China’s import expo offers great trade prospects

Tuesday January 1 2019

Business centre. The National Exhibition and

Business centre. The National Exhibition and Convention Centre Shanghai in China where the China International Import Expo was held in November. courtesy photo 

By Joe Nam

In the words of Chinese President Xi Jinping, the China International Import Expo (CIIE) is the world’s first import expo held at the national level, an innovation in the history of global trade and a major step by China to open market access to the world and support economic globalisation.
Organised by the China’s Ministry of Commerce, the CIIE attracted a big number of visitors mainly because of the way it was organised and promoted.
China’s diplomatic missions worldwide informed host governments about the CIIE and the opportunities it presents. The Chinese government has subsidised participation for African countries by offering exhibition space free of charge. Countries were only required to build their exhibition booth.
Uganda did not, however, utilise China’s offer of free exhibition space, unlike neighbouring Kenya. Kenya was represented by a delegation of more than 100 business personalities and entrepreneurs led by President Uhuru Kenyatta. Uganda sent only 16 people hawking mainly arts and crafts products.
According to an official from the Ministry of Trade who was at the expo, Uganda confirmed participation late when all exhibition space had been taken and potential exporters to the Chinese market did not respond as expected despite early communication.
The main respondents were mainly crafts shops. A Ugandan crafts dealer said she received overwhelming demand for her products and looks forward to participating in CIIE 2019.

Why CIIE is important
The CIIE is an open door to a $6 trillion market. From China’s $1.841 trillion import bill in 2017, 55.9 per cent were spent on goods from Asian countries. European countries trade partners took 17.7 per cent while 10.2 per cent went to North America. Smaller percentages of overall Chinese imports were spent on Latin American countries and the Caribbean. Africa took only four per cent.
Though the Chinese market is open to agricultural products – subject to quality and standards rules under the World Trade Organisation – Uganda still suffers a huge trade imbalance with China, something the Ministry of Trade attributes to poor marketing and distribution networks, transport related challenges, high cost of production, low production and low productivity, and post-harvest handling challenges such as storage, packaging and branding.
To address the trade deficit with China, the ministry proposed promotion of the Build Uganda Buy Uganda policy that empowers domestic sourcing of raw materials; promoting special economic zones that include industrial parks; establishing import replacement industries, which include attracting Chinese investments such as the Sukulu Phosphates Comprehensive Industrial Project.
Government is thus implementing exports related strategies that include the National Development Export Strategy, National Policy on Service Trade; and sector specific policy on cotton and coffee that highlight key market access penetration strategies for the major products and services.

Expo can solve uganda’s trade imbalance - chinese ambassador

Offering market. Chinese Ambassodar to Uganda

Offering market. Chinese Ambassodar to Uganda Zheng ZhuQiang

What is you assessment of the first China International Import Expo 2018?
The first China International Import Expo (CIIE), which successfully concluded in China in November has achieved great significance and drawn attention from around the globe. It has also produced tangible and positive outcomes for participating countries and the world economy.
According to information released by the CIIE Bureau, the expo ended with value of intended deals of more than $57.8 billion.
As Chinese President Xi Jinping said in the opening ceremony, CIIE is not China’s solo show, but rather a chorus involving countries from around the world.

In what ways could Uganda benefit from the Chinese market?
China is a huge market with a population of 1.4 billion people, and Uganda’s unique products have a great potential in China’s market.
By exporting to China, Uganda can effectively solve the problem of trade imbalance. As we saw from the first CIIE, a total of 3,617 companies from 151 countries and regions showcased their products in the business exhibition at the expo, and four Ugandan companies participated, including the NEC, FANAZA Ltd, Blessed Trade and Preg –Tech. Their products covered Coffee, Honey, Shea Butter, Jewelry and IT Services.
According to their feedback, they have got some orders from the Chinese, and more important is they get access to China’s market. I believe in future more Ugandan companies will get a chance to participate at the CIIE and more Ugandan products will come to China’s market.

How would you describe China’s trade relations with Uganda? What is China’s forecast of trade with Uganda in the short, medium and long term?
Statistics from the Chinese Customs show that trade volume in 2017 between Uganda and China has reached $811 million. Our two countries are enjoying a strong trade complementarity, and now China has become the second largest trade partner and the most important source of import for Uganda. Last September, Beijing Summit and the 7th Ministerial Conference of FOCAC was successfully held.
President Xi Jinping announced eight major initiatives in collaboration with Africa, including the trade facilitation initiative. The eight major initiatives delineate the blue print for China-Africa relations in the new era, and I believe the trade relations between China and Uganda will achieve great progress in the future. We will also solve the trade imbalance through our efforts such as the CIIE.

