PDD Food Systems Forum - Fireside Chat with Chen Lei, Chairman and CEO, Pinduoduo

Our director Lei has been part of the Pinduoduo story from day one. A data scientist with a PhD in computer science, he served as Pinduoduo's chief technology officer since 2016, and in July 2020 transitioned from the key CTO role to become our CEO. In March this year, he became the chairman of our board. Mr. Yo has had an illustrious career in public service as Singapore's foreign minister and trade minister, among other portfolios, and is currently a visiting scholar at the Lee Kuan Yew School of Public Policy at the National University of Singapore. Mr. Yo is an independent director on our board, chairing the nominating and corporate governance committee, and we have all benefited immensely from his insights.

Inaugural full system forum. I look forward to hearing from all the expert speakers we have invited, and I hope to leave with new ideas and new insights. And now, join me for this fireside chat.

I was invited by your predecessor Colin to join the board some years ago. At that time, I didn't know what Pinduoduo was doing, but I was very impressed by the vision. In the last few years, it's been wonderful to see the way Pinduoduo has been growing. And as an independent director, making sure that the systems that we have in place are robust and effective.

Well, I think you're right, Lei, that involving all stakeholders is extremely important in making a success of what we are doing. In all countries, the people involved in agriculture can be very upset if they don't understand the reason for the change and they don't understand what benefits it will give to them. Therefore, public-private cooperation in agriculture is absolutely important. And I'm glad that Pinduoduo, in all our work, we work closely with local government officials and farmers so that whatever we do is win-win for everybody. And even then, there will always be unexpected things happening. But what amazes me, Lei, is that now it seems that with technology, with a new platform, we are able to attract young people back into agriculture. And you were telling us at a board meeting about a PDD farm. Can you tell us a bit more about this, how we're able to attract young people into this sector and what are the interesting ideas that we're working on?

I think we often associate agricultural technology with big agricultural businesses that only they can afford to bring in scientists and technology and apply on a large scale. But what Pinduoduo has done in Yunnan, to me, is incredible because we're bringing technology not to big multinationals but to small players, to apply smart agriculture to relatively small farms. So when you talk about Singapore, well, that resonates with me because Singapore is a tiny place and you do not associate Singapore with agriculture. But Singapore is big enough for seeds and for the development of seeds, for the selection of seeds. Singapore has always been a kind of a nursery for seeds which can be in biotechnology, which can be ideas, which can be in finance. And therefore, when Pinduoduo talks about applying technology and AI to agriculture, I think Singapore can be a very interesting place to work with. There is a lot of potential for Singapore and Pinduoduo to work together. You mentioned Israel. Well, Israel started as an agricultural country, and the conservation of water is an obsession in Israeli agriculture to conserve water, and you've got to apply that water intelligently so that every drop counts. Every square meter of land counts. So, in a sense, by working with small countries like Singapore and Israel, we bring hope to smaller farmers in China and to the world that you don't have to be big to be productive, to be able to market far and wide. And what we're doing now would be of great interest to the whole world. But maybe, Lei, you should talk to us about the technology.

As society becomes more middle class, people want variety. In Singapore, we get our fruits from all over the world. We get our mangoes from the Philippines, from Indonesia, from Australia, from India. We get strawberries from different parts of the world. And it'd be wonderful if from different parts of China we're able to get high-quality produce. If the food is from a big company, we say okay, the brand establishes the trustworthiness of the supply. But how do you see Pinduoduo creating a system where we can increase people's trust in agricultural products which may come from places far away, which may come from small farms which may not bear names which we are familiar with? How do you see Pinduoduo creating such an ecosystem of trust?

The sooner we can create a system where consumers increase the trust level of the products they consume, the better it will be. And since Pinduoduo is not by itself the agency regulating food or ensuring food safety, it would be good if Pinduoduo over time can establish a relationship with regulators. In the world, when I was minister for trade and industry, I negotiated free trade agreements with many countries, and we were able to negotiate mutual recognition of standards with the US, with Europe, Japan, and to some extent with China. This is very important. It will take time, of course, but removing the doubt from people's minds that perhaps something is new, perhaps we should be cautious, being able to remove that doubt is very important. However, the other issue is cost. We may have a fantastic product, it may be very safe, but if it costs too much, the market does not meet all the needs that we have. And I know that Pinduoduo is now investing heavily in building up certain logistics capabilities to fill in gaps in the market. Can you tell us a little about how Pinduoduo is going about to provide better logistics in agricultural products and therefore lower the cost to consumers, and therefore create a win-win situation for both farmers and consumers?

You know, COVID has been a stress test on the entire world. And under conditions of stress, people behave differently. We can see among companies how they behave, we can see among countries how they behave. During COVID, people are afraid, people stock up on food, toilet paper, and people are beginning to grow more food in their own locality. Even in Singapore, which is a city, so many people are now trying gardening and growing vegetables at home. Of course, we will never be able to produce enough vegetables for ourselves, but even the government has set a goal of Singapore being 30% self-sufficient in vegetables by 2030. This will attract a lot of attention in the world. I remember attending a webinar organized by the World Bank where Pinduoduo made a presentation on what it was doing, and I could tell that from the audience there was very keen interest. Of course, every country has different circumstances, but there are lessons to be learned from China's experience, both positive lessons and negative lessons, but important lessons for themselves. And most valuably, what Pinduoduo has done to improve agriculture in China will give hope to many people in developing countries that agriculture in their countries can also be modernized. And with an international platform, they can maintain traditions, they can maintain a way of life, and at the same time be connected to the international market and enjoy a better life for themselves. So I, as an observer, because as a director I'm not really involved in the work that you do, but I watch what you do with the greatest fascination. I feel optimistic, but I know there are a lot of issues. These things are never easy. These are complex systems. There are a million things to worry about. And if I may ask you, Lei, in turn, what you see to be the big challenges ahead?