ARTICLES

 

Navigating the Unknown Treasures of Guangzhou, China: Ghanaian Traders' Networks and Strategies

 

 

Mark Kwaku Mensah Obeng

Department of Sociology, University of Ghana, Legon, P.O. Box LG 65. Email: mkobeng@ug.edu.gh

 

 

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ABSTRACT

Using multiple ethnographic methodologies spanning a period of 13 months and collecting data across borders, this paper suggests that African importers' participation in the burgeoning economy of China is more nuanced than previously reported. It argues that approaches, motives and strategies employed by these importers are subject to their trading capacities such as the size of capital, trading experiences and locations of their imports. For instance, whereas experienced large-scale traders procure the services of 'visa agents' for convenient purposes, the small-scale trader's need the 'visa agents' to be able to undertake their business in China.

Keywords: China, Ghana, traders, networks.

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Introduction

Trade between China and Africa has grown steadily over the past 16 years. The highest value of US$ 215 billion was recorded in 2014 (CARI, 2018; Monyae, 2014) and is projected to reach $440 billion by 2025 (Sun et al, 2017). Despite the recent slump of values of commodity imports from Africa, the trade exchange between Africa and China has witnessed year-on-year average increase of 7.5% over the last 16 years of intensive trade (UN Comtrade Data, 2017). For many Africans however, the Chinese presence is marked by traders in the markets (Dankwah and Amoah, 2019; Obeng, 2018) and the availability of 'Made in China' products in their homes (Obeng, 2019b). These commodities are imported to the African continent by both African and Chinese traders. The literature on the importers and their activities is however tilted in favour of the Chinese (see Dankwah and Valenta, 2019; Gu, 2009; Haugen, 2011; Marfaing and Thiel, 2011; McNamee, 2012; Park, 2009).

Accounting for this neglect includes the fact that in studying the Chinese traders on the continent, the Chinese traders had expressed significant doubt about the abilities and competencies of the Africans to participate meaningfully in the import industry. They attribute these challenges to the structural difficulties in China as well as the bad business practices of the African intermediaries in China (Haugen, 2011; Marsh, 2016; Obeng, 2019a). This is in spite of the realization that there are more Africans importing Chinese products onto the African continent than their Chinese counterparts (Marfaing and Thiel, 2011). This observation negates earlier studies that have justified the lack of focus on African entrepreneurs on the lack of zeal and poor business practices (see Haugen, 2011).

This, however, does not mean that the reported challenges are not present. Instead, it indicates that the traders have successfully devised reliable networks and strategies to circumvent these and other challenges (Obeng, 2017). These new insights have also failed to present a segregated analysis of these African actors and instead present these networks and the strategies in a more linear fashion (see Babou, 2002; Bodomo, 2018; Cissé, 2018; Diouf, 2000; Tall, 2004) and thus blur the observable nuances exhibited by these actors as they navigate this new territory.

In this paper, I use the stories of two Ghanaian transnational importers of Chinese products (one small-scale and less exposed transnational trader and another large-scale and experienced transnational trader) to demonstrate and analyze how in the midst of the structural and cultural constraints, these African traders procure and devise varied networks and strategies to participate in the Chinese import economy. This is done by profiling the traders and their trading trajectories and by highlighting the networks and strategies utilized to participate in the 'treacherous Chinese import economy' (Haugen 2011:167).

Ghana serves as an appropriate destination for such an analysis because Ghana has witnessed a dramatic surge of imports since 2000 and in the process became the second largest importer of Chinese goods in Africa in 2006 (Jenkins and Edward, 2006). Specifically, data from the UN Comtrade - the International Trade Statistics Database - indicates that the value of imports increased from US$ 243 million in 2001 to US$ 1.8 billion in 2017, representing a cumulative increase of over 741% growth. Figure 1 below presents a summary of the annual data on Ghanaian imports from China.

 

 

Further, the data indicates a consistent increase in the values of imports except for the periods between 2008 and 2009 and between 2014 and 2016 that witnessed a year-on-year decline. Percentage-wise, the data indicates growth from 3.9% to 10.4% over the period.

 

African Traders and the Chinese Import Business

The potential expansion of trade between the two continents was identified during the African-Asian summit in Jakarta in April 2005. At the celebration of the 50th anniversary of the Bandung Declaration, the dramatic rise in international commerce between the two regions featured prominently. Similar interest was evident at the G-8 summit in Gleneagles in July 2005 when the leaders of the global North underscored the growing importance of South-South trade and investment flows, especially as they pertained to the prospects for fostering growth and poverty reduction in Africa (Obeng, 2015).

As expected, the rising exchanges between China and Africa have generated an academic interest in implications for Africa largely at the macro level. The works of the following scholars are instructive in this regard: Alden, 2007; Bodomo, 2018; Brautigam, 2003; Broadman, 2007; Cheru and Obi, 2010; Lampert and Mohan, 2014; Taylor, 2009. In particular, Marfaing and Thiel (2011:1) stated that:

[...]this highly diverse subject field has been scrutinized in terms of partnerships in developmental aid projects, cultural exchange ... and macro-economic and geopolitical issues related to large-scale Chinese projects in the natural resource or infrastructure sectors.

