New digital business models have budded and blossomed since the early 2000s when the Internet first began permeating every sphere of life in China. Platform companies, bringing together buyers and sellers and managing their interactions online, for one, have thrived. In 2021, China's top 100 Internet firms earned a total revenue of 4.58 trillion yuan ($664 billion), and the size of the country's platform economy is estimated to reach 100 trillion yuan ($14.5 trillion) in 2030.
The Central Economic Work Conference on December 15-16, 2022, an annual gathering outlining economic priorities for the coming year, called for greater efforts to develop the digital economy, improve supervision and provide more support to platform enterprises so as to leverage their abilities in leading development, creating jobs and competing globally.
The platform economy is vital to the Chinese economy at large. The country does not yet have a solid foundation for economic recovery from the COVID-19 pandemic and remains challenged by pressures of demand contraction, supply shocks and weakening expectations. The global environment is turbulent, with the impact on the Chinese economy continuously deepening.
While managing these challenges, China must unleash the role of the platform economy in leading innovation, which means better connecting buyers with sellers and improving the efficiency of resource allocation.
Platform companies, including Internet and technology giants Alibaba and JD.com, have focused on improving their user experience, advancing the prosperity of different players and motivating international and domestic trade. Experts in the field believe that with support from the government and rebounding market demand, the platform economy will take on a more important role in the national economy.
But while enjoying the data dividends, the platform economy must also tackle the issues of monopoly as well as weak government supervision and data security.
It's crucial for global stakeholders to create a synergy for its healthy evolution. It is important to fortify weaker areas in both the long and short term, resolve prominent problems and promote its regulated and sustainable development.