China’s Ministry of Industry and Information Technology stated that it will allow foreign ownership of some eCommerce businesses, a move that Reuters said Friday (June 19) would encourage foreign investment in the industry.
The decision will apply to “online data handling and trade handling services” and is effective immediately, said the Ministry. It is hoped that the move will strengthen both the competitiveness and the development of eCommerce. The announcement came via the regulatory body’s website, and Reuters noted that “it was not immediately clear how this would affect eCommerce companies already operating in China.” The newswire noted that the government has in recent years kept taxes low for the industry and has been removing at least some restrictions on trade across borders.
As a result, China’s eCommerce industry has seen the emergence of outfits including Alibaba Group Holding, and others — ranging from Amazon to Vipshop to Walmart, the retailing giant that has a stake in the online shopping site Yihaodian — many of whom have been benefiting from the emergence of the country’s growing middle class.
In the meantime, recent research has been sanguine about the growth of global eCommerce. Earlier this month, research conducted by a joint venture between Accenture and Alibaba’s research arm found that the global B2C eCommerce market will grow to be worth $1 trillion in 2020, up from about $230 billion in 2014. That translates into a heady growth rate of more than 27 percent annually, with that acceleration roughly double the rate of the global B2C market overall. The report found that by the year 2020 about 900 million people across the globe will be international online shoppers, and their online buys will account for nearly a third of all B2C transactions.
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