Coupang, others seek to mitigate influence of Chinese shopping giants

Home > Business > Industry

Coupang, others seek to mitigate influence of Chinese shopping giants

Published: 14 Feb. 2024, 17:48

PARK EUN-JEE
[email protected]

The logo of Temu, an e-commerce platform owned by PDD Holdings, is seen on a mobile phone displayed in front of its website. [REUTERS]

Alarmed by the surge in Korean users on China’s e-commerce sites, Coupang and other local rivals met with government officials and academia to explore ways to contain the portals' growing influence and knockoff product sales.

Representatives from Coupang, Naver, 11Street, Gmarket and SSG.com attended a meeting hosted by the Ministry of Trade, Industry and Energy on Wednesday.

The gathering marks the first meeting between the government and Korean e-commerce players to discuss such an agenda, although it was a closed-door event.

“We still don’t know yet about specific details, but I expect it to be a platform where Korean companies raise concerns and let the government know how unfair it is to compete with China-based companies,” said a spokesperson from one of the participating companies.

“It is a given that most products sold online are produced in China,” the spokesperson said, “Therefore, malls like AliExpress and Temu send the products directly to Korean consumers without customs duties, offering extremely low prices.”

The meeting is scheduled to last about one and half hours at the headquarters of the Korea Chamber of Commerce and Industry in central Seoul. Jung Yeon-sung, business administration professor at Dankook University, opened the session with his presentation.

AliExpress has climbed to third among shopping apps in Korea, with more than 7.17 million monthly active users, trailing only Coupang and 11Street. China has also secured the top spot in Korea's overseas direct purchasing market, toppling the United States for the first time since 2014.

AliExpress made inroads into the domestic market in 2018 with its budget-friendly products and free five-day shipping. It recently created a dedicated section for Korean items with zero commission, successfully attracting major Korean household goods producers such as LG Household & Health Care and Aekyung Industrial.

BY PARK EUN-JEE [[email protected]]