China’s breakneck development has allowed a sophisticated e-commerce sector develop alongside a large rural population that is still plagued by poverty. It’s a disparity that has led to a unique relationship between agriculture and e-commerce, with $16 billion USD in agricultural goods traded online annually.
Now China’s government is hoping to boost the digital sector in rural and remote China by investing 140 billion yuan ($22 billion USD approx.) in extending the broadband network to 98% of the country by 2020.
The ambitious plan was laid out by China’s state council on Wednesday, and involves around 50,000 villages in rural and remote China. The memo details how 30 million households will gain improved internet access as part of the five-year project.
The plan is part of a wider commitment by China’s government to bring 70 million residents out of poverty by 2020, but it also coincides with the policy commitments of ‘Internet Plus‘, the strategy aimed at bringing China’s traditional industries — including agriculture, online.
Several of China’s largest tech companies have extended into the rural e-commerce space. JD.com one of the country’s largest e-retail platforms, has launched a dedicated service for the trade of agricultural products. Alibaba also opened an agricultural e-commerce service on its Taobao platform that also features data-driven guidelines for certain farming practices.
The parent company of Lenovo, Legend Holdings, also invested heavily in Yunnongchang, which means ‘Cloud Farm’, a service that sells agricultural products online, which also has service centers across over 200 cities.
The $22 billion USD investment plan laid out by the government will also seek to improve logistics in the affected areas, attracting investment to some of the country’s poorest areas.