E-commerce platforms seen as way to help producers boost sales abroad

With traditional exports in June having posted the biggest decline since the 2009 global downturn, China aims to promote further growth in cross-border e-commerce, a Ministry of Commerce source said.

"Promoting outbound shipments through the Internet is becoming an increasingly important task for Chinese exporters and manufacturers," said the official in the foreign trade department, speaking on condition of anonymity.

The ministry is "drafting detailed policies" that will probably take effect later this year. The measures would give "a big boost" to Chinese exports, said the source.

Europe's economic problems, rising costs and growing trade protectionism all combined to constrain exports in the first half of the year.

In June, exports contracted 3.1 percent year-on-year, the first monthly decrease since January 2012 and the biggest decline since the 2009 recession, according to the General Administration of Customs.

Over the past few weeks, the government has acted to stabilize trade. In late July, citing the complex and challenging trade environment, the central government pledged to improve policies and services and widen channels for exports.

The government also said the nation would maintain stable economic growth in the second half by fine-tuning policies.

"The measures and commitments are very important for Chinese exports. There are more in the pipeline, mainly about e-commerce," said the source.

According to the source, the policies aim to provide convenient and efficient e-commerce platforms for exporters and help them enlarge their overseas network and reduce costs.

The policies cover a wide range of issues concerning customs clearance, foreign exchange, taxes and inspections.

Commerce Minister Gao Hucheng said during a group interview last week that China has confidence in reaching this year's growth target for foreign trade, although the outlook for exports in the second half is not optimistic.

Gao said that in addition to implementing the measures announced by the State Council, the ministry would support new ways of conducting foreign trade that hold vast potential, including cross-border e-commerce.

During the past few years, China has seen a rapid rise of exports through e-commerce platforms.

"The annual growth rate has reached as high as 50 to 100 percent but, unfortunately, there aren't any coordinated measures from the government," said the source.

Statistics from the global e-commerce business platform provider PayPal show that in 2013 online shopping for made-in-China goods by the top five e-commerce markets (the United States, the United Kingdom, Germany, Australia and Brazil) is expected to reach 67.9 billion yuan ($11 billion). The figure will double by 2018.

Statistics from the PayPal report show that from 2011 to the first quarter of 2012, China's exporters saw transactions for shipments to three emerging markets (Brazil, India and Russia) through the PayPal system increase by as much as 79 percent.

In July, an e-commerce industrial park aiming to facilitate cross-border trade opened in Hangzhou, in East China's Zhejiang province. The first phase of the park covers 40,000 square meters.

Early in 2012, a handful of cities and municipalities including Hangzhou, Shanghai, Zhengzhou, Chongqing and Ningbo won government approval to act as pilot cities for cross-border e-commerce.

"Some exporters have already done well in leveraging the e-commerce channel but, to bring the potential into full play, the government has to contribute in terms of policies," said the source.

Experts said China needs to launch detailed, preferential measures to create more business-friendly e-commerce platforms for China's exports to unlock that potential fully, especially given grim global demand.

"Both smaller enterprises and big companies need the e-commerce platforms to improve efficiency, enlarge their sales networks and reduce costs," said Huo Jianguo, president of the Chinese Academy of International Trade and Economic Cooperation, a think-tank at the ministry.

But the problem is that there are "technical barriers", including customs clearance, logistics, tax and foreign exchange, he said. "They need to be solved."

Many small and medium-sized foreign trade enterprises have shifted to e-commerce in recent years, either by setting up their own online business platforms or partnering with e-commerce service providers such as Alibaba Group Holding Ltd and US-based eBay Inc.

In 2012, the Yiwu Small-Commodities Market in Zhejiang province, the world's largest market for small items such as toys and household gadgets, saw its online sales and shipments through Alibaba by its 230,000 outbound e-commerce sellers gain by an astonishing 400 percent.