Rather than being in some way tied to Chinese state assistance to Lesotho then, migrants come to Lesotho under their own steam, lured by rumours of easy profits. But they do not arrive as hostages to fortune, without a plan and alone. Rather, given that kinship networks are the main pull factor behind Fujianese migration to Lesotho, new arrivals usually have links to one of the local Fujianese business associations before they even land.These commercial networks link Fujianese traders across Lesotho with wholesalers in neighbouring South Africa and suppliers in Mainland China, and help new arrivals in number of ways. The presence of Fujianese merchants in villages that, at first glance, seem too small or remote to support a retail business, is testament to the success these associations have had.To begin with, these networks direct new migrants towards niches in the market and away from areas already saturated by Fujianese businesses; in this way, they create a centrifugal force, pushing new arrivals into remote corners of the country.Fujianese commercial associations also give advice and provide start-up loans and insurance for new ventures. In fact, Fujianese traders typically spend their first couple of years in Lesotho paying off debts to these associations and to the migratory agents who facilitated their entry into the country. This is part of the reason Fujianese businesses have a reputation for being open 24 hours a day, seven days a week – their owners must work extremely hard and live very frugally simply in order to pay their initial debts.Start-up capital, hard work and frugality are central to Chinese traders’ success. Also crucial, however, is the ability of Chinese businesspeople to undercut their local competitors. This is made possible by using local Chinese business associations to buy and ship goods in bulk. This helps lower wholesale costs and, additionally, given that the many of the goods sold by Chinese businesses are non-perishable, they can also be stored on site for long periods of time to save on transport costs.All these factors help make the Chinese community in Lesotho commercially successful.
Thursday, 23 May 2013
Wednesday, 22 May 2013
Taken together, these appointments demonstrate the new Chinese leadership’s emphasis on pro-market reforms and a shift from heavy industry to greater reliance on consumption and services. That shift is likely to mean a slower rate of GDP growth than the annual rate of nearly 10% that China achieved during the last three decades. But a slowdown to 7% annual growth would still double China’s GDP over the next decade.
More consumption and less heavy industry will also reduce China’s demand for raw materials, dampening global commodity prices. Even more significant, shifting income from state-owned enterprises to middle-class workers and increasing consumer spending will reduce China’s enormous saving rate. Since a country’s current-account surplus is the difference between its national saving and its national investment, China’s current-account surplus is likely to continue to shrink in the coming years. That is consistent with the Five-Year Plan’s goal of basing GDP growth more on domestic demand and less on exports.
Since China’s external surplus is already down to less than 2% of GDP, a decline in domestic saving could result in China beginning to run a current-account deficit. In that case, China would no longer be a net buyer of foreign bonds and other assets. If China wanted to continue to invest in foreign businesses and natural resources, it would have to become a net seller of bonds from its portfolio.
Tuesday, 21 May 2013
Alexander Chikwanda recently announced that the Kingdom of Saudi Arabia has pledged
to provide assistance to the Zambian government in the health and
agricultural sectors. Around US$15 million will support the rehabilitation of
the country’s main referral hospital. The two countries are also exploring the cooperation
in the area of localized fertilizer production, particularly the possible revitalization
of the Nitrogen Chemicals of Zambia (NCZ) plant in Kafue.