The Centre for African Studies of the University of Florida has urged African countries, including Malawi, to develop policies to protect local businesses from Chinese retailers.
The centre argues that legislations have been effected in Botswana, Malawi, Kenya and Zambia, but there is need for African leaders to take preliminary steps to maximise benefits that can be derived from Chinese traders as well as protect local businesses from their influence.
In its African Studies Quarterly issue for December 2016, entitled China-Africa Relations: Political and Economic Engagement and Media Strategies, the centre claims the perceptions of most people that Chinese traders provide low quality goods, compete with local traders and only seek short-term gains to repatriate to China have increased discontent among people in Africa.
The relationship between China and Africa has grown exponentially in the last decade with the former now assuming the position of the continent’s largest trading partner, displacing Europe and the United States.
China Africa Research Initiative statistics show that exports from China to Malawi have surged from $0.32 million in 1992 to $248.23 million in 2015.
“We, therefore, conclude that it is important for African countries to develop policies to deal with Chinese retail traders and specify which parts of the country they are allowed to trade and what goods they can sell.
“No longer are African leaders simply opening their arms to Chinese trade and investment, but they are rather negotiating trade and investment increasingly on their terms. This is a trend that is likely to spread throughout Africa as governments seek to balance the benefits of foreign trade and investment to their local economies with support for domestic businesses and industries,” reads the report in part.
In January, 2012 vendors in Karonga protested against Chinese traders in the district and petitioned the then district commissioner Emmanuel Banda to order the closure of their shops, claiming they were stifling the growth of their businesses.
In an interview with Business News on Monday, Small and Medium Enterprises Association (Smea) president James Chiutsi said small-scale businesses are failing to grow because of influx of foreign retailers in rural areas.
Ministry of Industry, Trade and Tourism spokesperson Wiskes Nkombezi said the Business Licensing Act (2012) only allows foreign traders to ply their trade in cities and municipalities. n