In a strategic move to rebalance its economic model, China has unveiled comprehensive sector-specific measures designed to catalyze growth in services consumption. This initiative, spearheaded by the State Council, targets the cultivation of new economic drivers as the nation navigates a significant structural shift in domestic demand, where spending on services is rapidly eclipsing goods consumption as a primary growth engine.
The detailed work plan, released in late January, focuses on two tiers of service sectors. For established sectors like transportation, domestic services, online audiovisual content, tourism, automotive aftermarket, and inbound consumption, the strategy emphasizes enhancing service quality, expanding pilot programs, creating innovative consumption scenarios, and developing professional talent.
For emerging potential sectors—including performance arts, sports events, and emotion/experience-oriented services—the plan outlines measures to refine incentive mechanisms, strengthen safety protocols, cultivate premium brands, and construct supporting digital and physical platforms.
This consumption-focused transition comes amid persistent external demand uncertainties. Officials highlight that China’s consumption structure is undergoing a fundamental transformation. Ministry of Commerce data reveals that between 2020 and 2025, per capita service consumption expenditure grew at an impressive 8.5% annual rate. Services now constitute 46.1% of total household spending, marking a 3.5 percentage point increase over the five-year period.
To operationalize this vision, the Ministries of Commerce and Finance have launched extensive pilot programs across 50 selected cities with a combined population exceeding 480 million. These cities, which account for over half of national retail sales, have received an initial fiscal injection of 8.6 billion yuan ($1.25 billion) to test innovative consumption models and business formats.
The economic impact is already materializing. National Bureau of Statistics data shows service retail sales grew 5.5% year-on-year in 2025, outpacing goods retail sales by 1.7 percentage points. Sub-sectors including culture, sports, tourism, and transportation all maintained robust double-digit growth.
Winter tourism exemplifies this surge. China’s ski resorts recorded 118 million visits during the November 2025-January 2026 peak season, generating 69.15 billion yuan in spending through 890 million transactions—a 6% annual increase. Particularly striking was the 89.2% surge in overseas visitors hitting Chinese slopes.
Concurrently, China is aggressively opening its services sector to international consumers through extended visa-free policies covering over 40 countries until December 2026 and expanded visa-free transit arrangements at 65 ports. The effectiveness is undeniable: Spring Festival period flight bookings to China skyrocketed 400% year-on-year, with Argentine travelers showing a 900% increase and European nations exceeding 200% growth.
The comprehensive strategy represents more than economic rebalancing—it aligns with broader social priorities including aging-in-place services for a graying population, cultural enrichment, and sustainable tourism development that distributes economic benefits beyond traditional coastal manufacturing hubs.
As Yuekai Securities Chief Economist Luo Zhiheng notes, with China’s per capita GDP exceeding $10,000, consumption upgrading is accelerating rapidly. However, services’ share in household spending remains below the 60-70% typical in developed economies, indicating substantial expansion potential still lies ahead in China’s consumption transformation journey.