INTRODUCTION
This article explores the socioeconomic impacts of Chinese entrepreneurial migration to Ghana. Africa has seen a significant increase in Chinese investments and migration in the past few decades (Chen et al. Reference Chen, Goldstein, Pinaud and Reisen2005). Unlike large-scale investments by corporations and the labour that moves along with them, Africa has also seen an increasing wave of individual Chinese entrepreneurial migration at the turn of the 21st century (Axelsson Reference Axelsson2012). Chinese entrepreneurial migrants are largely independent of huge Chinese firms and come to Africa to pursue their own economic interests (Marfaing & Thiel Reference Marfaing and Thiel2011). The literature on global migration has focused more on movements from poor to developed regions. Such a pattern has little relevance to movements within the South (Bakewell et al. Reference Bakewell, de Haas, Castles, Vezzoli and Jónsson2009) and the ensuing implications. For the developing world, the impact of China on countries in Asia and Latin America has been a focus, with relatively little work on Africa. Some studies on Africa have focused on China's soft power (Amoah Reference Amoah2016), as well as industrial competitiveness and macroeconomic performance with little attention to specific sub-sectors (Taylor Reference Taylor2006; Giovannetti & Sanfilippo Reference Giovannetti and Sanfilippo2016; Adolph et al. Reference Adolph, Quince and Prakash2017). Relatively few have explored Sino-African relations below the macro level (Mohan et al. Reference Mohan, Lampert, Tan-Mullins and Chang2014; Giese & Thiel Reference Giese and Thiel2015) and discussed the social impacts on local African communities (Liu Reference Liu2010).
Departing from a micro perspective, this article explores the everyday dispositions of indigenous Ghanaian entrepreneurs towards the Chinese presence in local Ghanaian trading spaces. In addition, it explores the impact of this presence on indigenous traders and the wider socio-economic effects in local trading spaces. Its micro perspective is distinguished by its focus on Sino-African relations beneath the macroeconomic level that is prevalent in the literature. It thus diverts from the studies that have explored the macroeconomic effects of China's rise on Africa and adds to the relatively fewer but increasing studies that examine how Sino-African encounters affect peoples’ lived realities (Rigg Reference Rigg2007) in African communities.
Despite the late entrance of Chinese traders into trading hubs in Accra and their small numbers relative to Nigerian, Indian and Lebanese traders, they constitute a highly visible section of the trading community in Ghana and continue to account for a large share of the trading community, not only in numbers but in volume of trade and investments (GSS 2013; IOM 2017).Footnote 1 By ‘starting from below' (Rigg Reference Rigg2007),Footnote 2 this article sheds light on the dynamics of the bourgeoning Chinese presence in an African community. We do this by exploring these questions: What are the everyday dispositions or attitudes of Ghanaian traders towards the Chinese presence in local trading areas?Footnote 3 How does the increasing Chinese presence affect Ghanaian traders, consumers and local trading spaces? Are some indigenes benefiting from the Chinese presence whereas others suffer?
This article is based on fieldwork conducted in 2016 in four suburbs within the area popularly referred to as the Central Business District of Accra, the major trading area in Ghana's capital. It relies on the realistic group conflict theory to explain Ghanaian trader attitudes towards their Chinese counterparts. We compare with the contact hypothesis to provide complementary and contrasting explanations where relevant to make comprehensive sense of the data. The article has three main sections. The first explores previous research and sets out the theoretical tenets used in explaining data. The second discusses contemporary Chinese investment flows to Ghana vis-à-vis the attitudes of Ghanaian traders towards the Chinese. The last explores the impact of Chinese trading activities on Ghanaian trading patterns and communities.
PREVIOUS RESEARCH
Three categories of studies are relevant for our article. First, are studies on the Chinese economic presence in Africa. Mohan & Tan-Mullins (Reference Mohan and Tan-Mullins2009) note China stepped up its relationship with Africa at the turn of the millennium. Improved relations coupled with increased trade have facilitated Chinese migration to the continent by state-backed firms, and private traders who are among the new shapers of African development. While several Chinese companies operate in key sectors, for most Africans, the Chinese presence is manifest by trading in local spaces (Mohan & Tan-Mullins Reference Mohan and Tan-Mullins2009). Dobler (Reference Dobler2005) notes that a common feature across African cities is that they have hosted at least one Chinese shop in the past few decades. Chinese shops are at the forefront of new South-South relations and are run mostly by petty entrepreneurs who are behind the availability of cheap Chinese goods in Africa (Mohan & Tan-Mullins Reference Mohan and Tan-Mullins2009). Their products range from consumables to complex equipment, mostly imported from China. They purchase directly from Chinese producers, which reduces middlemen and import costs (Park Reference Park2009).
The second includes studies on Chinese investments in Ghana. China and Ghana have agreements spanning diplomatic and economic cooperation (Tsikata et al. Reference Tsikata, Fenny and Aryeetey2008). Per Ghana Investment Promotion CentreFootnote 4 (GIPC) (2006) statistics, China was the second main source of foreign investment in Ghana. Between 1994 and 2006, the GIPC registered 249 Chinese projects with 19% in General Trade and 34% in Manufacturing. Tsikata et al. (Reference Tsikata, Fenny and Aryeetey2008) note that Agricultural and Manufacturing received the largest Chinese investments followed by General Trade in 2001. Despite a dip in 2002, General Trade recorded an increase, making it the second largest after Manufacturing. Again, though the overall decrease continued through to 2003, General Trade continued to increase to 15.78% relative to 10.25 in 2002. By 2003, General Trade (84%) had overtaken Manufacturing as the largest recipient. It continued to be the highest sector through to 2006. The primary activity in this sector is the trading of goods (Tsikata et al. Reference Tsikata, Fenny and Aryeetey2008: 6–9). Tables I and II show Chinese investments from 2001 to 2006.
Table I Investments from Chinese companies to Ghana ($000).
