"The slowdown in global economic growth has brought both challenges and promising opportunities for cross-border e-commerce," said Yi Xiaozhun, former Vice Minister of Commerce and former Deputy Director-General of the WTO, in his keynote speech at the forum titled "New Speeds in Digital Foreign Trade, A New Era for Cross-border E-commerce" at the 2023 Global Digital Economy Conference on July 6th.
From Yi Xiaozhun's perspective, due to the stagflation in the US and Europe, China's foreign trade has faced difficulties this year. According to IMF predictions, economic growth in developed countries will decline from 2.7% in 2022 to 1.3% in 2023. In particular, the three major economies of the eurozone—Germany, France, and Italy—are all on the brink of recession.
The latest "Global Trade Data and Outlook" report released by the World Trade Organization shows that global merchandise trade volume will only grow by 1.7% in 2023, a decrease of one percentage point from the trade growth rate in 2022. Imports in North America and the EU will both decline, compared to a growth of 5% to 6% in 2022. Coupled with the geopolitical tensions caused by the Russia-Ukraine conflict, some developed countries, represented by the US, are accelerating the "de-China" trend in their supply chains, posing significant challenges to China's foreign trade.
However, from a dialectical perspective, Yi Xiaozhun believes that these conditions have also created promising opportunities for cross-border e-commerce. On the one hand, the number of global online shoppers is growing steadily. In 2021, more than 2.14 billion people worldwide purchased goods and services online, with 70% of online buyers preferring to buy products from foreign websites. On the other hand, the global transaction scale of B2C (business-to-consumer) cross-border e-commerce is expected to rise from 780 billion in 2019 to 4.8 trillion in 2026, with a compound annual growth rate of 27%.
Specific to China's advantages in cross-border e-commerce, Yi Xiaozhun believes that China is not only the largest cross-border e-commerce retail export economy in the world but also the largest economy in terms of global e-commerce retail sales (B2C). Meanwhile, China's cross-border e-commerce imports and exports amounted to 2.11 trillion yuan last year, an increase of 7.1% over the previous year and 30.2% over two years ago. In addition, China's ultra-large market advantage serves as fertile ground for the vigorous growth of cross-border e-commerce. As of June 2022, the scale of online shopping users in China was about 850 million, accounting for 81.6% of China's internet users and 40% of global online shoppers.
"The new business form of cross-border e-commerce has provided strong support for foreign trade. The outbreak of the COVID-19 pandemic severely impacted China's traditional trade, but cross-border e-commerce helped China's foreign trade turn around against the wind and played an important role in preserving orders, markets, and shares. In 2020, China's foreign trade imports and exports increased by only 4% year-on-year, but cross-border e-commerce exports grew by 40.1% year-on-year. Over the past five years, China's cross-border e-commerce imports and exports have increased tenfold. Cross-border e-commerce has become the fastest-growing, most potential, and most driving new business form of foreign trade in China, with a growth rate 2.3 times that of global e-commerce," said Yi Xiaozhun.
