Tuesday, January 8, 2013

China's services industry

China's fast-growing services industry has so far weathered the global slowdown much better than the factory sector, with the PMI consistently signaling healthy expansion and hitting a 10-month high of 58.0 in March.

That's partly due to a maturing economy as well as a historic shift in the last decade leading a majority of Chinese to live and work in cities rather than the countryside.

China's services sector generated 43 percent of China's GDP in 2010 and by 2011 provided nearly 36 percent of new jobs, exceeding the agricultural sector for the first time.

Beijing has acknowledged that greater consumer activity is needed to reduce the economy's reliance on the exports sector and investment-led growth.

"Expanding domestic demand will be a major stimulus for China's economic growth, and the greatest potential will come from the service sector," Xia Nong, deputy director-general of the Department of Industry under the National Development and Reform Commission, said on Friday, according to the China Daily.

Xia pledged to open the services sector to more foreign competition as well as encouraging Chinese service firms to go overseas.

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