Promoting Services Trade

In Economics

By Zhou Xiaoyan

A services trade cooperation roadmap was adopted at the trade ministers’ meeting to boost economic complementarities and diversification. With the trade in services becoming a new driver for global economic and trade growth, the ministers decided to intensify cooperation on information exchange, capacity building and coordination within BRICS to make services trade a new highlight of BRICS trade growth.

Although the group’s combined GDP accounts for nearly one fourth of the global total, its export of services accounted for only 11.3 percent of the world total in 2015, according to data from the World Trade OrganiSation.

“Services trade is not only a strong driving force of global economic and trade cooperation, but also a precious opportunity for countries to balance their trade structure. It will also push forward the development of China’s services industry and supply-side structural reform,” Xu Hongcai, Deputy Chief Economist with China Center for International Economic Exchanges, told Beijing Review.

Zhang Shaogang, Director General of the Department of International Trade and Economic Affairs at China’s Ministry of Commerce, said services trade covers a wide range of sectors and BRICS countries have demand for cooperation in every one of those sectors.

“As the first step in implementing the roadmap, we will carry out cooperation in the prioritized areas,” Zhang said at the press conference on August 1. “The first prioritized area would be tourism, with Russia being a hotspot travel destination for Chinese, and tourist visits to India, South Africa and Brazil gaining more popularity.”

An Yongming, a retiree living in Haikou, capital of south China’s Hainan Province, recently had an eight-day trip to Moscow and Saint Petersburg, which cost him a little more than 10,000 yuan ($1,500).

“People of my generation have a very deep fascination with Russia and deep memories of the former Soviet Union. We grew up listening to stories about the Soviet Union and reading Russian novels. Russian, instead of English, was the foreign language some of the people of my generation acquired,” An told Beijing Review. “Our minds are full of Russian names and places. I’d always wanted to visit the country.”

However, An thinks the local government has much to do to improve the tourist experience in Russia.

“Most Russians don’t serve their customers. Drivers don’t help passengers carry their luggage. There’s no Chinese language service on the flight, although the plane is full of Chinese. There are no Chinese signs or even English signs in most tourist spots,” An said. While he would still recommend people of his age to visit Russia, he thinks younger generations should visit countries with better tourist services.

In addition to the tourism industry, Zhang said other prioritized areas include healthcare, computer and related services, research and development, business services, construction services, distribution and education.

As the first achievement of the trade ministers’ meeting, China and Brazil signed a two-year action plan on August 1, pledging to bolster collaboration in services trade. It would include project consultation, project construction, information technology, automation of banking services, travel, culture and traditional Chinese medicine.

Read more about strengthening e-commerce cooperation within BRICS here.

This article was originally posted on Beijing Review.

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