Alibaba Group Holding Limited (NYSE:BABA) Q4 2019 Earnings Conference Call Transcript
May 15, 2019 • 07:30 am ET
we have the reach and deep insights on over 650 million active Chinese consumers on our platform. The scale and effectiveness of our access to Chinese consumers is simply unrivaled.
In cross-border commerce our team, our Tmall Global platform is China's number one platform for overseas brands and merchants to sell to Chinese consumers directly without physical operations in China. Well established global retailers and brands that have built an online presence on Tmall Global include nutritional supplement vendors Chemist Warehouse and Blackmores; baby products brand, Pampers; and apparels brand, Emporio Armani.
Second, the trade negotiations will lead to China opening its markets to more foreign businesses in order to satisfy the massively growing demands of domestic consumers. We are not concerned about slowing China exports affecting GDP growth because the Chinese economy is shifting from an export economy toward domestic consumption economy. Job expansion is continuing in China. Over the last five years, while China lost 14 million manufacturing jobs, the economy added 70 million service jobs that drove real disposable income growth and consumption.
The middle-class in China has reached critical mass of over 300 million, almost as large as the entire US population. The middle-class would double in the next 10 years, especially from the lesser developed Chinese cities. While total Chinese domestic consumption is $5.5 trillion today, consumption from these third, fourth and fifth tier cities with a combined population of 500 million people will triple from $2.3 trillion to nearly $7 trillion in the next 10 years.
Third, intellectual property protection. In recent years, China has made significant improvement in reducing IP infringement as China moves closer to global norms in protecting and paying for foreign IP. China also recognizes the need to protect its own innovators, as well as being focused on Chinese consumers who demand genuine products of high quality. Alibaba is at the forefront of protecting intellectual property, leveraging on our cutting-edge technology, we take proactive and aggressive steps to crack down on counterfeits in our marketplaces because the customers who trust our platform demand it. Alibaba is the only e-commerce company that is validated by global brands as having the highest commitment to IP protection.
The Alibaba Anti-Counterfeiting Alliance, which we initiated in 2017 has grown to 132 global brand companies from 16 countries and 12 industries. The Alliance members collaborate in six key areas. Number one, proactive online monitoring and protection; number two, product test-buy programs; number three, offline investigations; number four, assisting law enforcement; number five, litigation against infringers; and number six, public awareness campaigns.
Fourth, reforming the structure of the Chinese economy. The model of state dominated influence in traditional industries is being complemented by private sector initiatives to digitize the economy for manufacturing, supply chain, distribution, product development and marketing. Through our new retail strategy and support from our Intelligent cloud computing solutions for enterprises, Alibaba is playing a leading role in building a new commerce infrastructure in an increasingly digitized economy.
Our partnership with Starbucks is