Government needs to remove institutional obstacles for healthy development of the service sector, says an article in the 21st Century Business Herald. Excerpts:
State Council recently issued a notice supporting the restructuring and upgrading of the service sector. This is the first time that the central authority has revealed its overall development plan for the sector.
It said the government should open up the market further, make better industrial standards and create the environment that promotes the structural upgrading. The key productive service sectors include research and development, third-party logistics, finance lease, after-sale service, human resource services and brand building.
The rise of service sector stems from the further division of labors in modern enterprises. But service sector’s added-value in China is much lower than that in the developed countries, despite the industry’s fast growth in China.
Many productive service industries are still dominated by State-owned enterprises, such as finance, transportation and postal services.
Recent move to allow private banks is an overdue action. There are also many regional barriers for various industries, such as banking, law, accounting, and consulting.
Service sector offers more well-paid jobs, it’s the largest employer, and the government will mainly depend on it to create new jobs while modernizing its agriculture and automating its industry.
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