Alibaba Sets Up $2 Billion Russia Venture With Kremlin Help โ Bloomberg
What happened: Chinaโs tech giant Alibaba is setting up a $2 billion joint venture with Russia Internet Company Mail.ru Group, further strengthening Alibabaโs e-commerce marketplace in Russia. Alibabaโs deal with Mail.ru is backed by the Kremlin through the Russian Direct Investment Fund. The venture could better compete with local rivals Wildberries and Yandex in Russia.
Why itโs important: Michael Evans, President of Alibaba said the cooperation would boost Alibabaโs cross-border business. Alibabaโs Russian AliExpress unit mostly sells China-imported goods and thus, isnโt in direct competition with US e-commerce giant Amazon. The company recently rolled out Tmall for Russia after winning consumers through AliExpress. Alibaba will now fold the two companies into the new venture, giving SMEs in the country greater access to local and international markets.
