Tanzania pays price for cheap knockoffs

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Kai Ryssdal: Chinese President Hu Jintao is on a 4-day tour of Africa this week. It’s an indicator of Beijing’s growing influence and interest in the continent. Tomorrow will find him in Tanzania. China’s a top importer of that country’s timber. Chinese factories, in turn, export many of the counterfeit goods that are circulating in Tanzania — knockoffs of everything from high-end fashions to electronics. The prices are cheap. But the long term economic costs can be high as Marketplace’s Gretchen Wilson explains.

Gretchen Wilson:
This is the busiest market Dar es Salaam. Traders from all over Africa come to this port city to buy cheap imports that they then re-sell across the continent. They load trucks with huge bags of jeans and purses — all bearing brand names, like Chanel and Gucci.

These are ostensibly Sony radios. But the labels are glued on crooked. On some, Sony is spelled with two n’s. And shop owner Rogers Naftar won’t give any guarantees.

Rogers Naftar:
These are sold as is. If it breaks, find someone to repair it. Or come back and buy a new one.

Tanzania has an international reputation as a dumping ground for fake merchandise, most of it made in China. As much as 20 percent of goods in the country are cheap look-a-likes. And what’s happening here tells a bigger story — of counterfeiters making a quick buck off the world’s poor. And the difficulty in the developing world to shut them down.

Naftar:
The police don’t bother us. This is the Tanzanian system. Even the police themselves come here to buy fake products!

Most Tanzanians earn only a few hundred dollars a year. Shopper Hamadi bin Kimaro says everyone knows these cell phones and TVs don’t last. But they’re all most people can afford.

Hamadi bin Kimaro: It’s according to the power of your pocket. If the power of your pocket is less, then you purchase the things of the less price.

But this isn’t just about cheaper prices for consumers. Local businesses can’t compete. One industry group says counterfeit goods translate into the loss of 140,000 local jobs.

And there are serious public health concerns. A recent crackdown found all sorts of counterfeit pharmaceuticals in Tanzania’s markets, including AIDS medications and anti-malarial drugs. These worthless pills that are made to look exactly like the real thing in order to fool pharmacists and unwitting consumers.

In Dar es Salaam, one pharmacist who gives only his first name, Ramal, tells me on tape that he’s confident in the quality of his medicines.

Ramal:
And I have to trust my suppliers. Suppliers who have passed through the proper channels, those are the people that we deal with.

But when Ramal is sure I’ve stopped recording, he tells me something else. He says he knows 10 percent of the drugs in his pharmacy are probably fake. But that he’s not about to shut down 90 percent of his business because of it.

Most counterfeit goods come into the country through sea ports, like this one in Dar es Salaam. They’re usually shipped alongside legitimate products, which makes them harder to identify. A new law gives authorities more power to search private businesses and destroy fake merchandise. It also makes it easier to slap big fines on offenders.

In Dar es Salaam, I’m Gretchen Wilson for Marketplace.

All reporting by Gretchen L. Wilson, © 2009

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