Africa's thriving trade with China

By Lara Pawson
BBC Africa Live! Hong Kong

African traders are buying more Chinese goods

If you've ever wondered how Chinese products make it to your local market place or shopping mall in Africa, you might like to think about a place called Chungking Mansions.

This 17-storey building, situated in the heart of one of Hong Kong's commercial areas, Tsim Sha Tsui, is the main trading centre for African exporters.

The first two floors are an open-air market: goods from mainland China are sold here in bulk to traders from across the African continent and a few from India.

Chungking Mansions is stuffed to the brim with all sorts of goods from baggy jeans decorated with model guns, plastic-gold jewellery, and mobile phones, to suitcases of every shape and size, electronic Korans, videos, stereos, clocks and ladies' underwear.

You can go there at almost any time of the day and you will find traders haggling over prices, talking or drinking tea.

On the second floor, at the back of a small boutique stacked to the brim with jeans, Sagara Modie - a Malian businessman - is negotiating with a local dealer.

Mr Modie has been travelling from Bamako to Hong Kong for the past eight years. "I come at least three times a year," he says. "We sell jeans, that's our speciality. If you buy in large quantities, you can make quite a bit of money."

Destination Africa

Back on the ground floor, there is a loud crackling noise coming from one corner. A young Chinese man is bent double over a huge cardboard box, pulling large strips of tape around the flaps in order to seal the container for transport.

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Piled up around him are more large boxes, some wrapped up, ready and marked for their destination: Angola, Nigeria, Ghana, Uganda and Tanzania.

This is the main cargo centre of Chungking Mansions. And this corner belongs to Steven and Daniel Cargo Company, which appears to have the monopoly on air cargo.

Daniel Ng, the company director, says: "Many, many Africans do business here, from over 35 countries. For my business, they comprise more than 90% of my customers. For business, the Africans are very good."

And some of the African traders enjoy working with the Chinese too.

Chima Henry, a Nigerian who buys mobile telephones to sell on the open market in Lagos, says: "There are many things you can take from here that are good. They don't work on bribes. I have not come across bribery here. Never."

China direct

But not everyone is quite so complimentary. Increasingly, African traders are going to China directly in order to buy cheaper goods at source.

Traders come from all over Africa to do business

Many fly into Hong Kong and then take a three-hour train journey to the southern Chinese city of Guangzhou.

Mohammed Kadala is the director of a Tanzanian-owned shipping and export company based in Guangzhou. He used to export from Kenya and before that, Hong Kong. But now he only works in the mainland.

"When you go to China, the things you used to buy in Hong Kong for 10 shillings, you can find in China for two shillings," he explains.

"So we had to establish there because we saw it was good to do business there: the labour is cheap and they use cheap materials."

Mr Kadala also enjoys working with the Chinese, more perhaps, than his own people in Uganda. "The Chinese are very good people," he tells me.

"They are very hard working. In Africa, our foundation was a lazy foundation. We used to have land, we used to have food, so people did not bother about working hard. Africans have to pull up their socks to meet the standards of the current world situation."

Mixed welcome

The growing attraction to China is not welcomed by some of the local traders at Chungking Mansions.

Ahmed sells mobile phones on the ground floor. At least 90% of his customers are Africans.

He says that many of them are leaving Hong Kong to go direct to China, largely because the products there are cheaper but also because many Africans feel that the Chinese people from mainland China are much more friendly than those from Hong Kong.

Ahmed fears that he will lose his business: "Ninety per cent of customers here have already moved to China. They were supposed to buy from Chunking Mansions.

This building provides a lot of revenue for the government. But already most customers have switched to China. If the remaining 10% go, we will have nothing here."

So will the boom of the Chinese economy lead to the demise of Chunking mansions? Already, many African traders, have realised that it is cheaper to go straight to China.

By doing so they cut out the middle man - which is in effect what Chungking mansions is: a giant, 17-storey middle man.