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‘Chinese squeezing us out of business’

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MASERU – A case in which a Chinese businessman allegedly assaulted a fellow countryman last month could open a can of worms regarding the relations between

Basotho and businesspeople from the Asian countries. Huang Liang appeared before the Maseru Magistrate’s Court in December last year charged with assaulting fellow

Chinese businessman Youming Chen. He was remanded out of custody on a M1 000 bail.

Huang allegedly assaulted his fellow Chinese landlord for supporting a business owned by a Mosotho instead of his.

The landlord, Youming Chen, owns a business complex in Roma where Huang and several other Basotho are tenants.

Huang is running a restaurant competing with a Mosotho’s in the same complex.

The case is yet to be heard in the Maseru Magistrate’s Court.

The case, though pitting two Chinese businessmen, has put the spotlight on relations between locals and foreign business owners, particularly of Chinese origin.

Youming, the victim of the alleged victim, owns a business complex in Roma, where Huang and several Basotho are tenants.

Youming claimed to thepost that Huang assaulted him for helping Basotho businesspeople compete against a fellow Chinese.

According to Youming, Huang called him one Saturday night to come to the complex.

“He told me that my building did not have electricity and therefore I should come and check,” Youming said.

He said when he arrived at the building around 1am, Huang lured him into the shop.

“When we entered the shop, he pushed me and locked the door.”

He said Huang asked him why he was supporting Basotho businesses instead of his fellow Chinese.

“He started beating me and said I had nowhere to run to.”

Youming said Huang beat him severely and kicked his private parts. The case comes amid growing tensions between Basotho business people and their Chinese competitors.

Locals allege unfair competition is pushing them out of business.

Teboho Modona, who runs a nightclub in Roma, less than a kilometre from the National University of Lesotho (NUL), says he started operating in the area in October last year.

He runs the nightclub at a building belonging to a Chinese businessman. When he first arrived at the place, he said he found another Chinese man running a restaurant.

“And that rival Chinese man slashed his drinks prices as a way to attract clients to him. I did not decrease mine, instead I looked around on how I could stay afloat,” Modona said.

“My rival used to drink in my bar so I was surprised to hear that my competitor had fought the landlord asking him to kick me out of his business,” said Modona.

Their case is still pending in court. Poloko Rantho, 55, from Mathebe Mafeteng said he has been operating a small shop for the past ten years and his business was generating enough profits to keep the wolves off the door.

But today things have changed. Rantho said his business is in financial distress because of “unfair and stiff competition” from Chinese competitors.

“He sells at ridiculously low prices. This makes the customers run away from me,” lamented Rantho, adding that his stock sometimes takes months on the shelves without being bought.

“I make a huge loss on perishable goods such as fruits and vegetables. I hardly sell anything,” he said.

Rantho said people only buy from his shop when his competitor has not yet opened since he starts trading at 10am.

Rantho said Basotho would waylay the Chinese man from Mafeteng where he stays and start buying goods before he even reaches the shop.

“He sells goods from his car on the way to the shop. Customers in the villages through which he passes line up for the Chinese man,” Rantho said.

Even vendors say they are not spared. Matšeliso Lefane, 34, who sells fruits as a street vendor in Mafeteng, said they are suffering because of unfair competition from the Chinese.

The mother of two said she buys the fruits from Chinese shops, but unfortunately the same shops also sell to individuals who are supposed to be customers of vendors.

“We were hoping the Chinese would only sell in bulk. When we sell an apple for M3, the Chinese sell it at M2,” Lefane said.

Another street vendor, Vuyisile Masia, 27, who is the deputy secretary-general of Micro-Small Enterprise Association in Mafeteng, also cried foul.

“Unfair competition is killing us,” said Masia, who sells clothes, cosmetics and other small items at his small shack in Mafeteng town.

Masia says they embarked on a strike in October last year asking the relevant authorities in the district to intervene.

“We are waiting to hear the progress from the District Administrator,” he said.

“We complain about the unfair competition because we buy from the very same Chinese who are pushing us out of business. It is their legitimate expectation that the

Chinese would give them a chance to sell their products without any competition because they buy from them.

“We have been told that there is no law that protects us as street vendors against the Chinese. We have been told that the Bill is still in Parliament,” he complained.

Chinese started off by operating in towns then slowly moved to remote areas, conquering the market with cheap prices, drastic cost-cutting measures and bulk-buying through deep-pocketed syndicates.

Now the Chinese retailers are all over the country, selling anything from bread to alcohol.

Across the country there are sad stories of business people who shut their shops as soon as Chinese retailers landed in their area.

Chief Thato ’Mako Mohale of Tajane said they are not against a law that protects local businesspeople.

He said the Bill should state and show the penalties to be imposed on businesses that breach the law.

“So the legal department of the ministry has to deal with that irregularity,” said the Chief.

Last year, there was a tense standoff between Mafeteng street vendors and foreign investors running big shops like supermarkets.

The spokesperson of the street vendors in the district, Vuyisile Masiea, told this publication that they are getting tough and unfair competition because the Chinese sell

“small items that are supposed to be sold by us”.

