February 17, 2011

Chinese businesses get mixed reaction

The continuing influx of Chinese businesses into Namibia since independence is evoking mixed reactions from institutions, local business enterprises and consumers, all of whom have either complained about the impact of their advent on the retail trade, particularly in clothing and jewellery, which pose a health hazard. The most robust reaction so far has come from clothing vendors and small garment manufacturers many of whom are against what one local retailer described as "a Chinese invasion and colonisation".

On the whole, local traders in clothing and apparel regard the growing presence of the Chinese traders as a 'competitive threat', which they are hard-pressed to cope with. But none of the established businesses which were aseks, including the National Chamber of Commerce and Industry (NCCI), were prepared to publicly assume an anti-Chinese posture. When approached for comment, NCCI northern chairperson Thomas Indji said the key objective is to make Namibia an attractive business location. "We need foreign investment, that's clear cut," Indji said. "All investors are welcome, but we should blame ourselves for the state of affairs. We do not have an effective control measure in place."

He said the position of NCCI was entirely consistent with the government's 'open door investment policy' and that the finalisation of the revised Foreign Investment Act by the Ministry of Trade and Industry would address some of the problems currently faced. He would not say when the Act would be ready. He called on the business community "to be united and speak with one voice".

Northern-based clothing and accessories traders say they are already beginning to feel the impact of the presence of the Chinese competition. "They have access to cheap goods from factories in China and their prices are very low compared to our imports from other Western countries. "The Chinese are killing competition," said the owner of a sports wear shop, who did not give his name. "Equally, I am concerned about the health effects some of their products may have on the ignorant locals," he said. "I honestly believe that the Government should introduce a quality control measure to address this 'free' flow of hazardous material from China."

Some years ago, Chinese firms were putting cadmium into children's costume jewellery for the glossy effect, as they cannot use lead anymore. Cadmium is said to produce toxic effects on humans. Long-term exposure can cause adverse health effects on the lungs and kidneys. Other traders concurred, pointing out that clothing and accessories manufactured in China benefit from low labour costs and are sometimes manufactured locally behind closed-door 'covert' factories based in Oshakati, Ondangwa and Oshikango."
Investigations in the northern regions turned up at least a dozen Chinese businesses, most of them offering the same items for sale. Increased demand for storefront property has reportedly pushed rental prices up and Chinese merchants quickly occupy most vacated trading premises. Their clothing has become particularly popular on the local market. (New Era)

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