Chinese e-commerce giant Alibaba Group is said to be in talks with the Thai and the Malaysian governments, seeking the best location and conditions to set up a regional distribution and logistics hub for South East Asia.
In response to last week’s media reports saying that the group would set up the centre in Malaysia, Thailand’s Industry Minister Uttama Savanayana insisted that Alibaba is still interested in establishing its regional logistics hub in Thailand and it will finalise its investment plan by the end of this year.
“Thailand is the best location for developing the regional distribution and logistics system as it connects to Cambodia, Laos, Myanmar, Vietnam and Malaysia,”
he said, adding that “Thailand’s consumer market is larger than Malaysia’s, and we are forming a free-trade zone for product distribution to our neighbouring countries.”
The Chinese conglomerate has expanded its business empire outside China aggressively. It acquired the significant stakes in SingPost’s unit Quantium Solutions International, an end-to-end e-commerce warehouses and logistics services provider in Asia Pacific, in July 2015.
Nine months after the acquisition, Alibaba took a $1-billion control stake in Singapore-based e-commerce platform Lazada, underlining its determination to be a significant player in the Southeast Asia.
Alibaba’s entry makes the competition in e-commerce business fiercer especially for existing e-commerce service providers like Ninja Van, aCommerce and the logistic giant DHL.
Southeast Asia’s appetite for online shopping has increased continuously in line with a smartphone penetration and is forecasted to surge from 175 million units in 2015 to 230 million units this year.
According to eMarketer’s report, e-commerce revenues in six largest markets in Southeast Asia would reach $14 billion in 2016, around 40 per cent up from $10.5 billion in 2015.
The post Alibaba in talks to form logistics hub to strenghten its e-commerce biz in SEA appeared first on DealStreetAsia.
DEALSTREETASIA Pte. Ltd. is a news and intelligence platform providing reports on investments, mergers, acquisitions, private equity, venture capital, investment banking and the business of startups across the Asian region.
How will oil prices shape the Covid-19 recovery in emerging markets?
– After falling significantly in 2020, oil prices have returned to pre-pandemic levels
– The rise has been driven by OPEC+ production cuts and an improving economic climate
– Higher prices are likely to support a rebound in oil-producing emerging markets
– Further virus outbreaks or increased production would pose challenges to price stability
A combination of continued production cuts and an increase in economic activity has prompted oil prices to return to pre-pandemic levels – a factor that will be crucial to the recovery of major oil-producing countries in the Middle East and Africa.
Brent crude prices rose above $60 a barrel in early February, the first time they had exceeded pre-Covid-19 values. They have since continued to rise, going above $66 a barrel on February 24.
The ongoing increase in oil prices, which have soared by 75% since November and around 26% since the beginning of the year, marks a dramatic change from last year.
Following the closure of many national borders and the implementation of travel-related restrictions to stop the spread of the virus, demand for oil slumped globally.
In the wake of the Saudi-Russia price war in early 2020, Brent crude prices fell from around $60 a barrel in February that year to two-decade lows of $20 a barrel in late April, as supply increased and demand plummeted. The value of WTI crude – the main benchmark for oil in the US – fell to record lows of around $40 a barrel last year on the back of a lack of storage space.
While global demand for oil remains low, one factor credited with reversing the trend is the decision to make significant cuts to oil production, which subsequently tightened global supplies.
How the Rural-Urban Divide Plays Out on Digital Platforms
It is one thing for entrepreneurs, whether urban or rural, to create and operate an online store, as some digital platforms have made it relatively easy to manage an e-store – even by using just a smartphone.
Will South-east Asia’s tech giants turn to SPACs to boost post-pandemic growth?
– The vehicle is widely used to help tech start-ups go public
– Both Singapore’s and Indonesia’s exchanges are set to allow SPACs
– Several South-east Asian tech unicorns may use SPACs to list publicly
South-east Asia is seeing a wave of interest in special purpose acquisition companies, or SPACs, with various major tech players considering them as a means to fast-track public listings. In parallel to this, several exchanges in the region are moving to allow SPAC listings, with a view to boosting post-coronavirus growth.
SPACs are shell companies set up by investors and then listed on a given stock exchange. Their sole function is to acquire a private company, enabling it to go public without having to go through a traditional initial public offering (IPO).
A SPAC does nothing beyond its essential function – it neither produces nor sells anything, and a SPAC’s only assets are the funds raised from its own IPO.
Crucially, people who buy into a SPAC do not know what its eventual acquisition target or targets will be. This is why SPACs are often referred to as “blank cheque companies”: they give the founders a free rein to back their choice of private company. A key feature of SPACs is that they are often headed by big-name business executives or fund managers, who trade on past successes to inspire trust in investors.
While they are far from a novel phenomenon, SPACs have become a hot button topic in recent times: SPAC initial offerings quadrupled last year, with the vehicles raising a record $80bn.
Merging with a SPAC enables a company to go public and raise capital more quickly and painlessly than with a traditional IPO, circumventing some of the volatility that Covid-19 unleashed on global markets. At the same time, they function rather like venture capital, helping investors to buy into high-growth start-ups on the ground floor.
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