Views on quality still sticking point

Forum discusses how to boost China-Africa trade, which is hampered by inaccurate stereotypes

Quality continues to be a key factor for Kenyan and Chinese trade links, as highlighted during a promotional forum in Nairobi that brought together business leaders and entrepreneurs.

The head of a delegation from China's Fujian province, Chen Shaohe, said most Chinese products meet global quality standards, yet Chinese entrepreneurs still face challenges in marketing their products in Africa due to misconceptions.

"Chinese products are affordable and relevant for emerging markets, but quality is usually the key issue determining the level of trade," says Chen, who is also deputy director of the Fujian Department of Commerce.

He adds that Kenya and the province will realize increased trade once quality issues are addressed.

According to the commerce department, this year has seen Kenya-Fujian trade grow 77 percent to $120 million. Export volume stands at $114 million, while imports have reached $6.13 million. In 2014, trade between the two sides was $182 million, up 36 percent on the previous year.

The one-day forum promoting products from Fujian saw an exchange in strategies on how to spur business growth between the two sides.

Kenya exported products worth $4.97 million to the Southern Chinese province last year - an increase of 574 percent on the previous year. The main imports were zirconium and its concentrates, titanium and its concentrates, manganese and its concentrates, and leather.

"The Chinese business community has identified additional areas of cooperation in sports, electronics and auto industries," says Michael Munyao, chairman of the Kenyan chapter of the China-Africa Friendship Association.

Such forums are suitable for candid interactions, he says, and visitors were keen to develop their presence in Kenya. "They're here looking for suitable partners who can be distributors. This is a steppingstone to penetrate regional markets, while the transfer of technology will benefit the local economies."

Li Shifang, general manager of Fuzhou GFF Keypower Equipment, which makes diesel generators, says his company is interested in opening a service center in Nairobi that will support its products in the market and complement its South African offices, launched early this year.

"We're looking for partners who have identified the opportunity our products offer, a partner whose main concern is not the price, but the effectiveness and relevance of the product to the market," he says.

In addition to diesel generators, Keypower sells hybrid products with integrated solar and diesel systems. Li says these products are suitable in remote areas that have no access to the national grid.

"They can work independently from the grid," he explains. "During low-radiation periods, when it is cloudy and not enough energy is generated, the diesel system kicks in to bridge the power deficit."

The product has been popular in Nepal and Cameroon, as well as in some Chinese cities. Keypower sells in more than 40 countries and has 10 overseas branches, mainly service centers.

Fujian Keyton Motors, however, is keen on building assembly plants in Africa. The company, known for its vans, says plans are at an advanced stage to establish factories in Sudan and Nigeria.

"We may consider Kenya in about two years," says Fan Dingqiang, the automaker's sales manager for Africa. He notes that Keyton's 131-hectare factory in Fujian assembles right-hand-drive vans, but as they push toward expanding into Africa, the new assembly plant will produce left-hand-drive vehicles.

"Our vans are of high quality, and we have partnered with some global brands such as Mercedes-Benz," he says, adding that the vehicles are "high in efficiency, low in fuel consumption".

Also at the forum was Joyce Laboso, deputy speaker of the Kenyan National Assembly, and Senator Beatrice Elachi. In her speech, Laboso commended the continued warm cooperation between her country and China, saying she is deeply encouraged by the economic benefits from investment and trade fairs hosted by the two countries.

"The fact that Fujian is showcasing its potential and products is testimony that not only have the two countries cooperated at the national level, but it is cascading to the other levels of government," she says.

According to Zhou Bin, marketing director for Africa for Julong Group, a palm oil processor, says China still has advantages in many industries and can offer suitable and quality goods to the African market.

"Made-in-China electronic devices and light industry products still have huge market potential, as only a few countries in Africa, such as South Africa, Nigeria and Kenya, have light industry systems. Light industry products are the most needed category in Africa right now," he says.

In terms of quality goods, there are inaccurate stereotypes about Chinese goods sold in Africa. He says top Chinese brands with good quality and suitable prices still have not made their mark in Africa. The best way is to gradually introduce them to the market and, he adds, localize production.

China should strengthen city-to-city communication, as it will serve Africa's own development goals, according to Zhou. "Some African countries have started positioning themselves into a specific development mode, and if a Chinese city has a similar development mode or experience, it will be a very effective way to share experiences and promote bilateral relations, which will remove the need for unnecessary, high-level governmental procedures," he says. "For instance, Kenyan's harbor city Mombasa is a perfect sister city for China's Shenzhen, in Guangdong province, which made great progress by using its strategic port location."

Fujian, which exports commodities such as garments, shoes, electrical equipment, metal, stone, porcelain, chemicals and steel products, is considered one of the most developed areas in China, with 18,000 international trading companies based there. It is characterized by its export-oriented economy.

Contact the writers at Lucymorangi@chinadaily.com.cn.

(China Daily Africa Weekly 08/21/2015 page21)