E-COMMERCE in China and many other countries has become the cornerstone of the economy instead of a supplement. It has greatly reduced information cost, built an open and transparent market environment, deeply integrated with traditional sectors, and successfully transformed the nation’s economic landscape. Meanwhile, the growth benefits have not been only distributed among big players. From cities to villages, from manufacturing to service sectors, SMEs have a level playing field to compete with large companies and become the new growth engine of the economy.
China’s domestic e-commerce has also brought countless benefits to rural areas. These benefits are reflected in the form of poverty alleviation, employment generation, and income growth for rural residents. At present, there are more than 3,000 Taobao Villages (a village with at least 100 active online stores) in 24 provinces in China with an annual trade volume of RMB 220 billion. This phenomenon has created more than 1.8 million jobs in China, most of which are located in rural areas.
Pakistan is a country with abundant natural resources, young and talented human resources, and a vast consumer base. It has the potential to become the driving force of the e-commerce market. Recent developments in the country, such as the integration of smartphones, 3G, 4G, and broadband Internet services, road and logistics improvements, are all enablers for e-commerce trade. The rise of the middle class and small and medium-sized enterprises, the growth of the online shopping experience, and the standardization of microfinance services have increased the country's readiness for cross-border e-commerce (CBEC) trade. Pakistan's e-commerce market is expected to reach US$ 1 billion by 2020. This enormous market has recently attracted global e-commerce giants including Alibaba, which has acquired Daraz.pk; and Ant Financial that acquired a 45% stake in Telenor’s Tameer Microfinance Bank.
Currently, most of the trade between Pakistan and China is carried out through traditional (offline) channels. However, such transactions rarely benefit ordinary people, because ordinary people only stay on the purchase side, and it is often difficult for them to join the supplier's market. The cross-border e-commerce (CBEC) trade, on the other hand, leads to an inclusive growth that benefits from economic, trade, social, scientific and technological advancement which are incurred by every country and everyone, in particular, disadvantaged groups, developing countries, and regions.
The CBEC trade is particularly beneficial to Pakistan for two reasons. First, the trade imbalance between Pakistan and China is a problem that the Pakistani side has been paying attention to for a long time. CBEC trade can increase the export of Pakistan's comparative advantage products. Second, China is a massive market for e-commerce trade because of the rise of the middle class and the highly developed e-commerce ecosystem that has been integrated into all areas of the economy. Compared with general trade, cross-border e-commerce, supported by more open and positive policies, provides easier access to imported goods and can help Pakistani products to reach to Chinese consumers directly and more conveniently, at relatively favorable tax rates. Similarly, this CBEC trade is beneficial to China because it offers new ways of trading, which may include more Chinese micro, small, and medium enterprises (MSMEs). It can also benefit the rural economies of both countries and thus alleviate poverty.
THE SINO-PAK CBEC ASSOCIATION
In Pakistan, cross-border e-commerce is a relatively new phenomenon, and it requires a great deal of effort to find solutions to simplify trade between the two countries. There are many financial, regulatory, and policy barriers between Pakistan and China that hinder the development of CBEC trade.
The purpose of the Sino-Pak CBEC Association is to promote e-commerce trade between the two countries in a mutually beneficial manner. We conceptualize this association as a not-for-profit association that can include key stakeholders in both countries. These individuals may include researchers, academicians, students, policymakers, businesspeople, and the general public. Our goal is to find solutions to existing problems in CBEC trade promotion through research, education and the development of dialogue between stakeholders in both countries.
In the short term, we have designed the following initiatives:
- CBEC Free Trade Zone
First, we plan to establish an experimental CBEC free trade zone in Pakistan to reduce trade barriers and logistics of products traded through CBEC. To do this, we must consider the trade balance between the two countries so that both people can benefit from this initiative. The potential location of this free trade zone may be Gilgit-Baltistan near the border with China and the new Gwadar Port. These locations are already at the heart of the New Silk Road and the China-Pakistan Economic Corridor.
- Launching of Rural Taobao Village Model in Pakistan
We are looking for potential Taobao Village sites in Pakistan to link rural e-commerce practitioners in Pakistan to Chinese consumers, and vice versa. Given the existence of the CBEC Free Trade Zone, consumers in both countries will have easier access to CBEC trading products, especially Pakistani agricultural products with comparative advantages.
- Internship and E-commerce Education
In view of the above, we understand the training needs of e-commerce startups, rural e-commerce practitioners, students, and researchers. In this regard, we plan to establish a mechanism through which internship opportunities can be provided to relevant entities in China and Pakistan. Besides, steps can be taken to promote e-commerce education in Pakistan and China through formal and informal institutions.
