Wednesday, February 29, 2012

Why ‘Made in China’ is a problem for Uganda

Over the last festive holidays I strolled through my home town of Mbarara and was astonished at the number of Chinese immigrants in retail outlets selling commodities such as Chinese mobile phones in outfits which in Kampala-speak would be called emidaala.

I know it is not unusual in today’s Uganda to find Chinese immigrants in retail businesses as we have seen in Kikuubo in Kampala and I occasionally shop at a Chinese-run supermarket in the suburb of Wandegeya. But Mbarara was new for me.

Now, this is no homophobic treatise but I was struck me by what these developments say about the changing character of Ugandan commerce and how Chinese industry in Uganda has truly come full circle by completing the supply chain.

Products are made in China, imported by Chinese traders in Uganda, through an efficient export machine and are now directly sold in Uganda by Chinese retailers.

If you have shopped at any local supermarket in any town in Uganda, you will be forgiven for thinking that everything is ‘made in China’ these days. Chinese products have an irresistible lure. They are cheap.

They typically cost less than any other similar product (including Ugandan- made ones). But there is a catch.

Chinese industry has made many products seem cheap and affordable and many Ugandans have bought their first TV set or electric fan because of cheap Chinese products but this may come at the expense of the local manufacturing sector.

It now seems few Ugandan manufacturers can produce goods locally at prices that rival Chinese products. And this is why.

The cost of doing business in Uganda is not terribly competitive. Commercial bank loans interest rates in Uganda are as high as 30%. The cost of energy is prohibitive and recently, a 40% hike in electricity tariffs was announced. Many businesses have to do with expensive thermal generators during regular and prolonged power cuts. Uganda can’t even compete with China on labour cost.

Chinese engineers and construction companies typically bid lower than Ugandan construction forms for civil works and deliver that project faster than Ugandan contractors.

But there are some exogenous variables working in favour of Chinese businesses in Uganda and elsewhere.

The Chinese government subsidizes Chinese businesses in Africa and in many cases offers very low interest loans to businesses willing to set up shop in Africa. You have heard the Americans perennially complain that the value of Chinese currency is kept artificially low, making Chinese products seem cheap to importers.

Then Senator Barack Obama while visiting Kenya in 2007 pitted Kenyans for thinking that they would compete with Chinese industry saying even the Europeans and Americans had given up. When ever I return from Europe, I am amazed at how many souvenirs and Items I bring in from ‘Europe’ that are actually ‘made in China’.

Statistics show that in 2008, Ugandan exports to China that include cotton, coffee, leather and fish amounted to $20m while imports such as mechanical and electrical appliances stood at $202m.

Uganda’s trade deficit with China has more profound effects on the economy. Besides turning Uganda into a net importer of Chinese products and rendering local manufacturing uncompetitive with losses in manufacturing jobs, the repercussions extend to the value of the Ugandan shilling and imported inflation from China, among many ills.

An economic report shows that Chinese textile imports have caused 80% of Nigerian factories to shut down, resulting in 250,000 workers losing their jobs.

In response to these challenges, South Africa has introduced a quota system for Chinese textiles that limits entry of Chinese textiles. Joint ventures between Chinese and Ugandan entrepreneurs is another alternative middle round.

But the Chinese have built us a football stadium, a city hospital, a twin-tower president’s office and our foreign affairs ministry office block. Should we then be surprised at their benevolence?

And I am typing this on a lap top made in China, while wearing my made in China slippers, drinking coffee out of a mug made from China.

Thursday, February 23, 2012

African NGOs petition US government over Cape Town IP summit

Over one hundred human rights NGOs, including some from Uganda, have petitioned the US government to stop a three-day Intellectual property summit set to take place in Cape Town, South Africa in April 2012.

The summit has been called to discuss intellectual property enforcement on the continent and could be a critical meeting affecting millions of poor Africans.

Intellectual property touches on issues such as banning Indian generic AIDS drugs by enforcing patents for western pharmaceutical giants, outlawing extensive photocopying of educational materials published by western multinationals, limiting access to newly developed disease-resistant agricultural seeds for poor farmers or cracking down on counterfeit Microsoft computer programmes.

Intellectual property refers to exclusive rights held by inventors and innovators of new drugs, books, plant seeds, software developers etc. These rights are enforced by international law and unlawful access to them attracts penalties.

The Cape Town summit , billed as ‘ Africa Intellectual Property Forum: Intellectual Property, Regional Integration and Economic Growth in Africa’ is organised by the US Department of Commerce. It has been hyped as the first Africa-wide ministerial-level event of its kind. The summit is jointly organized by World Intellectual Property Organisation (WIPO) and several US multinational companies including PfIzer, Dolby,Caterpillar and Microsoft.

