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Cheap Gold Dirt, or Dirt Cheap Gold?
Piracy, Adulteration, and the Scramble for Premium Quality at Bargain-Basement Prices
By Des Nnochiri, Oct 2nd, 2008
Introduction
Importers of consumer goods into Africa face a number of obstacles - not least of which are those imposed by administrative and legislative bodies.
Yet, African society itself poses what may be the biggest obstacle of all.
What Is The Problem?
Africans in general (and Nigerians in particular ) are not a modest people. Historically, there is a deeply rooted tradition of ostentation and lavish ceremony, extending to all aspects of social and political life. It expresses itself in strict hierarchies and rigid class distinctions, which are reinforced by exuberant (some would say vulgar) displays of material wealth.
The influence of Western (and more recently, Asian) culture has provided a new set of status symbols - ranging from European designer suits and luxury cars, to the latest micro-chip technologies - that many see as vital in confirming their standing in the community.
Appearances are everything.
It is at this point that the harsh realities of economic life intrude. Average incomes remain too low to make these products available to any but the privileged few who have access to hard currency (foreign exchange), or those who have made vast sums of local currency by various (and often, dubious) means.
What hope, then, for the man in the street?
Locally, goods are manufactured to as decorative and elaborate a standard as possible, using the cheapest available materials for mass production. Quality standards and durability are low.
Imported goods must be kept as cheap as possible, so as to make them affordable to the largest proportion of the general populace.
There is great pressure on both local manufacturers and the importers of consumer goods to keep prices down to "acceptable" market levels - by any means necessary.
How Is This Done?
In many cases, importers simply resort to smuggling. Undeclared goods are often concealed within consignments of legitimate merchandise. This maximizes on container contents, and brings in lucrative (usually contraband) items, "under the counter."
Adulteration is another strategy. Here, importers take genuine products and "water them down" to maximize on volume. It is not uncommon to find bags of rice containing up to 30% of white sand, for example.
Pirates will make or import illegal copies of genuine (brand-name) goods, in reduced (ie. cheaper) packaging, and sell at low prices and high volume. Reproduction methods are often poor, as is the quality of the end product.
Counterfeiters may create convincing replicas of the packaging and outward appearance of brand-name goods, which are really locally made products, or cheap imports. These are then sold at "affordable" prices, giving the consumer a false impression of both the cost and quality of true brand-name goods.
What Can Be Done About It?
Legislation may be effective - if actively enforced. This requires unilateral action on the part of individual governments and consumer protection agencies, and concerted action at the international level, to make it harder to export and import sub-standard or counterfeit goods.
Education is essential, for the long term. Consumers must be made to understand the consequences of buying sub-standard goods.
In the first place, the buyers may not be aware that the goods are sub-standard, and will come away with an erroneous impression of the true quality of the big-name goods that they are so anxious to be seen to have. In the case of some pirated, adulterated, or counterfeit products, the consequences of this have been fatal. This has been the case with certain pharmaceuticals, electrical goods, and children's toys. The recent tragedies with tainted baby milk in China are a prime example.
It is in the interests of the big-name manufacturers themselves to create an increased awareness of the true price of their products, so that buyers will know that the goods they are being offered at significantly lower prices are either fake, second-hand, or "past their sell-by date." If the price is too good to be true, it most probably is.
Establishment of local industries as joint ventures is another possibility. If goods of proven high quality can be produced using indigenous raw materials and / or labour, this will provide consumers with a cheaper alternative. It would also be a valuable investment opportunity for manufacturers of generic or "second division" brand-name goods, and would serve to increase their presence and market share on the global scale.
A Final Caveat
African consumers must learn to actively discourage the extravagant lifestyle that makes expensive brand-name goods a "must-have." This will take considerable time, and will require the involvement of educational and social services, working in conjunction with governments and consumer protection agencies.
Ultimately, however, the attitude that makes smuggling, piracy, counterfeiting, and adulteration a necessary part of economic life - not just in Africa - must be tackled at source.