* These figures are inclusive of Chinese investment into Service, Tourism, Building & Construction, Export Trade, and Agriculture. Source: GIPC in Tsikata et al. (Reference Tsikata, Fenny and Aryeetey2008: 6–10).
Table II Chinese share as a percentage of total foreign investments in Ghana (%).
* These figures are inclusive of Chinese investment into Service, Tourism, Building & Construction, Export Trade, and Agriculture. Source: GIPC in Tsikata et al. (Reference Tsikata, Fenny and Aryeetey2008: 6–10).
Tables I and II show that Chinese companies have invested largely in Manufacturing and General Trade. While investments in Manufacturing have decreased over the years, they have increased in General Trade. Tsikata et al. (Reference Tsikata, Fenny and Aryeetey2008) argued hypothetically that investments in Manufacturing could create jobs and facilitate technological transfer. Conversely, it could displace domestic manufacturers. Indirectly, this could cause disinvestment and relocation of foreign investors, scaring away potential ones. Increasing investment in General Trade, apart from displacing local traders, could mean less spin-offs to the Ghanaian economy as Chinese profits could be sent abroad (Tsikata et al. Reference Tsikata, Fenny and Aryeetey2008).
While the studies above are relevant for our analysis indirectly, the third category is of direct relevance as they discuss relationships between Chinese and Ghanaian traders. Scholars discuss these largely along complementary, collaborative and competitive lines (Haugen Reference Haugen2011). Ajavon (Reference Ajavon2014) applies this analogy to Chinese and Ghanaians trading in Ghana. Complementary relationships, she notes, arise where experienced Ghanaian transnational traders are constrained into partnering Chinese peers due to the stress of importing from China, difficulties in obtaining Chinese visas and competition from Chinese traders. Collaborative relationships constitute petty traders who do not have the capacity to import from China and therefore buy from Chinese merchants to re-sell. In addition, there are landlords, Ghanaian labour employed by the Chinese and consumers of Chinese goods. Competitive relationships connote members of the Ghana Union of Traders and Association (GUTA)Footnote 5 who are sceptical of the Chinese and demand their withdrawal from markets (Ajavon Reference Ajavon2014). Conversely, Liu (Reference Liu2010) describes the relationships emerging from the Chinese presence and goods in Ghana along the lines of place, goods and people.
Several studies discuss concerns about the growing Chinese presence. Liu (Reference Liu2010) suggests Chinese traders in Accra appear threatening because of their low-quality items and their transactions in a space marked by economic and historical importance. For Axelsson (Reference Axelsson2012), instead of characterising African concerns as anti-Chinese, taking a closer look at them might reveal that the complexities of these responses are better couched as contextually mediated constructions and strategies embedded in places where they emerge. Hinged on these, we explore in which ways responses towards the Chinese could be wholly and partially divergent depending on settings and positions of Ghanaian merchants.
THEORETICAL FRAMEWORK
We believe the above-mentioned antagonisms may be associated with sociological perspectives on conflicts (Coser Reference Coser1957). The realistic group conflict theory and contact hypothesis provide us with useful lenses. The former, according to Levin & Campbell (Reference Levin and Campbell1972), posits that prejudice and discrimination are underpinned by conflicts of interest between groups. Campbell (Reference Campbell and Levine1965) notes that when group objectives are incompatible, conflict and negative intergroup behaviours are likely to exist. On the contrary, where compatible, they generate positive relations. The theory does not hold that actual competition over resources exists for prejudice to occur. Instead, it is the perception of competition that results in conflict. Further, outgroups that are salient and distinctive from one's group are more likely to be marked as competitors (Esses et al. Reference Esses, Jackson and Armstrong1998).
For the contact hypothesis, interaction reduces intergroup prejudice when optimal conditions are present (Schiappa et al. Reference Schiappa, Gregg and Hewes2005). Conditions include regular contact, balanced ratio of in-group to out-group members, competition-free contact, and contact involving genuine friendship amongst others (Dixon et al. Reference Dixon, Durrheim and Tredoux2005). Also, Schiappa et al. (Reference Schiappa, Gregg and Hewes2005) notes that parasocial contact (human processing of mass-mediated communication) boosts positive parasocial responses and changes in beliefs about minority groups.
Inspired by these, we explore whether Ghanaian attitudes are based on compatible interests with Chinese traders. Though the competition expected to generate resentment towards Chinese traders could be happening based on GIPC data, what is relevant is whether there is perception of Chinese competition. We also use the contact theory to explore dispositions of Ghanaian traders who may not have negative perceptions. We determine if Chinese-constructed projects influence Ghanaian perceptions in line with the parasocial hypothesis.
A critique of both theories is that studies on intergroup relations often equate in-group favouritism reciprocally to out-group negativity (Brewer Reference Brewer1999). However, as Allport (Reference Allport1954) acknowledged, affiliation to in-group does not necessarily cause hostility towards out-groups. We address the common misinterpretation and critique by combining realistic group conflict theory with contact hypothesis in analyses. By doing this, we use one to cater for the shortfall of the other and fulfil theoretical adequacy (Crang & Cook Reference Crang and Cook2007). Further, we demonstrate what conditions underpin intergroup conflict/harmony that transcend mere divergence/compatibility of group interests using our data, and highlight the underlying and intersecting class/race relations. Despite distinctions between the theories, their predictions are not incompatible and do complement each other in explaining intergroup relations.
METHODOLOGY
This article forms part of a July–August 2016 study. We combined various qualitative methods and data with interviews in exploring our questions. These included secondary data from GIPC, participant observation and mass media debates. Combining diverse purposive sampling, we gathered data from Ghanaians selling in the same areas as Chinese traders (primary informants); GIPC and Ministry of Trade; Ghanaian trader representatives – GUTA; and a Sino-African expert – Director of Centre for Asian Studies and lecturer at Department of Political Science, all of University of Ghana (key informants – five males and a female) via interviews and textual methods. In total, we interviewed 18 informants. Gatekeepers with decades of experience in the communities informed our sampling. Some had experiences with both Ghanaian and immigrant merchants. Further, feedback from initial interviews informed subsequent choices of participants via snowballing.