- The International Cross-Border E-Commerce Journal
We plan to release a high-quality, peer-reviewed international journal of cross-border e-commerce soon. The journal will focus on the practical issues facing CBEC in countries along the Belt and Road. Currently, we are looking for Editorial Board members, section editors, associate editors, and the managing editor. The CBEC Association website is under construction. When launched, we will integrate the CBEC journal with our website. We welcome you to join this journal in the capacity that suits you best. The CBEC team also welcomes the ideas and suggestions in this regard. In the long run, our goal is to promote the journal globally for indexing in well-known indexing organizations. Also, our future cross-border e-commerce forums and conference proceedings will be published in this journal.
- International Farm School Alliance Network
The International Farm School Alliance (IFSA) is the brainchild of Professor Zhou Deyi. The premise of IFSA is to establish a farm school alliance to develop youth potential through practice-based farm education in agriculture, environmental protection, information technology, and rural development. We believe that the exchange of information and services through CBEC will become more and more important in the future. With the support of this innovative alliance, farmers from countries along the “Belt and Road” can connect, exchange ideas, learn new farming methods, demonstrate advanced agricultural production techniques online, and finally realize cross-border e-commerce trade related to agriculture. The program is particularly beneficial for an agricultural economy like Pakistan, where the demand for agricultural training and education and overseas consumers is growing.
HOW YOU CAN JOIN
We are looking for interested researchers, academicians, students, entrepreneurs, policymakers, government officials, and other stakeholders to join the association and become part of our growing community. We warmly welcome your valuable comments and suggestions to enrich the purpose and scope of this new association. If you are interested in joining, please email your resume and a short letter of intent to the contact details below. After receiving your resume, we may discuss the position that best suits you and the responsibilities attached to the position. We also ask that you disseminate this information among colleagues who may be interested in joining the association. The Sino-Pak CBEC Association will be formally established during the second CBEC Forum in Pakistan (December 03-05, 2019).
Ecommerce Research Institute (ERI), College of Economics and Management, Huazhong Agricultural University, Wuhan 43007, Hubei, P.R. China
ABOUT E-COMMERCE RESEARCH INTITUTE (ERI) OF HUAZHONG AGRICULTRUAL UNIVERSITY
Huazhong Agricultural University's E-Commerce Research Institute (ERI) was established in 2018. Under the leadership of Professor Zhou Deyi, a visiting researcher at Alibaba Group and a professor at College of Economics and Management (CEM) HZAU, Professor He Dehua and Professor Wang Qing from CEM, ERI has achieved many milestones in the short period.
The foundation of ERI was laid after the success of the First International Cross-Border E-commerce Forum in 2018, with participants from more than a dozen countries coming together for a week. We are currently co- organizing the second International Cross-border E-Commerce Forum (2019) at the University of Agriculture Faisalabad, Pakistan.
Our CBEC team has been researching rural e-commerce in China. We will jointly hold this year's Taobao Summit in Zhijiang, Hubei Province, from November 23rd to 24th, together with the Zhijiang County Government and Aliresearch Institute of Alibaba Group.
ERI has successfully organized many e-commerce training programs and internships for Chinese and international students. These programs include cross-border e-commerce entrepreneurship training on the Alibaba, AliExpress, Amazon and eBay marketplace. Our students participated in the national new retail cross-border e-commerce simulation competition organized by Alibaba in 2018 and won two second prizes.
For our cross-border e-commerce training program, we organized an online training course for more than 30 Pakistani students in July 2019. Some of these students are now working with us on the Amazon online store. In addition, ERI has a training base at HZAU's Business Incubation Center, through which we offer internship opportunities for Chinese and international students. Currently, we are developing an English-taught course on cross-border e-commerce practice training. Students enrolled in this course will participate in AliExpress's analog system with zero risk and comprehensive experience.
ABOUT WUHAN, CHINA
Wuhan is the capital and largest city of the Chinese province of Hubei. It is the most populous city in Central China, with a population of over 10 million, the seventh most populous Chinese city, and one of the nine National Central Cities of China.
Wuhan's history dates 3500 years. Wuhan today is considered as the political, economic, financial, commercial, cultural and educational center of Central China It is a major transportation hub, with dozens of railways, roads, and expressways passing through the city and connecting to other major cities. Because of its key role in domestic transportation, Wuhan is sometimes referred to as "the Chicago of China" by foreign sources.
While Wuhan has been a traditional manufacturing hub for decades, it is also one of the areas promoting modern industrial changes in China. Wuhan consists of three national development zones, four scientific and technological development parks, over 350 research institutes, 1,656 hi-tech enterprises, numerous enterprise incubators, and investments from 230 Fortune Global 500 firms. It produced a GDP of US$224 billion in 2018. Recently, Wuhan won the United Nations sustainable development award. Here are some pictures of the city: