Four major bottlenecks need to be overcome to promote Internet Plus Circulation action plan, said Premier Li Keqiang.

The Premier made the remarks at the State Council executive meeting on April 6 when the Internet Plus Circulation action plan was approved for launch.

“The logistics and production have always been inextricably linked, like twins.” the Premier said. “And if we want to maintain a competitive edge in the new round of circulation revolution, we should eliminate the four major bottlenecks in both soft and hard environment.” he added.

The first bottleneck is the out-of-date information facilities in rural areas, said the Premier.

Premier Li called on telecom enterprises to speed up the broadband services and network base station construction in rural areas, which will drive huge rural market demands, provide more services for rural residents and expand agriculture products markets.

The Premier also called on efforts to boost rural e-commerce. “When I visited some villages, I saw even the villagers in the most remote areas were using smartphones, and we should take efforts to further bridge the urban-rural digital gap by speeding up broadband infrastructure construction and promoting e-commerce in rural areas,” he said.

The second bottleneck is China’s lagging in intelligent logistics system and the Internet of Things, as well as the cold chain transportation.

When the Premier visited Henan province last September, he learned a crowdsourcing model of refrigerated cars from an e-commerce company, which allows drivers and the company to jointly purchase refrigerated cars and establish cold chain system.

“They significantly reduced the empty loading rate to around 10 percent, and brought high efficiency in transportation and excellent profits,” the Premier said at the executive meeting.

“China is large in population and has a huge market demand for cold chain facilities, so we must unblock the bottleneck, invigorate the circulation system, and release enormous market potential.” he said.

The third bottleneck is the lack of a sound business environment which means the counterfeit and poor-quality products and fraud are hard to eliminate.

Premier Li said that the sales of the counterfeit and substandard goods and the infringement of intellectual property gives rise to unfair competition and affects the healthy development of the entire industry.

He called for related departments to enhance the regulation during and after the trading process through Internet and big data, and to establish a sound online and offline circulation industry.

And the last one to be overcome is the high rent for physical stores, which limits the online stores from developing offline business and hinders the integration of the online and offline business development.

Premier Li stressed that departments concerned should expand the commercial service facilities and adopt market means to cut down rents for physical stores.

Some local governments have a misconception about urban planning and management. “They blindly seek a clean city environment, prevent all manners of street selling and tiny shops and deprive the vigor of the city,” the Premier said. “Without the prosperity of cities, the circulation industry will lose its roots for development.”

“It is lazy administration to simply ban street shops,” the Premier said, calling on local governments to improve skills in city planning and management.