun, director of the Institute of International Trade in Services at the Ministry of Commerce, told China Business News that knowledge intensive trade in services is digital deliverable trade in services, and the two concepts are almost equivalent.

The so-called knowledge-intensive services in statistical terms also exclude travel, construction, transportation and processing and manufacturing services, he explained. Besides the four non-digital delivery services, all of them are called knowledge-intensive service trade, that is, the others can be digitized, such as financial, insurance and consulting professional services.

In the state of the epidemic, digital trade is indeed growing dramatically. Taking the trade in software and information services as an example, Li told reporters that he had recently conducted research in some southern provinces on industries such as games and animation, and that he had seen many enterprises still survive the impact of the epidemic.

"In particular, the game animation industry, which includes digital content, digital music and other trade, is actually growing dramatically." Li said that the epidemic has indeed caused some impacts, but from the perspective of business, it is also an opportunity for some sectors. Not only has digital deliverable trade in services been less affected by the epidemic, but the outsourcing of Internet software services may also have bucked the trend. Service outsourcing, for example, has seen double-digit growth in just one to six months, Says Mr Li.

According to the Website of the Ministry of Commerce, in the first half of 2020, Chinese enterprises undertook 679.53 billion yuan of service outsourcing contracts and 450.13 billion yuan of execution, up 5.9 percent and 10.9 percent year on year, respectively. Among them, emerging digital services and productive services such as RESEARCH and development and maintenance have grown rapidly. The offshore execution volume of new digital services, such as cloud computing services, artificial intelligence services and blockchain technology services, has grown rapidly year-on-year.

Of course, there is another relationship, that is, the speed and pace of our resumption of production is faster. Mr. Li added that corporate offices in the provinces he studied had largely returned to normal, "so it has something to do with the broader environment."

We will accelerate the formulation of a national negative list for cross-border trade in services

The head of the Service and Trade Department of the Ministry of Commerce said that the coVID-19 epidemic is still spreading around the world, the world economy is in a severe recession, and international demand is shrinking sharply. China's service trade is facing a grim situation.

In the second half of the year, moFCOM will, in accordance with the decisions and arrangements made by the CPC Central Committee and the State Council, actively deepen reform, push forward the pilot project for comprehensively deepening the innovative development of service trade and the construction of demonstration cities for service outsourcing, expand export bases for featured services, and promote the high-quality development of service trade. We will further open up the country, speed up the formulation of a national negative list on cross-border trade in services, and make the 2020 Services and Trade Fair a success under normal conditions of epidemic prevention and control, thus injecting new vitality into the development of trade in services. We will speed up innovation, vigorously develop digital trade, online exhibition and other emerging trade in services, and do our best to improve the quality and efficiency of trade in services.

Li said that if there is a possibility of coexisting with the epidemic for a period of time, this means that we should be prepared to play a long game in the development of trade in services, "because trade in services is closely related to interpersonal communication."

To develop trade in services in the face of the epidemic, we need to promote the digital transformation of trade in services and vigorously develop trade in digital services. 'We need to think about how to export our business model in the face of the epidemic,' Mr. Li said.

He said to the reporter, found in the research, some Chinese Internet companies hope to "sea", seize the domestic and foreign "curtilage economy" such a rapid development opportunities, and China in such aspects as cross-border electricity indeed is a leading, even lead to some developed countries, but the Internet enterprise entrepreneurs, on the one hand, want to go into the international market on the other hand also more cautious aspects such as the situation in the future.

In addition to stabilizing foreign trade, trade in services also plays an important role in stabilizing foreign investment.

Cui told China Business News that the opening up of China's manufacturing industry has been basically completed, so the focus of China's opening up in the future will be on trade in services.

"In trade in services, because there are so many industries involved, each industry has its own regulatory characteristics." "I think the regulation of trade in services will be one of the key points in the regulatory trend in the future. In particular, the regulation of trade in services involves new issues such as data and personal privacy protection, which need to be explored and experimented. In the open process, how can we guarantee data security and protect personal privacy? A large part of the trade in services is closely related to data and the Internet, and there will be more and more integration. These areas need some innovative measures."