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China's quiet recalibration: Opening the service sector to a fragmented world
Last Updated: 2025-04-23 09:03 | CE.cn
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By Hasan Muhammad

Editor's Note: The writer is a freelance columnist on international affairs based in Karachi, Pakistan. The article reflects the author's opinions and not necessarily the views of China Economic Net.

At a time when much of the world is turning inward, China is expanding outward - but in its own way, and at its own pace. On April 20, Ministery of Commerce unveiled a new chapter in China’s evolving economic playbook: the expansion of comprehensive pilot programs to liberalize the services sector across nine new cities. Dalian, Ningbo, Xiamen, and Shenzhen - names known more for their industrial prowess - are now being tasked with becoming laboratories of reform, of opening, of global engagement.

What Beijing is attempting here is a recalibration of its global posture - one that favors openness in the face of isolationism and seeks to inspire confidence while much of the world retreats into the false comfort of nationalism. Furthermore. the measures outlined in the 155 pilot tasks are both ambitious and strategic. These are not token reforms but foundational shifts in areas ranging from telecommunications and healthcare to finance and tourism.

What is perhaps most striking about this initiative is its unapologetically globalist tilt. Foreign doctors will now be able to open clinics; overseas medical professionals may practice short-term; foreign-invested travel agencies are permitted to operate outbound tourism services; app stores and internet access services will see foreign equity caps lifted. These are not minor concessions - they are tectonic shifts in sectors traditionally insulated from international competition.

Even more telling is the financial openness baked into the plan. Support for international factoring services, centralized fund management in yuan by multinationals, and a push for foreign ESG and pension funds to enter China’s green finance landscape - these moves are less about optics and more about systems.

The U.S., with its imposition of “reciprocal tariffs,” is unilaterally unraveling decades of painstakingly built multilateral trade frameworks. Global supply chains, once optimized for efficiency, are now being recalibrated for resilience - and in some cases, nationalist impulse. Against this backdrop, China’s proactive opening of its service sector reads almost like an appeal to reason, or at the very least, to stability.

There is, of course, a domestic calculus as well. Services now comprise 56.7 percent of China’s GDP, a figure that continues to climb. With manufacturing already liberalized and industrial growth reaching a plateau, the future lies in knowledge, innovation, and the kind of human-centered exchanges that services uniquely enable. More than seven million new jobs were created in this sector in 2024 alone, underscoring its role as a linchpin of employment and social stability.

But services are also about lifestyle - about the demands of a rising middle class hungry for better healthcare, smarter financial tools, more immersive cultural experiences. In this sense, opening up is not just a gesture toward the world; it is a necessity to meet domestic expectations. The cities now joining the pilot program-each with distinct industrial identities - offer a testing ground for how this pluralism of demand can be met with a pluralism of policy.

The service sector already accounts for over 70 percent of China’s inbound foreign direct investment. In 2024 alone, the 11 provinces and cities previously approved for pilot programs attracted 293.2 billion yuan in FDI. Now, with the latest expansion, that number is poised to grow. The country is not just signaling openness - it is institutionalizing it.

Such developments matter - not only for China but for a world searching for economic ballast. In a time when decoupling and friend-shoring dominate the discourse, China’s insistence on opening-up the soft underbelly of its economy sends a quiet but powerful message. It says that openness is not naiveté, but strategy; that the future of globalization may yet be shaped by those who choose cooperation over confrontation.

(Editor: wangsu )

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China's quiet recalibration: Opening the service sector to a fragmented world
Source:CE.cn | 2025-04-23 09:03
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