Trade exhibitions and fairs have become an integral part of China's strategy aimed at increasing the volume of trade and services in Global South countries. These events serve as a link between Chinese producers and suppliers, as well as international buyers, thereby opening up new opportunities for establishing partnerships and conducting sales.
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China's Service Exports Grow Globally, Including Tourism and Knowledge
According to data from the Ministry of Commerce of China, the total trade in the country's service sector reached nearly 3.78 trillion yuan (US$562.47 billion) in the first half of this year, demonstrating an 8.3% growth compared to the same period last year. Meanwhile, service exports amounted to 1.50 trillion yuan, an increase of 17.6%, driven by the continuous improvement in the quality and efficiency of China's service sector.
One of the most dynamically developing areas is the export of tourism services, which grew by 31.1% in the first half of the year to reach 229.2 billion yuan, surpassing the other five main categories of service exports. Tourism services cover areas such as tourism, medical care, and overseas education. The growing demand for trips to China and domestic purchases is supported by improved policies, such as tax refunds upon visa-free entry.
A nationwide random inspection system for VAT refund claims on low-value goods was implemented on July 1st. Applications for goods valued under 10,000 yuan are now subject to selective inspection instead of full verification of every transaction. In the first month after this policy came into effect, Shenzhen customs in Guangdong province processed 13,000 VAT refund inspection cases totaling 170 million yuan, which is 2.2 times and 94.1% more than last year.
According to a representative from Shenzhen Customs, foreign visitors are purchasing a wider range of goods. In addition to traditional souvenirs like tea and silk, domestic digital products, clothing, and cultural crafts are gaining popularity.
As 'Chinese tourism' gains popularity, foreign visitors are starting to visit not only major Chinese cities but also lesser-known destinations. Data from the online tourism platform Qunar showed that in the first half of the year, international flights booked by foreign travelers covered 160 cities in China, which is 20 more than in the same period last year.
Furthermore, foreign tourists are staying longer in the country. According to statistics from the Chinese accommodation platform Tujia, in the first half of the year, international guests booked accommodations in 330 cities across China, with an average stay of 2.8 days, approximately 10% longer than last year. During summer vacation, the average length of stay reached 4.7 days. Hu Yang, Vice President of Tujia, noted that many foreign tourists are willing to explore small towns, communities, and rural areas of China to spend more time experiencing a more authentic and diverse China.
On social media, Elon Musk, CEO of Tesla and SpaceX, recently wrote that 'China is magnificent. I highly recommend people visit.' His mother, Mei Musk, later shared this post, supporting the opinion by saying: 'Every city has its charm with different cultural attractions to visit.'
Expansion of Knowledge and Technological Services
Another significant aspect of China's growing service trade is the expansion of the knowledge sector. In the first half of the year, the export of knowledge-intensive services reached 805.67 billion yuan, showing a growth of 12.8% compared to the previous year and accounting for 53.5% of the total service export volume.
During this period, biotechnology company XtalPi accelerated its global presence by supplying intelligent automated robotic laboratories for drug discovery and process optimization to South Korea's leading pharmaceutical company, JW Pharmaceutical. The company also made progress in strategic cooperation with innovative US biopharmaceutical companies and signed an AI-based drug discovery collaboration agreement worth over $400 million with a major international pharmaceutical company.
Zhang Peiyu, Chief Scientist at XtalPi, stated: 'We are transforming our independently developed AI algorithms, tools, workflows, and automated experimental capabilities into standardized, delivered solutions for pharmaceutical and materials R&D.' The company operates one of the world's largest clusters of AI-supported chemical robots and has already provided services to several of the top 20 global pharmaceutical companies.
As technologies such as artificial intelligence continue to evolve, Chinese enterprises are increasingly shifting from exporting finished technological products to exporting technological services and capabilities. One new area is the export of AI tokens. A token is a basic unit that AI systems use to process and generate information, and it can be viewed as a form of digital output resulting from the conversion of electrical power and computing power.
Chinese companies are now packaging the computing power of mature domestic large language models into standardized application programming interfaces, allowing foreign clients to access and use them without needing to build their own computing infrastructure. This flexible and efficient model of token export is gaining increasing popularity among foreign enterprises.
Parallel to the expansion of Chinese companies abroad, consumer values and cultural elements associated with Chinese brands are becoming increasingly recognized and popular. For example, in April 2024, the first MIXUE store opened in São Paulo, Brazil. MIXUE, a chain of Chinese tea and non-alcoholic beverage shops, offers açaí ice cream in Brazil, provides customers in the United States with various sweetness levels, and develops tropical flavors adapted for Southeast Asian markets. Through its business model, which combines global standards with regional adaptation, the company respects and embraces local cultures while bringing Chinese-style tea beverages to local markets. It currently operates over 4,500 stores in 16 foreign countries.
MIXUE's global presence reflects the international expansion of Chinese brands. Chinese companies are focusing not only on expanding their market presence but also on building an emotional connection with local consumers. From the rapid growth of tourism services and the expansion of knowledge-intensive services to the accelerated global reach of Chinese brands—a series of data and real examples illustrate the transformation and modernization of China's service trade. As China continues to open up its service sector, Chinese services will participate in the global division of labor in increasingly diverse forms, opening up new sources of growth and injecting fresh momentum into the world economy.