$78.7b in deals signed at services trade fair

Trade deals signed at the second China Beijing International Fair for Trade in Services, which closed Saturday, reached $78.69 billion, up 30 percent compared with the previous year.

Analysts said however that China's service industry has plenty of room for improvement, as it lags behind developed countries that enjoy fast economic growth based on their high-value-added service products.

A total of 415 trade agreements were signed at the five-day fair, which attracted 1,300 companies and organizations from around the world to exhibit their services and products, with an international trade volume reaching $10.89 billion, according to the fair's organizing committee.

The fair covered 35 types of service businesses including high technology, logistics, financial services and tourism.

In light of the best-ever results of the fair, an industry watcher said Chinese enterprises in the service industry are still in their initial stages and will have room to grow.

China has experienced around 30 years of rapid development since its economic reform started in the 1980s, "while its service industry is still developing behind developed counties," Li Jianming, deputy director at the China Enterprise Confederation, told the Global Times.

Business in the Chinese services sector accounted for only 44.6 percent of the country's total GDP in 2012, the National Bureau of Statistics said. In developed countries the figure is much higher, as in the US where over 80 percent of GDP comes from service businesses.

Li chalked up the immaturity of China's service industry to an unfair business environment and poor implementation of government support policies.

"Some sectors, such as finance, are mainly monopolized by State-owned companies; and some businesses like consulting and accounting suffer from 'unspoken rules' such as commercial corruption," Li said.

China has launched a series of policies to support service companies, including imposing a value-added tax on certain sectors to replace the existing business tax to ease their tax burden, but "some of the policies are not fully executed," Li noted.

Among the deals signed at the fair, the express delivery sector signed contracts worth 20 billion yuan ($3.26 billion), four times the amount from the first fair last May.

"The logistics industry, including express delivery, has developed fast in China, but still lacks good market regulations," Pang Shiming, general manager of E-trans Information Development Co, affiliated with China Merchants Logistics, told the Global Times.

Pang noted that China's cold chain logistics market, which is responsible for the storage and distribution of ­temperature-sensitive goods, is also underdeveloped.

China has made some achievements in global service trade. Its international trade volume in the sector reached $470.6 billion last year, up 12.3 percent year-on-year, according to the Ministry of Commerce.

However, it still saw a deficit of $89.6 billion in the 2012 service sector, with import volumes rising a dramatic 18.2 percent year-on-year, while exports grew only 4.6 percent.