Primary informants comprised four males and eight females aged between 28 and 65 who hailed from different parts of Ghana but lived in the capital. Most averaged between 35 and 45 with a few older than 45 and younger than 35. Five sold in Zongo Lane, three at Rawlings Park/China House and two each at Kantamanto and Okaishie. Four sold footwear and bags, three electricals, and one sold clothing and footwear, underwear and clothing, cleaning equipment, jewellery and sewing materials. We sampled them from different sectors as regards kinds of wares to avoid bias. Diversity across how long they have traded (some as long as 30 years, others as recent as two), modes of sales (wholesalers or retailers, or both), kinds of goods and the different locations endowed the study with rich variety in exploring in-depth attitudes towards Chinese migrants.
We sampled the communities/traders as field sites/primary informants because these communities host the highest concentration of Chinese merchants in Ghana. They represented the highest visibility of Chinese trading activities, more so in Zongo Lane and China House. Concurrently, they had the highest concentration of other immigrant traders. They thus endowed the study with participants who possessed a better comparative sense of indigenous attitudes towards Chinese traders as well as impacts from their influx.
We anonymised our interviews and the huge population of field sites prevents compromising identities. Interviews ranged between 20 and 90 minutes. We encouraged informants to narrate their attitudes towards the Chinese. They described changes in their trade prior to the Chinese influx and the aftermath thereof. We urged them to comment on how they have been impacted by the Chinese influx. For our key informants, we deployed unstructured interviews given their diverse institutions and portfolios. This allowed ‘new’ insights into Sino-Ghanaian relations in trading.
Initial analysis influenced later choices of participants and data gathering techniques. It was evident after the first series of interviews that moving from a semi-structured to unstructured approach would give primary informants the opportunity to assert what they find relevant in their relationships with the Chinese. As relevant codes such as ‘individual’ and ‘group’ conflicts, unassertiveness from local government, and definition of ‘market’ emerged, later analyses focused on interconnections between individual attitudes and group rhetoric vis-à-vis concerns of local authorities in a complex web of Sino-Ghanaian relations. We also acquired GIPC statistics to comprehend the contemporary trend of Chinese investments.
We recorded our observations before, during and after interviews, and over the fieldwork period through notes. Observations comprised scouting communities to observe shop owners’ nationalities, inquiring prices in Ghanaian and immigrant shops, and observing the generic scene as trading transpired. We did some observations routinely during fieldwork and others simultaneously when interviewing traders. Observations assisted in raising supplementary queries about unexpected events by inputting observed experiences into later interviews, using an unstructured approach to allow participants more room to tell their experiences. For our purposes, observation's utility was not mutually exclusive (Kearns Reference Kearns and Hay2000: 243).
We triangulated interview data with participant observation. Further, we compared observations with not only the first author's rich historical experience of the communities, having grown up within them but also with gatekeepers’ knowledge. The combination of interviews, observations, gatekeepers’ insights and author's first-hand knowledge enabled us to gauge traders’ perceptions with the socioeconomic impacts. We exercised reflexivity throughout fieldwork enabling us to insert ambiguous issues from previous interviews into subsequent ones for clarification and to generate new knowledge. To augment the theoretical and analytical rigour of our findings, the first author's insider perspective complemented the outsider perspective of the second author, an established scholar in migration and ethnicity. Both perspectives have advantages and disadvantages (Kusow Reference Kusow2003; Carling et al. Reference Carling, Erdal and Ezzati2014). Combining different positions and triangulating our interpretations, we achieved advantages of both by using the strengths of each to offset the other's weaknesses.Footnote 6
CHINESE FDI TO GHANA AND RELATIONS BETWEEN CHINESE MERCHANTS AND LOCAL TRADERS
Our analyses of available statistics provide us with insights into how foreign direct investments (FDI) at the macro level are intertwined with attitudes between host community members and nationals of FDI source countries at the micro-community level. We infer from GIPC data that Chinese investments in Ghana have undergone significant transformation recently. We divide the 15 years since 2000 (2000 to 2015) into two periods, and compare the contemporary (2008 to 2015) flows to the first half (2000 to 2007). Table III shows Chinese registered projects from 2000 to 2007 and Table IV, 2008 to 2015.
Table III GIPC Chinese Registered Projects across Sectors from 2000 to 2007 ($000).
* All figures represent direct investment flows (FDI). Source: Ghana Investment Promotion Centre.
Table IV GIPC Chinese registered projects across sectors from 2008 to 2015 ($000).
* All figures represent direct investment flows (FDI). Source: Ghana Investment Promotion Centre.
As shown in Tables III and IV, Chinese investments have increased since 2008–2015 relative to 2000–2007. The total sum of registered projects was $4,471,000 in 2001. In 2015, it was $177,130,000, a 40-fold increase. Total investments increased from $198,669,000 in the first half of the studied period to $2,242,002,000 at the end of the second, over a 1000% increase. Except for Agriculture, which saw a dip at the end of the second half relative to the end of the first, all sectors increased. Also, Services, and Building and Construction surpassed General Trade in sum as the second and third largest recipient in the second period respectively. From 2008–2015, Liaison emerged as a significant destination for Chinese investments relative to the first half of the period and surpassed Agriculture, Export Trade and Tourism by the end of it. Our exploration of micro Sino-Ghanaian relations is embedded within the ambit of a huge increase in Chinese investments over the past decade.
