Chinese businessmen ‘buying up township shops’

CHINESE entrepreneurs were fast moving towards taking over all small businesses, including shebeens, in townships, in a move that would heighten poverty among locals, said ANC MPL Nhlakanipho Ntombela.

Ntombela, who is chairman of the economic development, tourism and environmental affairs portfolio committee, told the provincial legislature in Pietermaritzburg yesterday that the Department of Economic Development should assist black people in townships to sustain their businesses instead of selling them to foreigners.

“We recently visited Amajuba District (Newcastle) where a number of liquor outlets were visited. To our surprise, the Chinese community is almost taking over this sector in the townships and small towns,” he said.

Ntombela said liquor store owners were being tempted by large money offers from Chinese businesspeople in exchange for their businesses.

“We will end up with all the small businesses being taken away from locals and being run by foreigners. These are some of the anomalies that the department must correct.”

Ntombela said a report released by former UN high commissioner for human rights Judge Navi Pillay had indicated that recent xenophobic attacks came as a result of local business owners being frustrated by competing with their foreign counterparts. He said this had caused many who found the competition too fierce to fall into poverty.

Unfair

“Many South Africans operating tuck shops and spaza shops alleged that businesses owned by foreigners thrive due to unfair advantage, and that impropriety undermines the viability of local businesses,” he said.

The latest Statistics SA report indicated that most of the 19.5 million young people in the country had been drawn deeper into poverty between 2009 and 2014.

“The share of the youth between 20 to 34 years old among the employed declined by 2.9%, from 42.6% to 39.8%. The total share of young entrepreneurs declined by 2.6% between 2009 and 2014 from 29.8% to 27.2%. The percentage of youth living above the poverty line declined across all nine provinces.”

Another contributing factor to poverty among young people was the mushrooming of shopping malls in rural and township areas. He said these malls destroyed small entrepreneurs.

“In most of our townships, like Hammarsdale, Edendale, Imbali, Esikhaweni (Richards Bay) we can see clearly the consequences of malls built without due diligence in empowering locals. They have killed township economies.”

Ntombela said a new plan and strategy was required to empower small local businesses.

Economic Development MEC Mike Mabuyakhulu said the department would assist small business owners, especially young people, to compete by “cutting out the middle man” to buy their trading stock straight from producers.

bongani.hans@inl.co.za