SMEs' access to global trade key task for G20

Shi Dongwei, vice-president of Alibaba Group Holding Ltd, has called for more global trading information to be made available online for small and medium-sized enterprises in China that want to expand overseas.

Speaking at a meeting of the G20 Trade and Investment Working Group in Nanjing, Jiangsu province, on April 4, Shi said 60 percent of the SMEs using Alibaba's trading platforms still had limited access to information on global markets.

He said Alibaba's e-commerce platform, Taobao, has been used by millions of small-business owners to trade services and products online, and as such it has made a series of proposals to the working group with a view to creating opportunities for SMEs.

"We suggest a capability-building mechanism to allow SMEs to reap more benefits in the global value chain, such as knowing what products are needed in which parts of the world, or how to increase the appeal of their products in the global market," Shi says.

The company also supports the creation of a new Internet-based trading mechanism for SMEs and young entrepreneurs that could complement the World Trade Organization.

"The WTO is a product-based trading mechanism, which offers a lot of opportunities for large companies. Now, the Internet is generating so many opportunities for SMEs to compete, a new mechanism needs to be formulated to lay down the ground rules," Shi says, adding that Alibaba also has proposals to facilitate financing and policymaking for SMEs.

Wang Shouwen, vice-minister of commerce, says building global value chain capacity was top of the agenda at the G20 working group meeting.

With that in mind, he says seminars are to be held and case studies presented to help create a collaboration platform for companies in developing countries to benefit from the global value chain.

Zhou Mi, a researcher at the Chinese Academy of International Trade and Economic Cooperation, says G20 member countries - the world's economic powerhouses - must take the lead in tackling the current economic headwinds.

"The stakeholders vary greatly in terms of strength and growth. The working group has particular emphasis on the developing countries and SMEs within the global value chain," Zhou says. "The G20's efforts are being directed at narrowing the gap between the development of great power and disadvantageous groups."

Zhou notes that incorporation into the global value chain takes time, and that in turn depends on individual national and corporate resources and advantages.

"For instance, it has taken China decades to gradually move up the global value chain. It's a process that cannot be rushed."

It was hoped that the G20 meeting would result in a nonbinding global strategy for trade and investment that discourages any new protectionist measures and offers guiding principles on policies.

"Bilateral and multilateral investment agreements are plentiful, while global investment guidance is lacking," says Zhang Shaogang, director of the Ministry of Commerce's International Department. "The strategies being created are going to provide references for countries when they are formulating their own investment policies."

James Zhan, senior director of investment and enterprise for the United Nations Conference on Trade and Development, says global foreign direct investment could decline further this year before recovering a little in 2017 and 2018. But it will still remain far lower than the $2.1 trillion pre-crisis level in 2007.

"In the bumpy road to recovery, the G20's initiative to form a set of global investment guidelines will provide a systemic approach to policymaking on a lot of detailed international transactions, such as contract manufacturing, contract farming, licensing and franchising," Zhan says.

yangziman@chinadaily.com.cn