General Trade, Tsikata et al. (Reference Tsikata, Fenny and Aryeetey2008) noted, had overtaken Manufacturing as the largest recipient since 2003 up to 2006, the last year considered by them. Our recent analyses indicate that by 2015, Manufacturing had regained its position. However, General Trade received a steady flow with not such sharp increases and decreases since 2007 up to 2015, except for 2014 where it saw a huge dip and unlike Manufacturing, which was erratic. The mean of projects from 2007 to 2015 in General Trade was $11,244,000 between a low of $1,038,000 and a high of $21,296,000. For the same period, the Manufacturing average was $157,529,000 between a $2,114,000 low and $1,111,357,000 high. Flows to General Trade were by far more ‘steady’ in 2007–2015 although Manufacturing had overtaken it. It is in light of the more ‘steady’ flows to General Trade since the mid-2000s that we explore Ghanaian attitudes towards Chinese entrepreneurs.
In addition to steady inflows into General Trade, we observed within the communities and especially in Zongo Lane and China House/Rawlings Parks, a rapid surge in Chinese traders over the years. For instance, while traders dominating one stretch of road in Zongo Lane were Ghanaians a decade ago, during fieldwork, we observed the Chinese now dominated that road with only a few Ghanaians. The steady increase in Chinese investments based on GIPC data corresponds to an increase in the physical Chinese presence in the trading communities. Gatekeepers, primary and some key informants including an official who used to be part of a government task force sanctioning trading activities confirmed our observations.
Our general impression is that trading patterns in the local spaces complicate ‘strict’ categorization of relationships between Ghanaian and Chinese traders. We noted the Chinese sell their goods at the same price to large capital (transnational) and small capital holders (collaborative relationship). Instead of buying from big capital holders to re-sell, the petty traders now have equal access to goods from Chinese merchants. This creates competitiveness for the ‘complementary’ trader on two levels. First, they now compete with the Chinese for similar customers (petty traders). A trader who fits Ajavon's complementary frame highlights this:
I will go to Chinese and buy 10 to 20 boxes … and they (Chinese) give me same price as petty traders (mostly women), maybe 10 of them who will gather money and buy one box. Instead of the women buying from me, the Chinese sell that one box to those 10 people at the same price they sold to me. (Footwear, Zongo Lane Street – close to UTC, 2016 Int.)
Second, petty traders now have access to goods at the same price as big capital traders and therefore they both compete for final consumers. As one footwear trader decried: ‘the competition has doubled, because now I am competing with Chinese, I am competing with the women … Instead of the women buying from me, they buy from Chinese directly. I buy more boxes from them (Chinese), they (women) buy one box at the same amount …’ (Footwear, Zongo Lane, 2016 Int.). These perspectives fit Ajavon's typology, yet the designations of ‘competitive’ and ‘complementary’ do not express the nuances in Sino-Ghanaian trade relations in local spaces especially when examined in isolation. Ajavon's ‘competitive’ relationship connotes a loose term for traders who detest the Chinese presence regardless of whether they have a commercial relationship with the Chinese. A relationship close to a truly ‘competitive’ one would be Ghanaians who import goods also imported by the Chinese, and who do not buy from the Chinese to re-sell. We note such a relationship in a wholesaler with three decades’ experience:
We are importers, so … we don't buy from them (Chinese) … we import from … Thailand, Turkey and China … We (Ghanaians and Chinese traders) are all wholesalers … but they (Chinese) have huge capital, so … their goods … a little bit cheaper than ours … they are our competitors but they have some advantage over us. (Bags and footwear trader, Zongo Lane, 2016 Int.)
Thus, though ‘strict’ categorisations offer simplicity in describing Ghana–China micro level interactions, they do not highlight the complexity. It is only by partially selecting elements from the categories, that the nuances become evident. The quotes above indicate that a Ghanaian could be in a complementary relationship with the Chinese but still suffer ‘new’ competition from others classified as collaborators due to the Chinese calibre of trading.
The relations not expressed by ‘strict’ categories are further highlighted by traders ‘collaborating’ with the Chinese who bemoan Chinese selling of goods to final consumers and therefore also face ‘competition’ from the Chinese. In the words of a ‘collaborative’ retailer:
‘Even we buy some of the items from them (Chinese) on credit before we are able to sell and make some income … What is worrying is, the Chinese are supposed to be wholesalers and we retailers, but if you dig deeper you will find out that they retail just like us’ (Footwear trader, Zongo Lane, 2016 Int.)
This retailer, a ‘collaborator’ to Chinese merchants is also suffering competition from Chinese indiscriminate trading. This indicates Ghanaian traders can simultaneously be in more than one relationship category.
We triangulated the above examples and others with our observations, and further with interviews of some hawkers. We observed some hawkers buy footwear in smaller quantities from Chinese merchants in Zongo Lane, and sit in front of shops within the community to sell in pairs to persons passing by. A petty trader confirmed this: ‘The Chinese presence benefits us, as we are able to contribute and buy some footwear from the Chinese and sell right here’ (Footwear petty trader, UTC, 2016 Int.). Thus, within the same trading space, Chinese merchants sell in big quantities to Ghanaians with shops and to hawkers. The Ghanaian shop owner in a ‘collaborative’ relationship with the Chinese thus also faces competition from hawkers as they all have access to the same source of goods – the Chinese.
The relationship between Ghanaians and Chinese traders is therefore a complex web, which partly informs the attitudes Ghanaians have towards Chinese migrants. As we demonstrate in the next pages, how Ghanaians uniquely relate to Chinese merchants and sometimes cut across categories culminate in varying perceptions about Chinese and their trading activities.
Personal fears/threats towards indigenous Ghanaian livelihoods
As noted, the increased presence of Chinese merchants raised concerns among local traders (Axelsson Reference Axelsson2012). Burns & Gimpel (Reference Burns and Gimpel2000) note that individual economic fears directly influence attitudes regardless of indirect impacts through others’ racial prejudices. We identified that negative perceptions about the Chinese were informed by personal fears of threats by individual Ghanaians from Chinese trading activities. Personal fears largely underpinned the negative impacts Ghanaians believed Chinese activities had on them. One such negative perception is the Chinese duplicating goods sold by Ghanaians to sell cheaply in the same spaces. As a Ghanaian who has sold in varying spaces lamented:
For instance, the shoe we bring is 50 cedis … you will realise with time, the Chinese will … duplicate the shoe and be selling it for 10 cedis … there are a lot of differences. But our customers think they are the same … When you bring a new product, just give them (Chinese) at most three months, they will duplicate it … at cheap prices. (Bags and footwear trader, Zongo Lane, 2016 Int.)
