![TTourists shop at the Sanya International Duty-Free Shopping Complex, Hainan, China, October 2, 2020 [VCG]](https://i0.wp.com/usachinatrading.com/wp-content/uploads/2020/10/TTourists-shop-at-the-Sanya-International-Duty-Free-Shopping-Complex-Hainan-China-October-2-2020-VCG.jpg?resize=525%2C296&ssl=1)
Chinese tech giant Alibaba has agreed to form a joint venture (JV) with Swiss duty-free group Dufry, as Chinese shoppers’ appetite for overseas luxury goods seemed unfettered by the pandemic.
It also announced that it would acquire an up to 9.99 percent stake in the duty-free operator in a statement released on Monday. Alibaba Group will have 51 percent controlling shares to Dufry’s 49 percent. The joint venture combines Alibaba’s established network and digital capabilities with Dufry’s China travel retail business and operational skills, the statement said. “We expect this collaboration to drive growth in Asia and with Chinese customers worldwide with the support of new digital technologies,” said Dufry Chief Executive Julian Diaz on Monday. As the coronavirus pandemic halts global travel, Dufry’s revenue fell by 62 percent to 1.59 billion Swiss francs ($1.74 billion) in the first half of 2020. It is increasing presence in China’s travel retail markets as effective containment of the outbreak allowed the country to travel again.
With 14,941 flights booked during the country’s eight-day National Day holiday. that started on October 1, total air travel booking is comparable with the same period last year. Bookings for domestic flights have increased by 10.5 percent, data from China’s aviation authority showed. Dufry is proposing a capital increase that will raise up to 700 million Swiss francs, which Alibaba is to subscribe to up to 250 million Swiss francs of shares. China currently taxes imported consumer goods, such as garments and beauty products, an average of 6.9 percent and high-end cosmetics by 15 percent. But tariffs for many luxury products, such as perfumes and watches, exceed 30 percent.
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