This interest has resulted in two major positions about the extent to which China's increasing penetration into the economies of Africa is good or bad for the continent (Ajakaiye and Kaplinsky, 2009;). In this debate, the optimists have emphasized the opportunities that China offers the African continent and its people, while the pessimists have highlighted the more exploitative aspect of the Chinese engagement (see Hess and Aidoo, 2014; Tsikata et al, 2008).

One area emphasized by the optimist group is the availability of global consumables to the African continent and the benefits that the increasing consumption of such imported items offer the consumers (see Dobler, 2009; Obeng, 2019b; Zi, 2015). While the dominant theme in this area of research has been framed as a form of imperialism, leading to massive reports of tension and acrimony between the Chinese and their African counterparts (see Dittgen, 2010; Dobler, 2009 McNamee, et al. 2012), new perspectives have emerged that underscore multiple responses of Africans to the Chinese presence on the continent (see Haugen, 2011; Lampert and Mohan, 2014; Obeng, 2018). For instance, Lampert and Mohan (2014) and Obeng (2018) make the point that what generally gets framed by outsiders as tension between Africans and Chinese traders, is mostly a demonstration of competing African interests, mostly between those who have the capacity to import directly from China and those African distributors and consumers who do not have such transnational capabilities and have over time come to appreciate Chinese traders as a cheaper source of Chinese goods. They both, however, conclude that Sino-African encounters involve more convivial relations than usually reported. It must, however, be noted that these remain fluid subject to the trading capacity of these actors.

Closely related to this paper is the set of works that have addressed the inadequate representation of Africans in the business of importing Chinese products. For instance, the Chinese on the continent assert that Africans lack both the skills and the zeal necessary to succeed in a 'treacherous Chinese business environment'. They state: "This environment requires extreme vigilance and good bargaining skills for a successful purchase. The absence of such competencies (apparently lacking in many Africans) will end one up with goods of different quantity or quality than the ones paid for'' (Haugen, 2011:167).

The description of mainland China as a 'treacherous and dangerous destination' was particularly widespread in Ghana in the early 2000s. As a result of this, the few Ghanaians who desired to import items from mainland China did so through other Asian intermediaries from Hong Kong, as illustrated in the narratives below by Kofiga and Mansaba, respondents in this study:

I knew that the Middle East people, from whom we were buying these goods from in Hong Kong were bringing these products to us from mainland China, but we dare not go there on our own. This is because we were told it was a very dangerous place with the possibility of losing even our lives (Kofiga, Accra)¹.

[...] The Chinese were dangerous people; they will take your money and give goods of inferior quality and that you won't even have anybody to complain to (Mansaba, Kumasi).

Additionally, the Chinese described the African attitude toward business as unproductive and less competitive. Haugen (2011) reports the Chinese traders in Cape Verde as saying, "whilst the African aims at earning 100% profit, we won't do that; we take maybe 30 or 50% profit" (Haugen 2011: 167). The latter view is shared by a sizable number of African small-scale traders and their consumers who attribute the dramatic domestic successes of Chinese importers to poor trading practices of their nationals (See Obeng 2018:6264).

Notwithstanding the above narratives, a scoping study in Senegal and Ghana in 2012, Ghana in 2015 and 2019 indicated that there are more Africans importing Chinese products in person than their Chinese counterparts (Dankwah and Amoah, 2019; Marfaing and Thiel, 2011; Obeng 2015). In terms of numbers, although currently, no reliable statistics exist on the number of Africans importing from China for sale in Africa, the population of importers is estimated to be large and continues to expand. The city of Guangzhou reported that about 60,000 African tourists, mostly itinerant traders, stayed in hotels in 2007 (Guangzhou Municipal Statistics Bureau, 2008), ostensibly to trade directly with Chinese factories and wholesalers rather than through intermediaries. Similarly, Bodomo (2012 and 2018) estimated that there were about 500,000 Africans in China with almost 60% of them being traders or engaged in trade-related activities. The huge numbers of Africans in this venture challenge the pessimism with which their Chinese counterparts had perceived their attempts at doing business with the Asians (Haugen, 2011) as well as the projection that the Chinese dream for Africans was dead or dying (Marsh, 2016). These traders travel from all parts of Africa regularly in search of various manufactured items in China and ship them to Africa for sale and ultimately for profits.

 

Research Method

The base data for this research was collected both in Ghana and China over a period of 13 months, as part of a larger study. The study sought to understand the networks and strategies that are used by Ghanaian transnational traders who import global consumables from China for sale in Ghana. The respondents included both Ghanaians and Chinese citizens involved in the import enterprise. Multiple ethnographic methods were employed, notably in-depth interviews with 50 Ghanaian importers - 30 from Accra and 20 from Kumasi (the two biggest commercial centres in Ghana). This was supplemented with key informant interviews with 3 visa agents in Ghana and 5 itinerant agents in China. The itinerant agents included 3 Ghanaians and 2 Chinese. Other Chinese nationals interviewed were suppliers and shop attendants from whom the Ghanaian importers bought their products in China. Additional data was solicited from Ghanaian residents in China, whose livelihoods were connected to the import business. The last set of data was collected during nonparticipant observation. This involved 'shadowing' a few Ghanaian importers in China while they undertook their daily business activities in Guangzhou. In all, 89 interviews were conducted to properly contextualize the narratives and experiences of the transnational traders. The data for this paper, however, includes additional data gathered through continuous engagement with some of the traders (2015-2018). All interviews were transcribed, manually analyzed and presented.

