Cross-border E-commerce Boosts China-ASEAN Agricultural Cooperation

By Guo Xixian

“Sawatdee ka,Dajia hao (Hello,everyone),”greets Nisachol Thaithong,a Thai livestreamer facing a mobile phone,prepared to sell.In traditional Thai clothes,Nisachol greets viewers in both Thai and Chinese.

Nisachol hails from Ko Samui,an island of Thailand,and has been living and studying in China for 12 years.She holds a PhD in Economics and performs academic studies on the Chinese and ASEAN economies,teaches the Thai language,and hosts livestreams.Nisachol sells Thai durians on multiple mainstream Chinese social media platforms including Douyin and Toutiao and promotes other agricultural products such as jasmine tea on Facebook and Lazada,the largest online shopping platform in Southeast Asia.She attended the China-ASEAN Expo twice and won the New Star Prize at the 2021 Lazada Southeast Asia Cross-border Livestream Talents Competition.

“I became a livestreamer quite by accident,” revealed Nisachol.She arrived at Guangxi University in 2010 seeking a master’s degree in International Trade.She was soon fascinated by Chinese culture and decided to stay in China for further study.After the COVID-19 outbreak in 2020,Nisachol began teaching classes online and became familiar with livestreaming.Gradually she developed an interest in livestream marketing and decided to give it a try.

Nisachol cooperated with friends to build her own brand of durians.Her partners were engaged in tourism in Thailand,but the pandemic pummeled the industry,pushing them to seek for other sources of income.Half of Nisachol’s team works in Thailand to communicate with fruit growers,find suppliers,and build logistics chains,while the other half engages in marketing in China.“We plan to sell tangerines from the Wuming District of Guangxi’s Nanning City,” said Nisachol.“Our business has been improving,giving us the confidence to sell Thai durians in China and introduce Guangxi’s produce to Thailand.”

Livestream selling has enhanced cross-border e-commerce,creating opportunities for agricultural and economic cooperation

Livestream Booms

Pressured by the COVID-19 pandemic and the conflict between Russia and Ukraine,agricultural production capacity has been shrinking in the last two years.China-ASEAN agricultural trade has been impacted,but containment measures such as lockdown inspired greater usage of the internet in ASEAN countries.Business opportunities for cross-border e-commerce were generated during the crisis,and sales of agricultural products received a boost through livestream selling.

Nisachol is one of many to sell products on livestream platforms.The 3rd Lazada Southeast Asia Cross-border Livestream Talent Competition took place on June 24,2022.Altogether,nearly 200 livestreamers had participated in the annual event in the last two years,garnering millions of views and over 100 million likes.

The “Premium Goods from ASEAN Friends” livestream marketing campaign held on March 28 featured consul-generals of Malaysia,Thailand,and Vietnam in Nanning.They promoted high-quality ASEAN goods to Chinese consumers and also introduced Guangxi produce and specialties to Southeast Asian viewers.The event was tremendously popular throughout the region.

The 2020 China-ASEAN Livestream Shopping Festival,another livestream marketing program to facilitate trade of agricultural products between China and ASEAN,lasted as long as five months and held over 300,000 livestream events,achieving sales of nearly 10 billion yuan (US$1.48 billion).

At a press conference on China-ASEAN Economic and Trade Cooperation at the 18th China-ASEAN Expo on July 29,2021,Ren Hongbin,Assistant Minister of Commerce,noted that cross-border e-commerce in China had been undergoing rapid development in recent years and become a new highlight of foreign trade development.Since the COVID-19 outbreak,in particular,cross-border e-commerce has bucked the trend and maintained rapid growth.The scale of the sector has increased almost tenfold in five years.According to data released by the General Administration of Customs on April 24,2022,China’s cross-border e-commerce market volume reached 1.92 trillion yuan (US$283.97 million)in 2021,year-on-year growth of 18.6 percent.

Nisachol can seamlessly shift between Chinese and Thai languages while livestreaming.She likes to teach Chinese viewers simple Thai words and expressions such as “delicious”and “thank you.” When introducing products,she shows viewers ways to open a durian and pick a ripe one.

