As a vital force in the development of China's foreign trade and an important trend in the development of international trade, cross-border e-commerce is not only conducive to promoting the optimization of foreign trade structure and the stability of scale, but also conducive to creating new advantages in international economic cooperation. The CPC Central Committee and the State Council attach great importance to the development of cross-border e-commerce, a "new engine" of foreign trade, and have made arrangements for cross-border e-commerce, overseas warehouses and other work on many occasions.

The Decision of the CPC Central Committee on Further Deepening Reform and Promoting Chinese-style Modernization, which was reviewed and approved at the Third Plenary Session of the 20th CPC Central Committee, proposed to promote innovation in customs clearance, taxation, foreign exchange and other regulatory aspects, and create an institutional environment conducive to the development of new business forms and models. Innovate and develop digital trade, and promote the construction of cross-border e-commerce comprehensive pilot zones. In June this year, the Ministry of Commerce and nine other departments jointly issued the Opinions on Expanding Cross-border E-commerce Exports and Promoting the Construction of Overseas Warehouses, aiming to expand cross-border e-commerce exports, optimize the layout of overseas warehouses, and accelerate the cultivation of new foreign trade momentum.

Strengthen the engine

The formation and development of cross-border e-commerce reflects the distinctive characteristics of revolutionary technological breakthroughs, innovative allocation of production factors, and deep transformation and upgrading of industries. Its achievements and contributions to economic growth demonstrate the powerful force generated by industrial innovation in promoting the optimal combination of production factors and the transformation of production relations. Zhang David, a member of the Senior Expert Advisory Committee of the China Center for International Economic Exchanges and former vice governor of Henan Province, said that from the perspective of new productivity, the development of cross-border e-commerce is not technological innovation itself, but the result of phased application innovation and model innovation in the field of commerce in the process of the development of new productivity. In order for cross-border e-commerce to continue to prosper and grow into a new format with strong vitality, it must conform to the basic laws of the industry and the market, and accelerate the improvement of its ability to absorb new technologies, integrate with other industries, and interact and adapt with the institutional environment in the process of innovative development.

At present, the development of cross-border e-commerce has entered the 2.0 era of brand export from the 1.0 era of goods export, and is about to usher in the 3.0 era of cultural empowerment and service industry export. On July 26, at the 2024 Jiangxi Cross-border E-commerce Development Conference, Wang Xin, President of the Shenzhen Cross-border E-commerce Association, shared her observations on the development trend of China's cross-border e-commerce. At present, the growth rate of cross-border live broadcast is obvious. It is estimated that by 2025, the scale of China's cross-border live broadcast e-commerce market will reach 828.7 billion yuan, with an average annual growth rate of 60%. The development momentum of independent stations is strong. In 2023, the number of independent stations established by Chinese companies overseas has exceeded 200,000. It is estimated that by 2025, the share of the cross-border e-commerce independent station market in the cross-border e-commerce B2C market will rise to 41%. ESG is gradually emerging. As a representative industry of new quality productivity, cross-border e-commerce is actively complying with the requirements of green, low-carbon and sustainable development, gradually promoting the integration of environmental, social and governance (ESG) concepts into development strategies, and promoting responsible financial behavior and sustainable business philosophy. In addition, cross-border e-commerce compliance requirements are becoming increasingly stringent, and industrial belts are facing new opportunities to go overseas.

Breakthrough

To further leverage the role of cross-border e-commerce as a "strong engine" for the development of foreign trade, we need to "shift gears and refuel" to achieve more new breakthroughs and leaps forward in key areas and weak links.

Regarding the prominent contradictions facing the current development of cross-border e-commerce, David Zhang believes that there are mainly two aspects: First, the supply-side innovation momentum is insufficient. For example, can cross-border e-commerce provide more application scenarios for a large number of emerging new technologies? Can cross-border e-commerce make new breakthroughs in technical support in software, hardware, AI, platforms, flexible supply chains, big data applications, computing algorithms, large models, etc., and obtain continuous support from capital? In the next step of development, can cross-border e-commerce achieve an overall balance between capital returns and labor value? Second, on the market side, how to achieve a stable connection between the development of cross-border e-commerce and international economic and trade rules. The development of cross-border e-commerce requires strong, stable, timely and effective innovation support in systems, policies, resources and regulatory methods.

