China to ‘shift into hi-tech services gear’ over next 2 decades in WTO
- Digital technology heralds greatest potential for rapid growth, Chinese vice commerce minister says
- But dangers lurk in trade protectionism and resistance to economic globalisation, he warns
“In the past two decades, China has taken advantage of its accession to the WTO and decisively opened up its market while actively integrating into global supply chains,” Yi, former WTO deputy director general, said in his keynote speech to the China Inbound-Outbound Forum.
“It rode the wave of economic globalisation, and achieved excellent development results.
“Many people are asking if China still has opportunities for rapid development in the next two decades? My answer is yes. With widespread application of digital technology, the development of global services trade has accelerated significantly, much faster than that of goods trade.”
He said the potential existed despite the return of global trade protectionism and the resistance to economic globalisation, especially in manufacturing.
The forum, organised by the Group Office for the Development of Beijing’s “Two Zones” and think tank the Centre for China and Globalisation, was held as part of the China International Fair for Trade in Services, a key week-long event that opened on Thursday.
Yi’s comments on trade protectionism underscore a warning from the central bank on Friday, when it released its financial stability report for the year.
The People’s Bank of China (PBOC) said the pandemic had exacerbated a “period of turbulent change” in the world where globalisation and shared supply chains were being challenged amid rising nationalism and protectionism.
The bank urged the central government to fortify the domestic economy against these external risks, saying they could torpedo growth.
Aside from cleaning up systemic problems like credit risks and bad loans, more support must be extended to struggling small and medium-sized enterprises while still maintaining an open stance to world trade, the PBOC said.
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Yi’s stress on the services sector was echoed by other panellists at the forum.
Huo Jianguo, former president of the Chinese Academy of International Trade and Economic Cooperation at the Ministry of Commerce, said expanding the services trade, the digital economy and the use of more digital technologies to support services aligned with both the views of the WTO and the strategies used by the United States, the European Union and other Western democracies.
Huo said the digital economy was more than just having “e-commerce platforms” – it involved digitising services to support those sales as well as helping Chinese enterprises sell services online such as accounting or financial services.
“In the past we reduced tariffs to open up, but the opening up in the five-year plan does not prioritise market access. Now, market access is just the minimum,” Huo said.
Li Zhifeng, vice-president at Tencent’s social media service WeChat, said the digital economy was advancing with new platforms like WeCom, a WeChat tool to help companies communicate better and faster with partners and consumers.