The China Zhejiang Pilot Free Trade Zone in Hangzhou. [Photo/WeChat account: hzfbwx]

Hangzhou has been selected as one of China's first 16 National Service Trade Innovation Demonstration Zones, following the release of a new development plan by the Ministry of Commerce (MOC).

Experts say the city's strengths lie in three key areas: institutional innovation, digital capabilities and a highly integrated innovation ecosystem.

As one of China's earliest pilot cities for service trade reform, Hangzhou has completed 171 national pilot tasks across three rounds of reform programs. Since 2022, the city has ranked first nationwide in the MOC's evaluation of service outsourcing demonstration cities, outperforming Beijing and Shanghai.

Digital trade has become Hangzhou's defining advantage. Backed by strong capabilities in artificial intelligence, cloud computing and fintech, the city has built a competitive edge in digital services, cross-border trade and tech-driven service industries.

According to industry experts, Hangzhou's biggest edge is its five-chain integration ecosystem — combining innovation, industry, capital, talent and market resources within close geographic proximity. In many of the city's AI and robotics clusters, suppliers, research teams and commercial partners operate within just a few kilometers of one another, allowing technologies to move rapidly from labs to market.

In 2025, Hangzhou's total service trade volume reached 464.64 billion yuan ($68.3 billion), up 5.64 percent year-on-year, ranking among the highest in China.

Under the new national plan, Hangzhou will further expand opening-up in digital trade and financial services, continue to strengthen cooperation with BRICS countries, and support the global expansion of cultural and AI-powered service industries.

The hit game Black Myth: Wukong is an icon of cultural exports. [Photo/WeChat account: hzfbwx]