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Riding the e-commerce wave in China

Updated: 2013-06-01 11:11
By He Yini ( China Daily)

China's e-commerce sector is emerging as a new growth engine to underpin the country's ongoing economic transformation, with a better-than-expected growth rate that defies the nationwide economic slowdown and flagging consumer confidence.

Online sales surged to 8 trillion yuan ($1.31 trillion) in 2012, an increase of 31.7 percent year-on-year, according to a report from the Ministry of Commerce released on Tuesday at the China E-Commerce Conference.

Online retail sales came to more than 1.3 trillion yuan last year, up 67.5 percent from a year earlier, more than quadruple that of consumer goods in the same period, according to the report.

"The e-commerce industry is booming and has become a new impetus to push forward China's economic restructuring and industrial upgrade," said Li Jinqi, head of the department of electronic commerce and information under the Commerce Ministry.

"The sector has emerged as an important driving force to boost domestic consumption and reduce the unemployment rate in the country," he said.

China's GDP growth slowed to 7.8 percent in 2012, mainly because of a sluggish global economy and the government's self-initiated economic controls, according to the National Bureau of Statistics.

The country's urban jobless rate stood at 4.1 percent at the end of the first quarter, according to the Ministry of Human Resources and Social Security.

Mobile e-commerce and cross-border online business, as the report shows, are surging with the development of a mobile Internet based on the constant upgrade of Internet technologies including cloud computing and the Internet of Things.

"This is an irresistible trend in years to come. We have to go with the tide, and better still conjure up new business models in this field," said Li Jing, founder of Lefeng.com, an e-retailer striving to create its own star brands and expecting to rake in 1 billion yuan in sales this year.

According to statistics released by the country's three telecom carriers, third-generation subscribers exceeded 233 million by the end of 2012, with the smartphone penetration rate standing at 66 percent.

"Credibility is the key to the development of e-commerce, especially cross-border online business. It means, by and large, we have to improve consumer experience in aspects such as product quality, logistics services and online payment security," said Lin Yizhang, chief executive officer of eBay Greater China and vice-president of eBay Inc.

China has been working on its first e-commerce law to tackle malpractice including unfair competition, infringement of intellectual property rights and tax evasions, according to an earlier report, citing Liu Hongliang, head of the department of market regulation at the State Administration for Industry and Commerce.

 
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