The cheap Chinese store in the middle of Kenya row End-shutdown

Protesters wanted China Square to permanently close its doors

A Chinese-owned shop selling cheap housewares at the center of a dispute in Kenya has reopened after a counterfeiting complaint was dismissed. The dispute came at the center of a debate about whether this type of exit hurts or helps Kenyans.

Short presentation gray line

Short presentation gray line

Waving whistles and vuvuzelas, small Kenyan merchants marched by the hundreds to the vice president’s office in Nairobi to demand an end to what they called a “China invasion.”

The China Square store, which had become a hit with consumers due to its cheap products, was the focus of his anger. Its rapid success had reignited longstanding fears about competition from abroad.

The store, which is located in a shopping mall on the outskirts of Nairobi, had already closed its doors, albeit temporarily, at the time of last week’s protest as controversy swirled around it.

Just five weeks after going public, he had become a social media phenomenon. Its low prices compared to what the small merchants charged and its convenient location made it very attractive.

But some small-scale traders, who are a vital part of the Kenyan economy, began to notice a drop in business.

“We want the Chinese out of Kenya. If the Chinese become manufacturers, distributors, retailers and even street vendors, where will the Kenyans go?” an unidentified shopkeeper told reporters at the protest.

Peter Sitari, who imports and sells beauty equipment in Nairobi, was one of those who attended the rally.

He says that a plastic pedicure stool that costs around $43 (£35) in his store, retailing in China Square for around $21, effectively knocks him off by more than 50%.

“Many companies in Kenya are going to close their shops and our economy will collapse,” Sitari argued.

Pedro Sitari

Peter Sitari says he can’t sell his wares at China Square’s lowest prices

Pressed to explain why he was charging so much more, he said he was covering the taxes and duties he was being charged and thought he might be buying the goods from China at a higher price than China Square.

Despite being asked by the BBC, China Square did not explain how it set its prices, but it could benefit from being able to buy in bulk.

You may also have a more direct relationship with manufacturers. Many of the smaller merchants in Kenya have to go through middlemen and may be charged more as a result.

China Square founder Lei Cheng insisted he had done nothing wrong.

“My business is legal and focuses on healthy competition. We have cooperated with all government directives to open a business in Kenya and we are here to break the monopoly,” Mr. Lei said.

He added that his business raised more than $157,000 in its first two weeks.

“The people who fight us feel threatened because Kenyans now know that we exist and we are not exploiting them on prices.”

‘Quality products, affordable prices’

Some Kenyan shoppers are siding with the retailer.

“China Square must be allowed to operate. They are selling quality products at affordable prices,” said Sharon Wanjiku.

“The cost of living is very high right now and these prices are exactly what we need.”

The store’s rapid popularity followed by controversy caught the attention of the government, with a minister saying it should cease to operate as a retailer.

“We welcome Chinese investors to Kenya, but as manufacturers, not traders,” Trade Minister Moses Kuria said on Twitter on Friday before China Square closed.

It is unclear why the store closed its doors to customers. There were suspicions that he had been pressured by the authorities.

A statement from China Square said it was closing to “re-evaluate and replan our company’s strategy” and was “considering cooperation with local merchants.”

But late last week, the Kenya Anti-Counterfeiting Authority said it had investigated an allegation that China Square was selling fake goods, but had found no evidence that this was the case.

On Monday, the Kenya Chinese Chamber of Commerce (KCCC) welcomed the reopening of China Square after talks with the government, however it did not elaborate on the issue of the conversations.

“The Chamber expects equitable and fair treatment of all businesses throughout [the] to ensure a conducive business environment for all,” the KCCC statement said, but did not say whether any new agreements had been reached.

protesters in nairobi

There were huge protests against China Square

Some fear the dispute over the store has sent the wrong message about the economy and investment interest.

Korir SingOei of the Ministry of Foreign Affairs has been trying to reassure potential investors, saying that Kenya welcomes foreign money and does not discriminate where it comes from.

Wu Peng, the top diplomat for Africa at China’s Foreign Ministry, welcomed the clarification, saying “a non-discriminatory investment environment is vital for the healthy development of practical bilateral cooperation.”

In the past, Kenya has struggled to find a happy medium between attracting foreign investment and promoting free trade while protecting local traders from what some see as unfair competition.

“Preventing foreigners from doing legitimate business in Kenya is regressive. We need to see how to build the capacity of Kenyans so they can produce competitive products,” says Kenyan economist Gerrishon Ikiara.


Kenya’s Investment Promotion Act, which sets conditions for foreign investors, requires that an investment be beneficial to the country through things like new jobs, the transfer of new skills or technology, or the use of raw materials. or local services.

There is no data available showing how many Chinese traders or people there are in Kenya, but there has been growing anti-Chinese sentiment in recent years. This is partly due to accusations that individual Chinese in Kenya have been racist, as well as fears that Chinese merchants will take businesses and jobs away from Kenyans.

In 2019, Kenyan authorities deported seven Chinese nationals who had been operating in two markets in Nairobi, accusing them of not having work permits and saying they could not operate in a sector that had been reserved for locals.

In 2020, four Chinese men were deported after being accused of caning a Kenyan who worked at a Chinese restaurant.

President William Ruto has so far stayed out of the matter, but before his election last year he vowed to deport Chinese nationals involved in businesses that could be conducted by Kenyans.

“We have agreements with different countries about what level of business or work the locals should do and what is allowed, where you should have [a] work permit, to foreigners. And that level is not selling in kiosks, retailers or roasting corn,” Ruto said last June.

China Square is clearly not operating as a kiosk, but its reopening continues to present a challenge for small merchants, whose complaints have not gone away.

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