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Our reporter Shi Yuanhao

In recent years, the e-commerce market in Latin America has shown a rapid growth trend. The "2023 Latin American E-commerce Report" released by the online payment platform "PayU" pointed out that driven by factors such as the popularization of the Internet and economic growth, Latin America has become one of the fastest growing regions in the world for e-commerce. "Digital Market Watch", a subsidiary of the data statistics website Statista, released a report stating that in 2023, the sales of the e-commerce market in Latin America exceeded US$117 billion, a year-on-year increase of 30%, and sales are expected to reach US$205 billion by 2028. Market research organization "Insider Intelligence" predicts that from 2024 to 2027, the sales of the e-commerce market in the region will continue to maintain double-digit growth.

Market potential continues to be released

The report of the United Nations Economic Commission for Latin America and the Caribbean pointed out that Brazil and Mexico are the main e-commerce markets in Latin America, accounting for 50%-60% of the market share in the region. Statista predicts that Brazil's retail e-commerce revenue will reach US$66.06 billion in 2028, and Mexico's e-commerce market revenue will reach US$64.97 billion in 2029. "Digital Market Observer" pointed out that Brazil and Mexico will continue to maintain their leading position in the growth of the Latin American e-commerce market.

In the first quarter of 2024, about 16% of Brazil's total retail sales came from online channels. According to data from the Brazilian E-Commerce Association, in 2023, Brazil's retail e-commerce revenue reached 185.7 billion reais (1 reais is about 1.31 yuan), the number of online consumers reached 87.8 million, the order volume was 395 million, and the average order amount was 470 reais, which was significantly higher than in 2022. According to the agency's forecast, in 2024, Brazil's retail e-commerce revenue will exceed 200 billion reais, and the number of online consumers will exceed 90 million.

According to statistics from the Mexican Online Sales Association, the country's e-commerce sales in 2023 will reach 658.3 billion Mexican pesos (1 RMB is approximately equal to 2.47 Mexican pesos), a year-on-year increase of 24.6%; the number of online consumers will reach 69.5 million, accounting for more than half of the total population. The international market research agency "Research and Markets" predicts that the compound annual growth rate of Mexico's e-commerce market transaction volume is expected to be 7.53% from 2024 to 2028. Among them, beauty and personal care products and consumer electronics are the fastest growing business-to-consumer e-commerce market segments.

The e-commerce markets in other Latin American countries have also achieved varying degrees of growth. According to data released by the Colombian E-Commerce Chamber of Commerce, the country's e-commerce industry will grow by about 12% in 2023 and is expected to grow by 17% in 2024. Maria Fernanda, president of the chamber, said that e-commerce accounts for 2.5% of the country's total retail sales, a significant increase from 1% before the COVID-19 pandemic. A report released by Uruguayan e-commerce platform "Fenicio" showed that Uruguayan e-commerce sales in 2023 exceeded the highest level before the pandemic. Marcos Puerredon, dean of the Uruguayan E-Commerce Academy, said that Uruguay's e-commerce has developed rapidly in recent years, with more than 50% of the population choosing online shopping, of which cross-border e-commerce trade accounts for more than 40% of the market share.

PayU's report pointed out that there are currently about 300 million online consumers in Latin America, and this number may grow by more than 20% by 2027. Federico Balig, the company's Latin American CEO, said that despite short-term economic pressures such as inflation, with the continuous development of e-commerce and the expansion of e-commerce consumer groups, the potential of the e-commerce market in Latin America will continue to be released.

Increased policy support

With the popularity of digital payment methods, the development of social media and changes in consumer behavior, the development of e-commerce in Latin America has shown some new characteristics. Latin American countries have adjusted policies in a timely manner, actively improved industry infrastructure, and promoted the development of the e-commerce market.

According to the Brazilian e-commerce overview report released by a Brazilian company called Big Data, the number of online stores in Brazil will increase by 16.5% to 1.9 million in 2023. The report pointed out that 65.6% of retailers have accepted digital wallets as a payment method, and about three-quarters of online merchants use social media to advertise their own brands. Toran Rodriguez, the company's CEO, said that the e-commerce industry can provide consumers in different regions with a variety of products, services and payment methods, and Brazil's e-commerce market is becoming more and more diversified.

