A Study On The Global Competitiveness Of Service Trade In China

Owing to the special joining function and the higher and higher technology content in service products in modern economy, the global competitiveness of an economy in service industry and trade has been taken as the symbol of its development level and potential for future growth.The data in the present paper shows that the total amount of world trade in services has increased at least 3 times in the late 20 years, which grows faster distinctively than trade in goods. In this process, developed countries gained the advantage over developing countries. As concerning the trade structure, we can find that the share of transportation and travel services in the whole went stable or degressive in a certain extent, while professional service, like finance and law services, went up in contrast. The change in structure warns that the lack of competitiveness in service trade will lose not only the market share but also the competitiveness and potential of overall economy.Transportation & communication industry and retail & catering industry are two important sectors in China's service trade. The paper shows that the two sectors' technical improvement styles are all the capital-driven ones. The outcome indicates the capital-deepening process and the weak influence of human-capital upon these two sectors. Through analyzing several indicators synthetically, one could see that China's global competitiveness in service trade has no advantage, which proves the above conclusion on China's human-capital in service trade.On the basis of service trade theory and the specific situation in China, a model, including the factors of human-capital, foreign direct investment and urbanization, is formed to analyze influential variables in China's global competitiveness in service trade. The regression outcome indicates that these three variables are of high correlation with China's global competitiveness in service trade. By means of standardization of the outcome, one could figure out that human-capital is of most crucial importance among the three variables as far as China's global competitiveness in service trade is concerned.Aiming at the above three important factors, the countermeasure is proposed in this paper as follows briefly: forming diversified system of investment entity so as to alter the deficiency and inefficiency; investing more money in infrastructure construction to enlarge the capacity for service industry in urban area; improving the reform measures, especially unifying the service and labor market so that factors could flow without barrier, to maximize the technology-spillover effect from FDI.