China maintains growth with promising global prospects, and the annual report on digital trade is released

The 2023 China International Fair for Trade in Services held a special press conference for the Service Trade Development Summit today. The Ministry of Foreign Economic Research of the Development Research Center of the State Council and the China Academy of Information and Communications Technology jointly released the "Report on the Development and Cooperation of Digital Trade 2023".

The report consists of 6 chapters and provides a comprehensive and systematic research and analysis of the global digital trade development trend, policy trends, rule negotiations, China's digital trade development trend, cross-border data flow, and cooperation prospects. Xin Yongfei, Director of the Institute of Policy and Economics at the China Academy of Information and Communications Technology, introduced the content of the report.

Enhanced competitiveness of China's digital service trade

The report points out that China's digital service trade continues to grow, and its international competitiveness is further enhanced. In 2022, the total import and export value of digital services in China was $371.08 billion, a year-on-year increase of 3.2%, accounting for 41.7% of the total import and export value of services. Among them, the export of digital services reached 208.91 billion US dollars, a year-on-year increase of 7.2%, exceeding the world average level; The import of digital services reached $162.16 billion, a year-on-year decrease of 1.6%.

From the perspective of international market share, China's digital service exports account for 5.1% of the world's total, an increase of 0.2 percentage points year-on-year. From the perspective of trade surplus, China's digital service trade continues to maintain a surplus, with a net export scale of 46.75 billion US dollars, a year-on-year increase of 55.8%.

In addition, China's intellectual property usage fees are leading the growth rate in segmented digital service trade. In terms of exports, intellectual property usage fees, other commercial services, and ICT services grew the fastest, with year-on-year increases of 13.3%, 7.9%, and 7.7%, respectively. In terms of imports, insurance services grew the fastest, with a year-on-year increase of 30.2%.

Enhanced willingness of Chinese small and medium-sized enterprises to go global

The report points out that China's leading Internet enterprises are putting "going to sea" in an increasingly important position. The report's analysis of 18 listed Internet enterprises found that some digital enterprises have achieved initial results in "going overseas". Overseas business income will grow rapidly in 2022, becoming an effective way to promote growth and spread risks.

There are three major trends for Chinese Internet enterprises to "go to sea": the main body of "go to sea" extends from head enterprises to small and medium-sized enterprises, and the willingness of small and medium-sized enterprises to go out is growing. The strategy of "going abroad" has shifted from capital driven to capital and technology parallel, with the value of technology continuously increasing. "Sailing" products have expanded from tool category to multi category category. The top 20 Internet applications in terms of revenue have covered short video, games, e-commerce, finance, mobile travel and other fields, and are no longer limited to early anti-virus software and browsers.

In the overseas mergers and acquisitions announced by Chinese enterprises, the telecommunications, media, and technology industries ranked first in terms of transaction amount, with the main M&A regions being Asia and Europe.

The main cross-border e-commerce trading partners are the United States, Australia, France, and the United Kingdom

The report points out that in 2022, the scale of China's cross-border e-commerce import and export reached a new high, reaching 2.1 trillion yuan, a year-on-year increase of 7.1%, accounting for 4.9% of the total value of China's goods trade import and export. Among them, exports reached 1.53 trillion yuan, an increase of 10.1%, accounting for 6.4% of the country's total export value; Imports amounted to 527.8 billion yuan, a decrease of 0.8%, accounting for 2.9% of the country's total import value.

The main trading partners are still concentrated in developed countries such as the United States, Australia, France, and the United Kingdom, while trade with emerging market countries such as Thailand, the Philippines, and Vietnam is steadily increasing. From the top five export destinations, the US market accounts for 34.3%, the UK accounts for 6.5%, Germany accounts for 4.6%, Malaysia accounts for 3.9%, and Russia accounts for 2.9%. From the perspective of import sources, Japan accounts for 21.7% of China's total cross-border e-commerce imports, the United States accounts for 17.9%, Australia accounts for 10.5%, and France accounts for 7.5%.

Enhanced data flow within Europe and Asia regions

The report points out that cross-border data flow is a prerequisite for conducting digital trade. From 2005 to 2022, the scale of cross-border data flow expanded from 3554Gbps to 997301Gbps, an increase of over 280 times. The trend of multi centralization in global cross-border data flow networks is highlighted, with North America still leading the world in capacity scale, but its central position has declined. Its share of international broadband capacity between regions has continued to decline from 38% in 2013 to 28% in 2022. The share of Europe is gradually approaching that of North America, reaching 26% in 2022.

The internal data flow within major regions has strengthened, and international bandwidth connections within Europe and Asia have surpassed those between regions. The highest capacity directions in 2022 are within Europe and within Asia, significantly higher than international broadband capacity between any region.

The broadband capacity and traffic growth rate of BRICS countries have significantly surpassed developed countries such as Germany. From 2013 to 2022, China grew by about 14 times, India by about 23 times, Russia by about 10 times, South Africa by about 36 times, and Brazil by about 10 times, far exceeding the United States by about 7 times and Germany by 8 times.

Handle the relationship between development and security, openness and regulation well

The report believes that the international community has formed a broad consensus and the development prospects of digital trade are promising.

Although some countries have strengthened domestic regulation and even set certain trade barriers for the needs of national security, personal privacy protection, consumer rights protection, and maintaining technological ethics, they still prioritize digital transformation and development, and the overall policy direction is still tending towards openness. In the future, the driving force for the development of digital trade will continue to strengthen with the combination of trend traction, technology promotion, policy promotion, and rule guarantee effects.

High level openness and precise and efficient regulation in China, as well as trust building and regulatory rule cooperation between countries, are crucial. It is necessary to handle the relationship between development and security, openness and regulation well.