Africa: Shoprite's Africa Gamble Falls Flat

  • Shoprite sells five stores in Malawi to Karson, which must keep workers and report regularly to the competition commission.
  • In Ghana, Shoprite plans to sell seven stores and a warehouse, marking another step back from its Africa dream.

Shoprite is pulling out of Ghana and Malawi after struggling for years to make money outside South Africa.

The company once hoped to be Africa's biggest supermarket chain, opening stores in more than 15 countries. But weak currencies, rising prices and high import costs made that dream impossible.

Keep up with the latest headlines on WhatsApp | LinkedIn

In Malawi, Shoprite is closing after 25 years. It sold its five stores to a local company called Karson. The country's Competition and Fair-Trading Commission approved the deal but told Karson to follow strict rules.

Karson must keep workers who want to stay and give proper benefits to those leaving. It must also report every three months for two years to show it is sticking to the agreement. The stores will now trade as Shopwise Trading Limited.

Many in Malawi worry about what this means for jobs. Retail is the country's second-biggest sector, but it has been shrinking because of import costs and a shortage of foreign currency.

In Ghana, Shoprite is selling seven stores and a warehouse. The company says the deal is "highly probable," meaning another exit is near.

Shoprite has already left Nigeria, Kenya, Uganda, Madagascar and the Democratic Republic of the Congo.

At home, though, things look bright. Shoprite opened 225 new stores in South Africa last year, bringing its total to 2,577 supermarkets.

Tagged:

AllAfrica publishes around 600 reports a day from more than 90 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.