How does Africa get to benefit from the Belt and Road Initiative.
Launched in 2013, the Belt and Road Initiative refers to the Silk Road Economic Belt and the 21st Century Maritime Silk Road, which seek to serve as a platform for international cooperation, and create new drivers for shared development to benefit more countries and peoples globally.
With focus on connectivity in five areas including policy, infrastructure, trade, financing and peoples, China seeks to align the initiative with the UN Sustainable Development Goals the AU’s Agenda 2063 which is a blueprint for Africa’s development and prosperity.
It is also hoped that this initiative will open way for Africa’s economy, which is undergoing robust growth to integrate with the global economy. The Belt and Road Initiative is vital to address the infrastructure deficit in Africa, thereby accelerate the structural transformation in the continent.

How would you describe the guiding principle of the Chinese economy, is it communist, socialist or is it capitalist
Last year at the opening the 19th National Congress of the Communist Party of China, Party Secretary General Xi Jinping said that Socialism with Chinese Characteristics has come into a new era. Socialism with Chinese Characteristics entering a new era means that socialism is full of vitality in the 21st Century China.
It will be an era of securing a decisive victory in building a moderately prosperous society in all respects, and of moving onto all out efforts to build a great modern socialist country. It will also be an era that sees China making greater contributions to mankind.

What is China’s timeline of becoming the world’s largest economy
We do not aim at ‘largest economy’. We have our own goal. The 19th National Congress of the Communist Party of China drew up a two stage development plan for China. In the first stage from 2020 to 2035, we will build our country and see that socialist modernisation is basically realised.
In the second stage from 2035 to the middle of the 21st Century, we will build on having basically achieved modernisation, work hard for a further 15 years and develop China into a great modern socialist country that is prosperous, strong, democratic, culturally advanced, harmonious and beautiful.

Form joint ventures with Chinese, says Ambassador Kiyonga

Inviting Ugandans. Ugandan Ambassodar to China

Inviting Ugandans. Ugandan Ambassodar to China Crispus Kiyonga

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What is your assessment of CIIE 2018?
This is the first ever purely import expo in China. China has 300 million upper middle-income class persons And so the demand in China for goods and services is huge.
In the expo, it was evident that the opportunities for sale of goods mainly in China abound.
Uganda will take opportunity of this CIIE and the forth coming China Africa Economic and Trade Expos annual events to expand its exports to China.

How can Ugandan improve her balance of trade deficit with China?
The demand for Uganda’s coffee is growing. We have now started exporting dried mangoes and other tropical fruits to China. We are now working on identifying the full list of agricultural commodities for export to China.
[There are plans to] put in place programmes to step up production and processing of these commodities. Our collaboration with China is also intensifying import substitution.
In Kapeeka industrial zone, floor tiles to cover more that the needs of Uganda are under production.The excess is being exported to our neighbours. At Tororo phosphate, fertilizers are now being produced. So the momentum is on but we only need to accelerate it.

What are you doing to help Ugandans export services to China, for example English language teaching ?
[When President Museveni] was in Beijing for the third FOCAC summit, he made a very strong case to his [Chinese] counterpart Xi Jinping about teaching of the English language and commodity exports from Uganda to China. However, our comparative advantage is in commodity exports.

How many Ugandans are living and working in China?
We do not know the precise numbers yet, but we are working on it. What is clear, however, is that the numbers are going up. I am happy that there are Ugandans beginning to do significant business in China. We shall ensure that the environment increasingly gets more favourable for them.

How many Ugandans are jailed in China? And what are the prospects of their release?
There are slightly over 100 prisoners from Uganda in Chinese prisons and most of these have been convicted for drug trafficking.
They will have to serve the sentences as imposed by the courts. Criminals must be punished in accordance with the law. Dealing in drugs is very bad for Uganda and also the rest of the world. Therefore, governments must cooperate in fighting this crime. The government of Uganda and China are working on an agreement for exchange of prisoners. What this means is that a prisoner sentenced in China will be transferred to serve his/her sentence in Uganda. This does not mean release or reduction of sentence. No one in the world should condone crime.

What would you advise Ugandans in respect to business and scholarship opportunities with China?
We should do more business with our friends in China. We must take advantage of this huge market.
We should link with the Chinese even at personal level and form joint ventures on a win-win basis. But there should be no cheating by either side to ensure that this relationship is sustainable.
For education, we should choose courses properly. Even, those coming on private financing require guidance. I think the government will have to create a mechanism to achieve this. I am happy that Ugandan universities are making collaborative relations with universities in China.
My piece of advice is that this collaboration should be properly thought through before it is undertaken to ensure maximum benefit.

ugandan participants

Getrude Amanya, Monalisa Art and Crafts: “The CIIE was a very good experience for me. I enjoyed Shanghai and China very much. I displayed my arts and crafts and attracted a lot of interest. I plan to participate next year again.”

Stephen Kiwanuka, BBS TV journalist: “As a journalist, I was very interested in attending and covering it (CIIE). I learnt that most of the things Africa needs are in China but should be approached in a systematic and serious way. Look at what Kenya did, President Uhuru Kenyatta was there. Ugandans like to go in a small and individualistic way.
Ugandans were carrying small art and crafts in a bag. That only goes to show the world that Ugandans are small time thinkers not yet ready for the big league. Ugandan traders should digitise and run proper websites. I urge government to take the CIIE very seriously.”

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