Development Plan for China’s International Service Outsourcing Industry (2011-2015)

China’s Outline of the 12th Five-year Plan for National Economy and Social Development definitely proposes to “vigorously develop service outsourcing and establish several service outsourcing bases”. Recently, the Ministry of Commerce and National Development and Reform Commission jointly issued the Outline of Development Plan for China’s International Service Outsourcing Industry (2011-2015) (hereinafter referred to as the “Outline of Plan”). The Outline of Plan, China’s first development plan specially targeted at the service outsourcing industry, is inevitably generated and internally required by the progress of China’s service outsourcing industry from start point to accelerated orderly development.

International service outsourcing industry is an intelligence-intensive modern service industry against the background of accelerated and deepened industrial division worldwide, and features low energy consumption, low pollution, high added value, remarkable growth, etc.. Specifically, it refers to the economic activity in which institutions strip and outsource their non-core businesses originally conducted by themselves to external professional service providers, and carry out delivery by virtue of information technology and modern communication means. Vigorous development of service outsourcing is of great significance for China to transform economic development modes, enhance urban function level, relieve employment pressure, as well as advocate low-carbon and green development philosophies.

Since the beginning of the new century, China has been firmly seizing new opportunities of the new round of international industrial transfer to actively create favorable policy and industrial environment and to promote the growth of China’s international service outsourcing industry. In 2011, China undertook international (offshore) service outsourcing projects with a total amount of US$23,830,000,000, up by 65% year on year. It is estimated by an authoritative institution that China accounted for 23.2% of the global offshore outsourcing market in 2011, becoming the world’s second largest service outsource, next only to India. It is preliminarily forecasted by the Ministry of Commerce that international (offshore) service outsourcing projects undertaken by China in 2012 would amount to US$33,000,000,000, increasing over 40% year on year.

The Outline of Plan first reviews the development history and achievements of China’s service outsourcing industry, systematically summarizes helpful experience and practices of China’s development of the industry, fully and profoundly analyzes the domestic and overseas environment confronted by this industry, clearly points out that the global service outsourcing market will enter into a new period of rapid growth during the “12th Five-year Plan” period, with opportunities and challenges highlighted and much more advantageous conditions for the development of the industry in China. It also proposes the target that offshore outsourcing projects to be undertaken by China should amount to US$85,000,000,000 by 2015, accounting for 28% of China’s service trade exports.

The Outline of Plan definitely puts forward that we should consolidate the development of such advantageous source outsourcing fields as software, finance, pharmaceutical research and development and communications, primarily make a breakthrough in cultural creativity, commerce, logistics and other key fields, and proactively cultivate international service outsourcing fields such as medical treatment, and public utility, and, further specifies the industrial development layout, and requires us to actively establish an industrial development pattern with demonstration cities as subjects to drive the development of surrounding cities and with orderly divisions and different features, give play to the leading role of coastal cities in Eastern China, motivate the faster development of cities in Central China and Western China, support the aggressive development of cities in Northeast China, and impel border cities to stably develop international service outsourcing.

The Outline of Plan definitely requires that we should further enhance the international competitiveness of China’s service outsourcing industry, greatly expand international market, improve innovation capacity of enterprises, optimize the structure of human resources, and improve public service quality, and, puts forward six policy measures: strengthening system and mechanism guarantee, increasing policy support, enhancing the quality of talents, expanding domestic and overseas markets, establishing an evaluation and guiding system and promoting the organization and implementation of plan, so as to ensure the implementation thereof.

In the course of preparing the Outline of Plan, some work measures and development strategies have been pushed forward simultaneously. The Ministry of Commerce actively guided service outsourcing demonstration cities to combine local economic foundations and advantages of factor endowment to carry out differential development strategies, regularly supervised the implementation of policies by demonstration cities, evaluated the industrial development of the cities, and strengthened the guidance for the development of the service outsourcing industry by the cities. In term of expanding international market, by organizing 9 overseas road shows each year for the promotion of international service outsourcing, the Ministry of Commerce actively built an “outgoing” platform for service outsourcing enterprises and pushed forward the construction of “Chinese services” brand, making noticeable achievements. In respect of optimizing the structure of human resources, the Ministry of Commerce and the Ministry of Finance granted a lot of funds to greatly support trainings for junior talents from service outsourcing enterprises every year, effectively relieving the deficiency of talents. As for improving the quality of public services, the Ministry of Commerce, together with other relevant ministries and commissions, actively reinforced the construction of service outsourcing carrier platforms, including such nation-level platforms as the service outsourcing sector of Beijing Fair, China International Clothing & Accessories Fair and China International Software & Information Fair in Dalian, which effectively impelled industrial development.

The issuance and implementation of the Outline of Plan will show the direction and lay a solid foundation for the development of the service outsourcing industry in China for the next few years, and inevitably promote the leaping development of China’s service outsourcing industry. Next, the Ministry of Commerce, together with National Development and Reform Commission, will further refine and carry out strategic tasks and guarantee measures set out in the Outline of Plan, properly publicize and interpret the Outline of Plan, formulate supporting implementation policies, and conduct supervision and evaluation, in a bid to promote the fast and sound development of China’s service outsourcing industry and ensure the smooth achievement of strategic objectives specified in the Outline of Plan.

Source: Ministry of Commerce Website; http://english.mofcom.gov.cn/article/policyrelease/link/201301/20130108516476.shtml

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