New Trends in Cross-Border E-commerce in 2025: The Rise of High-End and Virtual Products

This year’s State Council Government Work Report proposed promoting the development of cross-border e-commerce, improving the cross-border delivery and logistics system, and strengthening the construction of overseas warehouses. This marks the 12th consecutive year that cross-border e-commerce has been included in the State Council Government Work Report, highlighting the importance attached to this new driver of foreign trade growth. Against the backdrop of a generally slow global economic recovery, cross-border e-commerce has maintained a generally good growth trend, becoming an important driving force for economic growth not only in my country but also in many other countries. On March 27th, the “Cross-border E-commerce Cooperation: A New Driver of Mutually Beneficial Trade” sub-forum of the 2025 Boao Forum for Asia Annual Conference was held in Hainan. Industry representatives from various countries shared their observations on the development trends of cross-border e-commerce in their own countries and globally, and offered suggestions on the challenges faced by cross-border e-commerce in areas such as market access, data flow, and regulatory policies against the backdrop of its booming development. At the forum, Jiang Xiaojuan, professor at the University of Chinese Academy of Social Sciences and former Deputy Secretary-General of the State Council, stated that cross-border e-commerce is developing rapidly in the field of international trade, which is closely related to the changes in people’s shopping habits in various countries during the pandemic, as well as the popularization and development of technologies such as artificial intelligence and big data algorithms. Two trends are clear: the growth rate of cross-border e-commerce is faster than that of general trade, and the proportion of cross-border e-commerce in international trade is constantly rising. In 2024, the global market size of cross-border e-commerce may reach as high as $4 trillion. Jiang Xiaojuan pointed out that with technological development and the gradual improvement of supporting infrastructure, cross-border e-commerce will become a very powerful new growth model in international trade in the future. According to her understanding, the market share of buyers under 35 years old is growing fastest in the global cross-border e-commerce sector. The younger generation is accustomed to shopping in fragmented time and using their mobile phones, a new trend that has led to very high expectations for expansion in overseas markets and the youth market. PayPal’s Senior Vice President and CEO of China, Qiu Han, stated that PayPal entered the Chinese market decades ago and has witnessed the development of China’s cross-border trade. Currently, she observes three important changes. First, Chinese products are becoming more high-end and specialized. Previously, foreign countries categorized Chinese products as “general goods,” meaning highly homogenized, generic standard products. In recent years, more and more Chinese merchants have begun to emphasize unique design and functionality, resulting in a general improvement in service levels and product quality. This view has subsequently been confirmed. After the meeting, a cross-border e-commerce seller service provider stated that with the early dividends gradually disappearing and “price wars” sweeping the entire industry, cross-border e-commerce’s strategy of “price wars” has no future. The new focus should be on enhancing product added value, including optimizing product design, quality, and customer service levels, so that “people don’t perceive it as cheap when they know it’s made in China.” The second change mentioned by Qiu Han is the continuous expansion of the cross-border e-commerce market, becoming more international and diversified. With improved capabilities, the reach of the Chinese e-commerce market has significantly expanded, with in-depth development in Europe, the Middle East, and South America. “This is also largely thanks to the support of AI technology, because it’s difficult for one person to master thirty or forty languages and understand the customs and cultures of thirty or forty different places.” Thirdly, the growth of virtual products going global is significant. Previously, Chinese e-commerce mainly sold physical products, but in recent years, virtual products have grown very rapidly, almost accounting for half of cross-border products, including games, online novels, short dramas, and frequently producing phenomenal products such as *Black Myth: Wukong* and DeepSeek. She stated that the consumption of consumer goods is usually capped; for example, one person might only need one table, but virtual products do not have such limitations. Where are the future “blue oceans” in cross-border e-commerce? For newly entering small and medium-sized sellers, Southeast Asia or the African market may be the first choice. The European and American markets have matured after years of development, and choosing developing or less developed regions as entry points results in relatively lower initial costs and less competition. However, these “blue ocean” regions also have prominent problems such as incomplete supply chains and underdeveloped infrastructure. Taking logistics as an example, express delivery is more prone to lost or missing packages, and the division of responsibility is not very clear. Data from China’s Ministry of Commerce in June 2024 shows that China has over 120,000 cross-border e-commerce entities, over 1,000 cross-border e-commerce industrial parks, and over 2,500 overseas warehouses, creating a widespread boom. Christine Holgate, CEO of Global Express, provided data from the perspective of Sino-Australian trade cooperation, stating that China is one of Australia’s closest trading partners. On the import side, imports from China increased by 30% in the past year and 45% in the past two years; on the export side, China accounts for about one-third of Australia’s total exports. Trade with China accounts for 15% of Australia’s GDP. Jiang Xiaojuan stated that from a global perspective, cross-border e-commerce is currently in a relatively favorable policy environment, but it also faces many challenges. One is that the large-scale export of low-priced, high-quality products to other countries, while benefiting local consumers, inevitably impacts small and medium-sized enterprises (SMEs). In her view, a major future development trend is that various countries will selectively export products with their own national characteristics to other countries. Another prominent challenge comes from the administrative level. Jiang Xiaojuan mentioned that some countries suffer from inadequate customs infrastructure, and the ever-increasing volume of imported goods has placed immense pressure on customs officials, even becoming a major obstacle to the development of cross-border e-commerce in these countries. In contrast, China boasts a highly efficient electronic “one-stop” customs service, and its high clearance efficiency is a crucial element in ensuring the quality of cross-border e-commerce services. Chea Sire, Governor of the National Bank of Cambodia, frankly stated that for developing countries like Cambodia, the development of e-commerce will inevitably “kill” some small and medium-sized enterprises (SMEs). Therefore, policymakers in various countries need to provide support, such as accelerating the electronicization of customs operations to improve clearance efficiency; establishing a cross-border after-sales service system, optimizing complaint feedback mechanisms, and improving the shopping experience for domestic users; and in terms of payment, she suggested establishing an end-to-end cross-border payment system. Meanwhile, Zhou Rui, Chairman of the French Bridge Think Tank, also proposed introducing blockchain technology into the cross-border payment system. China’s cross-border e-commerce development is at the forefront, and it adheres to the principles of innovation-driven development and mutual benefit, actively sharing its experience and development dividends with other countries. In her address, Li Yongzhe, Deputy Representative for International Trade Negotiations at the Ministry of Commerce, mentioned that in recent years, China has actively participated in international exchanges and cooperation, promoting cooperation on e-commerce issues through mechanisms such as BRICS; pushing the WTO to complete negotiations on an e-commerce agreement; adding relevant e-commerce chapters to the RCEP (Regional Comprehensive Economic Partnership Agreement); and signing e-commerce cooperation memorandums of understanding with more than 30 countries. Regarding talent cultivation and technical support, my country has participated in South-South cooperation, providing offline training to nearly 2,000 trainees from more than 90 countries; and established the Silk Road E-commerce Cooperation Research Center, training more than 5,000 foreign officials. Furthermore, China has created a cross-border e-commerce retail bonded warehousing import model, exempting import duties, allowing more high-quality overseas goods to conveniently enter China through cross-border e-commerce.