Ugandan MPs Query China Town Supermarket Expansion, Seek Fair Competition

Lawmakers in Uganda have raised alarms over the increasing presence of China Town Super Store branches across Kampala. The Public Accounts Committee (PAC-Central Government) has formally requested the Ministry of Trade, Industry and Cooperatives to scrutinize these operations.

The core of the concern lies in ensuring a level playing field for Ugandan businesses. Legislators worry that the expansive nature of China Town stores could disadvantage local retailers selling similar products.

“With the proliferation of China Town stores in several corners of Kampala, have you studied its impact on local traders who deal in the same business? Is it fair that the Chinese invest in retail trade?” questioned Committee Chairperson, Hon. Patrick Nsamba, during a meeting with ministry officials.

Hon. Nsamba highlighted that foreign investors often benefit from access to cheaper credit, which he believes creates an imbalance in the retail market. He suggested that while outright bans aren’t necessary, directing foreign investment to specific sectors could mitigate this advantage.

Concerns were also voiced regarding the perception that China Town stores offer significantly lower prices. Hon. Fortunate Nantongo, Kyotera District Woman MP, suggested this perception might lure customers away from local businesses, even when price or quality differences are marginal.

In response, Zackey Kalega, the Commissioner for Internal Trade, assured the committee that the ministry will investigate China Town’s compliance with Uganda’s trade and investment laws. He pointed to existing regulations, such as the Trade (Licensing) Act, which restricts non-citizens from engaging in certain retail activities, and the Uganda Investment Authority’s requirement for a minimum investment capital of US$250,000 for foreign investors.

Kalega stated that the ministry is studying the investment threshold for China Town and will take appropriate action if it falls below legal requirements, emphasizing that foreign investors are legally restricted from certain forms of retail trade.

Source: Parliament of Uganda