In this paper, I project the cases of two traders, with whom I have maintained a working relationship since 2013, to advance the subject of networks and strategies used by Ghanaian transnational traders importing from Guangzhou. These traders were among participants interviewed in 2013 in Ghana and subsequently, followed in non-participant observation in Guangzhou as they went about their trading routines in Guangzhou. The stories of the two are highlighted because they represent the two categories of Ghanaian transnational traders: large-scale and small-scale, a characteristic that to a great extent determines the different networks that are procured as well as strategies devised by the traders as they 'hunt' for their fortunes in Guangzhou. The discussion of the two cases is preceded by a summary presentation of the 50 Ghanaian transnational traders interviewed as part of the bigger project. This offers a broader perspective to the nature and strategies employed by Ghanaian importers, which the two selected cases typify.

 

Ghanaian Transnational Traders Importing Goods from China

The study involved 24 males and 26 females of varied trading experiences and demographics. This is a clear departure from other studies on Ghanaian transnational traders which have focused exclusively on women (Bowles, 2013; Darkwah, 2007). Although this challenges the perception that trade is a feminine enterprise (Clark, 1994; Cruickshank, 1853; Daniell, 1856; Robertson, 1983), it also reveals the dynamism that characterizes the trade enterprise. Further analysis indicates that men's superior access to financial capital has created gender differences in terms of what is imported and the volume of import between men and women. Specifically, most of males sampled (58%) traded in luxury and durable commodities and in large volumes, while the females (77%) were into fashion and trendy items that require relatively little capital.

Comparatively, the males were younger, with 71% below 40 years, while 65% of the females were above 40 years. The age disparity could be accounted for by three related socio-cultural practices in Ghana. The first is the unequal access to financial capital to the disadvantage of women (see Asiedu et al, 2013). The second is the practice of Ghanaians preferring to hand over their viable businesses to their male children rather than their female children, as in the case of Lamptey, whose story is related later. The third reason for the relatively late entry of women into international trade, are the domestic and gendered responsibilities such as the rearing of and caring for children, which make such long-distance business travels a tough field for women. To overcome the above gender-related challenges, particularly poor access to capital, female traders start from petty trading and rise through the ranks to become transnational traders as demonstrated by the story of Akorkor, discussed later in this paper. They do this by importing from countries such as Nigeria, Togo, Benin and Ivory Coast in a manner described by Ravenstein (1885:198) as "step-wise migration," a practice where emigrants who failed to satisfy the immigration criteria of Europe opted to travel to 'lower status, easy visa' countries from where they hoped to eventually relocate to a 'higher status' country (Konadu-Agyemang 1999). On the contrary, fewer men ever imported commodities from the coast of West Africa. They usually entered the import business as international traders.

The small-scale traders' activities in Guangzhou are characterized by the following: first, the importers do not have a known supplier from whom they import. Because of this, they have limited control over the design, style and sizes of the products they import. To be successful then requires them to move from one retail unit to another in search of marketable items and to 'pick' limited pieces. Though very stressful and time-consuming, the 'pickers'², unlike their large-scale counterparts, have the advantage of importing less compromised products because they buy the 'already made' products which offer a greater guarantee. Secondly, because they buy from various retail outlets, they enjoy the benefits of having a variety of items from various producers and designers as compared to the large-scale importers who purchase in bulk from limited producers. In China, the small-scale traders are usually seen with heavily loaded black polythene bags. They employ this strategy for about 80% of their time in China until they exhaust their funds. After successful purchases, they spend the rest of the period re-packaging for easy transport. The goods are transported home either by air or sea or a combination of both. The former, however, remains the main option. They buy up to ten, '32 kg' of extra luggage to transport their items home. With this, the traders are usually guaranteed their delivery between 3-5 business days. The cost of the extra luggage of 32 kg ranges from US$ 200 to US$ 300. This is, however, subject to space availability and thus becomes very difficult during the peak seasons - May to July and October to November. Another challenge is the limited size and weight permitted by air. As a result of this limitation, they complement their export by sea travel in a practice known in the industry as 'groupage' but technically known as 'less than container load' (LCL). The LCL implies that two or more importers hire a container and share the cost based on the space occupied by their goods. In terms of cost, sea transportation is cheaper. The 20-foot container costs between US$ 6000 and US$ 8000 depending on the season. But this may take between 6-8 weeks before its arrival at the Tema Harbour in Ghana. As a compromise, almost all traders simultaneously combine air and sea transportation.

