OPINION> Commentary
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OPINION> Commentary
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Services sector next big thing
By Yang Daqing (China Daily)
Updated: 2008-07-21 07:23 The Chinese economy has seen a continuous boom in the last three decades after the economic reform and opening-up. The per capita GDP of China rose beyond $2,500 in 2007, which marks a new starting point for further prosperity. At the 17th National Congress of the Communist Party of China held in 2007, it was resolved that the economy should develop in a sound and fast manner. China has entered a stage when the industrial structure is being upgraded. As the market economy becomes more mature, the producer service industries would have more opportunity to prosper. Hopefully, they would serve as an important force to drive sound and fast economic growth in the near future. The producer service industries refer to services needed in the process of production rather than in final consumption. They have high information content and usually include business and professional services, financial services, insurance services, real estate services, logistic services and other services offered to producers. Development of producer service industries would facilitate a transformation in the mode of economic growth. The previous economic growth of China was achieved through heavy input of financial resources and energy. With the annual GDP accounting for 5 percent of total GDP of the world, China consumes coal, iron ore and other resources in a proportion much higher than 5 percent in the global consumption. Besides the relatively low efficiency of energy consumption, another important reason behind the huge energy consumption is the high proportion of industry in the country's economy. When the service sector is a fledgling one, economic growth depends heavily upon resource input. Producer service industries do not involve heavy energy consumption. Therefore, their boom would diminish the overall demand for resources in the economy and facilitate energy-saving and emission reduction. Nurturing producer service industries would also help China take a better position in the international economic cooperation. Relying more on the competitiveness in human resources and the value created from intellectual works, producer service industries would lift China into an upstream position in the industrial chain around the globe. The major sectors of producer service industries would all play a significant role in promoting the country's capability of independent innovation. Research and development is now an integrated part of nearly all industries. Marketing services assist the businesses to spot their target customers and potential products, while financial services are indispensable for business innovation. The author is a doctoral candidate in the School of Economics and Trade under Hunan University (China Daily 07/21/2008 page4) |
