E-commerce creates a change in the global economy

E-commerce creates a change in the global economy

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Shatha Khalil *
E-commerce is part of economics and traditional commerce, and it has a close relationship to other sciences such as administration and law. It requires an administrative and regulatory environment that is suitable for its management and legal for the protection of its clients. E-commerce, or electronic commerce, is the transmission of funds or data through the internet to facilitate the purchase and sales of goods and services.
Economists confirm that the third industrial revolution focused on the software industry, the Internet and open satellite channels began with the advent of the computer. This has brought about tremendous developments in all areas of life, especially economic and commercial ones. The markets have been crowded with companies and multiple products, and competition has intensified among them then E-commerce emerged as a tool for modern commerce which has contributed significantly to changing the future of global business.
One of the advantages of e-commerce is that it provides time and effort, facilitates access to foreign markets, helps economic growth and improves exports and production. However, it presents a range of challenges, especially in terms of competition in local markets where the capabilities of supra-national and multinational companies may lead to the inability of national companies to compete it and continue in the markets .
Examples of global e-commerce markets include :
– The Amazon Market, founded by Jeff Bezos in Seattle, Washington, DC on July 5, 1994 he , is the world’s largest online retailer in terms of gross sales and market value.
The site began as an online library, then started selling DVDs, Blu-ray discs, CDs, download and broadcast video , MP3 download and broadcast, and the company is producing consumer electronics, the world’s largest provider of cloud infrastructure services.

– And the market of Alibaba Group Holding limited of China . it belongs to the Chinese private sector , the group was established in 1999 and headquartered in Hangzhou, People’s Republic of China, and its founder, Jack Ma, wanted to create an online portal called Ali Baba.com for business to link Chinese manufacturers and traders to the consumers and buyers from all over the world, earning most of its revenues from its business activities over the Internet , and then Jack Ma created aTaobai site similar to eBay’s website directed from consumer-to-consumer , one of the 20 most visited sites in the world with nearly a billion Product, and sites of Ali Baba Group Holdings represent more than 60% of parcels delivered to China.

Alipay site provides online secured payment service for almost half of all electronic payment transactions within China. Alibaba services represent the vast majority of these payments. The Group seeks to launch the Abel Dover service in the United States after an agreement can not be reached with Organizers in Hong Kong.
Alibaba entered the global gateway in 2014 after the company’s IPO was offered to investors on the New York Stock Exchange, raising about $ 25 billion, making it the largest IPO ever.
The group is the world’s largest e-commerce empire with annual sales of more than $ 170 billion and employing more than 22,000 employees in more than 70 cities around the world. The company is primarily facilitating e-commerce between individuals, companies and merchants globally and China.
Alibaba Group is responsible for more than 60% of packages delivered in China. The company accounts for about 80% of e-commerce in China. The electronic payment service “AliPay” accounts for almost half of all electronic transfers within China.
The company is a site where users can sell goods to each other, such as eBay site , and the number of products on the site is estimated at one billion products from 7 million users. Alibaba has also entered into lending. The Group provides small loans since three years ago ($ 8000) to the traders who use the site, giving it a huge amount of data that it can use to adopt its strategy, and it provided loans of $ 600 million in 2012.
Experts in e-commerce said that the sales of the group amounted to about 170 billion dollars a year, with a capital ranging from 120 to 180 billion dollars, pointing out that it exceeds the sales of the social networking site, “Facebook”, which is estimated at $ 15 billion, indicating the potential that is available to “Ali Papa, “.
Experts say the company is becoming the first e-commerce company in history with $ 1 trillion worth of buy-and-sell transactions, expecting huge growth opportunities in the future as hundreds of millions of Chinese people have not tried online shopping yet, and those are a big opportunity for Alibaba to attract them to this service. Analysts predict that China’s e-commerce market will be larger than current markets in the United States, Japan, Germany and France altogether by 2020.
The figures announced by the Alibaba website raise the surprise of all economists after the company’s business and its market value are doubled in 2017, which threatens to redraw the map of retail trade.
Jack Ma said in Davos, 2018, that the massive coups created by phrases like “Made in China” or “Made in the Philippines” would disappear in the future to be replaced by phrases like ” manufactured by Internet ” noting that most of clients are young customers who are drawing the future.
According to Alibaba data, observers are shocked by the fact that they have shipped more than one million postal packages per day in China alone, and sales in 2017 are over 750 billion dollars, equivalent to the GDP of dozens of countries of the medium size.
Its sales on November 11 each year, at the festival of annual cuts known as Singles Day, reach $ 25.4 billion to jump again to record highs, culminating the event as the world’s largest shopping festival.
According to official data, the average number of sales transactions for Alibaba in the festival was about 256 thousand per second, and that day’s sales were equivalent to the GDP of a country such as Afghanistan or Honduras in a year.
Today, it has been adopted in the circles of the competing trade platforms after being a Chinese , it was turned into the biggest shopping festival in the world over a 24- hour period that its revenues are surpassing sales recorded on black Friday and Monday of the Internet in America together and becoming an indicator of consumer trends in China, which has become the largest e-commerce marketplace in the world, and the fastest-growing online shopping area that includes all types of consumer spending.
The Boston Consulting Group predicts that spending on e-shopping will increase by 20 percent annually to $ 1.6 trillion by 2020, compared with a 6 percent growth in the regular market.

