The phenomenon of "Taobao villages"

China is not only an industrial and economic boom and rapid urbanization. It is also a multimillion-dollar population living in rural areas below the poverty line. It was among such Chinese villages that the phenomenon of settlements arose, the economy of which depends entirely on the production of goods sold by the largest Chinese online stores. This phenomenon is called " Taobao villages ." Under the cut is a story about how and how modern Chinese rednecks live. If everything is fine with English, you can read the original text here.. Of course, I would like to talk about something similar from Russian reality, but so far only Gus-Khrustalny, Gzhel and other legends of antiquity are recalled. Mention of the villages of Ozone, Yulmart and Wikimart I have not yet met. If you know about something like that, flag in the comments. Let's go!

Dangji, a conglomerate of villages on the dusty plains of central China, is unlikely to be one of the country's leading e-commerce hubs.



The first word that locals use to describe their district is "remote." A few years ago, you would have had to drive to the district center, located just 15 km away, because of bad roads. But few people cared: anyway, no one had money for a car. In addition, in the village, as in many other rural areas of China, there were few residents of working age. Many went to seasonal work on the coast. Hejze Administrative Center, whose jurisdiction includes Danji, was described in one magazine article of those years as "a synonym for economic backwardness, an unwanted child of Shandong province."

When comrade Su Yongzhong was transferred from Hejie and appointed Danji's party secretary in 2013, even he was surprised at the poverty that prevailed here. Two villages that were part of the village were considered the poorest in the entire province. In the cities in the neighborhood there were at least one or two small factories, and in Danji there was nothing at all.



Today, the village and the surrounding area are one of the main places for the production of specific products - acting and dance costumes. Half of the 45 thousandth population of the village is engaged in the manufacture or sale of all kinds of costumes, from movie costumes to cute versions of snakes, crocodiles and monkeys. Products are sold through the largest Chinese online store Taobao, owned by Alibaba Corporation.

In 2016, Danji himself sold suits worth 1.8 billion yuan ($ 26.2 million). And the entire district, according to some estimates, sold about three times more. This is about 70% of the costume market on Taobao. In the village of Jinlu, which began the development of the e-commerce industry, 280 out of 30 households are engaged in trading on Taobao. The rest simply cannot work for one reason or another.



Today, the establishment of “Taobao villages” is one of the priority areas in the national rural development and poverty eradication policy. Vice Prime Minister Zhang Gaoli, a former party secretary in Shandong Province and one of China’s most influential officials, visited Danji at the end of 2015 and noted the village’s contribution to poverty alleviation.



In November 2016, the State Committee on Poverty Alleviation, together with 16 ministries, issued recommendations on the massive development of e-commerce in rural areas.

By 2020, seedy districts should quadruple their sales. Across the street, in front of a group of private factories, there is a building on which it says in big red letters:

“Thanks to Taobao, you can get your life organized. E-commerce paves the way for happiness. ”



Chinese President Xi Jinping promised to rid the country of poverty by 2020, putting his reputation on what will involve everyone in the construction of a “moderately prosperous society.” According to official statistics, today in China there are about 50 million people below the poverty line. This amount is calculated on the basis of a minimum income of 2,300 yuan at 2010 prices (today about 3,000 yuan = 24,980 rubles). Officials hope to raise the minimum income to 4,000 yuan (33,300 rubles) by 2020.

Fast growing city

The small hangar-like factory of Ding Peilin is located on the edge of its land in the village of Dinglou. It faces the newly paved road. In one room, a pair of middle-aged women ironing costumes of military nurses from the Second World War. They are intended for a historical film dedicated to the struggle of the Chinese against Japanese occupation. Previously, women were engaged in the cultivation of their land nearby. And now they have found a better job and much closer to home.



Most adult residents never left their village. Ding, a thin man of about 60, with big glasses, graduated from high school and became a teacher. He taught math, writing, and literature, but his salary was very low. After 13 years of work as a teacher, in the mid-1980s, he found himself another occupation. An artist from a neighboring village painted background paintings for photo shoots, but was too busy to sell them. Dinh and his cousin began to go home and offered backgrounds. Then he gradually switched to costumes for photography, and then to costumes for performances. There were more buyers in this area. Around 2013, only Dinh and several other households were engaged in some kind of business besides subsistence farming.

New party secretary Xu Yongjun saw an opportunity for development. The roads were too bad for truck deliveries, so he took the initiative. Comrade Xu asked other local officials for help, and they jointly put the roads in order. They laid fiber - “the Internet is faster than in Shanghai” - and then Xu wrote an open letter in which he invited college graduates and labor migrants who left for the cities to return back to the village.



As part of the state poverty alleviation program, the village administration sponsored training for residents of e-commerce and clothing production, offered low-interest loans, and encouraged successful businessmen to hire the poorest of local residents. According to a study by Alibaba, in less than four years, 6,300 people from Danji and the county have officially ceased to be considered poor due to online trading.



