Mak­ing a bee­line for new econ­omy

China Daily (Hong Kong) - - BUSINESS -

BEI­JING — As China’s “new econ­omy” goes from strength to strength, more and more for­eign firms are jump­ing in for a slice of the pie.

Shared bikes flood the city streets, din­ers pay for meals on their smart­phones, elec­tric cars whizz down the roads: in the rapidly shift­ing pic­ture of China’s new econ­omy, for­eign com­pa­nies are not ab­sent.

Ap­ple is bet­ting big on this emerg­ing mar­ket. Three weeks ago, its mo­bile pay­ment ser­vice Ap­ple Pay launched its largest-scale mar­ket­ing cam­paign since en­ter­ing China, of­fer­ing perks in­clud­ing up to 50 per­cent dis­counts on pur­chases for a week.

De­spite a much smaller pres­ence than its Chi­nese ri­vals Ali­pay and WeChat Pay, the coun­try’s mas­sive mo­bile pay­ment mar­ket is hard to ig­nore for the US tech gi­ant.

The gen­eral mer­chan­dise vol­ume of China’s third-party mo­bile pay­ments reached 38 tril­lion yuan ($5.7 tril­lion) in 2016, up more than 200 per­cent from 2015, ac­cord­ing to con­sul­tancy iRe­search.

Ap­ple’s in­ter­est is not just in mo­bile pay­ments. Last year, it made an in­vest­ment of $1 bil­lion in Chi­nese on-de­mand taxi provider Didi Chux­ing. This spring, Ap­ple CEO Tim Cook vis­ited bike-shar­ing startup Ofo dur­ing his China tour.

The shar­ing econ­omy is tak­ing off in China, so is its ap­peal to for­eign in­vestors. The coun­try’s top bike­shar­ing com­pa­nies, Ofo and Mo­bike, have at­tracted in­vest­ment from the United States, Ja­pan, Sin­ga­pore and else­where.

US home-shar­ing com­pany Airbnb has said it plans to more than triple the size of its China work­force this year and dou­ble its in­vest­ment in the mar­ket to bet­ter serve Chi­nese trav­el­ers.

E-com­merce is an­other suc­cess story in China’s new econ­omy. On­line re­tail sales reached 3.1 tril­lion yuan in the first half of this year, a surge of 33.4 per­cent from a year ear­lier.

On Black Fri­day last year, sales at Ama­zon China dou­bled from a year ear­lier, ac­cord­ing to a com­pany re­port. The num­ber of ac­tive users of its cross-bor­der shop­ping ser­vice soared 22 times by De­cem­ber 2016 from two years ear­lier.

In a move to tap deeper into China’s in­ter­net econ­omy, Ama­zon in June part­nered with Migu, a China Mo­bile sub­sidiary with one of the coun­try’ s largest mo­bile read­ing plat­forms, to launch a new Kin­dle ex­clu­sively for Chi­nese read­ers.

China’s spec­tac­u­lar growth used to be built on cheap man­u­fac­tur­ing, lowend ex­ports and smoke­stack in­dus­tries. Now, with a wealth­ier do­mes­tic con­sumer base as well as tech­no­log­i­cal progress, it is re­con­fig­ur­ing the econ­omy for more con­sump­tion, more in­no­va­tion and less pol­lu­tion.

Of­fi­cial data also showed grow­ing for­eign in­ter­est in China’s new econ­omy. In the first half of this year, for­eign di­rect in­vest­ment in China’s high-tech man­u­fac­tur­ing and ser­vices rose 11.1 per­cent and 20.4 per­cent year-on-year, re­spec­tively.

The tran­si­tion of China’s econ­omy has brought about a num­ber of very at­trac­tive sec­tors in­clud­ing high-tech, non-bank­ing fi­nance, life sci­ence and con­sump­tion.

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