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Squeezed Out By Alibaba, Thousands Of China’s Small Traders Flock Africa

Squeezed Out By Alibaba, Thousands Of China’s Small Traders Flock Africa

It is not strange  to see Chinese hawkers on the streets of Nairobi, Kampala or Windhoek, selling anything from smartphones to roasted maize.

The number of Chinese small traders in Africa has jumped in recent years and it is estimated that over one million of them are already living in Africa.

According to The Straits Times, there are nearly 50,000 Chinese living in Uganda, a landlocked East African nation that has vast deposits of tantalum — a mineral used in making smartphone capacitors.

Many of these Chinese settlers are traders or workers in China-funded infrastructure projects.

They say they travelled some 20 hours by plane to settle in Africa because big businesses such as Alibaba, the ecommerce giant, squeezed them out of the market back home.

“Uganda is safer and more peaceful than other African countries. It’s no longer good to do business in China,” said 31-year-old wholesaler Kelly Bian, who brings in bedding sets from China.

Close relations between many African countries and China — which has over the last decade become the continent’s largest trade partner — has made it easier for Chinese citizen to settle on the continent, but not without friction with the locals in some cases.

China’s interest in Africa has been driven by demand for rare and valuable raw materials such as metals and oil to feed its fast growing industries that have made it the second largest economy in the world.

In return, the Asian giant has extended grants and loans to several African governments for mostly infrastructure projects like the East Africa standard gauge railway line linking Kenya’s port of Mombasa to Uganda’s capital Kampala and ending in Kigali, Rwanda.

Several Chinese firms are building oil rigs, hydropower dams and roads across the continent and they have brought with them several workers from Asia.

Chinese traders have found an opportunity in importing cheap (low quality) products and selling them at a good mark-up to mostly poor Africans, who due to their low purchasing power cannot afford original merchandise.

In Windhoek, Namibia, there is a town on outskirts of the capital known as ‘Chinatown’, where Chinese trader have rented shops to sell ‘Made-In-China’ products.

Their foray in some African cities has however not been smooth.

In Kenya, local small traders protested last year over what they termed was undercutting by their Chinese counterparts who they say sell their good at throw away prices making it difficult for them to compete.

“The Chinese must go. Let them come and build roads. We don’t want them to manufacture goods, export them to Kenya, and engage in wholesale, retail and even hawking the goods,” one protester in Nairobi told Kenya Stockholm.

In January, the same claims were made in Malawi where local business owners ganged up against all foreign traders, especially Chinese nationals, and said they wanted them out because they were causing “frustrations” in the local market, Nyasa Times reported.