China's digital economy witnesses three-fold expansion
The expansion of China's digital economy is fast than ever before. The United Nations Conference on Trade and Development reveals that China along with the US account for more than 40 percent of the total global digital economy. While both countries dominate the digital economy globally, as a world leader in e-commerce and digital payments and a big player in investing in digital technologies, China is now home to one third of the world's best known privately held startup companies, otherwise known as unicorns.
Since 2000, China's global share of the digital economy has increased by more than three times.
eMarketer, a US-based market research company, reported in 2020 that the volume of e-commerce sales in China accounts for about 41 percent of sales in China's all retail sectors.
Having a 40 percent share of worldwide e-commerce transactions, China does more e-commerce transactions in terms of value than those of France, Germany, Japan, the UK and the US put together.
The fast-growing digital economy of China at subnational and national levels has also given China the edge of exhibiting its influence in the digital markets at the transnational level.
As a result, the country is leading in the global race of e-commerce and fintech. Furthermore, the use of a widespread infrastructure network to support information, product and service distribution as well as integration of 5G, big data, and AI with software and digital platforms are the primary factors that are expediting the growth of China's digital economy.
Overall, China possesses the biggest digital economy in the world and it is believed to be possible because of the striking support by the Chinese government.
Beginning from the basic infrastructure development, the government has been focusing on data-driven decision systems by developing advanced technologies like big data, IoT and artificial intelligence for the last decade.
To build a digital economy friendly ecosystem, the Chinese government is consistently supportive of the development and business traction of the start-ups in the areas of fintech, blockchain, virtual reality, autonomous driving, wearable technologies, distant learning, drones and robotics, payment system, cloud computing, 3D printing and machine learning.
In 2017, McKinsey Global Institute described China as a leading global force in building a digital economy.
As China plans to be a global power in the world cyberspace by 2035, this might turn out to be another catalyst for rapid growth of China's digital economy.
Additionally, to measure the size and growth of the digital economy with more accuracy, the China Academy of Information and Communications Technology proposed a "Digital Economy Measurement Toolbox" in the G20 Digital Economy Ministers Meeting in 2020.
The Measurement Toolbox was underpinned by four measurement themes, namely Technology Adoption and Innovations, Infrastructure, Empowering Society, and Jobs, Skills and Growth.
Overall, the country is committed to the continuous evolution of its digital economy in all situations.
The writer is an associate professor in the Department of Management Information Systems, Faculty of the Business Studies at the University of Dhaka, Bangladesh, and a visiting scholar at Emporia State University, USA. The views are his own.