At China’s annual 618 shopping festival, domestic e-commerce giants, including JD.com, generate billions of dollars in sales across the platform. The 2022 edition is against the backdrop of slowing economic growth in China and sluggish consumer spending.
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Regulations on China’s tech sector have not been relaxed and are becoming “reasonable” as the top executives of e-commerce companies. JD.com I told CNBC.
Over the last 16 months, Beijing has enacted drastic regulations on the Internet industry. Billions of dollars worth have been wiped out From China’s internet sector.
However, Covid’s resurgence in China has hurt economic growth, with blockades in major parts of the country. The government is looking for ways to boost the economy, Technology company crackdowns could be eased..
JD Retail CEO Xin Lijun told CNBC in an interview broadcast Friday that regulations have not necessarily been relaxed, but are more stable.
… overall development as regulations become more stable [of the internet sector] And the market will be more stable.
“In fact, countries follow the same path when developing certain regions, including China and the United States, which facilitates innovation, provides a loose environment in the early stages, and develops the sector to a certain level. It’s about implementing reasonable regulations when you do, “Shin said.
“China’s tech or internet department goes through this process, so it’s not a regulation. [is] Loosen.I think it’s a regulation [it] It will be done in a more rational way. “
China’s crackdown on technology comes from antitrust law Data protection And it seemed that investors were surprised at the speed at which it was enacted. But these days, regulatory measures don’t seem to be that strict.
“Current regulations are gradually moving in the right direction. Attempting to impose regulations on new sectors can have unforeseen negative consequences, but as regulations become more stable, overall development [of the internet sector] The market will be more stable. “
JD.com, unlike its rivals, has largely circumvented major regulatory measures Alibaba Was hit by Last year, a $ 2.8 billion antitrust fine..
Last month, China’s Deputy Director Liu He promised to support the technical sector. And there are plans to expose Internet companies as a potential sign of more supportive policy.
Shopping festival clouded by Covid
Xin spoke with CNBC prior to the 618 Shopping Festival, which takes place every June 18th. However, in recent years, 618 has tended to grow over several days up to one day.
This is usually the Chinese e-commerce giants JD.com, Alibaba, and Multiple onset Rack up Billions of dollars worth of sales The entire platform.
But this year’s edition is backed by Covid’s resurgence in China. Blockade of major cities, Especially the financial powerhouse of Shanghai.Economists China’s economic slowdown Private consumption continues to be under pressure this year.
Some slowdown in China’s economic growth will also affect Chinese consumers’ willingness and confidence.
Xin Lijun
CEO of JD Retail
May, Retail sales were down 6.7% year-on-yearAlthough it was less than expected.
Xin said the revival of the pandemic and China’s Covid policy had an impact on merchants with physical stores. Some of JD’s logistics operations have also been suspended.
Chinese consumers have also been affected, Xin said this was seen before the 618 sales period this year.
“A certain slowdown in China’s economic growth will also affect consumer confidence and confidence in Chinese consumers,” Shin told CNBC. “Of course, we are optimistic about the Chinese economy in the long run, but we are under pressure in the short run.”
The CEO of JD’s largest business segment said he was optimistic about the Chinese economy in the second half of this year.
“The government is implementing large-scale policies with businesses and I think these measures will be effective in the second and third quarters. China’s economy will improve in the second half and perform better next year. I think I’ll show you, “Xin told CNBC.
He also said JD introduced several steps to assist merchants during 618, including reducing platform fees as the economy slowed.
