A Beneficial Exploration of How E-commerce Drives Agricultural Supply-Side Reform

Some things only gradually reveal their value after they have been done. At a time when reform is still being carried out by feeling for stones while crossing the river, rural e-commerce, as a new thing, likewise faces a situation with no precedent to follow, and can only plunge in hastily, groping for stones to move forward. And being able to grope out a few "stones" first in the field of rural e-commerce against such a backdrop makes it all the more precious, and Lishui in Zhejiang is one of them.

Upon first entering the ranks of rural e-commerce, the first case I heard of was Lishui, and for the first time I learned that Suichang is a county in Zhejiang rather than in Sichuan as I had imagined (Sichuan has Suining), and only then did I learn that in the mountain valleys of Jinyun County there is a resounding "Beishan Wolf" brand, and afterward I also came to know such leading figures in rural e-commerce as Pan Dongming and Wang Junlong. When I accompanied the Shaanxi CPPCC delegation to Zhejiang in January 2015 for an official inspection of e-commerce, I finally had a "physical" encounter with Lishui's rural "virtual" economy, and the impression kept deepening. Today I read "Internet Plus Green Mountains and Clear Waters: An Analysis of the 'Lishui Phenomenon' in Rural E-commerce," and the image of Lishui's rural e-commerce in my mind has become even clearer.

To give an overview of Lishui's rural e-commerce, I absolutely have no authority to speak, while Mr. Wang Xiangdong, the doyen of rural e-commerce who has visited Zhejiang many times, is far more qualified; the preface he wrote for this book can be said to highly distill the essence of the "Lishui Phenomenon," namely that as a case, it will not let you "take it all in at a glance," but always makes you feel "unable to stop"; and the core of the logic behind the case's success is just one thing, the "service mechanism jointly built by the government and the market." So I want to combine my own experience and, on the basis of Teacher Wang's summary, extend it a little further.

What attracts me most about the Lishui rural e-commerce case is the mechanism. The first time I looked at the Lishui case, I remembered that rural e-commerce service institution that outsiders see as "neither fish nor fowl": it is a government institution, yet it is operated by an enterprise; its supervisor is the Lishui Municipal Committee of the Communist Youth League, while its director is the boss of Zhejiang Weixun Company, and its staff are volunteers from the Youth League Committee plus employees of Weixun Company; its operation is also incorporated into the government's assessment, but the content of the assessment is limited to only part of the government's purchased services, and the operating enterprise is even allowed to use this government signboard to solicit business externally. Judged by conventional standards, such an institution could be considered an oddity, yet it is efficient. The development of rural e-commerce absolutely does not require the government to attend to everything personally; it only requires the government to build the roads well, not set up checkpoints, and if it can also ignite the fire and add fuel, so much the better. Obviously, Lishui's mechanism may not look pretty, but it is absolutely effective, which is exactly what Lishui Vice Mayor Lin Liang says in the book: it has "explored a set of pragmatic and effective mechanisms for rural e-commerce development," with "the commerce department leading, the Communist Youth League giving the main push, platforms providing support, and the integration of the two (socialization and marketization)" - this is the core of the "Lishui experience." When I lectured at the Taobao University county-level e-commerce county magistrate seminar, I gave the "Lishui experience" a vivid name - the Parasol Tree Project works wonders; what the government does is plant the parasol tree well so that the phoenix comes flying.

Looking back again at the practice of rural e-commerce in recent years, the most crucial lesson among them is "putting new wine into old bottles." What is clearly a matter of the Internet age is often handled according to traditional routines: when it is said that leadership should be strengthened, it often means setting up an institution; when it is said that efforts should be increased, it often means nothing more than listing a few more special funds; and if you add attaching great importance to it, then it means the top leader personally supervising the battle. But how exactly should it be done? That is unclear. The greatness of strategy can never replace the ingenuity of tactics; no matter how grand the plan, there must always be meticulous measures to implement it. Thus a tragic thing appears: the e-commerce offices set up in various places are mostly just an added functional department, and the specific staff are mostly temporarily seconded; with such a team, how can they guide and promote a locality's rural e-commerce? Not to mention that the methods in concrete work are outdated; in some places, when a little funding is given to e-commerce enterprises, it even reaches the point where the design of a company's "logo" must also be approved, and while services are seriously inadequate, the degree of management has seriously overstepped. Why does rural e-commerce in some places "get half the result with twice the effort"? A poor mechanism is one of the most important reasons.

