Smart, green logistics is key to economic upgrading

Cainiao Future Park in Xinwu district of Wuxi, Jiangsu province integrates internet of things technology with the logistics business. [Photo provided to China Daily]

A recent report by the China Council for International Cooperation on Environment and Development, a high-level international nonprofit organization which advises the Chinese government on environmental issues, recommended that China strengthen its governmental and other institutions to become the leader in making supply chains more eco-friendly.

Recognizing the importance of sustainable supply chains to reaching the national goal of building an ecological civilization, Alibaba has adopted initiatives that use smart routing to reduce delivery journey distances, deploy new energy delivery vehicles, and also recycle and reduce packaging. In these cases, using technology to increase delivery efficiency also helps the environment.

An efficient logistics system is also an important component of China's poverty alleviation efforts. According to Alibaba, the number of Taobao villages in China exceeded 4,000 in 2019.

A Taobao village is denned as having online transactions exceeding 10 million yuan, more than 100 online businesses, and with at least 10 percent of households involved in e-commerce.

AliResearch, Alibaba's research arm, estimated that Taobao Villages created 6.8 million jobs in the 12 months ending June 2019 throughout the e-commerce value chain. In 2019, the 63 Taobao villages located in the country's most impoverished areas generated about 2 billion yuan ($297.94 million) in e-commerce sales. Total sales of Taobao villages exceeded 700 billion yuan in the financial year from July 2018 to June 2019, according to Alibaba.

E-commerce is giving rural people through-out China the chance to achieve real prosperity. Even just 10 years ago, many young people had to leave their rural or small city homes to find opportunities. Now, many can use online sales to create their own opportunities near their families.

Finally, Cainiao is investing heavily in upgrading its international capabilities.

In June 2020, it announced its plans to bring about a 100 percent increase in logistics efficiency globally. Specifically, Cainiao will increase its number of chartered flights to 1,260 from 260 in the next nine months, reducing air freight time from the current seven to 10 days to three-five days.

Cainiao will also expand its overseas warehouse network, from 30 warehouses spanning one million square meters to over 2 million square meters in three years.

Along with other logistics companies, Cainiao is a fundamental part of the technical upgrading of China's economy and of the growth of domestic consumption.