Service industry to grow in share of economy

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Last updated at: (Beijing Time) Friday, January 09, 2004

Service industry to grow in share of economy

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The service industry will become the major sector of the Chinese economy in the next 15 years as it expands to account for over 50 percent of the gross domestic product (GDP) by 2020, official sources said Thursday.

State Development and Reform Commission (SDRC) spokesman Cao Yushu said the government placed great importance on the leading role of the service industry in economic growth.

He said the service sector would experience a new round of expansion as it opened further to private and foreign investment and as living standards improved.

From 1978 to 2002, the added value of the service industry increased by 380 percent. The proportion of the service industry in the GDP also rose from 21.4 percent to 33.7 percent.

During the period, the number of employees in the service industry surged from 48.9 million to 210.9 million. The net growth of employees in the service industry was about twice that in the manufacturing and mining industries for the same period.

According to government estimates, the service industry's share of GDP and total urban employment will grow to 36 percent and 33 percent respectively by 2005. By 2020, the service industry will provide about 40 percent of the total jobs in cities and towns.

However, there is still a long way to catch up with developed countries such as the United States, Japan, Germany and Britain, whose service sectors contribute up to 70 percent of GDP.

Cao was speaking at a briefing on the China International Service Industry Conference and Exhibition to be held in Beijing from June 30 to July 3. It is jointly sponsored by the SDRC, the Ministry of Commerce, the China Banking Regulatory Commission and the Beijing Municipal Government.

The conference will promote the development and openness of the service sector, and will feature forums on modern service industries such as finance, logistics, tourism and intermediate businesses, as well as a large-scale exhibition.

China, with a population of 1.3 billion, is expected to become the largest service market in the world. The conference to be held in Beijing has attracted interest from the international community. The organizers said officials from a number of countries and regions, scholars, experts, Nobel Prize laureates, representatives from 40 international organizations and executives from nearly 100 multinational companies will attend.

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