What I envy most about the Lishui rural e-commerce case is the talent. If Suichang had not had Pan Dongming return from Shanghai, if "Beishan Wolf" had not had Lu Zhenhong taking the lead personally, if the Lishui Rural E-commerce Service Center had not had a group of people like Wang Junlong, then whether Lishui's rural e-commerce could still be as prosperous as it is today seems doubtful. And if from this we look further to the practice of rural e-commerce across the country, then behind every successful rural e-commerce case there is also a leading figure walking at the front. In the classic "out of nothing" Taobao village case of Shaji in Jiangsu, without the return of Sun Han and the other "three musketeers"; if Liu Wengao had not actively promoted Yiwu's Qingyanliu Village; if Wang Xiaobang, Zhao Hailing, Du Qianli, and others had not returned to the mountainous areas to pioneer agricultural product e-commerce, our rural e-commerce situation today would be unimaginable. It can certainly be said that the times create heroes, but it must also be said that only with heroes can splendor be written.

So, looking back again at today's rural e-commerce development, whether a locality's rural e-commerce can develop depends crucially on whether one or two leading figures return. As the saying goes, a thousand soldiers are easy to get, but one general is hard to find. The predicament of rural e-commerce in many places is in fact a predicament of talent: leaders do not understand it, departments do not know how to do it, and there is no one who knows how to do it, so how can it rise? Some places do not fail to value talent, but behind moving people with emotion and persuading them with reason, what matters more is whether a soil for talent growth has been created; otherwise, no matter how good the sapling, it cannot grow into a towering tree. Moreover, we must also see that in the current cases, almost all the talent is local, so the idea of bringing in a few talents to achieve a complete transformation of the rural e-commerce situation, as if attracting investment, must also be treated cautiously, as it may even produce a negative effect like "bringing in a son-in-law and infuriating the son." Rural Taobao's timely upgrade to version 2.0 has a core concept of the return of rural talent.

What makes me sigh most about the Lishui rural e-commerce case is the thinking. In the spring of 2015, "Internet Plus" once became a hot concept, and for a time became a big basket into which everything was wanted to be put. At this time, Alibaba President Jin Jianhang promptly gave a speech, clearly stating that the Internet can be added to anything, except it cannot be added to traditional thinking. Why is it that when doing the same rural e-commerce, the actual results differ greatly? There are reasons of objective conditions, but there are even more subjective reasons, and the way of thinking is an important factor. That Lishui's rural e-commerce has come this far, the innovation in development thinking absolutely deserves praise. It is precisely because of innovative thinking that it was possible to put forward the slogan of "replacing the market with e-commerce," while some places are still worried that e-commerce affects the real economy; it is precisely because of innovative thinking that new mechanisms and new models could emerge, while some places are still holding old boat tickets and waiting to board a new boat.

Now, in order to promote e-commerce, some places have produced a batch of e-commerce Party secretaries and e-commerce county magistrates; this is a good thing, but it absolutely cannot become the new normal. E-commerce is in essence still a matter for market entities; the government's raising its arms and shouting can only be a special state in the early stage of development, just as the plum blossom, when all flowers are silent, blooms first and draws a hundred flowers to bloom together; and once the flowers are in full bloom, the government needs to "smile among them." From the current situation, it is precisely in the e-commerce-developed coastal areas of Jiangsu and Zhejiang that the frequency of e-commerce county magistrates appearing is somewhat lower, while the corresponding opposite is in regions where e-commerce development lags behind. Therefore, when I speak of the top-level design of county-level e-commerce, I also hold that top-level design is absolutely not for showing the county magistrate's brilliance, but is entirely based on the needs of e-commerce development.

From this, I cannot help thinking of a very hot term recently - supply-side reform. What is supply-side reform? In a word, the government can no longer, as in the past, put all its effort into stimulating demand, but must instead reflect on the problem of insufficient effective supply, using new supply to spawn new demand; it should be neither a "Keynesian" who takes everything on itself, nor a liberal who leaves everything to market competition, but should work hard on institutional innovation, improving infrastructure, and unleashing the vitality of talent. Then do not the rural e-commerce development cases of recent years precisely confirm the concept of supply-side reform? Through the government's "creating a fishing ground," allowing platforms, talent, enterprises, and all other forces to "leap like fish in the broad sea and fly like birds in the high sky" in the vast space of rural e-commerce - is this not the most ideal state?