Alibaba to bring US$200 billion worth of goods into China in five years
Alibaba, the world’s biggest e-commerce company, announced that it will bring US$200 billion worth of imported goods into China within the next five years to sate consumers’ growing demand for higher-quality products from overseas.
The pledge, announced by Alibaba’s CEO Daniel Zhang, stated that the e-commerce giant will import goods from more countries and expand its product range significantly, doubling the number of its current categories.
From 2019 to 2023, the company will import goods from 120 different countries, up from current 75, via its cross-border platform, Tmall Global, and the number of product categories is expected to increase from 3,900 to 8,000 from clothing, baby products to beverages such as wine and spirits.
The expansion aims to keep up with China’s growing number of mid-level and high wage earners who are developing a more sophisticated taste for premium products, according to the Hangzhou-headquartered company.
The announcement came at a time when Chinese president Xi Jinping stated that the country will import more than US$30 billion worth of goods and US$10 trillion worth of services in the next 15 years, at the China International Import Expo (CIIE) in Shanghai this month. Total imports of 2017 stood at US$1.8 trillion.
“Leveraging Alibaba’s innovative technology and robust ecosystem, we are committed to making global trade more inclusive and fulfilling our mission ‘to make it easy to do business anywhere’ in the digital era,” Zhang explained, adding that the stimulus package will particularly help small and medium sized companies looking to tap into the world’s second biggest economy.
In the drinks sector, the company estimated that China’s online alcoholic drinks sales including Chinese baijiu, beer, spirits and wine are expected to reach RMB 100 billion (US$14.4 billion), based on forecasts in a joint report by Tmall and Moët Hennessy.
“China’s middle class is booming. As incomes are rising in China, consumers want faster access to, and a wider variety of, high-quality products from around the world,” said Alvin Liu, general manager of Tmall Import and Export.
Jack Ma, founder of the company and a champion of small-scale companies, previously promised to sell more American goods through his e-commerce platform.
However, amid escalating trade wars between the two countries, the entrepreneur retracted his pledge to the US and called the trade spat, “the most stupid thing in the world” at the CIIE this month.
Although Ma has announced plans to step down as Chairman next year, he has introduced his grand plan of building a ‘digital Silk Road’, echoing Chinese president Xi Jinping’s new Silk Road plan. According to Ma, the digital Silk Road project would encourage more e-commerce trade activities globally, as China’s shifting away from an export-driven growth to focus more on imports.
The transition, however, will be the “greatest challenge for China,” Ma said.