Unlike the small-scale importers, the large-scale importers enjoy much more control over their type of imports and their sources of imports. These importers, wielding huge capital, are able to deal directly with wholesalers and factories. This direct access allows them to order for the production of quantities of a given item with their own specifications. Some of them even enjoy the privilege of their products being branded in their own registered trademarks. Additionally, instead of travelling from one retail market to the other, they rather move from factory to factory, usually located in the small villages of China or to the showrooms in the commercial cities. One of the greatest advantages these importers enjoy over their small-scale counterparts is the advantage of economies of scale. Ironically, this also poses the biggest threat to their businesses. Because of the large volumes of import, they are not always able to verify the quality and specification of all the items ordered. After a successful order and payments, the goods are usually transported after they have left Guangzhou to Ghana by their agents. They are mostly able to charter a minimum of a 20-foot container.

Closely related to this typology is the traders' perspective on the future outlook of the import industry. For instance, for the large-scale importers, the Chinese traders operating within the country poses a major threat to the future of the business, while the Chinese traders are the least of the challenges of the small-scale traders. In some instances, the Ghanaians have forged a complimentary trading relationship with the Chinese traders and rate other internal threats above the Chinese presence in the market space (for more details see Obeng, 2018).

Another difference is the means of procuring a Chinese visa. While all traders eventually resort to proxy to secure visas, the motivation for doing so differs. For the large-scale traders, it is motivated by opportunity cost but for the small-scale traders, it is out of necessity.

The varied strategies and nature of networks utilized by the respective importers as they endeavour to benefit from the hidden treasures of Guangzhou are told through the stories of Mr Lamptey, a large-scale importer and Madam Akorkor, a small-scale importer. Further, the study highlights how variations in gender, financial resourcefulness, international trade exposure and level of education shape the activities of Ghanaian transnational traders participating in the Chinese economy.

 

Lamptey - Large-Scale Importer

Mr Lamptey represents the educated Ghanaian men who have joined the business of importing global commodities into Ghana, an enterprise which was originally dominated by women (see Awumbilla et al, 2011; Bowles 2013; Darkwah, 2002). Lamptey, 34, is married with three children. He is a university graduate and combines his import business with his professional career as a civil engineer. Lamptey inherited the business from his parents, an enterprise they managed for more than two decades. Even though Lamptey had a sister who was the eldest child, their parents preferred him because they believed that guaranteed the family ownership of the business. A woman, according to the family, will marry and ultimately join her husband's family.

Lamptey manages the business together with his brother and three other employees. One of the three employees is a distant relative, while the two others are non-kin members. The business is, however, managed professionally, with little familial attachment. Lamptey maintains an effective bookkeeping system and has the company's account distinct from his personal account. The business is also registered with the Ghana Revenue Authority, the Registrar General as well as the local municipal assembly and pays tax regularly to the state. The business outlet is relatively big and is in one of the busiest sections of the Makola Market in Accra, Ghana. Apart from the shop outlet where the imported items are sold, he also has a large warehouse where the imported items are kept and from where he restocks the showroom and the sales outlet.

For Lamptey, taking over the business from his parent was not a very difficult task because on several occasions he accompanied his parents on their trips to Germany, the original import destination for business purposes and worked in the shop during vacation periods. This practically acquainted him with the day-to-day routine and management of the business enterprise. He took charge of the business eventually after completing his national service³.

Having taken over the business in 2003, Lamptey continued with his parents' legacy by importing from Germany the same sets of products such as men's suits, shirts and suiting materials and sold these items in the same shop and largely to the inherited client base. Occasionally, he tried to make some modifications to the line of business but stuck generally to his parents' business model. All this changed in 2005.

In 2005, Lamptey and his brother decided to shift the import destination from Germany to China. Lamptey, like most Ghanaians, was aware of China as a potentially profitable market but was very sceptical about the destination. Although he knew some Ghanaians had started importing from China since the early 2000s, he never considered a shift to the Chinese market because of the generally held perception that imports from China are inferior (Obadia, 2009). This began to change during one of his trips to Germany when he discovered that one of his most trusted suppliers also sourced his wares from China. This information came as a shock to Lamptey because all the while he believed that all his imports were made in Germany and usually boasted of the quality of the products to his competitors by displaying the 'Made in Germany' label. This worked because Germany remains one of the countries that Ghanaians in general recognize and acknowledge as makers of durable and quality products (Obeng, 2019b). This information suddenly changed his long-held scepticism about Chinese products and he immediately set into motion plans to import directly from China.

In September 2005 Lamptey saw an advertisement in one of the national newspapers inviting businesses to attend a trade exhibition, the Canton fair in Guangzhou, China. He enrolled and applied for a visa to attend the fair. As an experienced importer, acquiring a visa was easy for him. He states, 'I went to the embassy, picked up an application form, filled it out and attached all the needed documents including my bank statement and business registration certificate and in less than a week I had a 6-months' business visa'. Even though Lamptey wields the capacity to procure his visa in person, after five trips he decided to procure his visa by proxy because he felt it was more convenient to do so. He would instead collect the application form, fill it out, and attach all the relevant documentation including a letter of invitation⁴ and give it to the visa agent to facilitate the processing at a fee. He pays between US $250 and US$ 300 dollars per application.

