Summary of Key Points
Recently, Shanghai has released the "National Service Trade Innovation and Development Demonstration Zone Construction Plan," which outlines two main goals: to reach a service trade volume of $270 billion by 2027 and over $300 billion by 2030, with the ultimate aim of becoming a global hub for service trade. The plan addresses the challenges faced by Shanghai's service trade, such as its large scale but lack of strength and difficulties in the flow of essential elements (such as data and talent). It outlines 27 key initiatives covering areas like digital services, high-end industries,要素 mobility, and open cooperation. These measures not only promote the inclusion of new business models such as AI large models and cross-border computing power in trade but also support industries like integrated circuits and biomedicine in expanding overseas. The plan balances openness with security, signaling China's steady progress in opening up its service sector to the world.
Detailed Explanation
1. From "Large Scale" to "Strong Competence": Focusing on Quality Improvement
Shanghai has led the country in service trade volume for several years (reaching $124.1 billion in the first half of 2025), but it faces the issue of being large without being strong—specifically, a low proportion of high-end services, weak international competitiveness of enterprises, and difficulties in the flow of essential elements. The new plan not only sets growth targets for volume but also emphasizes "structural optimization" (e.g., increasing the share of digital and professional services), "cluster development of key players," and enhancing the international reputation of Shanghai's services. In other words, it aims to shift from quantitative expansion to qualitative improvement, transforming Shanghai's service trade from a large entity into a powerful one.
2. New Approaches in Trade: AI, Computing Power, and Micro-Short Dramas as Trade Commodities
The plan includes several innovative and noteworthy elements:
- Inclusion of AI and Computing Power: For the first time, AI large models and cross-border computing power (e.g., renting China's computing resources to foreign companies) are classified as part of service trade, with detailed rules for the secure transfer of data.
- Cultural Products Going Global: Support is provided for original games, digital reading materials, and micro-short dramas to reach international markets—e.g., organizing international competitions, creating global digital reading platforms, and promoting the export of Shanghai-produced micro-short dramas in multiple languages.
- Diversified Development across Regions: Different regions are encouraged to develop specialized services to avoid repetitive competition.
3. Targeted Support for Key Industries
The plan offers targeted support for Shanghai's key industries:
- Integrated Circuits: An international joint design center will be established in Lingang to facilitate the development of the entire industry chain, with tax incentives (e.g., allowing for the deduction of imported testing materials based on actual usage instead of full upfront payment).
- Biomedicine: Assistance will be provided for the registration and sale of innovative drugs and high-end medical devices abroad, expanding international cooperation. Pilot programs will also explore the opening up of gene diagnosis and treatment technologies in free trade zones to make it easier for companies to engage in international business.
- Artificial Intelligence: Companies are encouraged to set up R&D centers, and efforts will be made to open up computing power and large models for overseas use, supporting smart device manufacturers (e.g., robotics) in developing new business models that include equipment sales and follow-up services.
4. Facilitating the Flow of Essential Elements
The core of service trade is the movement of essential elements, and the plan makes several reforms to streamline this process:
- Data Cross-Border Transfer: Rules are clarified to make data transfers both standardized and more convenient, with a focus on non-sensitive information.
- Talent Mobility: Procedures for foreign professionals to enter and work in Shanghai are simplified to make it easier for international experts to collaborate.
- Capital Flow: The management of corporate foreign exchange earnings and expenditures is optimized to reduce unnecessary approvals and facilitate smoother capital flows.
- Technology Transfer: Channels for the import and export of technology are improved to support companies in selling their independently developed technologies abroad.
5. Balancing Openness and Security
The plan emphasizes high-level openness while ensuring security:
- Openness Measures: The negative list for cross-border service trade in free trade zones is being expanded (with a "no ban, unless prohibited" approach), and the opening of value-added telecommunications services is being deepened (allowing more foreign investment). Pilot programs like "one test, multiple certifications" are being tested to save companies' costs.
- Security Measures: A monitoring system is established to oversee potential risks associated with service trade, ensuring that openness does not compromise security.
The implementation of this plan will help Shanghai strengthen its position as a regional hub for open trade in the Asia-Pacific region and serve as a model for service trade innovation nationwide. In the future, we may see more of Shanghai's AI services, micro-short dramas, and integrated circuit technologies going global, while ordinary consumers will benefit from more convenient international services (e.g., easier access to professional consultations and medical care abroad).