Tanzanian Traders Accuse Foreign Retailers of Unfair Competition in Dar es Salaam

Traders in Kariakoo, Dar es Salaam's busiest shopping district, are accusing foreign retailers, particularly Chinese merchants, of unfair competition. The local traders claim that the foreign retailers are dominating the market, selling products at cheaper prices, and threatening the livelihoods of Tanzanian business owners.

Why this matters: The allegations of unfair competition have significant implications for the future of retail trade in Tanzania and the role of foreign investment in the country's economy. If left unchecked, the dominance of foreign retailers could lead to the erosion of local businesses and job losses, ultimately affecting the country's economic growth and development.

Chinese merchants have become ubiquitous in Kariakoo, exploring both wholesale and retail markets. China is the world's second-largest economy and the biggest foreign investor in Tanzania, with 1,098 investment projects worth $9.6 billion by October 2022. Sino-African bilateral trade has been growing steadily over the past two decades, with China supplying manufactured goods and machinery to African countries.

The influx of Chinese traders has increased the supply of affordable goods in the market, discouraging locals from traveling to China to purchase goods and sell them at higher prices in Tanzania. Juma Zuberi, a Tanzanian trader, expressed his concerns, stating, "They shouldn't be involved in retail businesses and compete directly with us." He added, "We expect them to partner with local retail outlets so that Chinese investors supply products in wholesale."

Hamisi Livembe, Chairman of the Kariakoo Traders Association, emphasized the need for government intervention, saying, "Something must be done to correct the current situation around foreign traders." He argued that "Chinese investment should focus on manufacturing, not competing with locals for customers on the streets," and urged the government to "protect our small traders who are employed in retail trade."

In response to the allegations, government institutions such as the Tanzania Investment Centre, Immigration Department, and Ministry of Industry and Trade have promised to investigate the matter and take appropriate action. The National Investment Promotion Policy of 1996 seeks to promote export orientation on domestic production of goods and services to enhance the development of a dynamic and competitive export sector.

Local traders are calling for the government to enact a law that differentiates retail businesses conducted by foreigners from those of locals and to control the issuance of work permits to foreigners. They fear losing customers to cheaper products offered by foreign retailers and worry about the long-term impact on their businesses.

The growing presence of foreign retailers in Kariakoo has sparked a heated debate about fair competition and the need to protect local businesses. As the government investigates the allegations, the outcome could have significant implications for the future of retail trade in Tanzania and the role of foreign investment in the country's economy.

Key Takeaways

• Tanzanian traders accuse Chinese merchants of unfair competition in Kariakoo market.
• Foreign retailers dominate market, selling products at cheaper prices, threatening local livelihoods.
• Chinese investment in Tanzania totals $9.6 billion, with 1,098 projects by October 2022.
• Local traders demand government intervention to protect small businesses and regulate foreign investment.
• Government institutions promise to investigate and take action to address allegations of unfair competition.