Chinese businesses ‘kill’ Namibian retail outlets

NAMIBIANS regard Chinese business and construction companies in the country as “unacceptable” and blame Government for not controlling the influx of Chinese businesspeople, who “penetrate every inch of the country” and “squeeze” the owners of small shops, depriving them the chance of growing their business, a study has revealed.

Chinese businesses in Namibia are perceived as paying below minimum wages, hiring people as casual workers instead of permanent employees, and expecting them to work seven days a week without a lunch break, according to the findings of Dr Andrew Niikondo of the Public Management Department of the Polytechnic, who compiled the study with fellow lecturer Johan Coetzee. Presenting the key aspects of the study last week, Niikondo said information gathered showed that Chinese companies sold about 80 per cent of products sold at large clothing chain stores.It was only Pep Stores that was negatively affected by the Chinese competition, as both were competing for the same range of lower-income customers, the study found.Some of those who responded to the survey felt that the quality of Chinese products was mostly poor and often fake copies of international brands, and that Chinese shops had cheaper prices and thus “killed Namibian retail businesses”.Some even feared that money laundering was going on, as Chinese businesses were perceived as avoiding using bank accounts and allegedly avoiding paying taxes.The researchers found that the Chinese businesses mainly employed Oshiwambo-speaking Namibians between the ages of 20 and 35, mainly as casual workers.Having sampled 50 people working in Chinese shops and 50 workers at construction companies, Niikondo and Coetzee concluded that 76 per cent of respondents in shops said they earned between N$100 and N$500 per month, while Namibians owning small shops pay N$500 to N$1 000 a month.”None of the respondents in Chinese-owned retail shops earned between N$1 000 and N$5 000 per month, but 48 per cent of employees in local retail shops earned in that range,” Niikondo said in his presentation.”About 68 per cent of workers for Chinese are employed as casuals, while only 44 per cent were casuals at local employers.Forty-four per cent of respondents working in Chinese shops rated their jobs as unsatisfactory,” he added.”About 92 per cent of the respondents employed in Chinese shops said they only work for survival.”The language barrier was also a problem and about 40 per cent of employees at Chinese shops did not belong to a union, neither were they registered with the Social Security Commission.The situation was similar in the construction industry, with the lowest wages between N$100 and N$500 a month.The Namibia Investment Centre told the research team that Government was aware of below minimum wages paid by Chinese and that unfair competition was often the case, but there was “no justification to oppose Chinese businesspeople, this would be tantamount to economic xenophobia”.Government regarded the contribution of Chinese businesses to Namibia’s economy as “significant”, according to the study.The study gave no figures of the number of Chinese wholesale and retail businesses or construction companies in Namibia, but mainly collected the views of individuals, employees, shop owners and labour unions, the Labour Commission, the Namibia Chamber of Commerce and Industry (NCCI), the Trade Ministry and the Chinese embassy in Windhoek.The Government Tender Board told the two researchers that Chinese companies were usually 15 to 20 per cent cheaper in their bidding and imported construction materials like steel for much cheaper from China.They also were “more productive because they did not close over the Christmas season like local construction firms” and their tender documents were generally “of a higher standard” than those of Namibian companies.They also bid for all tenders, in contrast with some local and South African competitors, who were only interested in tenders upwards of N$100 000.The Labour Commission held the view that Chinese businesses in Namibia seldom asked workers for IDs and birth certificates, resulting in the employment of underaged children in many instances.Presenting the key aspects of the study last week, Niikondo said information gathered showed that Chinese companies sold about 80 per cent of products sold at large clothing chain stores.It was only Pep Stores that was negatively affected by the Chinese competition, as both were competing for the same range of lower-income customers, the study found.Some of those who responded to the survey felt that the quality of Chinese products was mostly poor and often fake copies of international brands, and that Chinese shops had cheaper prices and thus “killed Namibian retail businesses”.Some even feared that money laundering was going on, as Chinese businesses were perceived as avoiding using bank accounts and allegedly avoiding paying taxes.The researchers found that the Chinese businesses mainly employed Oshiwambo-speaking Namibians between the ages of 20 and 35, mainly as casual workers.Having sampled 50 people working in Chinese shops and 50 workers at construction companies, Niikondo and Coetzee concluded that 76 per cent of respondents in shops said they earned between N$100 and N$500 per month, while Namibians owning small shops pay N$500 to N$1 000 a month.”None of the respondents in Chinese-owned retail shops earned between N$1 000 and N$5 000 per month, but 48 per cent of employees in local retail shops earned in that range,” Niikondo said in his presentation.”About 68 per cent of workers for Chinese are employed as casuals, while only 44 per cent were casuals at local employers.Forty-four per cent of respondents working in Chinese shops rated their jobs as unsatisfactory,” he added.”About 92 per cent of the respondents employed in Chinese shops said they only work for survival.”The language barrier was also a problem and about 40 per cent of employees at Chinese shops did not belong to a union, neither were they registered with the Social Security Commission.The situation was similar in the construction industry, with the lowest wages between N$100 and N$500 a month.The Namibia Investment Centre told the research team that Government was aware of below minimum wages paid by Chinese and that unfair competition was often the case, but there was “no justification to oppose Chinese businesspeople, this would be tantamount to economic xenophobia”.Government regarded the contribution of Chinese businesses to Namibia’s economy as “significant”, according to the study.The study gave no figures of the number of Chinese wholesale and retail businesses or construction companies in Namibia, but mainly collected the views of individuals, employees, shop owners and labour unions, the Labour Commission, the Namibia Chamber of Commerce and Industry (NCCI), the Trade Ministry and the Chinese embassy in Windhoek.The Government Tender Board told the two researchers that Chinese companies were usually 15 to 20 per cent cheaper in their bidding and imported construction materials like steel for much cheaper from China.They also were “more productive because they did not close over the Christmas season like local construction firms” and their tender documents were generally “of a higher standard” than those of Namibian companies.They also bid for all tenders, in contrast with some local and South African competitors, who were only interested in tenders upwards of N$100 000.The Labour Commission held the view that Chinese businesses in Namibia seldom asked workers for IDs and birth certificates, resulting in the employment of underaged children in many instances.