What happened: China’s tech giant Alibaba is setting up a $2 billion joint venture with Russia Internet Company Mail.ru Group, further strengthening Alibaba’s e-commerce marketplace in Russia. Alibaba’s deal with Mail.ru is backed by the Kremlin through the Russian Direct Investment Fund. The venture could better compete with local rivals Wildberries and Yandex in Russia.
Why it’s important: Michael Evans, President of Alibaba said the cooperation would boost Alibaba’s cross-border business. Alibaba’s Russian AliExpress unit mostly sells China-imported goods and thus, isn’t in direct competition with US e-commerce giant Amazon. The company recently rolled out Tmall for Russia after winning consumers through AliExpress. Alibaba will now fold the two companies into the new venture, giving SMEs in the country greater access to local and international markets.