Lamptey had little difficulty settling on what to import because of his experience. His main challenge was where and how he could buy these items. As a strategy, Lamptey preferred to have embarked on the journey in the company of an experienced Ghanaian importer, but he failed in his bid because of fewer importers of 'Made in China' items at the time. He, however, secured the services of a non-Ghanaian agent in China via the internet and arranged his trip with him. The agent was due to pick him up at the Baiyun international airport and guide him through Guangzhou.

On the day of the departure, Lamptey was disappointed when he arrived at the airport and discovered that fewer people had signed up for the program. He, however, was fortunate to have sat next to an experienced importer. He shared his concerns about the trip with the woman and solicited her assistance on the trip. On their way, he learned that there were Ghanaians in China who provide intermediary services to new traders. Lamptey requested such services and the woman arranged one for him. The preference for a Ghanaian intermediary is consistent with most of the Ghanaian respondents in this study who almost always preferred, particularly, at the initial stages, to have a Ghanaian contact person on their visits. This is also consistent with the literature on the role of what Darkwah (2002) calls transient nationalistic networks in helping importers navigate foreign terrain (Obeng, 2015).

On arrival, Lamptey was picked up and assisted to check-in at his hotel and together they discussed where Lamptey could find the items he was interested in buying and agreed on the terms of their engagement. Lamptey agreed to pay the agent US$50 per day in addition to his meals. Lamptey also bore the costs of transportation. Lamptey was interested in importing items such as floor and wall tiles, construction materials and electronic gadgets in addition to his core imports. The peripheral import, nonetheless, changes from time to time either as a result of specific requests or because different types of items caught his attention during the market tour.

Lamptey was astonished by the huge size of the market space and its structuring by wares:

Master! ! Their malls and markets are well structured and very huge; so, if you want garments, for example, the whole of Accra Business District will be for such items. So, when you get there, you will have to walk through these places, observing and making your bargaining. In fact, it will take you more than two or three days just to tour the garment market alone.

As a large-scale importer, he was taken to both the city market and showrooms in Guangzhou and two other factory sites in the small districts of China. The two factory sites were Foshan, for the sanitary items and Santon, known for electronics within the Guangdong province. These three sites remain his main import destinations. Lamptey, like most of his colleagues, even after years of importing from China and the Guangdong province, still perceives the region as a learning field. He says:

I am always learning on my trips. You see, sometimes, you might be thinking that you are actually dealing with a factory or wholesaler and so you are getting your wares at the best price only for you to realize that the things sell on another floor at half the price in the same department.

Statements such as the one above gives further credence to the description of China as 'treacherous' by the Chinese on the African continent. For Lamptey, therefore, the key to a successful purchase in China is a combination of meticulousness and persistence. Guided by this, he spends the first three to five days acquainting himself with developments within the market by combing the market and bargaining with potential suppliers without necessarily making any financial commitments. This activity was initially undertaken by his agents but over time, he has decided to take charge of it because the agents have consistently not lived up to his expectation. He is, however, unable to terminate the relationship with the agent because of some structural constraints, key among which is the language barrier, particularly as he moves to the outskirts of Guangzhou. Unlike the business district of Guangzhou, where the spread and use of the English language keep improving, in the smaller towns it becomes practically impossible to engage in any meaningful discussion without a Chinese-speaking intermediary. In addition to language, Lamptey needs the agent to supervise the delivery of ordered goods that usually tend to be supplied after his departure to Ghana. The agent then arranges and supervises the transportation of the goods to Ghana. This is in spite of the realization that the agents keep taking undue advantage of his lack of proficiency in the Chinese language by pre-arranging prices with suppliers with their mark-up included, a practice he refers to as a bi-commission. This is because the agent gains from both parties in a single transaction, a cost that is borne eventually by the trader. To protect his interest, he has changed agents on several occasions, but he remains unsure even of his current agent.

In terms of money, Lamptey spends between US$ 35000 and US$ 50000 per trip. After a successful purchase, Lamptey transports his goods mostly by chartering a 20-foot 'full container', but may in addition resort to 'groupage' when he has more products than the chartered container could transport. He spends between US$ 6000 and US$ 8000 per 20-foot container subject to the season. He regularly transports some of his imports by air to hold the business until the bulk of his imports arrive. Compared to others, Lamptey makes fewer (2-3) trips a year at an average airfare cost of US$ 3000.

He also complements the direct imports with indirect imports through the help of his agents and suppliers. Doing so, however, requires clear instructions and detailed descriptions of the products to avoid any difficulties or misunderstanding. So for instance, if he needs to import suits, he will, in addition to telling them the quantity, sizes and colours of the suits, include the number of buttons for each set and the type of lapel to be affixed. In addition, because he finds it difficult to describe the nature and types of fabrics, he sends samples of the fabrics properly labelled via airmail or other colleagues.

He also enters into a written agreement with the supplier in order to protect his stake. In these contracts, Lamptey makes a 20%-30% part-payment of the agreed sum and undertakes to pay the difference upon satisfactory delivery of the order. He arrived at this strategy in response to earlier mishaps which almost cost him his capital. Although Lamptey has reservations about his suppliers, he maintains that if he proves to be trustworthy, his action will be reciprocated by the Chinese suppliers. This, he believes, he has achieved successfully. As a result, he enjoys supply on credit, sometimes, even without making any deposits. He returns the money after delivery or sales. Notwithstanding this partnership, he remains very sceptical of the quality of the product. He says, "...in business, you never trust 100%."

