Why China Town is causing discomfort among traders

Kampala, Uganda | THE INDEPENDENT | What is it about China Town supermarket?

Well, this is my experience.

I strolled into China Town, and after walking around hundreds of meters through columns of shelves, I instead landed on Ugandan products – laundry soap and related items by Mukwano Industries Ltd and Bidco Uganda Ltd.

My efforts towards the plastic products section were in vain, as all the buckets, basins, and trashcans were all marked “Made in China.”

“This is taking me back to China,” remarked a female shopper who had acquired a 40-litre plastic basin, adding “I had given up on Chinese things, but this is 5,000 Shillings cheaper than I would have bought it elsewhere.”

These are some of the reactions by the thousands of people flocking to the store at Lugogo Mall, which previously housed Game Stores supermarket before the South African retailer quit Uganda over alleged bad business.

Day three of the grand opening of China Town in Kampala still recorded thousands of shoppers, including window shoppers, while the low cost of many items was the main source of excitement. While the catchwords of the store “Cheaper. Satisfaction. Quality” stand out prominently, some shoppers were still skeptical about the quality of the products made in China.

China’s Embassy in Uganda has defended their country, saying there are different kinds of products in China, including those with the best quality, but Ugandan importers go for the low-quality ones because they are cheap.

A customer wrote online on the issue, brushing off criticism about the quality of Chinese goods.

“There are different kinds of products in China, including those with the best quality, but Ugandan importers go for the low-quality ones because they are cheap,” he said, adding that “The Chinese market is a result of the situation caused by the local traders who hike the prices of their goods at any chance including the slightest adjustment in taxes.”

“So you see why we the consumers are celebrating?”

He said the game is on. “Game on now so competitors can henceforth up their game so that there’s fairness; those guys had fleeced us for so long and these days it was becoming a bitter pill to swallow that the market is full of fake products. Now with a formidable competitor, we can only anticipate better services at competitive rates.”

On day three, however, there was no evidence of some of the low price quotations that attracted the hordes of shoppers on the first day, with attendants saying they had sold out.

Many, however, especially electronics, plastics, foodstuffs, and other household items still had fairer prices compared to what is on the general market. A feature standing out was that almost all the items are made in China, including those where the Ugandan industry has matching products, like plastics, stationery, and others.

A move around the expansive store finally revealed Ugandan products – laundry bar, powdered soap, and related items by Mukwano Industries Ltd and Bidco Uganda Ltd. The government of Uganda developed a policy which was followed by an agreement with the Supermarket owners, to reserve 40 percent of shelf space for locally manufactured products.

While to many shoppers it is a welcome development, the coming of China Town has sent discomfort among Ugandan retailers, who also agree that it threatens their businesses.

Kampala City Traders Association (KACITA) and other traders’ groups have been speaking against foreigners investing in retail businesses and other small or petty businesses, saying they outcompete them.

This, they claim, is because the local business operators do not have enough capital and technical ability to invest in factories. They also accuse foreigners who have factories of undercutting them by selling their products cheaply directly to the consumers.

“It shows the government’s failure to protect its people. How can you allow foreigners to get involved in all these kinds of businesses which the Ugandans would be doing?” KACITA Chairperson, Thaddeus Musoke Naggenda said. “Even where foreigners have built factories, the opportunity to supply raw materials should be given to Ugandans, but instead, foreigners are involved even in sand extraction!” he lamented.

Several retail chains have quit Uganda over the last decade for various reasons, including high taxes, high rental charges, dishonesty by staff as well as stocking foreign products which tend to be more expensive than locally made products, especially foodstuffs.

The failure to get closer to the common consumer to compete with the local corner shops commonly known as Duuka has also been an undoing, as they fail to break into the traditional shopping behavior of the majority of Ugandans, according to experts.

Previous victims include Nakumat, Uchumi, Tuskys, Shoprite, and Game, among others. However, there are some sentiments that the coming of the Chinese market is a result of the situation caused by the local traders who hike the prices of their goods at any chance including the slightest adjustment in taxes.

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