Xing Kangnan, president of Shenzhen Zhongzhi Cross-border E-commerce Research Institute, said that the difficulties in the development of cross-border e-commerce are mainly concentrated in customs, taxation, foreign exchange control and global compliance. Enterprises also face many challenges in adapting to changes in international rules, overseas brand protection, overseas tax planning and other aspects. To achieve new breakthroughs in cross-border e-commerce business, efforts need to be made in the following aspects. At the tax level, it is necessary to focus on the implementation of the assessment and collection of cross-border e-commerce without invoice exemption; at the customs supervision level,it is necessary to strengthen the supervision of cross-border e-commerce export enterprises rather than logistics service enterprises;in terms of foreign exchange settlement, it is necessary to deeply combine third-party payment, corporate orders, and no-invoice exemption services. In addition, withthe growth of China's high-value-added product exports, higher requirements have been put forward for the radiation range of cross-border e-commerce export returns, repairs and other services. Xing Kangnan also emphasized that in the era of big data, cross-border e-commerce is a natural adaptation scenario for AI efficiency improvement. Through AI, the efficiency of cross-border e-commerce traffic diversion and order conversion rate can be further improved, and the efficiency of all links in the industry can be improved.

To promote the high-quality development of cross-border e-commerce, David Zhang also mentioned that we must focus on the following aspects.

First, we need to enhance endogenous motivation and build a modern industrial system. We need to further enhance the pivotal role of cross-border e-commerce platforms in the development of the industry, gradually upgrade the existing self-operated brand + platform, trusteeship, and agency operation models to public digital platforms with global supply chain management capabilities, and use this to promote the upgrading of manufacturing, logistics, and other matching modern service industry systems and expand exports.

Second,we should enhance innovation and optimize the development environment of cross-border e-commerce. The internal conditions for the formation of innovation include the research and development,transformation and application of science and technology,as well as factors such as creativity,design and talents;the external conditions include institutional innovation, regulatory innovation and continuous improvement of the social environment. Compared with traditional international trade, the underlying logic of cross-border e-commerce development has changed greatly, and the transformation of its development paradigm ison the way. To promote the development of cross-border e-commerce, the Chinese government has adopted a series of institutional innovations, including launching a series of new customs supervision models and fast customs clearance measures, simplifying the approval process, etc. At the same time, it should be noted that there is still a lot of room for innovation in government supervision services. There is still a lot of work to be done to solve the problem of unsmooth operation of capital flow and information flow. We must also strengthen the connection with international rules and actively participate in multilateral and bilateral negotiations on global digital economy, digital trade, cross-border e-commerce governance, etc. We should take the development of new quality productivity as the driving force, closely combine with the actual development of the industry, promote the cooperation between academia and government departments, enterprises and industry organizations, strengthen the innovation of theoretical research on the development of cross-border e-commerce and institutional innovation including laws, regulations, planning and standards, and create a good development environment for it.

Third, we need to connect with major strategies and improve the layout of the cross-border e-commerce industry. The joint construction of the "Belt and Road" initiative, the expansion of high-level opening up, the construction of a new dual-circulation pattern, and the construction of a unified national market all require cross-border e-commerce to take on responsibilities and make arrangements. Affected by the industry's sensitivity to timeliness, transportation convenience is still an important constraint on the layout of cross-border e-commerce. At present, the development of cross-border e-commerce has increased its dependence on air transportation, but China's insufficient air transport capacity is a major shortcoming. How to meet the needs of industrial development and optimize the layout of the cross-border e-commerce industry by improving conditions, especially in the formation of a cross-border e-commerce industry ecological belt in the adjacent areas of China's large hub airports, there is a lot to be done.