China to expand visa-free policy coverage amid high-quality devt of service consumption

Groups of foreign tourists walk outside Beijing's Palace Museum on July 9, 2024. In the first half of the year, 14.635 million foreigners entered the country through various ports, an increase of 152.7 percent year-on-year, data from the National Immigration Administration showed. Among them, 8.542 million entered the country under visa-free policies. Photo: cnsphoto

China vows to promote the high-quality development of its services sector, in a bid to tap the potential of consumption, which will be realized through multiple measures, including the extension of the visa-free policy to more countries and the further expanded opening-up of the services industry.

The State Council, China's cabinet, on Saturday released guidelines on boosting high-quality development of service consumption to unleash consumption potential.

Analysts said domestic consumption will be boosted by attracting foreign investors and tourists. Also, China will optimize the overall quality of its services sector to better serve the demand of domestic and foreign consumers. More importantly, China's opening-up policy will let the world share the opportunities and dividends of the country's development.

The guidelines include 20 specific targeted sectors in six categories, calling for improving the service quality of the catering industry and encouraging world-renowned catering brands to open their first or flagship store in China. The quality of accommodation services and foreign-related services should also be improved.

An array of measures will be taken to boost the vitality of life-enhancing consumption, including expanding visa-free policy to more countries, read the guidance.

The signal is clear, and the direction of future economic work has been further clarified, Pan Helin, a member of the Expert Committee for Information and Communication Economy under the Ministry of Industry and Information Technology, told the Global Times on Sunday.

"China has begun to enter a mature economy, and it is imperative to increase the proportion of the tertiary industry - services sector - in China's economy," said Pan.

Making service consumption a major driver in the expansion and upgrading of consumption was among the arrangements for economic work in the second half of 2024, which was outlined at a meeting of the Political Bureau of the Communist Party of China Central Committee held on July 30 to analyze the current economic situation.

Analysts said China is in the stage where its service consumption growth rate is faster than commodity consumption, which means that service consumption has become the main source of increase in household consumption.

However, compared with the average level of high-income economies at the same stage of development, the proportion of service consumption in household consumption in China is still low, and there is huge potential for development, they stressed.

The current domestic effective demand is insufficient. Promoting high-quality development of service consumption is a powerful measure to expand domestic demand, Hu Qimu, deputy secretary-general of the Digital-Real Economies Integration Forum 50, told the Global Times on Sunday.

"The consumption of foreign tourists will have a spillover effect on domestic industries, especially on services industries such as catering, accommodation, entertainment and tourism-related industries," Hu said.

Hu also said the fact that China has been the world's largest goods trader means there is little space for growth in goods trade. The new drive for growth will lean on the trade of services.

"The services industry has a strong ability to accommodate the labor force. Boosting service consumption is conducive to solving the current employment problem in China and will create more jobs in the future," said Hu.

Analysts pointed out that inbound tourists have created and will continue to create more jobs in the tourism sector.

"In the future, China's visa-free policy will be extended to almost all countries with a stable political and socioeconomic situation, including developed countries and some middle-income countries," said Pan.

Currently, the 72/144-hour transit visa-free policy has been implemented for tourists from 54 countries. China's visa-free policy covers tourists from more than 15 countries.

"Based on China's current technical capabilities, it is completely feasible to allow the vast majority of applicants to obtain e-visas online and greatly improve the convenience of visa applications," Qin Jing, vice president of Trip.com, a Chinese online tourism agency, said in a report the company sent to the Global Times in July.

The number of inbound entries in China continued to increase with China's extension of visa-free policy. In the first half of 2024, 14.635 million foreigners entered China, up 152.7 percent year-on-year, of which 8.542 million enjoyed visa-free policy, up 190.1 percent year-on-year.