Agri­cul­tural e-com­merce bridges China's ur­ban-ru­ral gap

The Pak Banker - - 6BUSINESS -

A year ago, farmer Liu Tongy­ong, who lives deep in the moun­tains and had never used the In­ter­net, was wor­ried about his snake gourd sales.

Now the 45-year-old from east China's An­hui prov­ince is sell­ing his pro­duce on­line. "I have not only sold out of prod­uct, but also got­ten a bet­ter price," he said.

Liu's home in Taip­ing Vil­lage is about a two-hour ride from the seat of Yuexi county.

In the past, he had to wait for some­one to col­lect the gourds. Some­times the col­lec­tors wouldn't even show up. Liu had no choice but to let the fruit de­cay in the field.

This year, an e-com­merce ser­vice cen­ter was set up in Taip­ing Vil­lage, which has helped more than 300 farm­ers sell their prod­ucts. About 7,500 kilo­grams of snake gourds were sold in a year.

A re­port by the China In­ter­net Net­work In­for­ma­tion Cen­ter showed that of China's 688 mil­lion In­ter­net users by the end of 2015, 195 mil­lion, or 28.4 per­cent, were ru­ral res­i­dents.

China has wit­nessed a boom in ru­ral e-com­merce in re­cent years, with 780 vil­lages ex­ceed­ing 10 mil­lion yuan ($1.5 mil­lion) each in on­line trans­ac­tions in 2015, ac­cord­ing to a re­port re­leased by on­line retail gi­ant Alibaba.

China's on­line sales re­mained strong in 2015, jump­ing 33.3 per­cent year on year to 3.88 tril­lion yuan, with 22.4 per­cent of on­line shop­pers com­ing from ru­ral ar­eas.

E-com­merce has not only helped farm­ers sell their prod­ucts, but also helped them buy things.

With the spring grow­ing sea­son on the way, Zhou Zhuwen in east China's Jiangxi prov­ince is buy­ing fer­til­izer for his grain on­line.

"It is cheaper, and I have more choices," he said. The fer­til­izer can be de­liv­ered to his home, sav­ing him the trou­ble of trans­porta­tion. "This time, I bought 20 tonnes and saved more than 10,000 yuan," he added.

"E-com­merce is chang­ing farm­ers' work habits and boost­ing their ef­fi­ciency," said Zheng Feng­tian, vice head of the School of Agri­cul­tural Eco­nom­ics and Ru­ral De­vel­op­ment at Ren­min Univer­sity.

Last year, China's Min­istry of Fi­nance and the Min­istry of Com­merce an­nounced 200 coun­ties that would serve as demon­stra­tion bases for ru­ral e-com­merce and ear­marked two bil­lion yuan to help with de­vel­op­ment there.

Ac­cord­ing to Min­is­ter of Com­merce Gao Hucheng, the coun­try will re­duce lo­gis­tics costs, which are 15 to 16 per­cent of to­tal prod­uct costs on av­er­age, al­most dou­ble that in de­vel­oped coun­tries.

"Meth­ods of con­sump­tion will be im­proved," he said, adding that on­line sales have be­come the trend.

In this year's govern­ment work re­port, Chi­nese Premier Li Ke­qiang promised to "en­cour­age the in­tro­duc­tion of e-com­merce into ru­ral ar­eas", and in­crease the ac­ces­si­bil­ity of broad­band net­works in both ur­ban and ru­ral ar­eas.

The govern­ment has pledged to spend 140 bil­lion yuan by 2020 to pro­vide at least 50,000 vil­lages with broad­band In­ter­net ac­cess. At that time, about 98 per­cent of the na­tion's ru­ral ar­eas will be hooked up to the In­ter­net.

Alibaba plans to in­vest 10 bil­lion yuan to es­tab­lish 100,000 vil­lage ser­vice cen­ters in the next three to five years, which will serve to teach ru­ral peo­ple how to use the In­ter­net for shop­ping or busi­ness. Farmer Liu has just ex­panded acreage of his snake gourd fruit.

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