China will remain steadfast in opening up to the world, and continue to ease market entry to the services sector and expand imports of high-quality services, Chinese President Xi Jinping said at the Global Trade in Services Summit of this year’s China International Fair for Trade in Services (CIFTIS), the first major offline international trade fair in China following its effective containment of Covid-19. “It is against such a backdrop that China decided to hold this important international trade event despite many difficulties in preparation,” Xi said. “It shows China’s willingness to join hands with all of you in this trying time, and work together to enable global trade in services to thrive, and the world economy to recover at an early date.”

China’s services sector remains strong, boosted by the first employment increase since January. The Caixin/Markit services purchasing managers’ index fell slightly to 54.0 in August from 54.1 in July, which was the highest reading since April 2010, but still remained positive for a fourth consecutive month. “The Caixin China General Services Business Activity Index came in at 54 in August, almost the same as the previous month‘s 54.1. The ongoing resumption of work and normalization of market demand continued to promote the post-epidemic economic recovery,” said Wang Zhe, Senior Economist at Caixin Insight Group. The official non-manufacturing PMI expanded at its fastest pace since January 2018 last month with a reading of 55.2 for August, up from 54.2 in July. China will import more than USD10 trillion worth of services over the next 15 years. During the past 15 years, the average annual growth rate of China’s service trade exports reached 9%, 2.9 percentage points higher than the global level. During that period, China imported USD4.5 trillion worth of services, contributing 12.9% to the growth of global service trade imports. In 2019, there were 17 service trade pilot zones in China, and their trade volume accounted for over 75% of the national total. This year, the number of service trade pilot zones will increase to 28.

The industrial sector’s share of China’s GDP could drop to 35% by 2025 from 39% in 2019, while the share of the services sector is expected to rise to about 60% in 2025 from 53.9% in 2019. The contribution of China’s digital economy to the national economy is projected to rise from about 6% in 2019 to 11% by 2025.

The 2020 China International Fair for Trade in Services (CIFTIS) was held in Beijing from September 4 to 9, the nation’s first major in-person gathering in the sphere of international economic and trade since the epidemic began. Sub-forums were organized on such topics as digital trade, financial services, tourism, 5G, and culture and sports. New technological applications from over 50 companies and institutions including General Electric, Huawei, Qualcomm, Standard & Poor’s, Baidu and iFlytek were unveiled during the event. The fair highlights Beijing’s accelerated efforts to deregulate its services trade, Li Jun, Director of the Institute of International Trade in Services at the Chinese Academy of International Trade and Economic Cooperation, a think tank under the Ministry of Commerce (MOFCOM) told the Global Times. The gathering created “a global platform” for services providers to tap into an increasingly important part of China’s trade. The nation’s services exports shrank 2.2% year-on-year to CNY912.79 billion in the first half, while its imports of services were down 21.7% to CNY1.31 trillion. The decline was mostly attributed to shrinking imports and exports of travel services during the period, as coronavirus lockdowns and social-distancing rules were implemented across the globe to restrict mobility. Both imports and exports of knowledge-intensive services, accounting for more than 40% of total services trade – such as financial services, telecoms, computers and information services – recorded a gain in the first six months. China’s move to give overseas investors more access to financial services is a notable example of its staunch support for free services trade, setting it apart from a rising wave of protectionism, Li commented.

Citibank (China) Co announced it has received a domestic fund custody license from the nation’s securities regulator, making it the first U.S. bank to be granted such a license. With the license, Citi can build additional value-added services around custody, such as fund administration and other outsourcing services, Vicky Tsai, head of securities services for Citi China, told the Global Times. “In anticipation of an influx of global financial institutions setting up in China, where the aggregate scale of assets managed in mutual funds, wealth management products and other programs now reaches approximately USD16 trillion, Citi has been investing heavily in its local custody, clearing and fund services capabilities,” Tsai said, adding that the license enables the U.S. bank to support its global clients in their custody needs as they enter one of the world’s fastest-growing fund markets.