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China Opens the Door to E-Commerce…Slowly

By James Wolf
Apr 22, 1999 12:00 AM PT

Relationships between the governments of the United States and China may have been chilled by recent spying allegations and President Clinton's refusal to allow China to join the World Trade Organization. Nonetheless, several Chinese and American business leaders are hoping that a newly announced Web portal will heat up business relations between the two nations.

China Opens the Door to E-Commerce…Slowly

On Tuesday, Chinese government officials and leaders of the U.S. Internet industry announced MeetChina.com -- the officially sanctioned e-commerce portal of China. The portal will be officially unveiled at the Great Hall of the People in Beijing, on April 28.

The portal is owned by US Business Network, Inc., which has received exclusive status as a "wholly-owned foreign enterprise" (WOFE) to operate and help develop Internet services in the People's Republic of China.

Its creators hope that the MeetChina portal will facilitate business-to-business e-commerce between the United States and the most populous nation in the world. US Business Network says that their site will have links to over 15,000 Chinese companies by July, and the company plans to add over 4 million Chinese businesses in the next three years.

Cutting Out the Middlemen

US Business Network's co-founder, Thomas Rosenthal, tells the E-Commerce Times that, "The Chinese companies we put online seek to sell to the U.S., or resell U.S. goods in China in a direct fashion." According to Rosenthal, companies in Hong Kong, Singapore or Taiwan currently act as intermediaries for these types of sales.

Rosenthal also notes that there will be some business-to-consumer selling via the site, but that the primary focus of MeetChina is business-to-business commerce.

An Explosive Market

While some sources have estimated the number of Chinese Internet users at around two million, Thomas Rosenthal thinks that the number is probably closer to five million. According to Rosenthal, in China it is common for several people or even an entire company to share a single login. However, he believes that these numbers are going to take off "like a rocket" in the next few years.

If Rosenthal's predictions come true, China could become one of the world's largest markets for online goods. By getting in on the ground floor of Chinese e-commerce, US Business Network believes that it is positioning itself to take advantage of this potential growth.

About US Business Net

US Business Network and its Chinese subsidiary, USA Business Network, was founded in 1998 by Kenneth Leonard, Joseph Tong, and Thomas Rosenthal to bring Internet services China. Both the parent company and subsidiary have been granted the exclusive status of a "wholly-owned foreign enterprise" to operate and help develop Internet services in China.


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