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Business / Hangzhou G20

Hangzhou: A hub for small business

By Meng Jing (China Daily) Updated: 2016-09-04 09:47

Capital city of province now gearing up to play much bigger role in trade via e-commerce

Centuries ago, it was silk that made Hangzhou, a major producer and exporter of the treasured fabric, a critical city in East-West trade.

The capital city of Zhejiang province is now gearing up to play a much bigger role in trade. But rather than exporting any particular products, Hangzhou, home to the world's largest e-commerce company Alibaba Group, is using internet technology to enable more companies and more people to do business online, even cross-border trade.

The Hangzhou government has made the information technology-driven economy its top priority to spur growth since 2014, as the city revamps its sprawling economy which was once dominated by specialized manufacturers in small towns.

E-commerce and other information technology sectors have proved themselves effective powerhouses to fuel economic growth. In the first half of the year, Hangzhou witnessed 10.8 percent economic growth, eclipsing the overall national growth of 6.7 percent in the same period.

Jin Jianhang, president of Alibaba Group, said that only when each individual makes his or her own effort to participate in business can a city's economic growth be truly boosted.

E-commerce seems an ideal way to involve a large number of people in business as it lowers the threshold to set up a business, whether it is a one-man shop or a 200,000-employee manufacturer, anyone can find his or her place in cyberspace.

Jin used an example to show why Hangzhou has such a thriving economy. "Out of every 17 online shoppers in Hangzhou, there is one who owns an online store," he said. In 2015, nearly 60 percent of the city's total retail sales of 469.7 billion yuan ($70.34 billion) were made online, while China's average rate was 12.8 percent.

Alibaba, which was founded 17 years ago by former English teacher Jack Ma, provides fertile ground for anyone who wishes to engage in e-commerce. On its online platforms that sold more than 3 trillion yuan worth of goods in the fiscal year ended in March, it connects more than 400 million shoppers with retailers around the world.

Yang Mingping, who owns an online education startup in Hangzhou, said the platforms to do business are not the only thing that Alibaba provides.

"Many Alibaba employees have become multimillionaires after the company's record breaking IPO in the United States in 2014, and their deep understanding of the internet makes them very supportive venture investors for anyone who wants to set up internet-enabled businesses in Hangzhou," he said.

Thousands of other smaller online retail businesses are clustered in the city, encouraged by the local government's favorable policies to support people to set up their own businesses.

Dong Yan, deputy director of the innovation and entrepreneurship park in the city's Binjiang district, said the local government has made a big effort to attract talent and offered tremendous support to encourage those who want to set up their own businesses.

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