China’s Knowledge-Intensive Service Exports Up 12.2%

China’s knowledge-intensive service exports grew by 12.2% year-on-year in the first five months of 2026, reaching 6,677.5 billion yuan (approximately $930 billion), according to data released by the Ministry of Commerce (MOFCOM) and reported by CCTV. The figures underscore a deepening structural shift in the world’s second-largest economy toward higher-value services.

Strong Overall Trade Performance

China’s total service import and export volume reached 30,994.8 billion yuan between January and May 2026, up 6% year-on-year. Service exports totaled 12,304.6 billion yuan, rising 15.9%, while imports reached 18,690.2 billion yuan, up just 0.4%, according to the Xinhua News Agency. The resulting service trade deficit narrowed significantly to 6,385.6 billion yuan, a reduction of 1,607.2 billion yuan compared to the same period last year.

Knowledge-Intensive Services Lead the Way

Knowledge-intensive services — which include intellectual property royalties, telecommunications, computer and information services, personal and cultural services, and professional consulting — accounted for 44.2% of total service trade, up from 42.5% in the first two months of the year. The Economic Information Daily reported that knowledge-intensive service imports and exports totaled 13,687.4 billion yuan, growing 5.4%.

Two sub-sectors posted exceptional growth: intellectual property royalty exports surged 64.9%, while personal, cultural, and recreational service exports rose 50.1%, reflecting the increasing global competitiveness of Chinese technology and creative industries.

Expert Analysis: Structural Optimization Underway

Zheng Wei (郑伟), Associate Researcher at the China Service Outsourcing Research Center, told the Economic Information Daily that the steady growth of knowledge-intensive service exports — with their share rising above 44% — “indicates that China’s service trade structure is being optimized and developing toward higher quality.”

Li Jun (李俊), Director of the Institute of International Service Trade at the Chinese Academy of International Trade and Economic Cooperation, offered further context in an interview with CCTV Finance. He noted that export performance has been particularly impressive, maintaining double-digit growth in both March and April. Li highlighted that “the output of comprehensive services such as computing power, electricity, and technology not only directly drove exports of telecommunications, computer, and information services, but also empowered cultural creativity, technology R&D, and other business activities.”

Travel Services: A Rising Export Engine

Travel service exports reached 1,885 billion yuan in the January-May period, growing 31.3% — the fastest growth among the top five service export sectors. This surge is attributed to a series of Chinese government policies aimed at expanding inbound tourism consumption. Despite this growth, travel services remain the largest contributor to China’s service trade deficit, though the gap is narrowing as exports accelerate.

Transport service imports also showed strong momentum, reaching 4,025.2 billion yuan with 26.7% growth, the fastest among the top five import sectors.

Broader Economic Implications

The data confirms a clear trajectory in China’s ongoing economic transformation from a manufacturing-driven model to one increasingly focused on knowledge-intensive and technology-enabled services. The progressive increase in the knowledge-intensive services share — from 42.5% in January-February to 43.5% in Q1 and 44.2% in the first five months — demonstrates consistent structural improvement.

This shift aligns with China’s “dual circulation” development strategy, which emphasizes domestic economic resilience while maintaining international competitiveness. The exceptional growth in intellectual property royalties suggests that Chinese technology companies are increasingly monetizing their IP portfolios globally, while the surge in cultural service exports points to growing international demand for Chinese digital content, gaming, and entertainment products.

What to Watch

Analysts will be watching closely to determine whether the high growth rates in IP royalties (64.9%) and cultural services (50.1%) represent sustainable trends or one-time effects. Key questions also remain about the geographic distribution of China’s knowledge-intensive service exports and how the country’s performance compares to other major economies such as the United States, the European Union, and India in this increasingly competitive arena.

With more policy measures expected to support service trade innovation and inbound tourism, China’s service exports appear well-positioned for continued growth in the months ahead.