Online Sales Platform Boosts Cross-Border Trade | China Unlocked

By Zhang Hongrui

Online-Shopping-2-1280x850

The China-ASEAN E-commerce Platform (CAEP), a web-based service facilitating trade of a wide variety of products between China and ASEAN member states established in December 2016, has introduced a new way for China’s online shoppers to purchase goods from ASEAN countries.

Products on offer on the platform, which can be reached at http://www.eshopasean.com, include Vietnamese dried fruits and vegetable, Malaysian coffee, Thai rice and a wide range of others.

The establishment and operation of the CAEP reflects an effort in upgrading the China-ASEAN Free Trade Area and is conducive to the diversified development of economic and trade cooperation within the free trade area.

New Engine of Bilateral Trade

The CAEP was initiated by the China Council for the Promotion of International Trade (CCPIT) and the national chambers of commerce and industry of seven ASEAN countries. So far, some 907 categories of goods are on offer, and around 750,000 total orders have been placed.

According to a CAEP staff member, commodities from Vietnam, Thailand, Malaysia and Cambodia are bestsellers among Chinese shoppers on the site.

When placing an order for a box of cookies produced in Indonesia on the platform, this reporter found that more than 25,000 customers left comments, indicating Chinese enthusiasm for the product. Comments were 98 percent favorable.

The box of cookies ordered were delivered three days later — remarkably quick for a cross-border transaction.

Chinese Vice Minister of Commerce Qian Keming said that in the future China will continue to deepen cooperation with ASEAN countries in terms of simplifying customs clearance and improving quality inspection in order to facilitate the export of ASEAN countries’ products such as agricultural products, tropical fruits, aquatic products, natural rubber and palm oil to China. Therefore, Chinese consumers will be the beneficiaries who can enjoy a wide variety of exotic products from ASEAN countries, as well as rapid delivery.

China has more than 700 million internet users and over 400 million online shoppers. Its e-commerce market is valued at nearly US$3 trillion. A senior official at the Federation of Thai Industries explained, “Nowadays ASEAN investors are focused on the e-commerce sector, and China will play a key role in the global e-commerce market.”

CCPIT President Jiang Zengwei said that an increasing number of online shoppers have provided potential business opportunities for companies in both China and in ASEAN countries, and cross-border e-commerce has become new driving force for bilateral trade.

QQ截图20170901172640
China has more than 400 million online shoppers

Joint Prosperity

 China has been ASEAN’s largest trade partner for each of the past eight years, and ASEAN has been China’s third largest trade partner for the past six. Official data show that in the first five months of 2017, the bilateral trade volume between China and ASEAN amounted to US$195.7 billion, up 16.2 percent compared to the same period in 2016. China’s trade surplus with ASEAN was more than US$20 billion during the first five months of 2017.

However, ASEAN’s e-commerce sector is lagging behind. Its online retail sales accounted for less than 1 percent of gross retail sales in 2016. By contrast, in Europe, China and the U.S., e-commerce retail sales accounted for 6 to 8 percent of the total volume of retail sales. Nevertheless, e-commerce is growing in ASEAN. Yin Zonghua, vice president of CCPIT, said that by 2020, the bilateral trade volume between China and ASEAN is expected to reach US$1 trillion, so there is great potential to develop cross-border e-commerce between the two sides.

Myanmar_Jade_19
A duty free shop near the China-Myanmar border

A report titled Lifting the Barriers to E-Commerce in ASEAN argues that with the rapid economic growth in Southeast Asia, the purchasing power of consumers within the region will be greatly improved and the varieties of online retail products will increase. So far, ASEAN’s internet users exceed 260 million, and the bloc is the fastest growing region for internet users worldwide. It is estimated that the online retail market of ASEAN countries will increase 25 percent annually.

Analysts predict that in the future, economic and trade cooperation between China and ASEAN will be closely linked with the Belt and Road Initiative. In recent years, ASEAN countries have proposed their own plans to boost their local economies and ASEAN as a whole, such as the Master Plan on ASEAN Connectivity 2025, Indonesia’s Global Maritime Fulcrum and Vietnam’s Two Corridors, One Economic Circle initiative. The policy initiatives of relevant countries can be aligned with the Belt and Road Initiative in terms of infrastructure construction, international capacity cooperation and industrial transformation and upgrading.

Yin said that the e-commerce development between China and ASEAN countries can help ASEAN countries attract foreign investment so as to promote economic development domestically, and at the same time introduce China’s high-quality products and advanced technologies to ASEAN countries in order to facilitate economic upgrading and innovative growth.

27af10d4770a4c798437234b07826395_th
The Seminar on China-ASEAN Cross-border E-commerce Cooperation 2017 was held in Nanning, China, June 6.

ASEAN countries each have their own characteristics. Singapore is an emerging industrialized country, Vietnam and Myanmar have abundant mineral resources and Malaysia, Thailand and Indonesia have advantages in the fields of agricultural products and tourism resources.

“Taking their unique industrial structures and the demands of China and ASEAN countries into consideration, China needs to identify its own position and actively grasp the business opportunities that the Belt and Road Initiative offers when conducting economic and trade cooperation with ASEAN,” explained Cui Fan at the University of International Business and Economics’ School of International Trade and Economics. “Therefore, China should provide more financial and transportation support for the further development of China-ASEAN economic and trade cooperation.”

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s