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1st LD Writethru-China Focus: Action plan aims to double e-commerce sales

Xinhua, May 15, 2015 Adjust font size:

China is aiming to almost double the value of its e-commerce sector in two years by tapping in rural, small city and foreign markets, under an action plan published by the Ministry of Commerce on Friday.

The ministry promised measures to help e-commerce businesses make further forays into these relatively unexplored markets, as well as encouragement of cross-border trade through better coordination between online platforms and brick-and-mortar stores.

With these measures, the ministry predicted the country's 2016 e-commerce transactions will hit 22 trillion yuan (3.6 trillion U.S. dollars), almost double the 13.4 trillion yuan recorded for 2014.

The ministry is also aiming to lift the annual value of online retail sales, referring specifically to those through third-party online marketplaces like Taobao, to 5.5 trillion yuan in 2016. The figure would also nearly double the 2.8 trillion yuan recorded in 2014.

To achieve these goals, the ministry said it would first "nurture 200 counties to lead e-commerce development in rural regions" by encouraging them to sell farm produce online. It will also support e-commerce companies to establish bases and sales channels in the countryside.

The ministry also plans to set up 60 national e-commerce demonstration parks and establish 150 "e-commerce companies with strong competitiveness", meaning larger firms demonstrating best practice.

According to the plan, it will also place equal emphasis on development of logistics firms, and work with other government departments to improve infrastructure and distribution networks in order to facilitate the e-commerce sector's expansion.

"The action plan is important for optimizing production, expanding employment and improving people's lives," according to a statement on the ministry's website.

The plan falls under the "Internet Plus" strategy championed by the central government, which is trying to give new impetus to the slowing economy by integrating the Internet with traditional industries.

The new action plan is concerned with making online shopping more convenient for consumers in small cities, with the ministry saying it will support the establishment of localized e-commerce platforms to compete with existing companies.

Meanwhile, it is aiming to help the e-commerce sector explore value-added services such as parcel keeping and bill payment to benefit residents of large cities.

Physical stores, including retailers, restaurants, launderettes, appliance repair shops and ticket sellers are encouraged to use the Internet to offer diversified services such as online orders and delivery.

The ministry said it would also encourage domestic e-commerce companies to establish storage facilities outside China.

China's State Council, the cabinet, said last month it would smooth the way for e-commerce to grow by abandoning rigid registry requirements on e-commerce businesses, encouraging venture capital to enter the sector and reducing share-holding restrictions on foreign investment. Endi