Smartag partners Salimy for online trade and traceability ecosystem

KUCHING: Smartag Solutions Bhd (Smartag) has entered into a partnership agreement with China-based Ningxia Salimy Muslim Commodity Trading Co Ltd (Salimy) yesterday to develop China international Halal online trade and traceability ecosystem.

The company in a filing to Bursa Malaysia said it will partner with Salimy to build an online electronic commerce and traceability platform that allows company from all over the world to display halal food and Muslim supplies and trade internationally.

Smartag said by setting up the platform, companies from all over the world can open a virtual store in the electronic commerce platform if their products complies with international Halal standard.

The ACE Market listed company said product listed in the electronic commerce platform is traceable by using radio frequency identification (RFID) and 2D barcode. It added that the platform offers International Financial Clearance that facilitates the trading between China with the rest of the world.

In the meantime, Smartag said Salimy is responsible to deal with local and central government department on regulations matters, getting provincial government aid, subsidise, grant, coordinating the join bid project, forming project team and tasks as well as promoting and recruiting merchant to participate in the electronic commerce portal.

Likewise, Smartag said the company is responsible to develop electronic commerce portal with traceability, complete client platform software and install server to achieve international Halal certification and realisation of International Financial Settlement Green Lane.

Additionally, Smartag said the agreement with Salimy provides a good platform for Smartag to commercialise its traceability on an international level whereby there is huge market potential for Halal products.

Smartag noted that it has budgeted the amount to develop the ecosystem to be Reminbi16 million over a two-year period.

As for the risks of the business, the company pointed out that both parties agreed the project is a medium to long term project.

The company outlined that funding plan includes matching fund from Chinese government, pending that, Salimy agrees any portal or software develop by Smartag as well as any intellectual property shall remain under the ownership of Smartag.

Smartag revealed that the company reserves the right to terminate any further development should Salimy is not able to obtain the government grant.

The company said both parties shall set up a foreign signed joint venture within three months after approval of government funds, where Smartag shall owns 60 per cent stakes in the foreign joint venture and Samily the balance of the 40 per cent.

The agreement shall be valid for two years and in the case of Salimy not able to get government funding, the signed agreement shall be terminated and both sides shall not hold any responsibility.

As for the background of Salimy, Smartag said the company, established in Yinchuan, Ningxia, China is a well- respected and trustworthy Niangxia Muslim Enterprise that leads Ningxia Muslim Community towards international trading.

Salimy is principally involved in trading and promoting Ningxia local featured goods such as Halal foods and Muslim products.

On another note, it added that Ningxia is the sole Muslim province in China and the Muslim community accounted for 36 per cent of the 6.4 million population in the province.

Smartag said in 2013, the total imports and exports of Ningxia reached US$ 3.22 billion, an increase of 45.2 per cent over 2012.

It noted that exports amounted to US$ 2.55 billion, an increase of 55.5 per cent and imports amounted to US$670 million, an increase of 15.6 per cent.