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China's e-commerce to be boosted by rural broadband investment

April 18, 2016

In order to promote e-commerce and boost trade, China plans to invest in the improvement and extension of internet infrastructure and broadband connections in rural areas, Mobile World Live reports.

According to a statement by the State Council's executive meeting, chaired by Premier Li Keqiang, a government program is in place to integrate the internet with the logistics sector. The aim of the program is to increase profits, stimulate consumption and boost employment.

In China's rural areas there are 195 million internet users, accounting for 28% of China's total internet users, China Internet Network Information Center (CINIC) claims.

The number of rural internet users in China grew at almost double the rate for urban internet users last year, increasing by 9.5%.

As markets in first- and second-tier cities become saturated, China Daily reports that e-commerce giants, such as Alibaba, JD and Suning Electronic, are extending their services to rural areas.

However, in terms of broadband download speeds, China ranks 91st out of more than 200 countries, with internet access much slower in the country's rural areas than in cities.

According to a CINIC report, there is huge potential for online shopping in rural China as 22% of online shoppers live in townships and villages.

China Daily reports the number of rural online buyers is expanding rapidly and there are claims that they may outnumber urban internet shoppers within 10 years. This would make the development of a robust broadband infrastructure a necessity.

In an attempt to improve China's mobile broadband, the country's three main operators committed to reducing data prices by 20-35% and improving network speeds in May last year.

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