China urged to curb excessive cash burn, not competition, to fight ‘neijuan’

With e-commerce platforms locked in fierce competition for China’s instant retail market, a prominent Chinese economist has called for government guidance that balances regulatory oversight with innovation and a push for new growth drivers.

Wang Yiming, a central bank adviser, said “quick commerce” – involving the rapid delivery of food and essential goods, often within 30 minutes – creates new opportunities for consumption, which could be vital for long-term growth.

He urged officials to guide the sector’s high-quality development through targeted policy measures.

“Anti ‘involution’-style competition is not against competition itself, but against behaviours that undermine fair competition,” said Wang, who also serves as vice-chairman of the China Centre for International Economic Exchanges, a Beijing-based governmental think tank.

“Instead, the goal is to raise competition to a higher level – moving away from a zero-sum mindset towards a win-win approach through innovation, quality upgrades and a better industrial ecosystem.”

Beijing has increasingly warned about “neijuan” – cutthroat competition that drives prices down and suppresses domestic demand. E-commerce giants, including JD.com, Alibaba and Meituan, have been at the centre of the controversy as they fight to lure customers through aggressive subsidies.

South China Morning Post