Ghanaian wholesalers also held personal economic fears over Chinese sales in smaller quantities to petty traders, partly influenced by their understanding of the GIPC Act.Footnote 7
They (Chinese) do not have to compete with us in retailing … But if the Chinese will be selling to the (petty traders) in 1 or 2 dozen, then it means the ladies will not be coming to us … If they (Chinese) stick to wholesaling … we don't mind … But you will find out that … they are selling in smaller quantities. (Clothing and underwear trader, Okaishie, 2016 Int.)
The above fears reflect how Chinese traders negatively affect Ghanaians. For these traders, sales have slowed down in the wake of the Chinese presence.
In the past when the Chinese were not here in their numbers, we were selling a lot. Before you come to open the shop, people would have queued up … At first, you open the shop latest by 4 am … If you come and open in the morning these days, you are just worrying yourself … Even by 10 am, nobody will come to your shop … Sales have gone down a lot … (Bags and footwear trader, Zongo Lane, 2016 Int.)
Our observations confirmed personal feelings of threats by primary informants from Chinese trading. On goods duplication for instance, we noticed products that looked similar but were sold cheaply by some who procured products from the Chinese and expensively by Ghanaian importers. The latter group confirmed this by asking us to compare their products with those of hawkers. Our checks revealed price and quality differences from hawkers/petty traders sourcing goods from the Chinese. We further triangulated this by conferring with some petty traders/hawkers. ‘When we see a ‘new’ particular footwear that is selling … we take a sample … to the Chinese. In a few months’ time, the Chinese will bring a similar type … at reduced price and quality’ (Footwear petty trader, UTC, 2016 Int.). Some hawkers as indicated in the preceding section also confirmed the fear of Chinese sales in smaller quantities.
Intense competition amongst the Chinese also propels further competitive reduction in prices making it difficult for Ghanaians to sell. The dip in sales has reduced profits for Ghanaians and some Ghanaian shops have closed. It is arguable the Chinese presence therefore poses actual competition in accord with the realistic group conflict theory as noted by Quillian (Reference Quillian1995), although Quillian used objective economic indicators. A primary informant bemoaned:
At first, you … import things … The profit margin was OK. But now the Chinese have brought the items … cheaply … Even when … they realise … fellow Chinese have brought similar goods, they reduce the price of theirs. Then those who brought theirs maybe a week ago will also reduce theirs, meaning when you have bought items from them to re-sell … you will be incurring continuous losses … I had four shops. Today … I am left with two. (Footwear trader, Zongo Lane, 2016 Int.)
Haugen & Carling (Reference Haugen and Carling2005) similarly documented ‘price wars’ among the Chinese in Cape Verde albeit such competition culminated in a drop in Chinese profits. Lyons & Brown (Reference Lyons and Brown2010) also captured the perception of indigenous shops across the CFA (African Financial Community) closing from Chinese competition.
These accounts are in harmony with Lancee & Pardos-Prado's (Reference Lancee and Pardos-Prado2013) delineation of the realistic group conflict theory that socio-economically vulnerable members of the host community are more likely to perceive immigrants, herein the Chinese, negatively due to a perceived competition over economic benefits. Vulnerability is in the sense that informants have been negatively affected due to the Chinese influx. Further, and in conformity with the theory as noted by Esses et al. (Reference Esses, Jackson and Armstrong1998), their proximity to Chinese worsens rather than improves their perceptions due to the perceived competition.
The brighter tale: Ghanaian traders in no commercial relationship with the Chinese
Despite negative perceptions largely held by Ghanaians perceiving the Chinese as competition, we also met others with positive perceptions. Here, we identify two categories who gained from the Chinese presence. In the first are those indirectly employed:
The Chinese presence does not spoil anything of mine … Their items are cheap… the women … buy some and re-sell so that they can also get something to buy food… They have provided … jobs to Ghanaians. If the Chinese were not present, the hardship will be more. (Sewing materials trader, Chinahouse/Rawlings Park, 2016 Int.)
These jobs are indirect as hawkers, mostly women who are not employed directly by the Chinese but take advantage of their cheap goods to earn an income. This evokes positive attitudes towards the Chinese, amplified by high unemployment levels in Ghana.
In the second category are Ghanaian traders content with Chinese activities because their presence increased local activity. Comparing field sites across time, they noted Chinese influx made trading spaces relatively busier.
Their presence makes this place busier than before … because people are always coming for their goods … you see people going up and down … it wasn't like this before, but now the Chinese presence has made here busier than most streets in Accra’ (Electricals trader, Zongo lane, 2016 Int.)
The Chinese presence does not pose a threat to this trader and instead, may be boosting his sales.
Per previous research on migration and inter-ethnic contact, the basis for conflicts/cooperation may be related to the intersection of race, class, gender and religion (Dankwah & Amoah Reference Dankwah and Amoah2018). It is clear that opposing economic interests and Chinese visibility (skin colour differences) as non-Africans informed perceptions as intruders. However, these perceptions blurred or reduced in cases where Ghanaian traders had compatible interests. They may be related directly or indirectly to the field of trade. Indeed, observations confirmed the greater activity in trading areas compared with a decade ago. As we noted, the ‘new’ factor obvious in the now bustling spaces was the increasing presence of Chinese shops, occupying spaces that hitherto were Ghanaian-occupied. A young male trader confirmed that his father, a landlord, rented most spaces to the Chinese because they offer higher rents. He added that they used to use the shop next door as well as their current one, but his father had rented it to the Chinese and reserved only one for business (Electricals trader, Zongo Lane, 2016 Int.).
