Amazon in Shanghai e-commerce pact

amazon parcel US ecommerce giant Amazon is boosting its presence in China

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Amazon has stepped up its presence in China with a strategic partnership with the Shanghai Free Trade Zone (FTZ).

Amazon's branch in China has signed a memorandum of understanding (MOU) with the Shanghai FTZ and Shanghai Information Investment Limited (SII).

The deal paves the way for Amazon to bring millions of its e-commerce product offerings from around the world directly to Chinese customers.

It comes as Amazon celebrates 10 years of operations in China.

Amazon has declined to comment on how much it will spend to set up business in the Shanghai FTZ.

In a statement emailed to the BBC, Doug Gurr, president for Amazon China said: "We seek to be the most customer-obsessed on-line shopping platform with vast selections, competitive price and most convenience in China.

"Today's partnership announcement with FTZ and SII will help Amazon further realise our vision."

Under the pact, Amazon will open its new cross-border e-commerce platform in the free trade zone.

The online retailer will also establish a logistics and warehouse centre in the FTZ, whereby imported goods will enter China via the zone's cross-border e-commerce platform.

Also as part of the deal, products from small and medium-sized enterprises in China can be sold to Amazon customers across the world.

China's e-commerce market is heavily dominated by home-grown names Alibaba and JD.com.

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Sign reading "China (Shanghai) Pilot Free Trade Zone"
Shanghai Free Trade Zone
  • Established in September 2013
  • FTZ covers an area of 29 sq km (11 sq miles)
  • Restrictions on foreign investment will be eased inside the area
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Future growth?

The partnership comes as Amazon looks to diversify its revenue source.

The company posted a loss in the second quarter, which amounted to $126m (£76m), partly due to higher costs associated with developing digital content including computer games and TV shows.

Amazon has said producing its own TV shows would cost $100m in the third quarter.

The US firm has also been spending money on improving its delivery systems which includes expanding Sunday delivery to 18 cities in the United States.

And it continues to look to Asia for growth opportunities too.

Last month Amazon said it will invest a further $2bn (£1.2bn) to boost its operations in India.

India's total e-commerce market was worth $13bn in 2013.

But online travel accounted for more than 70% of the transactions.

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