“They squeeze us out of business. The sad reality is that the Chinese are found even in the hard to reach areas of the country,” he said.

The founder and leader of Micro-Small Enterprise Association, Thobi Motlere, said the government should protect local businesspeople.

“We have already written two letters to the new minister to intervene. We will not rest. We are taking our battle further,” Motlere said.

Trade Minister Mokhethi Shelile said there are laws in place that have to be implemented to protect locals.

“What we have to do is to enforce the laws,” Shelile said.

Majara Molupe

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Mahao, PS in big fight

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PRIME Minister Sam Matekane this week summoned the Basotho Action Party (BAP) executive committee in a bid to defuse simmering tensions within the party.
This comes amid fears that Professor Nqosa Mahao’s fallout with his principal secretary at the Ministry of Energy, Tankiso Phapano, could threaten the unity in the BAP and the government’s stability.

thepost can reveal that Mahao has hinted that he would resign if Matekane doesn’t fire or reassign Phapano.

But there are strong indications that Mahao doesn’t enjoy the backing of his executive committee and MPs in his fight with Phapano.

Inside sources this week told thepost that some members of the BAP’s executive committee and MPs are openly siding with Phapano and have been secretly lobbying Matekane to reshuffle Mahao from the Ministry of Energy to Sports.

A source said Mahao is aware of these manoeuvres, including a clandestine meeting in Maputsoe, and has said he would rather resign than be the subject of a humiliating reshuffle instigated by people he leads.

The source of the bad blood between Mahao and Phapano is not clear but it is understood that they have disagreed over tenders and the ministry’s direction.

The source said Matekane was first briefed of the running battles at the ministry some three weeks ago just as matters were coming to a head.

It is the second briefing which revealed a complete breakdown in the relationship that triggered Matekane’s meeting with the BAP’s executive committee and MPs on Monday.

Three people who were in that meeting said Matekane told the BAP officials to deal with the crisis before it affected the ministry and threatened the coalition government’s stability.

The BAP’s executive committee, including MPs and Mahao, then had a marathon meeting to discuss ways to make peace between Mahao and Phapano.

A source who was in that meeting said “it was clear to Mahao that the majority of the committee and the MPs were on Phapano’s side”.

“Mahao quickly realised that he did not have the backing of the majority and took a conciliatory approach. It was clear that the committee would rather have him resign than get Phapano removed from the ministry,” the source said.

“In the past Mahao had flatly refused to reconcile with Phapano because of seniority. But this time he appeared to be open to a meeting to discuss reconciliation.”

Both Mahao and Phapano told thepost last night that their relationship was still cordial. ‘“We are still in good books with Phapano until further notice,” Mahao said.

“However, we cannot predict the future.”

Mahao denied ever discussing Phapano’s dismissal or transfer with Matekane.

Phapano also insisted that he was working well with Mahao.

“We are still on good terms,” Phapano said, adding that the allegation that they were fighting was “baseless”.

The fallout between Mahao and Phapano has been quick and spectacular.

The two had been almost inseparable months before Mahao agreed to join the coalition government.

Phapano would use his car to drive Mahao around. They would attend party meetings together. Some party insiders saw Phapano as Mahao’s right-hand man and adviser.

Mahao allegedly strongly pushed for Phapano to be appointed as his principal secretary when he became energy minister.

But sources said Mahao started having second thoughts days after recommending Phapano and tried to get his appointment reversed but it was too late.

A source says within weeks Mahao was telling cabinet colleagues that Phapano had captured the ministry and he was unable to function as the minister.

“He started pushing to oust Phapano within days because they were already clashing. It’s been war from the first days,” said the source.

Staff Reporter

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How chicken import ban hit vendors

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MALESHOANE Pakela used to work at small backyard chicken farms where she was paid with chicken heads, necks, legs, and offals that she would roast and sell to factory workers at the Thetsane Industrial Area.

Her job was to clean and pack chicken.
The profit wasn’t much but just enough for the 37-year-old widow to feed and keep her four children in school.

“It also covered her monthly rental of M150 for a room in Ha-Tsolo Sekoting.

Her life was however shattered last October when the government imposed a ban on chicken imports from South Africa following an outbreak of bird flu.
Without day-old chicks the farms quickly shut down, cutting Pakela’s supply of heads, necks, legs, and offals.
Within a few days, her family was starving.

Pakela had been struggling even for months before the ban. The closure of the factories and retrenchments of thousands of workers has severely hit her sales. She was behind on her rent and could barely feed her children.

The partial lifting of the chicken ban has not helped Pakela because her former employers still cannot import day-old chicks or live birds.
Pakela and a family were kicked out of their rented room in November when their arrears were about M1 000.
She has found another room nearby.

A ‘Good Samaritan’ has allowed her to use a room for free until she can afford the rent. But Pakela says she still feels obliged to pay something because she understands that things are hard for everyone.

“Here the rent is still M150 but the landlord accepts every amount that I give her,” Pakela says.
There are days when her children go to bed hungry.

“I have told them (children) that if I have nothing they should accept (the status).”