We observed replacement of Ghanaian shops by Chinese in Arena, all in the Central Business District. Ghanaians ran all the shops close to the Arena station a decade ago. During fieldwork, we saw that the Chinese now run most of these shops. Thus, in the now busier communities, one obvious change over the years was the increase in Chinese shops, some of which supplanted Ghanaians. Observations of activity in buying and offloading of goods from container trucks at Chinese shops emphasised the impression of places being busier due to the Chinese presence. A gatekeeper with over two decades’ livelihood in Zongo Lane similarly considered the area to be busier due to the Chinese.
While cheap Chinese goods constituted a threat for some traders, they generated positive perceptions in consumers and traders selling goods not popular amongst Chinese merchants. Thus, the particular position of some traders, namely those not in any kind of trading relationship with the Chinese, has a determining effect on perceptions they have about Chinese merchants. Regardless of their level of capital, they see the Chinese positively. For them, cheap Chinese goods afford Ghanaians increased purchasing power.
They (Chinese) are selling their items, I am also selling mine … their shoes are cheap… if you have something (money) small and … buy some, I feel that is good in itself… at first, shoes were very expensive, but now if you are not rich, you have what you can buy per your standard … When they come here I receive them very well. At times, I even call them my brothers … and I laugh with them because he's coming to buy something from me. (Electricals trader, Rawlings Park, 2016 Int.)
In addition to the absence of a competitive threat, the above trader has personal friendly relations with Chinese in the local spaces. Drawing on Dixon et al.’s (Reference Dixon, Durrheim and Tredoux2005) optimal contact, we argue that conditions necessary for positive attitudes, namely, competition-free, regular contact, which also involves genuine friendship, culminate in positive perceptions about the Chinese. Consistent also with Esses et al.'s (Reference Esses, Jackson and Armstrong1998) instrumental model of group conflict, we add that the absence of a perception of competition from the Chinese entrepreneurs, along with a proximity to them in the trading areas, facilitates positive rather than negative attitudes.
Chinese daunting prowess: the macro-group (‘we’/GUTA) perception
Although we found local traders with positive attitudes to the Chinese, the general impression is that negative attitudes towards the Chinese dominate, including sentiments of members of the Ghana Union of Traders Association (GUTA). In this section, we focus on perspectives of GUTA traders and officials. These traders decried Chinese trading as minimising the resources available for them. Here, they not only personify their Chinese sentiments, but also bemoan how Chinese activities are detrimental to their group. First, Chinese entrepreneurs are perceived to repatriate profits. A trader who per a ‘collaborative’ relationship should be happy, bemoaned:
The Chinese are hindering the progress of the country … After selling … they immediately transfer the money to their country … how will … the government benefit from their activities? … Instead … they should do mass production. (Footwear trader, Zongo Lane, 2016 Int.)
Rooted in his position and complicated relationship with the Chinese, he instead expresses negative sentiments. This is because, despite the ‘collaboration’, Chinese sales in smaller quantities creates a competition between him and the Chinese for petty traders. The profit repatriation he decries mirrors the interest of his group at the macro and national level, herein GUTA and Ghana.
When they (Chinese) sell, and are repatriating not just their profits but the whole money back, you find … pressure … if the two of you go to the exchange market … you the 35% (interest rate in Ghana) will have a cut-off point in which you cannot go further but with the 5% (Chinese interest rate) he can … if the supply cannot meet the demand that is where you find the cedi depreciating. (GUTA official, Accra High Street, 2016 Int.)
In addition, the Chinese are perceived to sell not just cheap but inferior goods. Sub-standard Chinese goods are prevalent across Africa. Corkin et al. (Reference Corkin, Burke and Davies2008) for example talk about Sierra Leone whereas Mbachu (Reference Mbachu2006) cites Nigeria, where authorities have gone to the extent of shutting down malls. The mass media is full of descriptions of cheap Chinese inferior goods in the continent. Osahon (Reference Osahon2013) for instance, published this: ‘Their (Chinese) stabilizers, radios, electric bulbs, food blenders, fans, pressing irons, explode, two cases out of three, the first time they are switched on … one that passes first-time use test, lasts … couple of weeks’.
Ghanaians also perceive their Chinese counterparts to have enormous advantages over them. They perceive positive macroeconomic Chinese indicators afford Chinese entrepreneurs unfair advantages. Less favourable Ghanaian macro-economic indicators exacerbate this.
If you are running a hundred-metre hurdle … the Chinese … has already overtaken you … Because of the macroeconomic indicators (in China) there, interest rate, exchange rate … Ghana seems to be very higher than theirs … so they can cut down the prices and people will start trooping, buying items that are not of good quality. (GUTA official, Accra High Street, 2016 Int.)
Indeed, the generic advantages of China's economy over Ghana afford Chinese merchants a competitive edge. The low interest rates are augmented by direct links the Chinese in Africa have to production in China (Gu et al. Reference Gu, Zhang, Vaz and Mukwereza2016). The external support afforded to Chinese entrepreneurial migrants from cheap loans and their speciality of selling shoes increases Ghanaian traders’ perception of competition. This is because Chinese merchants are similar to Ghanaian shoe traders in relevant dimensions (selling shoes) and this evokes competitive feelings. In addition to cheap loans, Chinese merchants are, according to local traders, endowed with better access to capital enabling the Chinese to outcompete.
It is worrying … because of their … huge capital … if you go to China right now and you are buying … the more you buy the lesser the price, so if Chinese can bring 30 containers, and you sell the same goods … theirs will be cheaper. (Footwear trader, Zongo Lane, 2016 Int.)
The fact that immigrants trading in Ghana ought to meet a minimum capital requirement of US$1,000,000 as required by the GIPC Act buttresses the huge capital advantage of the Chinese. It is therefore very clear that Chinese traders in Ghana have bigger financial muscle and therefore their physical presence evokes Ghanaian perceptions of threat.
A GUTA official also blamed Ghanaian authorities for their lackadaisical attitude in ensuring Chinese are not present in markets, which according to the GIPC Act are reserved for Ghanaians.
