Chinese giving Indians a tough time in Limbe

Limbe in Blantyre, once the cushy terrain of Indian (Asian) business people, is now taking new shade with several Chinese shops sprouting in the raucous trading town.

And judging by the speed at which the Chinese are settling in, the Indian business people risk being pushed out of Limbe as their wares are cheaper than what is on offer.

Added to that, the Chinese shops remain open on Sundays while the tradition with the Indian business community is to rest on Sundays.

A visit in Limbe confirms that the Chinese business people have become traders of choice as the trading centre is fast becoming a ‘China town’ which cheap goods flourishing on the sidewalks and scores of shop windows.

While the Indian business traders that we approached were unwilling to grant Nyasa Timesinterviews, the Chinese, in their trademark broken English said they are here to give Malawians a good deal for their money.

Limbe commercial area

“It is always good when people have a choice, so we are here to merely give Malawians the right to choose. It’s not about driving them out, because, actually, we work with them as they sometimes buy their goods from us,” remarked a Chinese shop-owner who only identified himself as Chen.

Despite Malawi’s deteriorating economy, Limbe is flourishing, with several new building sprouting up on every street.

Limbe is loosely considered as Malawi’s business capital as a billion kwacha business is transacted every day. Limbe is the epi-centre from where traders from surrounding towns in the southern region source their goods.

The Chinese have concentrated their business in the major cities after Parliament passed a law to close down Chinese businesses outside of the four major cities.

The movie was condemned as xenophobic by rights organisations. The law, enforced July 31 barred foreigners from carrying out trade in Malawi’s outlying and rural areas.

The Investment and Export Promotion Bill required traders to move to Malawi’s major cities Lilongwe, Blantyre, Mzuzu and Zomba. The law is an attempt to protect local small-scale businesses from competition from foreign traders.

Two prominent civil rights organisations, the Centre for Development of People and the Centre for Human Rights Rehabilitation (CHRR), warned the Malawian government against encouraging the victimisation of foreign traders.

“We are worried about the increasing xenophobia sentiments and attacks on foreign nationals who are doing legal business across the country,” the executive director of CHRR, Undule Mwakasungula, told IPS. He argued that the way Chinese traders were being treated was in violation of their human rights.

“Malawi should not be perpetrating xenophobic attacks on foreign nationals under the pretext of protecting the interests of local businesses.”

The new legislation comes immediately after Malawian traders in some rural areas grouped together in May and convinced local government authorities to force out Chinese traders. The protests first began in Karonga, a bustling town in the north of Malawi, which borders Tanzania, and later spread to all 28 districts in the country.

Minister of Trade John Bande said that the new legislation was intended to regulate foreign investment.

“The new law clearly outlines what kind of businesses foreign investors will be allowed to get involved in. We will not accept foreigners to come all the way from places like China and open small businesses and shops in the rural areas of this country and compete with local traders,”  Bande said.

Chinese-run shops, restaurants and lodges have sprouted across the country since 2007, when Malawi established diplomatic relations with China. The country had just abandoned its 41-year-old ties with Taiwan in favour of the economic giant.

China has become Malawi’s major economic partner since then. According to statistics from Malawi’s Ministry of Trade, the country’s trade volumes jumped to a record high of 100 million dollars in 2011 –  a 400 percent increase from 2010.

The two countries have a 2008 memorandum of understanding about issues of industry, trade and investment. It commits China to increasing Malawi’s productive capacity in tobacco, cotton, mining, forestry, and fertiliser production, among other things.

China has also given Malawi 260 million dollars in concessionary loans, grants and development support. This year, the country’s first five-star hotel opened. It includes 14 opulent presidential suites and a state-of-the-art conference centre, and was built by the Chinese government.

In April 2012, China’s direct investment in Africa surpassed 15.4 billion dollars, according to statistics from the Chinese embassy in Malawi.

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