Alibaba claims that today 18 villages across the country, previously below the poverty line, today annually sell goods worth 10 million yuan ($ 1.45 million) in total. The total turnover of another 200 villages considered poor was close to this value, according to the increased value of the minimum income. The villages of Piny County, Hebei Province, a few hundred kilometers north of Danji, were also officially considered poor.

Today , children's bicycles are mass produced there . In a village in the southwest of Yunnan, representatives of the Bai minority sell handmade silverware , and in 2015 they sold 19 million yuan worth of goods through Taobao.

Thanks to Xu's efforts, the Danji village flourished, raising its status among locals to incredible heights. Xu insists that this experience can be applied anywhere. “In each locality you can produce some unique goods. The main thing is to give the opportunity to sell them online. "

“Moderately successful”

It is well known that it is thanks to China's economic development over the past 30 years that the global poverty level has significantly decreased. They understand this in China. The former deputy chairman of the Communist Party of China's Rural Development Working Group said in 2016:

“If by 2020 we still have many inhabitants below the poverty line, this will reduce the quality of life of a moderately prosperous society.” Our citizens and the international community will doubt us. If we can raise the level of well-being to the target level by 2020, this will demonstrate to the whole world the leading role of the party and the advantages of Chinese socialism.



The designated deadline is only a few years old. In 2016, the central government increased anti-poverty spending by 43%, to more than 66 billion yuan. Provincial administrations added another 40 billion. In 2013, a national campaign against poverty began, as part of which systematic work was begun to identify areas below the poverty line and the development of targeted programs for their economic development.

At the end of 2016, a five-year development plan was adopted prescribing the targeted development of 128,000 villages officially recognized as the poorest. The responsibility of the central and local apparatuses for reducing poverty is envisaged, to which an assessment of the performance of officials has been tied.

Alibaba also offered help. Today she offers rural areasfour development programs . The main emphasis is on the central and western regions of the country, where Alibaba invested 10 billion yuan in the construction of 100,000 Taobao service centers, the development of logistics infrastructure and the training of local residents in the wisdom of speeding up Taobao market entry. The central government has signed an agreement with Alibaba and Jingdong to create another platform for the development of electronic commerce in poor areas of the country.

In 2010, Ant Financial , the financial division of Alibaba, launched a small business microfinance program. And over the past years, Ant Financial has issued loans in the amount of four times more than Grameen Bank for 39 years.

Brain drain reversal

Despite local optimism and a high level of government support, many areas mired in poverty are struggling to fit into the e-commerce boom. According to some observers, Danji had an advantage - the village is located on a plain where you can easily build roads and the necessary infrastructure.



In many areas of China, economic growth is hampered by remoteness of settlements and mountainous features. According to Alibaba, of the more than 1,000 Taobao villages, only 25 are located in remote areas. Somewhere it is possible to figure out how to create a distribution and logistics system despite the difficult climate and landscape, but in most cases even a high level of support does not help.

Today, China is making great efforts to transform villages from poor settlements into production centers at the national level. But to successfully solve this problem, coordination of actions at all levels of the bureaucracy and business will be required.

An important problem is the outflow of the able-bodied population from poor areas, which reduces the already meager economic base. The development potential of the districts does not depend on the quantity, but on the quality of the population.

Today, China is experiencing a boom in industrial development in rural areas. Community-based village and village enterprises provided employment growth, received support from local administrations, and in the 1980s and early 1990s, the level of consumer demand was so low that they managed to earn huge profits and create millions of jobs. It was thanks to communal enterprises at that time that partly managed to stop the "brain drain" from rural areas to industrial ones.

Xu wrote his open letter inviting Danjing to labor migrants and college graduates in 2015. It was an additional incentive: since the beginning of the Taobao boom, about 5,000 people have returned from cities, including hundreds of college graduates. But the village still needs skilled workers. “All returning college graduates have been successful, now we need to expand.”

Dinh Peyyu offers yesterday’s students from neighboring districts and cities shelter and food. Prepared several computers. But it’s not so easy to attract people to the village. In the hottest months of sales, the largest enterprises in the village are overloaded with orders and transfer part of them to enterprises in other provinces. This is a difficult, but enviable problem, the occurrence of which no one could have imagined a few years ago.

With sales growth, residents begin to make plans to expand their businesses. A third industrial park will soon be laid in the village for production facilities and sales offices. Today, Danji begins to sell costumes abroad: to Malaysia, Vietnam and other countries of Southeast Asia. The plans are to improve product quality in order to become competitive in the European and American markets.



Z.Y. In conclusion, I would like to express the hope that something similar will become possible in our country. Against the background of the increasing penetration of high-speed Internet in the regions and the growing popularity of platforms and formats based on electronic commerce, the appearance of high-tech villages Ozon, Tinkoff, Yulmart or Exist in Russia is not ruled out.