Alibaba joins global shipping effort

Updated: 2014-10-20 05:49

By ZHANG FAN in Sao Paulo(China Daily Latin America)

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Shipping between China and Brazil just got easier.

A new logistic platform jointly established by China Shipping Group and Alibaba will enhance the efficiency of international trade and both Chinese and Brazilian companies will benefit when it's fully operational, experts said.

Alibaba, along with China Shipping Network Technology (CSNT) and China Shipping Container Lines (CSCL), two subsidiaries of China Shipping Group, announced this July that the three companies would build an integrated platform for international shipping.

After two months of preparation, the new joint company, named "Yihaitong" in Chinese, officially went online on Sept 18 and will be in charge of the operation of the e-shipping platform.

Clients can use the platform for online logistic price inquiries, ordering, settlements and goods tracking. It is the first Chinese e-shipping platform covering both land and sea transportation, as well customs clearance.

According to the agreement, Alibaba will contribute its online operating team and promote the platform to its millions of customers, while China Shipping, one of the largest companies if its kind in China, will guarantee shipping space and related logistical services.

The companies did not reveal the exact numbers of the investment. According to an announcement by CSNT this July, its trade amount with CSCL in the project was less than $4.89 million.

Such a cooperative arrangement stirred interest throughout the industry, especially after Alibaba's recent IPO on the New York Stock Exchange. The company launched online the Portuguese version of its e-commerce website AliExpress this July, with an eye to enlarging its market share in Brazil.

To speed up shipping times, Alibaba partnered in July with Correios, Brazil's state-owned postal service company. The arrangement also allows Brazilian traders to sell their products through AliExpress and Tmall, the large Alibaba-owned retail website in China.

"If the e-shipping platform can fully operate, both Chinese and Brazilian companies can save a lot of effort in logistics because China Shipping enjoys obvious advantages in international shipping lines, which means trade can be more efficient and profitable," said Zhou Xinyu, a researcher in emerging economies at Beijing Foreign Studies University.

The new platform is also viewed as a way to stimulate business for China Shipping, which can attract more potential customers, according to a company analyst who preferred to remain anonymous.

"A possible difficulty for the e-shipping platform is whether it can be accepted by traditional customers," Zhou said. "Though China Shipping is advanced in sea transportation, it may need to devote great energy into land transportation, which is inevitable if the platform wants to provide door-to-door service,"

China Shipping established its South America branch this March in Sao Paulo, Brazil, to cope with the rapidly developing trade between China and the region. Xu Lirong, president of China Shipping, said at the launch ceremony that China Shipping expected to double its trade in the region within three years.

The company now has three branch offices in Brazil, Argentina and Chile, with the business stretched to other regional countries including Peru, Venezuela and Bolivia. Xinhua reports that the freight volume of China Shipping in Latin America reached 180,000 standard containers in 2013 and the number is expected to reach 200,000 this year.