Lamptey is not very optimistic about the future of the business even though he aspires to remain in the import business. Key to this expression of pessimism is the incursion of the Chinese into the retail business in Ghana. He sees the Chinese as undermining the Ghanaian participation in the distribution sector. He vehemently discounts the assertion that it is the Ghanaian quest for huge profits that makes the Chinese better competitors. Instead, he cites two major factors that work to the advantage of the Chinese. The first is the comparatively large volume of imports of the Chinese. This translates into a cheaper unit cost. Secondly, he believes that the Chinese circumvent the customs system and thus pay lower import duties than the Ghanaians. To illustrate the latter, he recounts an instance where a Chinese offered to help him 'clear his imports' at a lower cost. This according to him makes it unbearable for him and his counterparts. To illustrate this, he states that there are other colleagues who are now bankrupt because the Chinese are retailing at prices below their cost prices in China. He complains of losing some of his bulk buyers to the Chinese competitors as a result of the lower Chinese prices. To sustain this business, Lamptey and his counterparts demand the removal of the Chinese retailers from the market space and full implementation of the Ghana Investment Promotion Center Act, Act 825. The GIPC Act 825, 27 (a and b) grants Ghanaians the exclusive right to the "sale of anything whatsoever in a market, petty trading, hawking or selling in a stall at any place". In 2013 the state responded to this demand by setting up an inter-ministerial task force to address their issue. In the process, several shops operated by the Chinese were closed, while others operating illegally were repatriated. The activities of the task force, however, failed because of the complex nature of the situation (Obeng, 2018).

Amid the Chinese influx, Lamptey has decided to offer some customers who have proven over the years to be credit-worthy, supply credit. The decision to offer commodities on credit, according to Lamptey, remains one of the key strategies employed to maintain large-scale customers. Closely related to the success of the credit facility is the maintenance of social and personal contacts with traders and the offering of gifts, usually, purchased from China, as a token of appreciation. This offer of giving goods on credit to 'known customers' has not always yielded the expected prompt payments from the customers. Despite this, it continues to be one of the key strategies that Ghanaians use to compete against their Chinese counterparts since the Chinese lack the social connection based on which credit facilities could be extended and monitored.

This ability to offer goods on credit buttresses Petersen and Rajan's (1994) work on small-scale entrepreneurs' access to bank credit. Similarly, Uzzi (1999) argues that embedding commercial transactions in 'social attachment' allows the lender and the client to overcome their mutually experienced ambiguity. Just as it is in the case of banks, suppliers/creditors in this study invest in close personal relationships in the form of frequent interaction with each other's families in social settings such as child-naming or wedding ceremonies. Through these personal and extended ties, the creditors and the customers develop a trust and a deeper knowledge of each other's character and business dealings (Carruthers and Ariovich, 2013). In the process, as Uzzi (1999:488) points out, both parties form direct relations with third persons such as spouses and children whom they confidently rely on for perceptions of character and trustworthiness in their business dealings with others. Such interaction is not common between the Chinese suppliers and their customers. As a result, traders who do not readily have the capital to buy from the Chinese suppliers at a cheaper cost may still resort to getting their supplies at a relatively higher price from the Ghanaian who offers softer terms of payment.

The offer of soft payment terms is what allows the Ghanaian importers to maintain their status as the main channel through which imported goods are sold in Ghana (Marfaing and Thiel, 2011).

 

Akorkor - Small-Scale Importer

Madam Akorkor is a 53-year-old married woman with three children. Akorkor lives with her husband and her youngest child in one of the suburbs in Accra. Although Akorkor completed a Middle School Leavers' Certificate Education (MSLCE), she describes herself as an 'illiterate' person, because she cannot express herself fluently in the English language. She sells palm nuts as her main business and sells corn seasonally. She has been doing this for the past 30 years.

Five years ago, Akorkor took a giant step and joined the import business to generate an additional stream of income. She settled on fancy jewellery. She imported from West African cities - Lomé and Cotonou, the capital cities of Togo and Benin respectively. The choice of Togo and Benin was influenced by two key networks who helped her to navigate the two territories, an approach consistent with the role of networks as persons /groups that help new entrants to navigate unknown regions (Prell 2012:9). Her husband is a Beninese so when she decided on Cotonou, her husband accompanied her on the first trip and introduced her to one of his family members in the city. The relative who is a trader herself assisted her during her business trips to Cotonou until she was able to navigate the market independently. In Lomé, she also had a close friend who lived close to the Ghana-Togo border and assisted her with accommodation and communication. These persons were, thus, very instrumental in her insertion into the cross-border trade along the Ghanaian coast of West Africa. Six months later, Akorkor abandoned Togo and concentrated on Benin because Cotonou offered her more quality products than Lomé.

