China Unveils Measures to Expand and Upgrade Services Sector

What changed

China has announced a package to expand and improve its services sector.

The measures include:

• Embedding research and design, modern logistics, software and information services more deeply into industrial supply chains.
• Rolling out elderly-care consumption subsidies nationwide.
• Reusing vacant buildings and redeveloping inefficient industrial land.
• Prioritising land for elderly-care and childcare services.
• Directing targeted financial support toward technology services, logistics, culture, tourism and sport.

Services contributed 66.1% of China’s economic growth in the first half of the year, up 5.9 percentage points from the same period last year.

Why it matters

This is an attempt to make services part of the economic infrastructure, not just a collection of consumer-facing businesses. Research firms, software companies and logistics providers are being pushed closer to factories and supply chains, while elderly care and childcare are being given clearer access to land and household spending support.

The land measures are especially practical. Vacant buildings and underused industrial sites can become locations for service businesses, while local governments are expected to protect space for care services. That links the policy to two very different needs: improving how companies operate and expanding services used directly by households.

The scale of services’ contribution gives the package its economic logic. But the announcement leaves key execution details open, including subsidy amounts, launch dates, eligible providers and lending volumes. The results will therefore depend on how local governments and service providers turn broad support into operating capacity.