She now survives on handouts from neighbours and other well-wishers. Pakela’s poverty is apparent.

Barefoot and holding her small child in a seshoeshoe dress, Pakela says her two children usually go to school without eating.
The other child has dropped out of school because she doesn’t have shoes.

’Mako Lepolesa, 44, who has been running a chesanyama (meat grill) at the Maseru West Industrial Estate since 2018. The father of three says his clients are mainly taxi drivers and factory workers.

Chicken was her main product until last October when the ban was imposed. It wasn’t long before his business started wobbling.

“I thought it would be just a short-lived problem (chicken import ban) but it passed on this year,” he says, adding that it might take months for his business to recover.
Moshe Ramashamole, 42, who also owns a chesanyama in the Maseru West Industrial Estate, tried to remain in business by sourcing chicken from local farmers.

It was a stopgap measure that however lasted a few weeks because the farmers also ran out of stock. He resorted to bad chicken but they were double the price of a full chicken before the ban.
Yet Ramashamole thought he could make it work by increasing the price of his plate from M35 to M55. The customers however resisted the new price and Ramashamole had to take the losses.

The poultry ban did not affect street vendors like Pakela alone.
Former Minister of Communications, Khotso Letsatsi, is one of those poultry farmers struggling following the chicken ban.

He ventured into poultry in January last year. It was an audacious venture that included a M100 000 investment in a shelter and other equipment.
He started with a batch of 300 chicks and had reached 1 000 by the time the ban was imposed.

“The business was lucrative,” Letsatsi says.

“I had to employ two people permanently to assist me on a full-time basis,” he says.

When it was time to slaughter the chickens, Letsatsi says he had to employ seven casual labourers.
Since the ban was imposed he had released all his workers.

“I do not know where they are now. Maybe they are starving,” he says of the workers he released.

Letsatsi doesn’t know how he will revive his business.
The Director of Marketing in the Ministry of Agriculture and Food Security (MAFS), Lekhooe Makhate, says the ban has been devastating to farmers and businesses.

“Some big businesses are going to declare less tax to the government because there was no business,” Makhate says.

He says Lesotho spends M2.1 billion on the importation of chicken and its products from South Africa every year.
But that amount usually soars to M4 billion depending on the market forces of demand and supply.

Makhate says the M2.1 billion goes to South Africa where the chicken and its products are imported.

At the height of the scarcity of chickens in the country, Makhate says people were supposed to make initiatives to travel to villages to search for chickens.

“There is not enough production of chickens in the country,” he says.
“Economically speaking we rely on South Africa. We have to be self-reliant.”

Majara Molupe

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Letseng fends off threat to sue

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LETŠENG Diamond says it is under no obligation to advertise jobs for Basotho to provide certain services “where it has the capacity to undertake the same services”.
Letšeng Diamond boss, Motooane Thinyane, was responding to a threat to sue by a little-known political party called Yearn for Economic Sustainability (YES).

Matekane’s company, the Matekane Mining Investment Company (MMIC), had been providing blasting, haulage and drilling services at Letšeng mine since 2005.
The deal with the MMIC was terminated in December last year with the mining company saying it was improper because Matekane had now become a politician.

Letšeng Diamonds announced that it had reached an agreement with the MMIC to acquire its mining equipment at the mine and offered employment to its current employees in line with operational requirements.

“This will enable Letšeng to continue with its mining activities,” the company said in its statement.

This infuriated opposition parties that argued that the mine should have called interested Basotho companies to bid for the contract, saying it is provided for in the Minerals Act of 2005.

The leader of Yearn for Economic Sustainability (YES), Molefi Ntšonyana, wrote the mine last week threatening to sue for allegedly failing to follow section 11 of the Act.
Ntšonyana argued that the Act “does not grant the Letšeng Diamond 100 percent to mine with its good own equipment” but it should engage Basotho companies like it did with the MMIC.

Ntšonyana said Letšeng Diamond and the MMIC made the agreement to acquire the MMIC equipment so that the mine could continue with its mining activities “without any advertisement to seek qualified Basotho to provide such services”.

Ntšonyana said the agreement unilaterally denied Basotho a chance to tender for such services and ignored the fact that the government of Lesotho on behalf of Basotho own 30 percent in the Letšeng Diamond.

“It is advisable to reconsider your decision,” Ntšonyana said, adding that they would also write to the mining board requesting the resolution they made regarding this matter of insourcing mining activities.

He said the company should adhere to section 11 of the Mines and Minerals Act of 2005 and within 14 working days the matter should be reconsidered, “failing which we will have no choice but to drag the company to the courts of law”.

In his response, Thinyane said Ntšonyana must “revisit the section in question in full for its correct interpretation”.

“Letšeng Diamond is under no obligation to advertise to seek qualified Basotho to provide services where it is willing and has the capacity to undertake the same services,” Thinyane said.

He said the decision relating to the agreement referred to has been through the necessary governance structures and is therefore procedural.
Thinyane said Letšeng is a corporate citizen that is fully compliant with the laws of Lesotho.

Majara Molupe

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