Nisachol likes to interact with viewers during her livestreams.She sings Thai songs with her colleagues and performs Thai dance.Nisachol knows Chinese livestreaming jargon as well and often shouts “send the number ‘one’,Laotie” to stimulate viewers.“Laotie” is a popular Chinese online phrase referring to big fans or dear friends,and viewers usually post No.1 in the comments to simply acknowledge the streamer.Many Chinese viewers are surprised to see a Thai girl speak fluent Chinese and sell products on livestream platforms.They interact with her and even send her bonus “gifts” (varied amounts of money).

Nisachol recognizes the potential of livestream selling.She noted that livestreaming has fewer limitations on the diversity of sales,which makes the endeavor more interesting.It cuts the distance between sellers and customers,and empowers buyers to learn about the products directly and vividly.Products are purchased by viewers without applying any pressure.

Livestream selling has even evolved into a new social form.Many Southeast Asian celebrities with many fans have joined the industry.“It gives them opportunities to communicate with fans,” said Nisachol.“Livestream selling helps celebrities maintain their fan bases and increase income to offset decreased revenues from public performances due to COVID-19 protocols.”

1.The “Thailand Carnival -2022 Thailand Shopping Festival”is held by the Commercial Office of the Consulate General of Thailand in Nanning on July 15,2022 in Nanning,Guangxi Zhuang Autonomous Region.(HUANG YANMEI)

2.Nisachol Thaithong

3.The 2022 China (Guangxi) Pilot Free Trade Zone Overseas Investment Attraction and Cooperation Conference is held both online and offline on May 27,2022.(LIN HAO)

4.Consul-general of Thailand in Nanning Benjamas Tanvetyanont (right) promotes Thai products during a livestreaming event.(CHINA DAILY)

5.Consul-general of Malaysia in Nanning Azlimi Zakaria (right)participates in a livestreaming event.(CHINA DAILY)

Yuan Bo,a researcher and deputy director of Asian Institute of Chinese Academy of International Trade and Economic Cooperation (CAITEC) under the Ministry of Commerce,noted that while China-ASEAN e-commerce has been developing fast,the outbreak of the COVID-19 pandemic prompted the emergence of new forms of cross-border e-commerce and helped influencer livestream selling achieve explosive growth.Products sold by internet influencers are generally affordable but with high quality,which suits the economic development level of both China and ASEAN.Internet celebrities’livestream promotion has won cultural recognition as well.Many e-commerce companies have been scrambling to invest in ASEAN to create an even more favorable environment for further development of cross-border e-commerce.

More than 100 cross-border e-commerce companies including Alibaba and Ant Group have established offices in the Guangxi Pilot Free Trade Zone.Lazada has built a cross-border e-commerce and innovation service center in Nanning to create service systems for livestreamer incubation,cross-border livestream selling,and foreign language training for crossborder e-commerce practitioners.Over 200 livestreamers have worked at the center.

Difficulties and Challenges

Alongside the many opportunities,the pandemic and Russia-Ukraine conflict have brought challenges to cross-border e-commerce.Agricultural products have a shorter shelf life and greater transportation requirements than most commodities.Seasonal produce surges at harvest time,causing even bigger pressure on logistics.

Nisachol stressed that durians transported by air are picked when they are at “80 percent ripeness” to guarantee the quality of the fruit.Land transportation costs less but takes longer,so durians delivered by land are usually picked when they are at “60 percent ripeness.”

The COVID-19 pandemic added uncertainties to the transportation,with customs clearance time increasing by three to five days on average,and a sudden outbreak may further prolong the waiting.The costs of Nisachol’s durians rose two to three times after the pandemic.

Late last year,one of Nisachol’s refrigerated trucks waited for 15 days at Guangxi’s Youyiguan Port,during which time many durians nearly spoiled.The fruits,which were expected to sell for 900 yuan (US$133.29) per crate,were finally unloaded in Jinhua,Zhejiang Province,and for only 400 yuan (US$59.24) per crate,causing nearly 400,000 yuan (US$59,240) of losses.Now,most durians she sells are transported by air.Although this squeezes her profit margin,Nisachol wants to guarantee consumers fresh products.

