As China emphasizes the role of service sectors in achieving medium-to-high level of economic development, and as the bilateral free trade agreement (FTA) between Korea and China comes into effect in December 2015, the Korean government and companies expect increased opportunities to enter the domestic service market of China. This study deems that the market-opening strategy for China’s service sectors has been changing during the 12th Five-year Plan period (2011 to 2015). Based on the results from the case study of the Shanghai Pilot Free Trade Zone (PFTZ), the study evaluates the level of market openness of China’s service sectors and provides suggestions for furthering Korea-China cooperation in the service sectors.
 The primary findings of this study can be summarized as follows. In Chapter 2, we analyze the current state of the Chinese service industry and major related policies, and explain why a change in the strategy for opening the markets for China’s service sectors is necessary. The importance of Chinese service sectors rose substantially during the 12th Five-year Plan period. The share of the tertiary industry in China’s GDP surpassed that of the secondary industry for the first time in 2012, and steadily increased to reach 48.1% of GDP by 2014. Since 2011, the share of the tertiary industry in China’s total workforce was first among the three industries; the same has been true of FDI since 2010. During the course of the 12th Five-Year Plan, the Chinese government has also announced for the first time a development plan that focuses on the service sector. In 2014, the Chinese government emphasized the role of service sectors in the “Made in China, 2025(中？制造 2025)” development plan and announced a policy that specializes in nurturing the producer service industry. But the service sector still needs to be opened further in order for China to gain a competitive edge in the global market.
 In Chapter 3, we evaluate the level of market openness in China’s service sector and analyze the changes in the market opening strategy, focusing on six industries in the service sector: finance, health, law, education, tourism, and culture. China’s service industries have opened up substantially after joining the WTO in 2001, but no significant change was made in the DDA initial offer, revised in 2005. Similar trends can be seen in finance and cultural industries; some areas in health, law, education and tourism, however, show a higher level of openness than corresponding markets in Korea. A comparison of the Service Trade Restrictiveness Index (STRI) in 2015 revealed that China still shows a lower level of openness in all 18 sectors when compared to other countries, and an overall higher level of restrictiveness than Korea.
 The Chinese government’s market-opening strategy for its service sectors has taken a different turn since 2011. First, the basic framework for market-opening for service sectors changed from stimulating influx of capital and technology by attracting foreign investments to driving forward structural reforms in the domestic economy and easing the country’s adaptation to global changes. Second, the target beneficiary group for the opening policy has expanded from foreign companies to China’s privately-owned companies. Third, the government is attempting to apply the development strategy of so-called “Points-Lines-Surfaces (点-？-面)” to open up specific industries in the service sector within a specific geographical area. Fourth, the government’s attitude has shifted from perceiving the opening process as an obligation mandated by the WTO, to active pursuit of opening procedures to prepare for the age of multilateral cooperation, epitomized by the TPP or the RCEP. Fifth, the government has been pursuing changes in the market-opening method, such as discontinuing incentives to foreign companies, adopting a negative list, and encouraging overseas expansion of Chinese domestic companies.
 In Chapter 4, we conduct an analysis using Shanghai PFTZ as the representative case of the market-opening strategy introduced in Chapter 3, and analyze the specific market-opening policies of six service industries that was implemented in the Shanghai PFTZ. As a result, we found out unconventional measures were generally avoided in Shanghai PFTZ until presently. In addition, the marketopening policy of legal service industry has not been effective enough, because openings as a result of the new policy were not as palpable as the foreign law firms expected; case in point, allowing the establishment of Sino-foreign joint ventures and employment of Chinese lawyers. In the health services, the establishment of wholly-foreign-owned medical institutions was allowed in 2013, but the market-opening policy has been discontinued recently. Shanghai PFTZ also seems to be very cautious in the opening of the cultural service market, allowing only the sales of video game consoles (which has low market share in the game industry) and the establishment of wholly-foreign-invested entertainment artist agencies to provide services in Shanghai.
Other cultural sectors such as film, broadcasting, and online games were excluded from market-opening. In the education service sector, it is encouraging that establishing both educational training institutions for profit and wholly-foreign-owned vocational skills training institutions were allowed, but under the new policy no company has established a presence in the Shanghai PFTZ till now. Financial service sector is not an exception, and most of the market-opening policies are, as of yet, merely an expanded version for areas that have already been opened.
 In Chapter 5, we discuss the implications for the Korean government and companies to expand cooperation with China in the service sectors. While the essence of Shanghai PFTZ’s is institutional reform rather than market openness, and while there certainly are limitations for local governments to enforce the market opening policy aggressively; it is the conservative attitude of the Chinese government regarding market-opening for service sectors constituting the primary reason why the market openness of service sectors in Shanghai PFTZ is delayed. The PFTZ project and market-opening policy may be expanded throughout China in the future, but the Chinese government will likely continue to be cautious regarding their pace and scope.
 The Korean government should utilize the market-opening policies of Shanghai PFTZ as well as collect information on ‘bottleneck’ problems which the Korean companies have experienced entering the service sectors in China during the course of post-FTA negotiations with China. The monitoring system also needs to be established to provide Korean service companies with guidance related to PFTZ policies. The opening of finance, law, housekeeping, and pension service markets might take place prior to all other service sectors, and Korea can cooperate with China in those sectors especially. Moreover, the Korean government should establish a mentoring system enabling Korean service companies to exchange experiences in the Chinese service market.
 With regard to Korean companies, we suggest that they use the Shanghai PFTZ as a platform and source of funding, to ask for exclusive benefits by appealing that they can provide advanced management knowhow to the Shanghai PFTZ, and use the simple incorporation procedure in Shanghai PFTZ. In addition, they should strengthen cooperation with privately-owned Chinese companies and carve out new service markets, while considering local demand.