Global demand for Chinese e-commerce goods boosts low-value trade untouched by tariffs
- Buying Chinese products online has become increasingly popular, and shopping platforms such as Temu and Shein are riding the e-commerce wave
Manufacturers in China’s cross-border e-commerce sector are gaining momentum in the global market for general merchandise as the rising popularity of Chinese shopping apps fuels demand.
In June, China reported a 68 per cent year-on-year increase in the export value of “low-value simple clearance goods”, primarily representing cross-border e-commerce, according to customs authorities.
Cross-border e-commerce exports grew by 7.1 per cent, month on month, becoming China’s second-largest export category by value in June. In comparison, China’s overall exports in June grew by 8.6 per cent, year on year.
In the first half of the year, the value of China’s exports of cross-border e-commerce products saw a year-on-year rise of 36.72 per cent to US$38.16 billion.
Cross-border e-commerce is enjoying a rapid boom in China, benefiting from a rise in global demand and affordable prices as Chinese manufacturers offer discounts in a price war targeting bargain-hunting consumers. The sector has also gained support from various levels of government in China.
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The latest support was demonstrated in a 22,000-word resolution released after the much-awaited third plenum that concluded last week, as Beijing vowed to build comprehensive pilot zones and global distribution centres for cross-border e-commerce. Leadership also pushed for regions with the right conditions to build international logistics and commodity allocation hubs to spur growth.
“China’s disinflationary environment and weak domestic demand have pushed more firms to enter the overseas market at competitive prices,” said Gary Ng, senior economist with Natixis Corporate and Investment Banking.
For global consumers, buying Chinese products online has also become an attractive option, as goods under a certain value are exempt from import tariffs, Ng said.