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Business / Economy

Firms cash in on e-commerce with S. Korea

By Zhao Ruixue (China Daily) Updated: 2015-05-09 10:42

Firms cash in on e-commerce with S. Korea

Two workers check the color of fabrics being exported to South Korea at a factory in Weihai, Shandong province. Weihai and South Korea have always had an excellent economic relationship during the past 20 years. The city's trade with South Korea from 1995 to 2014 reached $59 billion. [Photo/Xinhua]

Businessman Lin Xuguang is predicting his company sales will double this year as a result of the free trade agreement between China and South Korea.

Lin, 40, manages an agricultural products company-Weihai JiuR Foreign Trade Co Ltd-in Weihai, Shandong province. He opened the business in 2007 and now he is rapidly expanding into South Korea, selling food products such as rice biscuits and soft drinks over the Internet.

"The maximum daily sales of my (online) store on the Tmall platform, which is part of Alibaba Group Holding Ltd, reached 4 million yuan ($644,145) after Weihai opened up for cross-border e-commerce," Lin said. "Before, I could only make 1 million yuan a month."

Weihai opened the e-commence business between Weihai and the South Korean city of Incheon on March 3, seven days after the free trade agreement came into force in February.

Zhang Hui, mayor of Weihai, played a key role in helping promote the FTA, which will develop closer economic ties between Weihai and the Incheon Free Economic Zone.

"We are working hard on creating a thriving e-commence business between Weihai and Incheon," said Zhang at a China and South Korea FTA trade forum in Weihai on Thursday. The forum attracted more than 100 South Korean businesspeople.

Yoon Hyochoon, deputy director of the Korea Trade-Investment Promotion Agency, is just as bullish about the agreement and the effects it will have on business between Weihai and Incheon.

"The FTA will embark on a new age of bilateral cooperation. It will be the engine that will drive economic development," Yoon said.

Statistics from the Weihai Bureau of Commerce show the city's e-commerce sector shipped 155 metric tons of goods to South Korea, worth of $1.31 million by May 3 from March 3.

Zhang is convinced that this figure will continue to rise as more Chinese companies expand into South Korea.

Overall, China's cross-border e-commerce industry was worth $600 billion last year, an increase of 39 percent compared with 2013.

Jang Dongmoon, of the South Korea-based Dong Wha Co, said that Weihai has the potential to be developed into a major distribution center for Korean goods.

"We have reached an agreement to cooperate with the JiuR Foreign Trade Co Ltd," Jang said. "This could be a big business opportunity."

Li Mingtao, deputy head of the China International Electronic Commerce Center, said that Weihai has the advantage of being an ideal shipment center to South Korea. "But we need to develop e-commerce infrastructure in Weihai to reach our full potential," Li said.

Weihai and South Korea have always had an excellent economic relationship during the past 20 years. The city's trade with South Korea from 1995 to 2014 reached $59 billion.

By the end of last year, there were 803 South Korean companies in Weihai. More than 40,000 South Koreans are now living in the city.

 

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