China Expands Pilot Program to Enhance Reforms in the Service Sector

On April 18, 2025, China’s MOFCOM launched a Work Plan to liberalize its service sector, introducing 155 pilot tasks across 14 areas, enhancing foreign investment, and expanding pilot cities. This builds on prior reforms, aiming for improved market access and alignment with international standards.

On April 18, 2025, China’s Ministry of Commerce (MOFCOM) released the Work Plan for Accelerating the Comprehensive Pilot Program for Expanding the Opening-up of the Service Industry (“Work Plan”), marking a significant new phase in the country’s ongoing efforts to liberalize its service sector and attract more foreign investment. Building on a decade of pilot programs initiated in 2015, the new plan expands the number of pilot cities and introduces 155 pilot tasks across 14 focus areas, including specific liberalization pilot programs in sectors such as telecommunications, finance, healthcare, and tourism. 

These initiatives reflect China’s broader strategy of cautious, phased reforms, starting with limited pilot programs in certain areas that, if successful, are rolled out to more regions. The Work Plan also serves to outline the country’s ambitions to expand market access, facilitate participation of foreign companies in China’s industries, and to align more closely with high-standard international economic and trade norms. 

Since the first batch of pilot cities was approved in 2015, China has steadily pushed to open its service sector, traditionally one of the most tightly regulated parts of the economy. To date, 11 regions (Beijing, Tianjin, Hainan Province, Chongqing, Shenyang, Nanjing, Hangzhou, Wuhan, Guangzhou, and Chengdu) have participated in three batches of “pilot tasks”. These efforts have collectively introduced over 1,300 pilot tasks, targeting critical industries such as telecommunications, finance, culture, and education.

According to MOFCOM, these pilot zones absorbed RMB 293.2 billion (US$40.2 billion) in foreign direct investment (FDI) in 2024, approximately half of the country’s total FDI in the service industry. These pilot zones have offered a stable policy environment, improved institutional transparency, and a rich array of business application scenarios for foreign companies operating in China. 

The pilot programs have also achieved tangible progress in several key sectors. In the healthcare services sector, the pilot zones have introduced a series of measures to encourage the development of foreign-invested medical institutions and the recruitment of overseas medical professionals. As a result, there are now more than 150 joint-venture or wholly foreign-owned medical institutions operating in China, and over 1,500 foreign medical personnel have engaged in short-term medical practice within the country. 

In the telecommunications sector, pilot reforms have supported the gradual opening of value-added telecom services to foreign investment. Specifically, in four key areas， including Beijing’s Comprehensive Demonstration Zone for Expanding the Opening-up of the Service Industry, foreign equity caps in several categories of value-added telecom services have been lifted. On February 28, 2025, the Ministry of Industry and Information Technology (MIIT) granted pilot approvals to 13 globally recognized enterprises, including Deutsche Telekom and Siemens, to participate in these programs.

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