Sino-African enterprises aim to turn challenges into opportunities

When Chinese company Sunda International started business in Kenya 13 years ago, it faced myriad challenges. Among the major challenges was the lack of skilled labor to fill various positions in the company.

Bob Xian, Sunda International's finance director for East Africa, said the company opened its office in 2010 and started with selling baby diapers and sanitary pads. In 2016, it moved into local manufacturing. And by 2019, it had established a factory producing hygiene products like baby diapers, pads and sanitary towels in Kenya's Athi River town.

"When we started manufacturing, we resolved to use local labor and so far, we have over 600 local employees. In most instances, this meant training the local workforce on the skills necessary in their areas of employment," Xian said. "As a result, we ended up providing skills and technology transfer to the local people, while ensuring we have the best-trained workforce to deliver quality products."

He was speaking during a seminar on Wednesday organized by the Stanbic Bank in Kenya, where the Industrial and Commercial Bank of China participated as a strategic partner in looking at the challenges and opportunities for Chinese businesses operating in Kenya.

While giving the opening remarks for the seminar, Zhang Yijun, minister counselor at the Chinese embassy in Kenya, said China believes that numerous opportunities exist for cooperation that will outlast whatever challenges that come in the way.

He added that Chinese people have embarked on a new journey of achieving a new socialist modernization and their belief in shared prosperity makes cooperation with Africa important. It is the spirit of turning challenges into opportunities that Xian said has made his company flourish in East Africa.

"By working with other Chinese companies and the embassy, we get pointers on how to operate in the local environment, what to avoid and how to abide by local regulations. Since 90 percent of our employees are local, cultural and language differences were a challenge in the beginning, but we have been able to identify areas where we can interact and have cultural exchanges with locals," Xian said.

Solving problems

Jeremy Stevens, Stanbic Bank's economist in Beijing, said Chinese companies can thrive in Africa because they seek to solve local challenges like informal labor and a low manufacturing capacity.

He added that with over 60 percent of Africans viewing China as a force in domestic development, there is more room for expansion in trade especially in areas like agriculture and real estate development.

Xian said Chinese businesses still face some challenges like high energy costs in some countries and the current inflation hitting the region is a new challenge since the local exchange rate to the US dollar makes the importation of materials costly.

Jibran Qureishi, head of Africa research at Stanbic Bank, said that despite recent challenges, sub-Saharan Africa's growth is resilient. He said the tourism sector, floriculture and horticulture are sectors that are looking up in the post-pandemic period and will help the region with forex earnings.