The impact of e-commerce on the following:
– Market structure:
E-commerce affects the structure of markets, whether goods or services, or the markets of production elements noting that the economic growth depends not only on the supply of production elements or on the increase in the supply of goods and services, but on how to take advantage of all these factors to achieve the highest possible revenue whether it was economic Or socially, depending on the optimal utilization of the available resources in the society and the nature of the market in which it is operating , which plays a crucial role in achieving the optimizing allocation of the resources , as the closer the market to full competition, the more it can be achieved ,and the e-commerce affects the structure of markets that it brings us closer to access to the market of full competition.

– Economic growth:
E-commerce affects economic variables and growth rates. It leads to higher wages, higher standards of living for individuals, structuring markets and expanding marketing, increasing sales and exports and thus increasing production and growth rates. The use of modern technological means of trade by states increases the strength of its economy and its growth, and this is beneficial to the social , health and education sectors , because of the use of modern technological means in the dealings, and iunder the electronic commerce , it is possible to develop production in accordance with its electronic nature , which increases sales, and Increases corporate profits.
E-commerce provides the right climate for the increase of production and efficiency by supporting the computer and software industries, the technological industry and other associated industries, such as electronic storage media, networks and communications, which are the infrastructure for e-commerce.
The spread of e-commerce requires more of these products, which increases its production. In particular, the use of electronic means in trade increases the level of management and organization within the institution and the development of its productivity activities, such as searching in the Internet for new sources of funding abroad and producing new types of Goods fit for the nature of e-commerce, which works to support the economies of countries.
– Exports:
E-commerce helps to increase foreign trade, especially exports, by facilitating access to global markets, making business deals easily and quickly without any administrative or commercial restrictions, responding to changes in consumer demand and marketing local products in these markets, increasing the exports of these countries.
E-commerce is increasing trade in services between countries. This sector accounts for 60% of the world’s total production. With the emergence of modern ICT, making the e-commerce to facilitate the process of convergence between consumers and producers and eliminates geographical distances.
– Investment:
E-commerce creates new investment opportunities, especially in the ICT sector, because they play an important role in the infrastructure of e-commerce. The spread of e-commerce requires increasing production in this sector and directing capital to invest in it to develop the infrastructure of e-commerce and then increase the investment in ICT sector which works to support the national economy.
– Capital Market:
E-commerce affects the capital market as capital flows are exchanged between surplus units, “savings” and “deficit” units “the investors”, through the issuance of long-term stocks and bonds, which plays a major role in stimulating investment and economic growth noting that the e0commerce increases the effectiveness of stock exchanges, where the contracts of purchase and sale of the securities traded in the stock exchange are concluded , and the possibility of obtaining information on these traded securities quickly, and the issuance of orders for the sale and purchase for brokers, all are done electronically, electronic commerce gives great flexibility through the availability of contracts or orders for sale or purchase, through e-mail or modern electronic means used in circulation, and provide quick information on the market for investors, noting that the brokers can not provide these information about securities traded in the market quickly in some times .
– Work’s strength
Most of the developing and developed countries suffer from unemployment problems and the lack of jobs that accommodate the labor force, and e-commerce can bring advantages to the national economy of the state in the field of employment in two ways:
• The first is that it is creating new opportunities for employment, by setting up small and medium-sized businesses and connecting them to the international markets at the lowest investment costs, especially the trade in services where e-commerce provides a mechanism for specialized individuals to provide their services at the regional and global levels without the need to move, tha matter that opens the space for them to work in free business.
• Second, e-commerce offers career opportunities in several areas related to e-commerce applications, such as specialists in e-commerce sites , employees, administrators and technicians in e-shops, as well as providing jobs in the ICT sector in which the e-commerce depends on of the engineers of Networks and software needed for e-commerce applications and others.
The use of e-commerce would lead to the removal of traditional jobs and the replacement of new jobs with a new skill, which required the training of workers to use technology so that they could enter the competition and win jobs.
This means that e-commerce negatively affects manual jobs and unqualified labor, but it has a positive impact on technically trained labor where it can easily find jobs and help to create job titles and disciplines that were not previously required or known.

E-commerce and the Arab States: E-commerce in the Arab countries suffers from weak marketing. If we compare the size of e-shopping in the Arab countries with what is spent on advertising in international sites, it is weak. However it is required from large Arab trade institutions and banks and business men and those who are interested in the trade to keep up with the development of commercial transactions.
So that e-commerce is a fundamental basis in its domestic, global and future business strategy. Although Arab countries are cautious and hesitant towards electronic commerce, unlike other countries, they are moving strongly to achieve giant steps towards economic growth.
We reach the conclusion that e-commerce helps to reduce the unemployment problem by providing new jobs, especially in the field of information and communications technology and the knowledge industry, and facilitates free individual businesses and small businesses, work at home, increase employment opportunities for the disabled , and increase work opportunities for woman at home without having to work outside, but it requires specialized and trained technical personnel capable of handling with its applications.

Economic unity

Rawabet Center for Research and Strategic Studies