Abstract: On the global value chain of service industry, the trend of bilateral nesting of value added in exports between trade partner countries has been increasingly intensified, which exerts important impact on the international division positions and trade benefit distributions. Through establishing an index system, this paper, from the three dimensions of balance, strength and position of bilateral nesting, studies the linked features of bilateral nesting and the evolution tendency between China and the major service trade partners (USA, Japan, Germany, Russia and India) on the global value chain of service industry. The result shows that China’s strength of service trade is being strengthened; the proportion of value added from China in the exports of more and more trade partner countries is gradually higher than the proportion of value added of the trade partner countries in China’s export. The strength of bilateral nesting between China and the trade partner countries is growing; China’s nesting position keeps rising and is gaining advantages in more and more service industries. China’s capital-intensive service industries are developing very well, while its knowledge-intensive service industries are comparatively weaker. Although China has bilateral nesting surplus against USA, the major cause is that the USA export volume of its service industry is much greater than that of China. China should strive to expand the export scale in its service industry, optimize the export structure, and pay more attention to the cooperation with the developed countries in knowledge-intensive service industries, so as to further improve China’s positions and earnings on the Global Value Chain in service industry.

Key words: global value chain; value added; bilateral nesting; division position; trade benefit