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Guangzhou Unveils Innovative E-Commerce Cluster Masterplan

City looks to capitalise on growth of online sales and its preeminent international trading role.

Photo: Cross-border e-commerce: Can Guangzhou take a lead? (Xinhua News Agency)
Cross-border e-commerce: Can Guangzhou take a lead?
Photo: Cross-border e-commerce: Can Guangzhou take a lead? (Xinhua News Agency)
Cross-border e-commerce: Can Guangzhou take a lead?

In order to capitalise on the rapid growth of e-commerce, Guangzhou has devised a blueprint for its future online development. Billed as the "1+1+9" initiative, the programme has been designed to establish a designated cluster of e-commerce operators in each of the city's districts.

The first "1" is a reference to the headquarters cluster, which will be established in Pazhou, the site of Guangzhou's planned central business district. In line with the overall plan, this will be the core cluster and also operate as the regional headquarters of a number of e-commerce giants.

Already, WeChat, Alibaba and Gome are said to be considering a move to the Pazhou cluster. Work on the site will begin soon and, once completed, it is expected to become a world-class, e-commerce hub, with an annual turnover in excess of Rmb100 billion.

The second "1" represents the planned cluster designated to operate in Baietan, a new development region stretching between Guangzhou and the nearby city of Foshan. Initially, this second cluster will be home to Weipinhui (vip.com) and Moonbasa, two of the mainland's leading e-commerce operators.

The "9" refers to the nine districts of Guangzhou, each of which will play host to a proprietary cluster. Each district will incorporate its own local advantages and requirements into its home cluster.

Overall, the development of a successful e-commerce offering is seen as an essential part of Guangzhou's bid to establish itself as an international trading centre. It is believed that e-commerce will help many of the city's traditional trading businesses in their moves to upgrade and expand. At the same time, it is hoped that a strong e-commerce presence will attract more companies to Guangzhou.

Although Guangzhou's e-commerce market is one of the most well-developed on the mainland, it is seen as having the scope to develop still further. At present, the city is not home to any of China's e-commerce giants, companies of the scale of Alibaba or JD.com. Instead, its e-commerce landscape is characterised by a number of small- to medium-sized companies.

The presence of the giants of the industry is seen as desirable not only in terms of achieving critical mass, but also with regard to boosting local employment and developing the logistics sector. It is hoped that, in due course, a number of such giants will relocate to Guangzhou, lured by its bespoke e-commerce environment.

E-commerce is increasingly seen as playing a key role in international trade. According to the Ministry of Commerce, Guangdong accounts for 70% of China's total cross-border e-commerce transactions, making the region ideally positioned to spearhead China's developments in this sector.

Guangzhou is also seeking to establish itself as one of the pivotal points along the Belt and Road Initiative, a move in line with its preeminent role in China's opening-up policy. As part of its bid to function as an international commercial and trading centre, the city is also looking at boosting its international shipping and transport facilities.

Natalie Lu, Guangzhou Office

Content provided by Picture: HKTDC Research
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