China JD.com plans to encourage overseas investment to challenge Amazon
Several boxes of goods purchased from JD.com are piled on the floor.
Zhang Peng | LightRakete | Getty Images
GUANGZHOU, China – JD.com plans to increase overseas investments, one of its top executives told CNBC as Chinese e-commerce giants try to reach international users.
The tech giant has been less aggressive than its rival Alibaba in expanding its overseas presence. But the international expansion of both Chinese companies could call into question Amazon’s e-commerce dominance in certain parts of the world
In the coming years, JD.com will “increase investment in countries that align with JD’s strategies, whether in warehousing, logistics or supply chain,” said Xin Lijun, the newly appointed CEO of JD’s retail business in Mandarin, according to a CNBC -Translation.
Xin said JD is conducting “further strategic analysis in Vietnam and Europe” as potential locations for expansion.
Singles Day in China
Xin’s interview came as China’s Singles Day is in full swing.
The mega-shopping festival – which sells more goods than Black Friday and Cyber Monday combined – sees massive discounts on China’s e-commerce platforms grossing billions of dollars.
JD’s international expansion has so far focused on investments and joint ventures.
In 2017, the Thai retailer Central Group and JD formed a joint venture and launched an e-commerce platform in Thailand in 2018. In 2019, JD.com became the largest shareholder in the Vietnamese e-commerce service Tiki.
… the improving international environment for business expansion better supports JD’s global business.
CEO of JD Retail
JD also operates Joybuy.com for international customers. It’s a rival to Alibaba’s AliExpress.
Xin said that JD’s logistics department is leading international expansion efforts for the group, which is different from other companies.
“This is the biggest difference in terms of global expansion compared to other companies. We offer integrated and closed services. This enables us to do well in overseas markets in general,” said Xin.
“I believe that as the pandemic eases and more companies develop drugs for Covid-19, the improving international environment for business expansion will better serve JD’s global business,” he added.
JD says it welcomes regulation
This year’s Singles Day, or Double 11 as it is called because it falls on November 11th, has a different feel. This is because the Chinese technology sector has faced a series of new regulations over the past year and President Xi Jinping is promoting the idea of “shared prosperity”.
Both Alibaba and JD this year have focused on ideas of sustainability and inclusivity that are part of the Beijing-emphasized social responsibility narrative. They have also pulled back from announcing big discounts and big sales like they have in previous years.
Beijing has introduced new regulations in areas ranging from antitrust law for internet platforms to data protection. The new rules took investors by surprise, causing billions of dollars of value to disappear from China’s internet sector over the past year.
JD welcomes regulations as they help restrict business behavior, provide better services to consumers, and create a fairer competitive environment.
CEO of JD Retail
In April, Alibaba was fined $ 2.8 billion as part of an antitrust investigation. JD has not yet received such harsh punishments.
Xin said JD welcomes new regulations and regards them as “positive”.
“JD can be called a good student in the eyes of regulators and partners. Almost all of our services follow the strictest regulatory standards, ”he said. “JD welcomes regulations because they help restrict business behavior, provide better services to consumers, and create a fairer competitive environment.”