China hits back

It is entirely the duty of Ghanaian authorities to regulate trade and check the illegal activities of foreigners who do business in the country, Chinese officials have said in a response to complaints of malpractices by their nationals in the local trading sector.

Among the charges, Chinese traders and businesspeople have been accused of illegal mining activities, pirating local textile-designs, and venturing into the retail sector which by law is a preserve of indigenous entrepreneurs.

Chinese employers have also often been cited for their disregard for workers’ rights, with some reported incidents of inhuman treatment of local labour in their employ.

But in a response, the Commercial Counsellor of the Department of West Asian & African Affairs at the Chinese Ministry of Commerce, Xie Yajing, stated: “It is your government’s responsibility to regulate trade. We, on our part, encourage our businesses to respect and abide by local laws and regulations.”

A lot of these companies are not state-owned enterprises but personal, private businesses, she said. While state-owned firms and other registered contractors doing business overseas are regulated by authorities in Beijing, her ministry is not fully aware of the overseas ventures of many private businesspeople, she claimed.

Though an increasingly important trade partner, China’s exports into Ghana have not always been welcomed. Local industries fret about cheap and sub-standard Chinese imports which have taken over their markets, and are gradually pushing them to the wall.

Xie Yajing defended the quality of products manufactured in China, noting that different standards apply in different export markets, which could explain why, for instance, a product that is rejected by the EU market may be permitted to enter Ghana or some other African country.

Franklin Cudjoe, an analyst with policy think-tank IMANI Ghana, agreed with the sentiments of the authorities in Beijing during an interview with the Business & Financial Times.

“I absolutely agree with them. You don’t blame foreigners for a lack of focus or proper regulation.

“If you look carefully at the mining sector, the only reason why the activities of so-called illegal miners have become significant is simply because there is a failure of regulation; and to the extent that we haven’t seriously looked at the laws regarding mining by ordinary individuals, it opens up the space to other nationals as well.

“The other crucial point on the issue of piracy is that we have not invested sufficiently in strengthening our copyright system. If the investments matched the technology that is needed, you wouldn’t have customs officials going after traders selling pirated products that consumers want to buy anyway.

“It is important for the Ghanaian authorities to have technology and software that allows them to crosscheck electronically in order to detect pirated materials at their points of entry.

“Also, the local textile industry is now a very expensive industry due to the cost of production. About 90% of ingredients in textile manufacturing are imported; therefore the combination of import and local taxes makes it difficult for local producers to meet the demand or compete with imports.”

Ms. Yajing recognised the lopsided nature of trade between China and Ghana, but said it is largely the outcome of both countries’ economic structures. Exports from Ghana comprise mainly primary resources like cocoa and minerals, while trade in the other direction is made up substantially of high-end manufactures like electronic products, machinery and ICT systems.

China intends to further boost bilateral trade and its cooperation with African countries, she said. Accordingly, it plans to assist some African countries to establish logistics centres that will serve as focal locations for the distribution of Chinese-manufactured goods to different markets in Africa.