New Era (Windhoek)
Catherine Sasman
23 June 2009
interview
Chinese Economic Counsellor Talks about Labour Relations Involving Chinese Companies
What is the size of Chinese investment in Namibia over the last five years?
The Embassy does not have exact figures of Chinese investments into Namibia because not all investments go through the Embassy. Government to Government investments comes in terms of aid, grants, concessional loans.
As far as investments are concerned over five years, we have roughly counted about US$50 million.
Aid has gone to the construction of hospitals and schools, the construction of the new State House, for a vocational training center, the drilling of wells in the south, and low cost housing in the Katutura area and the Regional Council in Rundu.
How many Chinese building constructors, retailers and other business people are currently in Namibia?
We now have roughly ten Chinese construction companies in Namibia. There are 500 Chinese employers here. The figures, however, change from time to time due to the construction projects. These companies employ about 1 500 local workers.
As to the retailing sector, all together with their family members, there are 24 00 people and they employ about 5 000 local workers. There are thus, roughly speaking, 3 000 Chinese working in Namibia.
As you are aware, Namibian small retailers - particularly in northern Namibia - have complained that their businesses are overrun by Chinese businesses, that they find it difficult to compete with these businesses, and as a result are squeezed out of business. Do you think there should be a balance struck between these small Namibian companies and Chinese retailers?
We think competition is an inevitable phenomenon in the economic and social environment, particularly in economic globalisation today. As long as we understand that under the same rules of fair competition, the result will promote economic development. Competition also can mean more rational allocation of resources and help enterprises to improve their efficiency, reduce their costs and provide better services and products to the public.
The direct result of Chinese retailers entering Namibia is that competition has to some extent restrained Namibian inflation because they can provide very low prices of products. In that sense, the lower income groups can afford many necessities and the lowest income groups can consume goods and services.
I have read a research report done by the Polytechnic of Namibia that talks about the reasons for the failure of Namibian small enterprises. The report quotes officials from the Ministry of Trade and Industry. The feeling is that they lack ability, that they are more family businesses, and regardless of the corporation, they lack a development strategy. It indicates that these businesses should improve their ability to competently deal with competition. We have the same idea.
The way to solve this problem is to improve the capability of these enterprises, and to enhance their competitiveness rather than to ask Government to eliminate their competitors.
One way to improve is to get into joint ventures with Chinese retailers and enterprises and so use their own advantage - and the Chinese part can do the same. The other way is that some Namibians simply go to China Town to buy wholesale and sell these goods in remote areas at their own businesses.
Nafau has expressed serious concern over bad labour practices at Chinese retailers. The union claimed that these practices happen in most Chinese businesses. Of these complaints are that Namibian workers' rights are violated in terms of annual leave, sick leave, maternity leave and overtime payment. The Embassy has facilitated two meetings between the Chinese employers and the union. There is, however, a feeling that the Chinese employers are avoiding the Namibian union. How should closer ties be established between the two camps?
We read in the newspaper and got a letter from Nafau that we passed to the Chinese Chamber of Commerce.
This is a universal problem. Whenever you have an employer and employee there will be problems. But to resolve the problem is not to get into conflict with each other. Dialogue is more important. We did facilitate meetings. At these meetings each side expressed their ideas. They reached some understanding. It is important to listen not only to the union, but also to the side of the Chinese employers.
We have received information from the Chinese Chamber to arrange an appointment with the union, so they do want to talk.
We think conflict can do nothing to resolve problems. The only way is through dialogue. The Chinese Chamber of Commerce already held a meeting where they have decided to make some improvements as far as the salaries, working conditions, and so on are concerned.
The chamber has issued leaflets and papers to Chinese employers in which they address Chinese employers to comply with Namibian laws and also to be friendly to the local people.
We will keep on facilitating meetings between the two groups. From time to time the Embassy requests the local Chinese people to be friends with Namibians, be more active in social activities in the Namibian society.
Some of the Chinese enterprises are doing quite well in this. For instance, some made donations to the flood victims in the north. There is an organisation called Loving Heart that from time to time makes donations.
To what extent is the Chinese Embassy aware how Chinese companies comply with the Namibian labour law?
By every means, be it meetings or at every possible chance we address our Chinese businesses and construction companies, associations and the chamber, and request them to comply not only with the labour laws, but also all Namibian laws.
Most of the Chinese companies are really employing a lot of Namibian workers. Most qualified workers get very good pay.
There is criticism that particularly construction companies not only bring their own equipment, but also their own workers.
Construction companies employ many locals. Perhaps for the technical positions, for instance, some construction companies pay even much more for qualified workers than local companies. Chinese Hu Na International, which is currently doing construction on a road in Rundu, is employing a lot of technicians from the local society. Again, for example, a driver of a truck - where some level of skill is required - on this project is earning N$20 000 or even more.
There might be one or two companies that are not complying with the local law, but they are in Namibia and any violation of the law should be criticised, corrected and punished by the local authorities. This should not be so only for Chinese companies, but also other foreign and local companies as well. Any violation of the law must be corrected.
Chinese employers experience language problems, most are in the country not for a long time and are therefore not accustomed to the local customs. We appreciate it that the Chinese employers are listened to as well.
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