Chinese tech firms pledge more help for street stalls, small vendors after premier’s comments
- Premier Li Keqiang says the Chinese government will provide more support for street stalls and small businesses as they are the “fire” of China’s economy
- Tech platforms like WeChat and JD.com responded to Li’s comments by announcing new initiatives to help smaller retailers
Major tech platforms – including Tencent Holding’s ubiquitous app WeChat, mobile payments platform Alipay and e-commerce platforms JD.com and Suning – announced new plans to help street vendors and smaller retailers recover from the impact of the coronavirus pandemic after Premier Li Keqiang described small businesses as the driving force behind China’s economy.
On Monday, Li said the Chinese government will provide more support for street stalls and small businesses as they are an important source of jobs and the “fire” of China’s economy.
The country can only develop well if its people are living well, Li said while visiting street vendors in the city of Yantai in east China’s Shandong province, according to a post on the Chinese Central Government’s official website.
Small and medium-sized enterprises (SMEs) which account for more than 90 per cent of enterprises in the country, are the backbone of China’s economy. Collectively, they contribute to about half of all tax revenue, more than 60 per cent of gross domestic product and account for over 80 per cent of urban employment, according to China’s central government.
But they were also among those that suffered most from production disruptions and lockdowns during the coronavirus pandemic. With more barriers to obtaining credit than larger businesses, many thousand SMEs are thought to have gone bust during the lockdown in January and February.
While tech platforms had already previously introduced some measures to support local SMEs, Li’s reiteration of the government’s support for small retailers on Monday sparked a new wave of responses from industry giants.
WeChat announced in a post on its platform on Tuesday that it was launching a new “fire” plan to support the digital transformation of small and medium-sized businesses and offer them subsidies, business guidance and marketing support.
Alipay, meanwhile, touted its efforts to provide interest-free loans to small businesses over the past few months. “Premier, we promise that we will carry out our 2020 plan to help small businesses, raising their income from digital operations by 20 per cent and the availability of online loans by 20 per cent!” the mobile payments platform wrote in a post on WeChat.
Alipay is run by Ant Group, an affiliate of the Post’s parent company, Alibaba Group Holding.
On Tuesday, e-commerce platform JD.com also launched “Spark”, an economic support plan for SMEs, stall owners and shopkeepers. Under the plan, JD.com will source about 50 billion yuan (US$7 billion) worth of quality goods, and provide each small shop with a 100,000 yuan interest-free loan to stock these items, it said in a blog post.
The same day, electronics retailer Suning said it would support street vendors in night markets by offering them free storage via its 10,000 freezers in Carrefour and Suning convenience stores across the country. The company will also let these vendors use its live-streaming platform for free to sell their goods and provide low-interest loans of up to 2 billion yuan in total, it said in a press release.