The summit has drawn the ire of human rights NGOs in Africa , partly because of a disturbing conflict of interest, it is sponsored by US multinationals in collaboration with western governments such as US,France and Japan who own most of the intellectual property rights and seek to enforce them in African countries where the majority of people live on less than a dollar.

''It’s a shame that the Africa IP Forum is putting emphasis on IP enforcement agenda. One would expect the continent to be discussing the Development Agenda in light of its social economic challenges in the areas of health, education and agriculture. Over emphasis on IP enforcement is iniquitous of the continent's population that still badly needs to utilise the policy space provided for by the TRIPS Agreement" said Mulumba Moses of the Center for Health, Human Rights and Development, a Ugandan human rights NGO.

The summit is being castigated by human rights activists because it appears to reverse gains made by African governments in securing exemptions from enforcing intellectual property rights of multinationals in poor countries,such as the 2006 TRIPS agreement in Doha which granted poor countries a grace period until 2016 to consume cheap generic AIDS drugs manufactured in India.

It is feared that the summit may trigger new intellectual property legislation in African countries in a compliance move that my curtail access to products, in some cases, life-saving drugs such as AIDS or Tuberculosis (TB) drugs.

The irony of the South African government playing host to a summit ,on African soil, seeking to perpetuate western multinational interests by curtailing access to life-saving drugs or educational materials to poor African students is not lost on African and global human rights NGOs.

The sentiments of the petitioning African NGOs are aptly captured by Sangeeta Shasikant, Legal Advisor of the Third World Network: '' The US is well known for pressuring developing countries to adopt TRIPS plus standards. The Africa IP Summit is another attempt by the US to advance its aggressive agenda on IP protection and enforcement such as Anti-Counterfeit Agreement (ACTA), that favours the interests of certain powerful multinational companies. The US concept paper and programme totally disregards the numerous developmental and socio-economic challenges facing Africa. Issues of access to affordable medicines, access to knowledge, misappropriation of genetic resources and associated traditional knowledge, farmers' rights are totally disregarded''.

Saturday, February 4, 2012

'Get off the sexual network': Uganda's widespread concurrent sexual partnerships

 'Have you ever seen a man who who does not cheat? Tell me if yours doesn't cheat.All men cheat. But we make sure we do not have kids with those women we sleep with' celebrated Ugandan musician, Bebe Cool, was quoted in a Sunday Vision interview with journalist Carol Kasujja, in the May 6th 2012 edition, when asked to comment on rumours that his wife had left him over alleged infidelity.

The non-regular sexual partners are often called names: 'spare tire', 'side dish', 'away match', 'side mirror..etc.

The very choice of names betrays Ugandans' social acceptance of casual sex. It is in Uganda that you will hear people call sexual intercourse as 'playing sex' . It is like a simple, casual game. Some kind of harmless fun. But it isn't fun.

Concurrent sexual partnerships or a situation where an individual is having more than one sexual partner at the same time is the leading driver of new HIV infections in Uganda- according to the Uganda AIDS Commission.

Ironically,it is married couples or people in stable relationships who are driving up new infections but also who are at a higher risk of HIV infection in Uganda because of reckless sexual behaviour. Married couples in Uganda have more unprotected sex than younger,single people. Married couples' aversion to condoms is legendary.'condoms don't belong in a marital bed' one couple says defiantly.

Today I listened to a lively Saturday morning health talk show on Radio One where this was the topic of debate. Why are Ugandans partial to 'side dishes' to use the tongue-in-chick reference to extra marital sex?

And the panelists were not short of answers. 'Women lose sexual appetite when they grow older,yet mens' libido's doesn't wane with age so a man has to look out for it' a middle aged male caller volunteers.

'Sometimes we women are in our periods and during such times, men should not be made to wait' a female caller volunteers. Ugandans are clearly socially accepting of marital infidelity. Although that is usually skewed in favour of the male gender.

In many Ugandan traditional societies, a man can be culturally granted divorce on account of a wife's infidelity although the reverse is not as easily accepted.

Cheating used to be a preserve for men. But not anymore. 'We now also have the money. When I know my man has a 'side dish', I also revenge and get a young man to satisfy my needs. These days we don't depend on men for money. We have our own money' says Namukasa Jane, 43(Not real name).

Statistics from Uganda AIDS Commission show that males still cheat more than females although the latter are catching up fast.

Uganda which was renown for taming new HIV infection rates in the early 1990s, for the first time, is on the wrong side of global trends which show that that new HIV infections are on a downward spiral even in the most affected countries like South Africa.

Uganda's new annual infection rates are set to reach 150,000 new cases compared to 120,000 cases last year and 100,000 cases in the previous years.