The Liberalization Of Service Trade And China's Countermeasures

The liberalization of trade in services is a typical characteristic and inevitable trend in the contemporary era. In order to develop the service industry and service trade, every country should comply with this trend, which will cost them as well as benefit them. As a developing country, China's service trade is still relatively weak, so we must adopt the corresponding measures and improve the competitiveness as soon as possible. The paper includes the following respects: The preface mainly introduces the background of the theme, the purpose, the structure and the main research approaches adopted. The first part is a summarization of service trade. This part briefly introduces the meaning, characteristics and developing trends of service trade since 1970s. According to the definition in "General Agreement on Trade in Services", service trade includes cross-border supply, consumption abroad, commercial presence and movement of personnel. The characteristics of service trade includes invisible trade target, trade course in pace with production and consumption, highly monopolized market, rigid protection modes, and greater degree of difficulty and complexity in marketing and management. Since 1970s, service trade has developed very rapidly, but the situation of unbalanced development occurs. The developed countries have been in the leading position, while the status of developing countries is rising continually. The structure of service trade is improved further and the fields are expanded gradually. The globalization and liberalization of service trade with the existence of service trade barriers become the irresistible tide. The second part is about "General Agreement on Trade in Services"and the liberalization of service trade. GATS is an important milestone of service trade toward liberalization. It explains the liberalization as "progressive liberalization", which means the members should enter into successive negotiations in order to reduce or eliminate the adverse effects of measures as a means of providing effective market access. GATS also offers certain consideration to the developing countries. It has promoted the intercourse and cooperation in service trade among various countries, therefore, pushed its development in the whole world. In addition, the servicelization of economy, the changes of world trade structure and the liberalization of goods trade have all impelled the forming of liberalization of trade in services. The third part is the analysis of economic effects in liberalization of service trade. Because of the particularity of service trade, its welfare effect is a little more complicated than the trade in goods. This paper takes service trade of information as an example, with the production possibility curve, relative price curve, indifference curve etc. as the tools and through model analysis, drawing the conclusion that the liberalization of service trade can increase the welfare incomes of both sides. But because of the existence of "secondary information market", the liberalization is favorable to the developed country with comparative advantage in information service, while unfavorable to the developing countries which have no such advantage. So the developing countries should try to prosper the trade with science and technology, and improve the proportion of information trade in international trade. In the long run, the liberalization of service trade can produce both positive and negative effects to both the developed countries and the developing countries. As to China, the liberalization of service trade can produce scale economy effect, raise the competitiveness of service industry and promote technologicalprogress and innovation. China can also learn the advanced management skills from the process of the liberalization of service trade, improve the national investment environment, and expand the new field in service, thus promote the adjustment of China's industrial structure. But at the same time, the service industry of China will face the fierce pressure. The changes of domestic consumption structure and the upgrading of industrial structure will produce the pulling effect to the service trade but it may transfer to the foreign countries. The adverse balance in service trade will aggravate further. In the process of the liberalization, the competition and loss of talents and the law imperfection will influence the promotion of competitiveness of service trade in China. The fourth part is the analysis of China's service trade competitiveness. The international competitiveness of service trade will be strengthened in the process of liberalization. The suitable liberalization policies adopted by one country must contribute to the promotion of its international competitiveness. Comparing with other countries, we can see that China's service trade expands constantly since the reform and opening-up, but its share in the world is still low, and the deficit exists for a long time. The analysis of the structure of export shows that the export of tourist service is relatively large, but other exports such as knowledge and technology-intensive service are still poor. In contrast, the import of the tourist service is relatively little and the import proportion of such services as finance, insurance, computer is increasing constantly. So the deficit in service trade of our country may be aggravated further. Comparing with the developed countries, China's degree of opening in service trade is relatively low, but with some developing countries, it is not very backward. Yet it is still a necessary direction to open the service market properly. The international comparison of the revealed comparative advantage index(RCA) reflects that China's overall competitiveness of service trade of our country is still relatively weak, when comparing with developed countries and some newly industrializing countries. From the trade competition indexes of industries of service trade in China, we can conclude we have advantages in resource and labor-intensive industries such as the tourist industry, construction, etc. But the competitiveness of the capital and skill-intensive industries are relatively weak. From the perspective of Potter's "diamond model", the reasons include we lack high factors of production, the relevant industries can't yet offer effective support, the organization and strategy of enterprises and the degree of competition are not rational enough and the government has not give abundant auxiliary function yet. But China has much potential of the demands on services, and it is a good opportunity to expand the scale of service trade. The fifth part is about the countermeasures of developing China's service trade under the liberalization trend. From the analysis above, the paper has put forward several countermeasures and suggestions for China's development of service trade. According to the competitiveness condition, we should open the service market to the world actively, reliably, stage by stage and with particular emphasis. In the range of GATS, we should make the appropriate protection measures and adopt different policies to different industries. We should establish scientific service trade management system, define the duty of every department and coordinate the interests between every industry. To perfect the legislation of service trade in our country, we need to strengthen the research about the clauses of GATS and WTO, establish, revise and perfect the relevant laws and regulations of the service industry and service trade as soon as possible. It is necessary to strengthen the cultivation of the high factors of production, increase the input to the scientific researches, improve the competitiveness of...