Alibaba seals deal for 10% of SingPost

This week, Alibaba also announced it had struck a deal with Australia Post to help more Western merchants sell to Chinese consumers through Alibaba's Tmall.com, China's No 1 business-to-customer platform. The deal is expected to speed up package deliveries for Chinese customers who purchase overseas products on Tmall.com.

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It is clear that Alibaba has been moving quickly in terms of internationalization. The group, which is heading to one of the largest initial public offerings ever seen in the United States, signed an agreement with the French government about a week ago to boost that country's exports to China via its e-commerce platforms.

A similar deal was signed between Alibaba and UK Trade & Investment in December last year to help promote made-in-Britain merchandise among China's increasingly wealthy online shoppers.

However, rather than helping Chinese online shoppers to buy from the Singapore market, the investment into SingPost is likely to boost only Chinese exports to the Southeast Asia market, Lu said.

"It is not easy to attract Western buyers to make purchases in China through Alibaba's e-commerce platform given the difference in language and culture, among others. But most of the population of Singapore is Chinese, so the investment into SingPost can help Alibaba to actually gain some solid market share in e-commerce markets outside China," he said.

The Asia-Pacific region is becoming the largest regional e-commerce market in the world, with online transactions expected to hit more than $1 trillion by 2020, according to eMarketer.

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