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China Post will provide delivery services and online payment support to e-commerce giant Alibaba.com.

 

Within a framework agreement the express mail service (EMS) under China's largest deliverer would be recommended by Alibaba's on-line payment platform Alipay to its customers.

 

Alibaba president Ma Yun said the cooperation would assist solve the problem of delivery that's causing bottlenecks in the country's burgeoning e-commerce business.

 

Most commodities traded on-line in China are delivered by regular mail, small and medium-sized express companies or by standard EMS which are either too slow or too costly especially for long-distance deals.

 

China Post will develop a special EMS, 40 percent cheaper than the standard service, for on-line traders at Taobao.com, an Alibaba subsidiary and the country's most popular consumer-to-consumer marketplace, said director Yuan Guoli of the China Post's delivery bureau, without revealing details.

 

The "special EMS” will be piloted in Hangzhou, capital of the southern Zhejiang Province, at the end of the year before being expanded nationwide in 2007.

 

Industry insiders say the strategic partnership could reduce the costs of delivery through large-scale negotiation and prevent e-commerce fraud as the EMS would check the delivered commodities.

 

And online buyers can remit the payments through post bureaus to their Alipay accounts instead of solely relying on bank cards as they do now, according to the agreement.

 

The agreement follows moves by the China Post to set up an online bookstore and philatelic center at Taobao.com and a simultaneous issue of greeting cards and special stamps for the New Year on the website and at the bureau's outlets on November 1.

 

Founded in 2003 with an investment of 450 million yuan (US$56.25 million) Taobao.com has six million registered users.

 

By June 30 about a quarter of China's 123 million Internet users were regularly engaged in on-line shopping, 50 percent more than the same time last year, according to the China Internet Network Information Center.

 

(Xinhua News Agency November 24, 2006)