What traders see as major hindrance to business

 Kariakoo has a long history. After Kariakoo Market was built by the Germans, it started operating in 1923. Today, Kariakoo is Tanzania and east and central Africa’s most vibrant commercial hub. It is near the city centre and the Dar es Salaam Port, which was constructed first by the Germans in the late 1890s. The construction of the iconic Kariakoo Market, a three-storey structure spanning several streets that was unveiled in 1975 by Tanzania’s first President Julius Nyerere, changed the fortunes of Kariakoo.

Now the commercial hub has attracted not only traders and shoppers from every corner of the country and beyond, but it has also attracted various investors in the hospitality industry, banking and in light industries.

The vibrancy of Kariakoo - more than Sh10 billion change hands daily, according to some estimates - has also facilitated the mushrooming of street vendors and hawkers, who peddle their wares on almost every Kariakoo street.

Shopping in Kariakoo is an experience of its own. A sea of humanity is overwhelming. Many streets are virtually impassable by vehicles and even by pedestrians because they are fully packed by vendors, who sell their merchandise at cheap prices.

This has left shop owners and other legally registered traders in the area complaining about their inability to compete with vendors, who sell their products at throw away prices.

But for Kariakoo traders, vendors are only part of the problem. The unfriendly business environment in Kariakoo, would, even without the menace of vendors, make their businesses unprofitable.

They complain about numerous charges and fees, erratic power supply, which means they have to spend money on fuel to run standby generators daily, a poor sewerage system and lack of parking spaces.

Charges, according to shopkeepers, include exorbitant garbage collection fees and over-the-roof space rentals.

In light of this, traders appeal to the responsible authorities to improve the business environment in line with creating a good sewage system and parking.

Those, who spoke to The Citizen, say the situation is such that doing business in Kariakoo as a formal and registered trader is almost impossible. But it is the problem of vendors that tends to get under the skin of many traders, who spoke to The Citizen.

Mr Omela Omela, an electronics trader and a shop owner in Kariakoo, says multiple charges are a major hindrance to his business.

He pays Sh900,000 in rent for a stall, whose length and width stand at 3.5 metres and 2.5 metres respectively.

The monthly wage for his five shop assistants and electricity bills stand at Sh750,000 and Sh200,000 respectively. Garbage fees stand at Sh12, 000 per month.

“The presence of vendors almost everywhere on the streets and their merchandise, which they sell cheaper than we do are among the problems we are facing in our business,” Mr Omela notes.

He says if the government cannot deal with the problem of vendors and hawkers, it should, at least, reduce the high cost of doing business by ensuring reliable power supply, among other things.

“High operational costs do not match the profit we make as we are often forced to lower prices,” Mr Omela told The Citizen.

He says his daily profit stands at an average of Sh45,000, but it could be higher than that if he did not have to use his standby generator every day to test radios and TV sets before selling them to customers.

“For us, the fear of multiple charges is the beginning of wisdom. So, I appeal to the authorities for a more business-friendly tax regime so that we can improve our business performance,” he says.

Mr Jackson Lang’o, a mobile phone dealer in Kariakoo, also laments that exorbitant charges and fees impart negatively on his business.

“This is daylight robbery… we are being exploited and our businesses are suffering, thanks to the high and numerous charges that are hanging over our heads,” complains Mr Lang’o.

His sentiments reflect the general feeling among the businesses that the authorities and other agencies’ exorbitant charges are killing their businesses.

According to him, the cost of doing business should not be as expensive as it is today if the government is serious about attracting investments in the country.

He says he pays Sh1 million and Sh200,000 in income tax and licence fee respectively per annum. “I also pay Sh500,000 in rent for a stall of four square metres and more than Sh30,000 and Sh15,000 for electricity and security charges respectively,” he says.

The situation, he says, creates unemployment and retards economic development and growth. Multiple charges also discourage both local and foreign investments and do not allow local products to compete with imported ones.

According to him, these factors are responsible for stunting the growth of the country’s economy.

On top of the multiple charges, AVCC Traders Shopkeeper Beatrice Wilson, who sells bags, heaps blame on unfair competition from Chinese traders.

She accuses them of unfairly undercutting prices by flooding the market with cheaper and substandard products.

“The government should crack down on cheap and substandard imports because they threaten the survival of our businesses,” she notes.

A fortnight ago, she was quoted by The Citizen as saying her daily sales had fallen from Sh1.4 million to Sh8.4 million to Sh280,000 per day due to the influx of vendors in two months.

“I can sell about 10 bags a day, down from between 50 and 300 bags…each bag is sold at Sh28,000,” explains Ms Wilson.

Because of this negative trend she says it is much better being a vendor than shop owner as the former does not pay any levies, no power bills and no tax. This makes their goods quite cheap. When contacted for comment on what has been expressed by traders, Dar es Salaam City Council acting managing director Phillip Mwakyusa said he was not in position to comment anything.

“As of now, concerns are not yet on my table…I will be able to comment on the matter as soon as they are brought before me,” he explained. These seem to be genuine concerns that need satisfactory answers from the responsible authorities so that traders do business in a friendly and rewarding environment.