One of China’s richest businessmen, Jack Ma, and SA union Sactwu are calling for a crackdown on counterfeit goods, writes Melanie Peters.
One of China’s richest businessmen, Jack Ma, founder of Alibaba, the world’s largest online marketplace, called for China to enforce stricter measures on the booming shadowy business of fake goods. Ma wrote an open letter, calling on China’s government to fight fakes as zealously as it does drunk driving.
Ma took to Sina Weibo, a microblogging site akin to a hybrid of Twitter and Facebook with more than 200million users, to make his appeal. He criticised the ineffective penalties and low conviction rate, saying there is “a lot of bark around stopping counterfeits, but no bite”.
This may be a PR stunt, or a genuine attempt to atone after Alibaba’s membership to the International Anti-Counterfeiting Coalition, a global organisation that fights piracy, was revoked in May.
Ma’s company runs Taobao, an online-sales platform mirrored on eBay. In a further blow late last year, the US put Taobao on its blacklist of “notorious markets” for selling fakes.
Ma may be concerned about the number of fakes sold on the company’s e-commerce platforms, or trying to quell criticism.
Either way, he highlights the mounting pressure on governments the world over to tackle the counterfeit industry which continues to grow, exposing porous border controls.
International body the Organisation for Economic Co-operation and Development pins the industry’s worth at an eye-watering $461 billion (R5.7bn).
In South Africa, one of the industries hardest hit by fakes is the clothing and footwear industry.
The Southern African Clothing and Textile Workers’ Union (Sactwu) held a protest outside South African Revenue Service’s (Sars) head office in Pretoria earlier this month. The protest was intended to demonstrate the sector’s unhappiness with what the union slammed as a “crisis of illegal imports flooding” the local market.
The clothing industry in the Western Cape has been hard hit over the past two decades, bleeding jobs and with factories forced to close doors. The union has suspended rolling protests as Sars agreed to a meeting next month to outline urgent solutions to renew its fight against illegal exports.
The long-awaited Border Management Agency Bill should be finalised this year too. It paves the way for an agency to take over management of the country’s ports of entry. One of its main focuses is battling corruption and reducing the number of counterfeit goods coming across the border.
Home Affairs Minister Malusi Gigaba has raised his concerns about the country’s battle to reduce the flow of counterfeit goods through its ports.
In its memorandum to Sars, Sactwu warned the customs fraud campaign was a key driver to reindustrialise South Africa.
The tax collector’s inaction undermines efforts by other parts of government to build and grow industries and factories.
The collapse of the Sars customs fraud campaign should not only concern workers and their unions, or industries and employers, the problem has a direct impact on society at large and on SA’s future development as a country.
Sactwu said apart from the obvious benefit of jobs, when import duties were not collected effectively, the country’s fiscus was robbed of billions of rand in revenue.
The domino effect of counterfeit goods is staggering.
As Sactwu’s sums show, an amount of R4bn in import duties that South Africans lose from illegal clothing and footwear imports every year could build an additional 25000 RDP houses every year, or provide child-care grants to more than 12.1million beneficiaries, or old-age grants to 3.2million pensioners.
The union’s members come from the poorest parts of the country, most being women and single mothers. The financial blow and ramifications for the labour force from counterfeit goods is hefty and something South Africa can ill afford.
* Peters is the Live Editor of Weekend Argus. She is on a 10-month scholarship with the China Africa Press Centre. Instagram: mels_chines_takeout