E-commerce spurs concern over fate of traditional trade

1. Postal Parcels (Envato Elements)
The number of postal parcels doubled in the first half of the year, according to official data. (Photo: Envato Elements)
AMMAN — The number of Jordan-bound parcels containing various imported goods doubled in the first half of the year, drawing merchants’ concern over the fate of their businesses.اضافة اعلان

Data by the Telecommunications Regulatory Commission showed that the number of parcels received in the mail or by couriers jumped by 100 percent between January and June this year, compared with the corresponding period in 2021.

Experts voiced concern over the impact of the significant increase of postal parcels on traditional shopping and local businesses, and called for establishing limitations and regulations for the workflow of e-commerce to create fair competition.

Asaad Al-Qawasmi, a representative of the clothing sector at the Jordan Chamber of Commerce, said that the “impact of the increase in the number of postal parcels coming to Jordan will be negative on traditional trade”.

“Traditional merchants pay high customs duties and taxes, as well as operating expenses, including rent and salaries,” he said. “This creates an unfair competition and deepens the sector’s losses.”

“When the amount of the increase in the number of postal parcels was 50 percent, this had a negative impact on traditional trade,” he recalled.

“How about when the increase is 100 percent?” he asked in an interview with Jordan News.

Cabinet regulation 1356, which was issued in February 2021, regulates the process of collecting fees for personal parcels. It stipulates that customs duties are collected at a rate of 10 percent of the value of the parcel, provided that the total value does not exceed JD200. It sets a minimum fee of JD5, provided that the parcel is personal and not used for commercial purposes.

Qawasmi said that “some e-merchants manipulate the laws and regulations. This manipulation is neither in the interest of merchants nor the government.”

“Some e-merchants take advantage of this decision and shop online four to five times a day,” he said. “Traditional traders lose, and their losses are exacerbated further, and the government loses revenue from foreign trade.”

He said that “e-commerce must be reorganized so that there is fair competition, either by raising fees and taxes on e-merchants, or reducing them on us so that we are equal.”

“If the situation remains as it is now, I expect the losses of traditional traders to increase,” he maintained.

Nael Al-Kabariti, president of the Jordan Chamber of Commerce, told Jordan News that “e-commerce should be regulated by setting controls and amending customs duties and taxes imposed on them.”

He said that “we cannot stop e-commerce because it has become a global trade and the demand for it has increased in the recent period, especially in the wake of the COVID-19 pandemic, but we can control it so that this does not exacerbate the losses of traditional traders.”

With the increase in the number of postal parcels, “local sectors will be affected, especially the clothing and footwear trade,” Kabariti said.

“What is also more important than the number of postal parcels is their purchasing and material value,” he said. “The purchasing value of 500,000 postal parcels may be JD10 million or JD100 million, and based on the purchasing value we can measure the extent of the impact and the losses.”

Kabariti demanded that the government “conducts a real study that enables us to know the purchasing value, accordingly to a certain criteria set to control the work of e-commerce.”

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