Dividends and Chinese city pins hopes for growth on livestreaming

In China livestreaming or selling goods online is expected to reach $210 billion, which is propelling more and more merchants to sell in this manner. It helps that most people in China have a Smartphone with apps which makes shopping and spending more very easy. Livestreaming is similar to the Home Shopping Network without the TV studios.

In an article by Nathan Vanderklippe of the Globe and Mail. In China, not all regions of the country are doing well or have done well economically but people are people and they are will to try something new. Small shopkeepers are being offered the ability to livestream in the evening hours their goods and some will sell things. It is noted that many shopkeepers open during the day and then livestream in the evening makes for an even longer day. However similar to most things, it depends on how many people watch and whether they will buy or not.

In the northeast of China, in the Wu’Ai business zone of Shenyang, some of the economic planners of China are hoping livestreaming will help the local economy. The area around Shenyang was once the 4th richest area of China but has fallen to the 15th with a GDP per capita of $11,000.

The area used to have steel mills or what are now considered rust belt industries and officials acknowledged they falsified data to artificially inflate the provinces performance. All the provinces were falsifying the data that Beijing cracked down on provinces which falsify data.

To ensure merchants can livestream, the local government has pressed for better internet speeds and lower fees, built studio space for the many small merchants and offering support for small shopkeepers and mall owners. In the studio space, the government has set up incubators with instructors to help shape online and livestreaming.

Linking to dividend paying stocks, there is no magic formula when an area goes into economic decline but a lot of help does wonders. For dividend paying stocks there are tax advantages to access, for small business they want a reasonably level playing field, although most of the businesses will remain small. If it works at the small business level, expect the larger business to copy and continue to put on pressure on the small business to stay small.

There are more questions than answers, till the next time – to raising questions.

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