I don't know whether they (Ghana government) are taking money from China and for that matter they don't want to catch them … But … if you are taking loans, they will be paid back by us, the taxpayers … government should not relinquish its responsibilities. (GUTA Official, Accra High Street, 2016 Int.)
Here, news about China's extension of loans to Ghana undermined rather than improved perceptions about the Chinese due to perceived competition emanating from Chinese merchants. We argue that where there is perceived competition, positive parasocial contact does not improve intergroup relations.
In sum, whereas strong anti-Chinese sentiments transpire in some African states, for example Zambia (Negi Reference Negi2008), this study argues that sentiments in Ghana towards the Chinese are affected by the nature of Chinese activities in specific spaces as well as media news about China. The fact that our informants had positive and negative sentiments concurrently accentuates mixed perceptions. This is captured amply:
It depends on the kind of business or what the person sells. For instance, some of them who sell Chinese shoes, when they need one extension, they will definitely come to me. But for me as an electricals seller, when the Chinese … want to sell electricals, we don't want them … retailing. (Electricals trader, Rawlings Park, 2016 Int.)
Figure 1 provides a tabular summarised representation of Ghanaian perceptions about Chinese entrepreneurial migrants. For Ghanaians selling goods also sold by the Chinese, and who have huge capital, Chinese duplication of goods is inimical to their livelihoods. Similarly, cheap Chinese goods and their ‘indiscriminate’ selling pose a threat. While the aforementioned evoked negative perceptions amongst wealthy traders, they triggered positive perceptions from traders with less capital who buy from the Chinese to re-sell. Indeed, some Ghanaian small capital traders aided Chinese duplication of goods. Traders selling goods not popular among Chinese merchants had mixed sentiments. While some perceived the aforementioned positively, others had negative perceptions. This category of outsider traders did not demand complete Chinese withdrawal but instead streamlining of their activities. Furthermore, and despite varying perceptions among individual traders, they expressed negative sentiments about perceived profit repatriation, economic advantages and inferior goods of Chinese entrepreneurs. Not only GUTA officials expressed negative sentiments, but our interviews with individual traders revealed similar sentiments at the individual level too. Commensurate with realistic group conflict theory, these sentiments indicate protection is not only sought individually but at the group level.
Figure 1 Perceptions towards Chinese merchants in local Ghanaian trading spaces.
IMPACTS ON GHANAIAN TRADING PATTERNS AND SPACES
The Chinese presence has multiple impacts on Ghanaian trading patterns and spaces. While cheap Chinese goods afford consumers increased purchasing power and indirect jobs, they displace imports from other countries and traders who import such goods. Several of our informants noted goods from Togo are no longer coming in large quantities in the wake of the Chinese influx
The Chinese goods are cheap, so people do not buy the Ghanaian and Togolese made … With the arrival of the Chinese, goods coming from Togo reduced … The Togolese goods are superior in quality to the Chinese but the Chinese goods are cheap. (Footwear trader, Kantamanto, 2016 Int.)
Jenkins & Edwards (Reference Jenkins and Edwards2006) showed that preliminary statistics on Chinese exports to Africa in 2003 suggested increased Chinese exports have been at the expense of other countries’ exports to Africa. It seems, however, that Chinese imports to Ghana have not only displaced imports from non-African countries but also within the continent itself. Marfaing & Thiel (Reference Marfaing and Thiel2011) similarly note this displacing effect when they argued that interest groups in Senegal and Ghana are dissatisfied with the Chinese presence in local communities because Chinese entrepreneurial migrants increasingly flock to a business that indigenous traders have mastered for a long time, namely the import of cheap Asian consumables into West Africa. Per our analyses, Chinese entrepreneurial migrants are therefore at the heart of the displacing effect of Chinese imports.
The Chinese influx has also altered trading profiles of Ghanaian merchants in myriad ways. Some Ghanaian importers/wholesalers are now limited to selling in smaller quantities as wholesaling is no longer profitable due to cheap Chinese goods being available in large quantities. An affected wholesaler noted: ‘Previously, we import … but now we are not importing, we are not doing wholesale … The Chinese have forced us to go into retailing’ (Footwear trader, Zongo Lane, 2016 Int.). Other traders have been ‘coerced’ into selling inferior goods. For them, there is no point in selling quality goods because they are relatively expensive and consumers are not willing to buy them.
The Chinese will bring in very inferior goods … they can sell it at any amount. If I sell mine 1 cedi, they will sell … 40 pesewas … And many people don't have much money, so they take advantage of buying Chinese goods. It is a disadvantage … to sell something quality … I also have to sell inferior goods … to stay in business. (Clothing and underwear trader, Okaishie, 2016 Int.)
Indeed, Ghanaian traders have experienced a change in their socio-economic positions over time along with the increasing Chinese influx. It is thus not surprising that for these traders, the Chinese are the competition, and therefore their presence is unwanted.
All our informants acknowledged that the increasing Chinese influx has resulted in busier trading spaces. While this was good for some Ghanaians as noted earlier, it was not positive for others. The surge in rents in prime trading locations is thought to be due to the Chinese influx. Chinese entrepreneurs are willing to pay more than twice the normal rent and this has triggered an increase in rent prices. A trader selling for more than a decade notes:
Because of the Chinese, now the rent for stores has increased … These days the landlords do not rent out to Ghanaians … a Ghanaian will want to rent a shop for 5 years for 50,000. When the Chinese comes, he will say he will double it to 100,000 … so the storeowner will give it to the Chinese. (Cleaning equipment trader, Kantamanto, 2016 Int.)
