Amazon is boosting its presence in China by setting up shop in Shanghai’s free trade zone, a move that lets the online retail giant take advantage of less-stringent trade regulations to sell a wider range of products, according to Reuters.
The company signed a memorandum of cooperation to give Chinese customers access to its products from its global supply chain and to help small and medium-sized enterprises in China to export their products to customers in other countries, Amazon told the news agency. But the company did not say when it will begin operations in the year-old Shanghai free trade zone.
Under the deal, Amazon will open a new cross-border e-commerce platform in the free trade zone, and establish a logistics and warehouse center in the Shanghai zone.
The move signals Amazon’s intent not only to remain in China but to step up competition with Alibaba Group, which dominates the market along with the second-biggest player, Beijing-based JD.com.
But the move to the Shanghai zone won’t be a panacea. Amazon has been hit by problems with counterfeit goods, an issue that regularly plagues companies in China from fashion to pharmaceuticals and even food and drink. In March, Amazon said it will strengthen regulation of its online sales channels and that it closed down a third-party store after state media criticized it for selling fake cosmetics.
Amazon is also promoting its cloud computing offering, Amazon Web Services, in China. In December the company said that China will get its own AWS region to improve speeds for its mainly corporate customers.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More