context: Amid the accelerating digitisation and diversification of China’s services trade, the long-awaited Hainan cross-border services trade negative list marks the next-level liberalisation of trade and investment. Foreign service providers will have equal access to sectors that are not included on the list, especially in professional services, transportation, talent recruitment and finance.
'Special management measures for Hainan Free Trade Port cross-border trade in services (negative list) (2021)' was released by MofCOM (Ministry of Commerce) on 23 Jul 2021, including 70 special management measures across 11 sectors
- agriculture, forestry, animal husbandry and fisheries
- architecture
- retail
- transport, storage and postal services
- ICT
- finance
- rental and commerce services
- scientific research and technology services
- education
- public health and social work
- culture, sports and entertainment
The negative list represents the highest level of opening in services trade, which has exceeded China’s WTO promises and other existing free trade protocols in relevant areas, claims Wang Shouwen 王受文 MofCOM vice minister. Wang notes that Hainan will be able to bring in high-quality foreign service providers to improve economic efficiency, while also attracting global highly skilled individuals and advanced resources. For instance, restrictions were eliminated to allow foreign individuals to register for exams for certified engineers and public valuers. Overseas individuals are also allowed to open securities or futures accounts, as well as applying for securities or futures investment consulting professional certificates.
Hainan will serve as a stress test for a national services trade negative list, commented Bai Ming 白明 MofCOM Research Institute Department of International Market deputy director, who pointed out the national negative list will address the core interests of foreign investors. Bai predicts that cross-border services trade will be the future growth engine of global trade. In the past ten years, annual average growth rates of global cross-border services trade doubled the pace of the global goods trade, with the exception of that of last year. Hainan’s services sector accounted for over 60 percent of annual provincial GDP and contributed to 95.8 percent of annual growth, stated Ni Qiang 倪强 Hainan vice governor. According to China (Hainan) Reform and Development Research Institute, the PRC’s services trade is expected to achieve an annual average growth rate of 8 percent between 2020-2035 and become the world's largest global services trade by 2035.