Online vs Offline Commerce

China’s e-commerce tycoon fulfils boyhood dream to become village head, pledges to spread wealth

As a child, JD.com’s billionaire founder Richard Liu harboured dreams of becoming a village chief so he could help every villager afford to eat pork

PUBLISHED : Wednesday, 29 November, 2017, 6:29pm
UPDATED : Wednesday, 29 November, 2017, 10:48pm

Pingshitou village may just be 300 kilometres south of Beijing, but it might as well be another world. There’re no soaring towers in this mountainous region of Hebei province, and the village’s 655 residents coax apples, mushrooms and walnuts out of near-barren land. Average income levels hover just above the official poverty line.

For Richard Liu, billionaire and chief executive of China’s second-largest online retailer JD.com, Pingshitou is a reminder of his early years as a farmer’s son. As the newly appointed honorary head of the village, it is also his latest project: to raise income levels by 10 times within five years.

To achieve that target, Liu plans to gather the village’s produce and sell it through JD.com, according to the company. And instead of selling them as commodities, the company will help the villagers build brands for their agriculture products and assist with the design of the packaging so that they can command a higher price. Liu also plans to build a nursing home, attract better teachers for the school and create jobs for some of the local residents.

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On his way to the village, Liu posted a photo of the mountainous terrain and said that the lack of natural resources is the main reason for the poverty. Photos on social media show Liu getting out of a black SUV and greeting villagers, who crowded around him to take group photographs.

“I will not donate money [directly to the village ] but will drive industrial developments,” Liu said on his Weibo account. “I finally made my childhood dream of becoming a village head come true.”

Liu’s efforts are a reminder of the disparity in development that still remains between China’s big cities and rural areas, where employment opportunities are scarce and many residents find they have to seek work in urban areas to support their families, which they have to leave behind.

Many technology companies are focusing on bridging this gap, from JD.com using drones to deliver parcels to hard-to-reach places to education and health care start-ups connecting teachers and doctors in major cities to serve more remote areas.

Alibaba Group, which owns the South China Morning Post, runs an initiative to connect farmers to sell their produce through online markets. A village in southern Fujian province used live-streaming and Alibaba’s Taobao platform to market its home-grown kumquats for Chinese New Year.

China’s government is banking on the use of technology to foster new growth engines. In his address to Communist Party members at the 19th National Congress, President Xi Jinping called for deep integration between the real economy and advanced technologies including the internet, big data and artificial intelligence. In July, China’s State Council laid out goals to build a domestic artificial intelligence industry worth nearly US$150 billion in the next few years, and to make the country an “innovation centre for AI” by 2030.

For Liu, helping Pingshitou grow is both an act of community outreach and test bed for applying technology to increase rural incomes. Rising incomes would create more consumers capable of affording more goods and services.

“I am a son of Chinese farmers … I deeply know how bitter the Chinese farmers’ life is and how hard to develop the Chinese countryside economy,” Liu said last month in a speech to celebrate the 90th year of the founding of his middle school. Liu, who has an estimated net worth of US$8.8 billion according to Bloomberg, said that his “biggest dream is to be a village head and make sure every villager can afford to eat pork”.