The realistic group conflict theory and the contact hypothesis provide inference on how Ghanaians having a stake in renting shops will differently perceive a Chinese impact on rents. In harmony with the contact hypothesis, we argue Chinese entrepreneurs’ contact with Ghanaian landlords is free from competition, hence the latter will be pleased with the Chinese presence. For landlords, the Chinese trooping into the trading spaces demonstrates a higher demand for stores which culminates in an increase in rents. On the other hand, rent increases negatively affect Ghanaian traders who are renting shops. In line with the instrumental model of group conflict, we argue an increase in rents due to high Chinese demand presents a resource stress for Ghanaians. The scenario that higher rent prices means Ghanaian traders will be unable to rent shops or renew their tenancy at the end of contracts highlighted this. Resource stress coupled with salience of a potentially competitive out-group, herein Chinese migrants, culminate in perceived competition for resources and hence the Chinese presence is not desirable for Ghanaian merchants.
In ascertaining Chinese impacts, we triangulated interviews with observations along with a comparative lens to a decade ago hinged on the first author's insider's perspective.Footnote 8 Data from traders used for gauging the impacts are based on traders’ real-life experiences, some of whom have been trading for three decades. Moreover, we subjected information from traders to verification by cross-checking the large capital traders’ assertions with Ghanaian vendors trading on tabletops or in front of shops. Some large capital traders’ assertions matched those of petty traders who acknowledged their role in the impact of the Chinese, such as sending samples of superior quality goods to the Chinese for duplication. Our findings of a Chinese willingness to pay higher rents culminating in the closure of shops run by Ghanaians who could not renew their tenancy, based on interviews with the traders, were triangulated by interviewing a landlord/trader and our observation of Chinese merchants supplanting shops that used to be under the tenancy of Ghanaians. Figure 2 summarises the major impacts of the Chinese influx.
Figure 2 Impacts of Chinese entrepreneurial influx into the central business district.
Figure 2 indicates that Chinese entrepreneurial activities in Accra exert two major direct impacts, namely displacing local traders and heightening activity, thus resulting in busier trading areas. The general impression is that Ghanaian traders would have different experiences of the Chinese depending on their position within the hierarchy of trading spaces. However, it is difficult to identify a general trend, as both well-established wealthy traders and street sellers may face compatible and conflicting impacts from the Chinese presence. Busy trading spaces further trigger indirect jobs, since hawkers who buy from the Chinese re-sell their wares along Accra's major trading streets due to the crowdedness of the areas. Indeed, we observed some women buy from the Chinese just to sit in front of both Ghanaian and Chinese shops to sell their goods. Busier spaces have also led to an increase in rents in the trading areas. Higher rents present good news for Ghanaian landlords within the area but pose challenges for Ghanaians who have to renew their rent contracts. The displacing of local traders due to the Chinese influx along with cheap Chinese goods have largely culminated in reduced sales for Ghanaians who are selling goods also sold by the Chinese. Reduced sales links to a dip in Ghanaian profits. A persistent dip in profits has forced the closure of some Ghanaian shops.
CONCLUSION
Inspired by the literature on the impact of China's burgeoning growth and influence in other parts of the world, this study sought to capture micro Sino-Ghanaian relations by exploring attitudes of indigenous Ghanaian traders towards Chinese entrepreneurial migrants trading in Ghanaian spaces. We explored the perceived impacts of Chinese merchants on these spaces and on indigenous traders. We observed relationships between Ghanaian traders and Chinese counterparts identified by previous studies, and our findings are in line with most of these. However, we argued that while strict categorisations between Ghanaian and Chinese traders provide simplicity in describing such relationships, they do not express the nuances in them. Our analyses show Ghanaian traders could simultaneously be in more than one category and that the relationships are not clear-cut in all scenarios. Ghanaian and Chinese traders are involved in relationships which can only be explained by partially selecting elements from the categories. We maintain that perceptions of Ghanaians towards Chinese entrepreneurial migrants are dependent on the particular position of each trader amidst the activities of Chinese merchants.
Without doubt, the increasing Chinese entrepreneurial migrant flow has an impact on Ghanaian trading spaces. On the positive side, the cheap goods of Chinese merchants enhances the purchasing power of average African consumers – this is acknowledged both by consumers and traders selling goods not known to be sold by Chinese. Cheap Chinese goods also indirectly trigger employment, mostly for women with little capital. On the other hand, cheap goods are generally inferior relative to local products and products from other countries, making Africa a dumping ground for sub-standard goods. Cheap Chinese goods have also displaced goods coming from Togo and other countries alongside Ghanaians who import them. Chinese trading makes parts of the Central Business District of Accra busier relative to the past. However, this has also culminated in a decline in sales for some traders. The dip in sales has contributed to low profit margins and the eventual closure of some Ghanaian shops. The Chinese clamouring for shops has escalated business rents in the Central Business District. In summary, while Chinese trading activities have been good for some Ghanaian traders, this is not the case for many others, most of whom sell goods the Chinese have now come to dominate in selling.
The general impression is that existence or absence of a perceived threat from Chinese trading activities towards Ghanaian trader livelihoods shape perceptions about Chinese migrants. Further, intersecting race and class relations highlighted in visible skin colour difference and larger capital strength of the Chinese relative to Ghanaian traders also influence perceptions. However, the intersecting relations that informed negative intergroup attitudes blurred where group interests were in harmony. Increased vulnerability over time also partly underpinned negative sentiments about Chinese merchants. We noted that where conditions necessary for positive relations existed between out-groups and in-groups, Ghanaian traders perceived Chinese colleagues in a good way in line with the contact hypothesis. Conversely, absence of these conditions evoked negative perceptions. Mass media, Ghanaian traders’ understanding of the GIPC Act and the larger position of their group, such as GUTA, also shaped Ghanaians’ perceptions of Chinese merchants. Overall, while some Ghanaians perceive the Chinese presence and activities negatively and therefore their presence is unwanted in local trading communities, others were satisfied to the extent that some wished for increased Chinese immigration into trading communities. There were also those whose perceptions about Chinese are neither exclusively positive nor negative but rather nuanced. Instead of a dislike for continuous Chinese entrepreneurial migrant inflows, they preferred policies be put in place and implemented accordingly for African societies to capture the benefits emanating from Chinese inflows.