After importing from Cotonou regularly for two years, Akorkor discovered that the items were originally sourced from China at a cheaper cost. That was after she had inquired about the sudden absence of her Nigerian counterparts from the Cotonou market. On her return from Benin, Akorkor solicited assistance from a friend to travel to China. At that point, Akorkor had made sizeable savings from both her jewellery and oil palm businesses. The friend introduced her to a travel and tour agency to assist her to procure a Chinese visa. She paid US$ 400 for the services of the agency. She only had to submit her passport and two passport-size photos. The rest of the documentation such as a letter of invitation from a Chinese supplier, statement of account, business registration and tax clearance certificate were procured by the agency on her behalf. The agency also linked Akorkor to a Ghanaian based in China who serves as a trade broker to facilitate her business activities in China. The business relationship had changed from the initial role of an itinerary agent who was always with her during her visit to China to a business consultant who proffers experts knowledge when approached.

Akorkor changed her visa agent after two trips because she got better offer from another agency that charged US$ 300 instead of the US$ 400. The cost of her airfare over the periods has ranged between US$ 1000 and US$ 2000 for a return trip.

In preparing for her first Chinese trip, Akorkor sought to know from her friend how much money she needed to make a successful trip to China and back. Instead of a direct response, her friend offered her some guidelines. She quotes:

I cannot tell you how much money you need, but to be successful on your trip, you must at least have about double the amountyou spent securing the visa and your plane ticket and maybe your accommodation in China.

After several years Akorkor confirmed the validity of her friend's guidelines. Guided by this advice, Akorkor subsequently travels with an amount of between US$10000 and US$ 15000 and makes reasonable returns.

Similar to the experiences of Lamptey, Akorkor did not have a problem with her core imports, the jewellery items. As part of her preparation, she undertook a kind of market survey to identify the goods that sell fast at the best prices. To do this, Akorkor adopted a combination of pretense and deception. She recounts:

I couldn't go and ask them for their assistance directly, you know Ghanaian traders, they will not be truthful. So, what I did was to go to the stores and tell them that I am a regular customer and was there to re-stock. With this, they then opened up to me and I bought some items to be used as samples on my trip.... To be sure, I got the appropriate pricing. I tried to bargain vigorously and bought at the wholesale prices.

After a successful market survey and adequate preparation, Akorkor made her first trip to Guangzhou, China, in February 2010. She was met at the airport by her agent and taken to the agent's home. The agent had converted his private apartment in China into a guesthouse and rents out rooms within the apartment to his clients at US$ 15 a day compared to the average hotel rate which ranges from US$ 30 to US$ 50. The traders also have access to a kitchen where they can prepare their own preferred dishes during their stay in China. Akorkor therefore always carries some Ghanaian delicacies on her trips.

Just like Lamptey, Akorkor pays her agent US$ 50 a day. She is also responsible for his meals during their trips. The agent also assists her with currency exchange from US dollars to the Chinese RMB. It takes 3 to 4 days for her to go through all the business areas and to all the potential shops where she could find her choice of fabrics, dresses, shoes as well as the fancy jewellery.

As a strategy, Akorkor window-shops on the first 3 days as a form of recognisance. She takes note of potential items and their respective prices with the assistance of her agent because of the language barrier. The routines normally take her to major centres such as the Yulong Plaza, Canaan and the Sanyuali sub-way area. Other places also toured included Dashatou Flee Markets, the Tianxiu building and the Denferc hotel areas. These are known to have items that meet the taste of Africans and are mostly visited by African small-scale traders (Bodomo, 2012; Obeng, 2018). After this, she usually dedicates a day in her apartment to compare and review her notes and plan her subsequent itineraries. This also includes converting and expressing the cost in Ghanaian currency to determine its marketability in the light of products already on the Ghanaian market.

After these exercises Akorkor embarks on her shopping, mediated by the agent, from one shopping outlet to another. In between the regular purchases, Akorkor would sometimes purchase items she did not budget for but chanced upon in the course of her shopping when she envisages a potential market for the item in Ghana. In fact, some of these items, according to her, on a couple of occasions, had fetched her more profit than her regular imports. Akorkor further reveals that it was this possibility of an 'occasional bonanza' that had entrenched her desire to always make the Chinese trip in person even though she could have arranged for her regular imports to be shipped to Ghana on her behalf.

Akorkor has ceased moving around with her agent but maintains close contacts with him and continues to stay in his apartment, if it is available, when she travels to China. In addition, she calls him for assistance when needed and when she intends visiting an unfamiliar place. She discontinued using the services of the agent mainly because she had become conversant with navigating the market area independently. Just like Lamptey, Akorkor also attributes her decision partly to some unethical practices of the agent. She accuses the agent of not being truthful as he always sought to steal from her either by pre-arranging prices with the suppliers or overstating the cost of services he renders on her behalf. This decision was not taken hastily, though. Akorkor prepared and armed herself before finally severing the relationship, albeit not completely. Akorkor set out to observe all the relevant processes, closely and to learn some of the relevant expressions in the Chinese language. In particular, she learned and took note of key landmarks so she would know where to board and alight from the bus, how to communicate with the taxi drivers and, most importantly, how to negotiate prices with her suppliers. To use a taxi, she learned to collect complimentary cards from all the shops she visited. In order to keep track, Akorkor makes notes on all the cards. When she needs to make a visit, she will stop a metered taxi and show the destination to the driver and she will be driven to the destination. Similarly, to transact business with the suppliers, Akorkor recounts:

One just needs a workable calculator and three important Chinese phrases. The phrases are, tiga do sa, which translates into 'how much'; the second is tud tudi, which means 'reduce the price' or 'your last price'; and haundu haundu, which is to tell the supplier that you are interested in buying in bulk.

