China’s Alibaba to build cyber Silk Road by creating global e-commerce platforms

China Central Television (CCTV) – China’s e-commerce giant Alibaba Group has been developing cross-border e-commerce platforms in countries along the Silk Road Economic Belt and the 21st-Century Maritime Silk Road, promoting the idea of building a “cyber Silk Road”.

In recent years the company has expanded its business to countries like India, Russia and Malaysia.

On the streets of India, the sign of Paytm is a common sight, whether on the tuk-tuks or in shops and stores.

Paytm, India’s largest mobile payment and e-commerce platform, allows users to pay easily by scanning the Quick Response (QR) codes provided by businesses.

In January 2015, Ant Financial, e-commerce giant Alibaba’s financial arm, became an investor in Paytm. It invested more in September the same year, without disclosing its worth or the size of the stake.

Paytm now has become the world’s third largest mobile wallet with 220 million users.

“Obviously, India and China are slightly different markets. But one thing that is common is the widespread adoption of alternate payment modes. So we are learning in terms of how to make it secure, how to make it convenient, and how to give more value-add to the user,” said Deepak Abbot, senior vice president of Product Growth at Paytm.

Similar trials have been carried out by Alibaba in other countries participating in projects under the the Belt and Road Initiative.

The company launched e-commerce platform Aliexpress in Russia in April 2010, which allows smaller buyers around the world to buy small quantities of goods at wholesale prices.

It now has over 100 million users around the globe, with 22 million in Russia. The figure has put Aliexpress on top of all the cross-border e-commerce platforms in Russia.

To attract more users, Aliexpress has opened an off-line store in Moscow, allowing customers to see the real goods before they made online orders.

During the Singles’ Day (November 11) shopping spree in 2016, the website received 20 million orders from Russian users, up 85 percent from the previous year.

An Aliexpress user says the platform is different from its competitors in that it offers lower prices with more convenience and safety.

All these are just part of the company’s ambition to help build a “cyber Silk Road”. The company is planning an Electronic World Trade Platform, or e-WTP, to enable small and medium enterprises (SMEs) that had been largely left out of the free trade regime of the world in the past.

The idea of e-WTP, proposed by the company’s founder Jack Ma, has been included in the G20’s Leaders’ Communique Hangzhou Summit last September.

In March this year, the company announced a plan to set up an e-commerce hub in Malaysia encompassing logistics, cloud-computing and e-financial service to boost trade and e-commerce in the region.

The e-commerce hub will be part of the collaboration between Alibaba and the Malaysian government in the development of a Digital Free Trade Zone (DFTZ) in Malaysia, in line with the idea of the e-WTP.

“Ninety-seven percent of our companies are SMEs. However the contribution to GDP is currently less than 40 percent. So there is a lot of room to move. So what we want in this collaboration with Alibaba is to really learn from Alibaba in the area of how to use e-commerce to transform SMEs towards better, stronger economic empowerment,” said Yasmin Mahmood, chief executive officer of Malaysia Digital Economy Corporation Sdn Bhd.

“Our cooperation with Malaysia is aimed at helping the Malaysian government realize the transformation into a digital economy by making use of Alibaba’s advantages in logistics, e-commerce platform big data and inclusive finance. We hope to choose a number of most suitable places in the world to establish e-WTPs and connect them to build a digital path and facilitate the globalization of SMEs,” said Song Juntao, head of Alibaba’s e-WTP project.