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Role of digitalization in business grows

Pub Date:2024-05-15 09:40 Source:China Daily

China has set out a detailed action plan aimed at amplifying the integration of digital technologies in business practices nationwide by 2026, in a significant move to spearhead the digital transformation of its commercial sectors and drive the nation's opening-up.

The action plan, published by the Ministry of Commerce in late April, emphasized innovation across all sectors of commerce by leveraging advanced information technologies to drive innovation in business models, products and services.

It also stressed the need to deepen international cooperation in digital commerce by expanding cooperation channels and building cooperation platforms, including advancing the development of Silk Road e-commerce and joining the Digital Economy Partnership Agreement.

Data released by the ministry in January showed that China's online retail sales reached 15.42 trillion yuan ($2.13 trillion) in 2023, marking an 11 percent year-on-year increase. China has maintained its position as the world's largest online retail market for 11 consecutive years. The nation's total online retail sales grew by 12.4 percent year-on-year to 3.3 trillion yuan in the first quarter of this year.

An official with the ministry said the action plan is part of broader steps to develop new quality productive forces, empower economic and social development and help foster a new development paradigm.

The official also noted the plan has prioritized measures to attract foreign investment in the digital sector, including steps to loosen restrictions on industries such as telecommunications to draw in a greater number of foreign enterprises investing in digital industries.

The nation will further ease cross-border data flow for qualified foreign enterprises, the plan said.

Li Mingtao, head of the research institute at the China International Electronic Commerce Center, said one of the major highlights of the action plan lies in its emphasis on boosting digital consumption.

Key measures to spur consumer spending include incentives for spending in the digital, green and health sectors and conducting online promotions for trade-ins on furniture and other products.

The government has set a target for creating a number of new scenarios for consumption around new experiences, entertainment and tourism, sports events, healthcare and health preservation, while cultivating more digital consumer brands.

To unlock rural consumption potential, initiatives will be rolled out to implement high-quality rural e-commerce development projects. This includes fostering a cohort of rural e-commerce livestreaming hubs and leading enterprises in county-level digital distribution, as well as organizing rural livestreaming e-commerce events to drive the digitalization of agricultural product supply chains.

Efforts will be made to enhance the rural postal and logistics network to promote the coordinated growth of rural e-commerce and express delivery services.

To foster greater synergy between domestic and international markets, the policy document pledged greater strides in promoting the standardized and healthy development of cross-border e-commerce imports, thereby offering Chinese consumers a diverse array of global goods.

Li said such measures can enable businesses to fully capitalize on the allure of China's vast domestic market by importing a greater array of high-quality foreign goods through cross-border e-commerce, thereby enhancing domestic market offerings.

"Streamlined online channels can also entice more overseas small and medium-sized enterprises to access the Chinese market via cross-border e-commerce, with low costs and risks," he explained.

"This will enable the unlocking of China's consumer market potential to become a crucial driver for furthering global development and advancing globalization."

The policy document stressed the need to invite more foreign ambassadors to China to take part in livestreaming sessions on e-commerce platforms to promote products from their countries.

So far, senior diplomats from Sri Lanka, Rwanda, Ethiopia and Canada have taken part in livestreams to bring their countries' exports closer to Chinese consumers, according to media reports.

Greater openness

To promote greater openness in the digital commerce sector, the action plan spelled out steps to broaden the room for cooperation in Silk Road e-commerce.

According to the Ministry of Commerce, the nation's Silk Road e-commerce initiative has so far attracted participation from 31 countries.

The nation will build up the network of Silk Road e-commerce partnerships and promote the establishment of bilateral e-commerce cooperation mechanisms with more countries, the plan said, adding that partner countries in the Silk Road e-commerce initiative will be encouraged to establish exhibition and sales sections on Chinese e-commerce platforms.

The government will explore the establishment of a global e-commerce cooperation alliance by creating a series of local cooperation brands, and encouraging local authorities to leverage their resources for cooperation with relevant countries and regions.

Jiang Rongchun, an associate professor at the Institute of International Economy at the University of International Business and Economics, said the joint construction of cross-border e-commerce platforms and intelligent logistics systems has driven countries to integrate into the global supply chain, achieving mutual benefits.

Through Silk Road e-commerce, coffee from Rwanda, pine nuts and propolis from Brazil and handicrafts and spices from India have become popular items in China, and the initiative has also boosted trade and cross-border logistics between China and Russia, he said.

While enabling the imports of global products to China, the development of digital commerce, especially cross-border e-commerce, has also empowered small and medium-sized enterprises in China to explore global markets, he added.

China's cross-border e-commerce trade reached 2.38 trillion yuan last year, marking a growth of 15.6 percent year-on-year. The majority of businesses engaged in cross-border e-commerce, well over 100,000 in 2023, were SMEs, according to official statistics.

The policy document also reaffirmed the nation's pledge to actively engage in global digital economic governance. The nation will continue to play an active part in e-commerce negotiations at the World Trade Organization, while strengthening regional and multilateral dialogues and cooperation in the digital sector within the Shanghai Cooperation Organization, BRICS, the G20 and APEC.

The government has pledged proactive steps to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the DEPA.

China officially applied to join the DEPA in 2021, and set up a working group in August 2022 to advance talks on joining the agreement. As of this month, the nation's negotiators have held five rounds of talks on joining the agreement with their counterparts from Chile, New Zealand, Singapore and South Korea.

Ouyang Rihui, assistant dean of the China Center for Internet Economy Research at the Central University of Finance and Economics, said China's accession to the DEPA will enable the nation to share its rich expertise and contribute to the development of global e-commerce.

The accession will offer China a more favorable position in the global rules-making process and spur the nation to expedite the process of domestic reform and opening-up, he said.

xuwei@chinadaily.com.cn

Editor:Zheng Chen

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