Bodomo (2012:43) calls the use of these simple expressions, combined with the use of a calculator and body movements, "calculator communication". It works for Akorkor because she makes all her purchases in the main cities of Guangzhou where these expressions are meaningful to the non-English-speaking Chinese suppliers. This approach, though familiar to Mr Lamptey, cannot suffice for him, because he does most of his business activities in the less cosmopolitan districts. The service of an intermediary, therefore, becomes indispensable.

After a successful purchase, Akorkor transports her commodities to Ghana by paying the airlines for the excess baggage. She pays between US$ 150 and US$ 200 for every 32 kg luggage and is permitted up to 10 pieces of excess luggage. Where she had more goods, she made use of sea transport.

Unlike Lamptey, Akorkor does not have a retail outlet where she sells her imports but rents a room where she keeps her imported items. She sells her products through a combination of targeted marketing and personal retailing. She visits boutique owners and wholesalers and showcases her products to them and retails them to friends and other acquaintances, including her palm fruit and corn customers.

She has little concern about the increasing presence of Chinese retailers in Ghana. Her challenge relates to the difficulties in acquiring a visa and the depreciation of the Ghanaian cedi against the major trading currencies. This is because it increases the cost of her items which directly reduces the volumes that she can import as well as the quantity she is able to sell which ultimately affects her profit margin. For Akorkor, therefore, as long as the presence of the Chinese traders does not deny Ghanaians access to China, the Chinese traders pose no threat to her business.

 

Conclusion

The two cases presented above serve as a signpost to the lives and navigation processes of Ghanaian transnational traders who import from China. The study reveals that both men and women with varied trading experiences are involved in the importation of global consumables from Guangzhou. In terms of demography, the study confirms the assertion that the import business is a high-class enterprise (Bowles, 2013; Darkwah 2007). The field is dominated by well-educated people, contrary to the notion that trade is for the poorly-educated who cannot find employment in the mainstream economic sector. A significant number also combine their formal sector jobs with their import businesses, as in the case of Mr Lamptey.

Although all the importers are within the active working age group, the males are comparatively younger (mostly below 40 years) than the females (mostly above 40 years). A combination of socio-economic factors including male dominance and access to financial capital, result in women's late entry into the import industry, though they have a longer history of trading. This also influences the nature of items and the volumes of items imported.

The regularity and consistency of importing by Ghanaians successfully defy the pessimism of the Chinese traders on the continent and show the agency of the African traders, as passionate, entrepreneurial and resourceful. This is despite the problem they face from their compatriot agents in China and other issues such as the difficulty in obtaining a travel visa, competition from Chinese importers back in Africa and depreciation of the local currency.

They have achieved this by procuring the services of relevant networks at every stage to render services that they could not perform in person. The longevity or otherwise of these network relationships nonetheless depends on trust and personal capacity. As innocuous as the situations may be to reduce risks, the engagement is done in a piecemeal fashion until the point where trust between the parties is secured. When this is abused, the relations are terminated either completely or are reviewed to safeguard the trader's interest. Succeeding in such environments thus depends on tactfulness. This requires different approaches and strategies to be used by different categories of traders. For instance, small-scale traders, by necessity, have to maintain the networks in order to procure their visas while the large-scale importers do so for convenience. Similarly, the services of the itinerary agent in China can be terminated permanently by the small-scale trader without jeopardizing their business interests but this becomes a near-impossible option for the large-scale importer who buys from the outskirts of the capital city. This paper therefore argues that although the occurrence of disequilibrium may trigger a desire to terminate network relationships, cessation does not occur automatically. Instead, cessations are subject to the context in which the network relationships are being implemented.

 

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1 Kofiga and Mansaba are among the first set of Ghanaian traders who began the import business in mainland China. Prior to importing from China, they had imported from other countries including Malaysia, Singapore and Hong Kong. Importing from Hong Kong, they had learnt that the products imported were cheaper in mainland China, particularly in Guangzhou, but were for years never courageous enough to enter mainland China because of the reported threats. To imports from mainland China were only possible with the services of middlemen, mostly from the Middle East.
2 This term is used to refer to small-scale importers who normally carry with them very small amounts of money on their trips, moving from one shop or market to another as they search for and buy limited quantities of various already manufactured products usually for retail in their home country.
3 National service is a mandatory one-year service to the state by all citizens usually after tertiary education. A proof of national service certificate is a fundamental requirement for future employment.
4 As a measure by the Chinese authorities to control the number of persons who enter the country and to ensure that all persons who enter China have legitimate reasons for doing so, the immigration service now insists that all persons desiring to enter China must produce a letter of invitation. For traders, this should be issued by a registered trader, usually, from a major client. For the large-scale traders procuring this letter is easy because they already have clients who have the capacity to issue these letters. The small-scale traders, however, do not have major and regular suppliers with such capacity. To secure this, means resorting to using the services of an agent.