Cover News:

The Government Work Report for this year includes a dedicated section on enhancing the capacity and quality of the service sector. In light of this, could you elaborate on the considerations behind this focus? What policies will be introduced to promote the development of the service sector? Thank you.

Shen Danyang:

I'll answer this question. In recent years, China's service sector has developed rapidly. However, both from an international perspective and in light of domestic development trends, the sector's capacity, quality, and efficiency remain insufficient, leaving significant potential to be tapped. For example, with the widespread application of artificial intelligence technologies innovative models integrating culture, tourism, and sports, such as the Village Basketball Association and Jiangsu Football City League, are becoming increasingly diverse. An increasing number of emerging types of service models will become new growth drivers and a major source of employment. Another example is the software and information technology services sector. Data from relevant research institutions indicate that the value added in this sector is projected to grow at an average annual rate of around 12% over the next five years. This growth could generate an additional 5.6 trillion yuan in value, with the market for artificial intelligence application services alone expected to surpass 800 billion yuan.

While there are abundant market opportunities for the development of the service sector and promising development trends, these alone are not enough. Effective policy guidance and strong government support are essential, and the key is to enhance the capacity and quality of the service sector. These are the measures proposed in this year's Government Work Report for the service sector. So, how should we understand the goal of "enhancing the capacity and quality?" "Enhancing the capacity" refers to bolstering development capacity, with a focus on increasing the supply of high-quality services and fostering more competitive business entities. This aims to bridge the gap between supply and demand. "Enhancing the quality" is about improving development quality and efficiency. It aims to boost professionalism, standardization, and added value, avoid inefficient and homogenous competition, and ultimately promote the high-quality development of the service sector.

How to do this specifically? It is believed that we should not take a one-size-fits-all approach, but instead clarify differentiated development directions tailored to the characteristics of different types of service sectors. From the perspective of sectors, the focus is on two main areas. One is to "ensure that producer services in different sectors become more specialized and move toward the higher end of the value chain". This year's Report proposed to "press ahead with trials to promote integrated development of advanced manufacturing and modern services," which reflects this requirement. The other is "boost the quality, diversity, and accessibility of consumer services". This year, in line with the requirement of investing in people, efforts will focus on sectors where supply–demand imbalances are most acute, supporting the expansion of better-quality services geared toward consumption upgrading, so as to better meet the diverse needs of the people. Just now, Mr. Chen talked about investment. These areas of service-sector development also present abundant investment opportunities.

In terms of policy measures, there are three priorities. The first is to support technology empowerment, focusing on addressing technology and scenario application problems, and promoting the development of high-value-added, innovative service industries. For example, we'll support the application of artificial intelligence in information technology services, human resources services, and the integration of culture, tourism, sports, and commerce. Some supportive measures will be introduced in this regard. The second is to provide policy support. This mainly involves using fiscal, financial, and factor-guarantee policy tools to provide support, and further improving the standards system for the service sector. The third is to advance reform and opening up. This involves further removing institutional and mechanism barriers that constrain the development of the service sector, vigorously developing trade in services, and promoting the orderly opening up of the service market. Thank you.