Looking forward to more "micro multinational enterprises"

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Recently, Deloitte released the 2021 "Technology Empowers Asia-Pacific Digital Trade" report, saying that growing Asian small and medium-sized cross-border e-commerce companies are trying to become "micro-multinational enterprises" with the help of the policy dividends of the Regional Comprehensive Economic Partnership (RCEP) and digital technology.

The outbreak and spread of the new crown pneumonia epidemic has suppressed the offline consumer demand in domestic and foreign markets, while the home epidemic prevention measures taken by various countries have further released online consumer demand, and the huge transformation of consumer shopping patterns has accelerated the digitalization process of cross-border e-commerce. According to the latest Global Trade Update released by the United Nations Conference on Trade, global merchandise trade reached a record high of US$5.6 trillion in the third quarter of this year. Global trade is expected to be around $28 trillion in 2021, up 23 percent from 2020.

According to Deloitte's survey of more than 600 cross-border e-commerce companies in Asian countries, 85% of cross-border e-commerce companies are small and micro enterprises with less than 100 people, as few as one or two people, but they can achieve business in more than 3 overseas markets on average. How did these small and micro enterprises grow into "multinational" enterprises?

First of all, the explosive growth of online consumer demand has undoubtedly provided the first impetus for the development of small and medium-sized cross-border e-commerce, and actively building independent brands, establishing independent foreign trade network channels exclusive to the company, facing consumers with the help of global social networks, and tapping the deep demand of the consumer market have become the "golden key" for these enterprises to win. There are reports that water-soluble pet fecal bags sell in 6 countries such as Britain, Germany, France and the United States; turtle "couture" sweaters have gained countless fans in France and Japan... As the Deloitte report points out, the founders of these "micro multinationals" are better at spotting consumer demand from global social networks, using "locally made" and flexible supply chains in the Asia-Pacific region to provide customized services to equally young overseas consumers.

Secondly, the policy dividend "escorts" small and medium-sized cross-border e-commerce companies to go to sea. According to the Deloitte report, the RCEP, which came into effect on January 1, 2022, will promote regional digital trade in five major areas: eliminating tariff barriers, establishing flexible rules of origin, promoting e-commerce, improving trade facilitation, and attaching importance to small and medium-sized enterprises and technical cooperation.

Third, under the influence of many factors such as technological progress and international cooperation and opening up, global trade has ushered in intelligent upgrading. Technological upgrading will attract more and more cross-border e-commerce to join the global industrial chain of digital trade to adapt to the growing digital consumption habits of global consumers, among which the Asia-Pacific region will become a new force in the construction of global digital platforms.

With the blessing of technology and the policy dividend, the "transnational" of small and micro enterprises will usher in a key leap. Zhejiang University and Ant Research Institute recently jointly released the world's first "RCEP Regional Digital Trade Cross-border Payment Service Index", showing that in 2020 and 2021, the year-on-year growth rate of the cross-border payment service scale index will maintain double-digit growth. Payment activity, measured by the number of payments, far outpaced seller growth and transaction value growth, up 25.6% year-on-year in the third quarter of 2021. This also confirms that the capital settlement channel capability of Asia-Pacific cross-border e-commerce is being significantly improved, highlighting the high activity and vitality value of "micro multinational enterprises". (Source of this article: Economic Daily Author: Zhu Lin)