The sustained development of crossborder e-commerce of agricultural products faces many challenges.In terms of transportation,logistics infrastructure needs improvement,and the situations of countries’ railways and highways vary.Institutionally,a lack of standards for inspection and quarantine as well as certification of agricultural products also causes problems.Meanwhile,laws and regulations on cross-border e-commerce are not improved enough to effectively restrain false advertising and regulatory violations arising in livestream selling.In terms of markets,cross-border e-commerce in many ASEAN countries started late,so the ASEAN market is not open enough because of the lack of both information and related marketing experience.

Nisachol believes that the sector is seizing progress despite the many lingering difficulties.Varying languages,cultural differences,the lack of information transparency,distrust of payment credibility,and incomplete supply chains are all hampering the development of cross-border e-commerce.

Yuan Bo added that more efforts are needed to facilitate China-ASEAN e-commerce of agricultural products.Although the sector boasts great potential and advantages,both sides should focus on coordinating the online economy and the real economy to ensure long-term development.Nontariff barriers will be eliminated,which will require greater efforts in inspection and quarantine as well as reciprocal recognition of standards of agricultural products.

At a high-level April 26 conference to discuss China’s e-commerce of agricultural products,Zhang Tianyi,director of Department of Market and Informatization of the Ministry of Agriculture and Rural Affairs,outlined how the sector enjoyed rapid development in the past but is now at a key stage of overcoming difficulties.The strategies and policies related to the sector should pivot to high-level development,which requires a shift in focus from sales to upgrading industrial and supply chains and building brands.All these efforts are fundamental to the sustained and sound development of the sector.

RCEP Booster

The entry into force of the Regional Comprehensive Economic Partnership(RCEP) agreement on January 1,2022 marked the creation of the free trade area with the largest population and biggest economic aggregate.The RCEP will become a development booster for China-ASEAN cross-border e-commerce of agricultural products.

Chapter 12 of the RCEP agreement elaborates on electronic commerce because developing the sector has become a consensus of signatories.As part of the agreement,customs clearance procedures are simplified for more efficient release of goods.It stipulates that the importing Party shall adopt or maintain procedures that allow goods to be cleared from customs within 48 hours of the arrival of goods and provide for the release of perishable goods from customs control in less than six hours.

The agreement also promotes paperless trading by clarifying that a Party shall not deny the legal validity of electronic authentication and electronic signature.It also requires each Party to endeavor to avoid unnecessary regulatory burden on electronic transactions and build mechanisms of dialogue and dispute settlement on e-commerce.RCEP encourages establishment of new cross-border e-commerce service platforms and construction of supportive logistics systems and overseas warehouses to accelerate sound development and upgrading of cross-border e-commerce.

Yuan Bo added that RCEP further lowers tariffs on some agricultural products such as peppers and coconut water ASEAN exports to China,based on the China-ASEAN Free Trade Area(CAFTA) agreement.And the principles of trade facilitation provide a favorable environment for the import and export of produce,especially fresh products.Harvest time of agricultural products varies between China and ASEAN countries,which is also a factor conducive to bilateral e-commerce trade.The RCEP enhances trade facilitation throughout the region,further motivating regional cooperation on agricultural trade.

Thanks to livestream selling,the trend-bucking growth of cross-border e-commerce is injecting new impetus to China-ASEAN agricultural cooperation.Nisachol believes that Chinese and ASEAN preferential policies in the sector will help industrial development and trade facilitation and that competition will encourage market opening and force e-commerce companies to improve the quality of products.Nisachol is confident in the prospects of livestream selling.“Cross-border e-commerce is new to Thailand,so the country only has a handful of well-known livestreamers,”she said.“So I believe Thailand boasts great potential in this sector.”

“Thank you,kom kun ka,” she says while placing her palms together and doing a wai,the traditional greeting of Thailand.Nisachol bids farewell to her viewers when the day’s sales near their end.The future will bring more livestream events,and Nisachol is ready for it.