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Trading nations

Updated: 2013-01-25 11:57
By Zhang Haizhou and Xu Junqian ( China Daily)

Trading nations

Shoppers choose products at the Uganda booth of the African Products Exhibition and Trade Center in Yiwu. Zhang Jiancheng / for China Daily


El-Maairgy is optimistic about his business prospects and is happy in Yiwu, but it was a different story when he first arrived in late 2005.

He came with little more than a 91,000 yuan ($14,600) deposit from a potential customer back home, and within a month of arriving lost 41,000 yuan to a thief on a bus. When he returned home after three months in China, he vowed never to go to China.

But a customer "pushed" him back, he says. "He told me that he only trusted me."

The second time around things turned out much better. Police had caught the thief, though El-Maairgy got nothing back, and his company began to make money. He now plans to live in Yiwu for three more years.

"Bad things happened to me in China when I came, but afterwards there have only been sweet memories," he says.

But not every African business person is as optimistic as he is. A Sudanese businessman is said to have fled Yiwu earlier last month leaving up to $12 million in debt in his four-year-old trading company.

China's national broadcaster CCTV, which reported the case, blamed the global economic turmoil as the key reason, adding that "such an incident is no longer a rare, single case".

Mamadou Sall, 46, from Senegal, and president of Chinafrican Business Association in Yiwu, agrees. He says his business has been "very slow", despite rising export figures for the city last year.

He also blames the political upheavals of Arab countries in North Africa and rising costs in China in recent years for his situation.

"The price of everything is increasing," Sall says.

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The profit of Sall Industrial Co Ltd, which he established in 2000, has fallen to just 2 percent now, he says. The best years of his business, exporting textile goods from China to 15 African countries, were 2005 and 2006, when profits reached 20 percent.

The Yiwu China Commodity Index, or Yiwu Index, also reflects sluggish trading conditions for consumer goods in recent years.

The index, launched in late 2006, and which is the nation's first weighted index on consumer goods trade, comprises a price index, prosperity index and 10 single indices.

The prosperity index, published monthly, reflects the general situation and prospects for the market.

It closed at 1,022.13, its base being 1,000, last month, 17 points down from November. It peaked at 1,250.35 in September 2006 and remained above 1,200 points for the rest of the year.

But it slumped during the world financial crisis in 2008 and has remained between 1,000 and 1,100 points for much of the time since. It dropped below 1,000 for the first time last February and to a low of 973.03 in May.

The world economic situation has resulted in a slump in confidence among market dealers, Yiwu China Commodity Index Information Periodical said after last month's figure was announced.

Ma Enyu, of the Institute of African Studies at Zhejiang Normal University, was doing a project on the African community in Yiwu in early 2012.

"I actually didn't hear that many upset messages last year," Ma says. "But profits are set to be lower due to more competition and rising labor costs in China. So it's now time to consider how to upgrade and survive."

Sall says his company has been making changes to generate growth. His company now imports agricultural goods from Africa, such as peanuts and sesame from Senegal.

He has also opened two shops in Yiwu to sell African crafts, such as wooden sculptures and handmade drums.

"Things are getting a little bit better," he says.

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