Services in China: Prospects for growth and implications for Australia

Relative to China, Australia has a well developed service sector. The development of a service sector goes hand in hand with economic development in other areas of the economy and a strong service sector is seen as being vital for a strong economy. The Chinese economy is still in the process of developing, but even for an economy at its stage of development the service sector lags behind where it should be. Trade in services is one way in which this gap can be overcome. Unfortunately for China, many of the factors that have held back the development of the service sector are also factors which have inhibited foreigners from supplying to China the services that China's economic development demands. The Chinese authorities have been slow to recognize this but now, in the early years of the 21st century, effective action is being implemented through changes that have been given added impetus by China's accession to the WTO and to the commitments that China has made as part of this process.