The Mexican Online Sales Association recently summarized the country's e-commerce trends in 2023. Among them, the growth of long-term subscription goods and services, the use of virtual reality technology to improve shopping experience, live streaming interactive sales, social media video marketing, etc. have become new features of the country's e-commerce development. The association pointed out that the new trend of e-commerce development has effectively increased consumers' participation in online shopping by borrowing new technologies, new platforms and new methods.

Latin American countries are actively promoting more companies to participate in the e-commerce market. Chile proposed the "Chile 2035 Digital Transformation Strategy" in 2022. In addition to accelerating the deployment of 5G networks and increasing Internet coverage, the Chilean government has included the promotion of digital transformation of the production sector as a goal, and promoted companies to accelerate the development of e-commerce business through the development of digital inclusive finance. Carlos Sublet, head of the Santiago Chamber of Commerce in Chile, believes that the emergence of new technologies such as machine learning, visual recognition, creative and generative artificial intelligence has prompted relevant practitioners to constantly adapt to the new situation and increase the application of new technologies in e-commerce.

Colombia's e-commerce chamber said one of the key challenges to the growth of the country's e-commerce industry is the digitization of small and medium-sized enterprises, which is a costly and time-consuming process. Currently, the chamber is implementing a series of programs for small and medium-sized enterprises, providing them with digital platforms, and working with large Internet companies to provide training and guidance for small and medium-sized enterprises.

China-Latin America cooperation continues to deepen

In recent years, more and more Chinese companies have entered the e-commerce market in Latin America and launched mutually beneficial cooperation with Latin American countries in related industries such as logistics, e-commerce platforms, and digital infrastructure, allowing more and more local consumers to enjoy benefits and convenience.

In Panama, COSCO SHIPPING has established an overseas warehouse in the Colon Free Trade Zone through the "sea transportation + overseas warehouse" model, providing customers with a "one-stop" logistics service integrating sea transportation, land transportation, warehousing, customs declaration, etc. After Latin American customers place an order, the overseas warehouse can respond quickly, greatly shortening the logistics time from China to Latin America.

In order to meet the needs of growth, Sao Paulo Guarulhos International Airport, Brazil's main cross-border e-commerce logistics distribution center, began to expand the airport warehouse last year. Chinese company Anjun Logistics is one of the companies that settled in the new warehouse. According to reports, in 2023, Anjun Logistics will handle about 300,000 to 380,000 inbound parcels per day, accounting for more than 1/3 of the total inbound parcels in Brazil. Fang Ke, founder and general manager of Anjun Logistics, told our reporter that in addition to strengthening infrastructure investment in entry port operations, the company has also improved its on-site delivery capabilities for local Brazilian e-commerce platforms, and has currently achieved local delivery services in many eastern states.

Chinese companies are actively helping to improve the level of digitalization in Latin America. In Chile, the Presidential Secretariat signed a memorandum of understanding with Huawei Chile last year, committed to cooperating in digital education and other areas, cultivating digital talents, and improving people's skills in using digital tools; in Mexico, the social media platform TikTok signed a cooperation agreement with the Mexico City Economic Development Department last year, committed to providing training for 33,000 companies to promote the transformation of local small and medium-sized enterprises to e-commerce and digital marketing.

"Latin America has great potential for the development of e-commerce. China is at the forefront of the world in e-commerce logistics, digital economy, and intelligent infrastructure construction. Cooperation between the two sides in related fields can achieve more win-win results." Claudia Iannucci, president of the Brazil China Innovation Economy Research Institute, said in an interview with our reporter that Latin America still faces challenges such as insufficient infrastructure, technology and investment in the development of the e-commerce economy, and needs to further strengthen cooperation with Chinese companies.

(Rio de Janeiro, July 22)

People's Daily (17th edition, July 23, 2024)