Over the following three years, China's Alibaba Group Holding plans to invest $1.1 billion to establish a logistics network in South Korea.

By utilizing inexpensive prices and quick delivery, the company hopes to challenge the dominant local e-commerce company, Coupang.

The plans were reported by Yonhap News Agency, based in South Korea.

In 2018, Alibaba launched its e-commerce venture in South Korea under the moniker AliExpress. This year, it intends to build a logistics center on a 180,000 square meter plot of land. At the moment, it is choosing a location within the larger Seoul area.

In an effort to increase exports for 50,000 small South Korean businesses over the course of three years, a 300-person call center and a purchasing department will also be established.

The biggest food company in South Korea, CJ CheilJedang, started selling goods on AliExpress in March. Coupang and the corporation have been embroiled in a dispute over the conditions of business. By providing firms that join its platform with favorable terms, Alibaba is increasing the range of products it offers.

With more than 100 of its own distribution facilities, Coupang dominates the South Korean e-commerce industry and is experiencing growth in sales. Major retailer Shinsegae Group and IT giant Naver are pursuing this.