Alibaba Group Executive Chairman and Malaysian Prime Minister hit the gong to signal the first eWTP hub outside of China. Source: Alibaba

Alibaba’s first digital trade hub outside China launches in Malaysia

ALIBABA today launched their first Electronic World Trade Platform (eWTP) outside of China in Malaysia, in an effort to build up their assets in Southeast Asia and exert its influence in the region ahead of domestic rivals.

The launch marks the latest milestone in a series of ventures and investments the Chinese technology giant has made over the last year since the announcement of its intention to work with the Malaysian government. Founder and chairman Jack Ma attended a ceremony today with Prime Minister Najib Razak.

The launch follows closely on from the company’s announced partnership with the Malaysian Digital Economy Corporation (MDEC), and the launch of Malaysia’s first data center by the company.

The eWTP will form part of a larger policy and infrastructure initiative that has been formed in between the Malaysian government and Alibaba, that is the Digital Free Trade Zone (DFTZ). The zone was created in order to introduce some kind of regulation and government control into the burgeoning economic opportunities posed by today’s digital economy.

The eWTP hub will be a center for SMEs in Malaysia looking to run commercial activities, where they can obtain services encompassing e-commerce, cloud computing, logistics, mobile payments and talent training.

Part of the mission of the eWTP is to lower trade barriers, especially around commercial practices in the digital economy which are far less defined than traditional forms of trade. The hub will work with both private and public sector entities to ensure equitable access to the markets, without restricting businesses from operating freely.

Alibaba Group Executive Chairman and Malaysian Prime Minister survey a model of the future regional ecommerce logistics hub. Source: Alibaba

The initiatives designated under the eWTP were said by the company in a statement to be a huge positive for the Malaysian economy as it would introduce more domestic products to the global stage in a much more streamlined manner. Through the hub, SMEs will be permitted to apply for customs clearance, run tax declarations and submit permit applications, all in one location.

“With the launch today and our early participation with eWTP, Malaysia is progressing its economic transformation vision and taking a step towards becoming the leading sourcing and fulfilment hub in Asia,” said Razak in a statement.  

“Collaborating with Alibaba to develop the infrastructure freely available to SMEs in the DFTZ, we have fundamentally improved the competitiveness of Malaysian firms on the global stage which will boost exports and bring wide reaching economic benefits to society.”

Malaysia was picked to be Alibaba’s distribution and fulfilment center in Southeast Asia, while Ma serves as the country’s digital economy advisor. Najib’s government has been pushing for greater involvement in the Internet marketplaces, as evidenced by large provisions in a recent budget proposal that saw huge funds being funnelled to digital startups, projects and incentive.

The eWTP’s e-Hub will be located in KLIA Aeropolis, a 24,700 acre development that is owned and managed by Malaysia Airports Holdings Bhd., and is widely expected to generate large sums of domestic and foreign investments. The hub will act as a regional e-commerce logistics center that will be developed in partnership with Alibaba’s logistics arm, Cainiao.