Boko Haram Scourge: Lebanese, Indians retreat, Chinese fill the void in Kano

Insecurity and poor electricity supply have compelled Lebanese and Indian expatriates to relocate their businesses to the South-West and other West African countries. But the Chinese have aggressively began to fill in the void.The Lebanese have for a very long time played a very important role in the economic development of Kano state.

Their history can be traced back to when they acted as middlemen in most parts of the old Northern Nigeria, by establishing small companies that served as distribution centres of European imported goods and produce.

They also bought raw materials, like groundnuts and cotton for Europeans and sold finished goods in Kano. Perhaps, it was from these deals that Kano gained its fame as the commercial nerve centre of the North. Traders from the North-East and North-West went to Kano to purchase goods in bulk in order to retail them in their own localities. The trade extended to other parts of West and Central African countries, like Cameroon, Chad, Burkina Faso, Niger Republic, Mali and Senegal.  Traders from these countries purchased textiles from Kano and sald in their cities. This trend gave rise to the creation of Kano-Lebanese business community, which enjoyed a tremendous bi-lateral relationship for several decades.

However, in recent times, especially since the attacks on Kano by the Jamā’atu Ahlis Sunnah Lādda’awatih Wal-Jihad, known as Boko Haram, beginning from January 20, 2012, these Labanese expatriates have been beating a retreat from Kano, leaving a lot of room for Chinese businessmen who have flooded the sector with mainly substandard products. The insecurity, combined with the perennial power crisis, have dealing a deadly blow to the long institutionalized bilateral trading relationship between Kano businessmen and these foreigners. The deadly violence that rocked the state on January 20, left hundreds of people dead, and severely disrupted the tranquillity enjoyed by the expatriates and the indigenes alike.

It planted fear and suspicion in the minds of expatriates, notably the Lebanese and Indian communities. For instance, some Lebanese families which used to live alongside their native hosts in populous areas had to relocate to less populated parts of the city. Their fear was heightened by two cases of attacks on expatriates in May and July.

In the first incident, about six gunmen riding three motorcycles stormed a plastic company, killed a Lebanese storekeeper and carted away mobile phones worth millions of naira. The gruesome killing of the foreigner and the inability of the police to arrest the assailants shook members of the Lebanese community after the story was widely shared among them.

The other incident was that of Raufach Edgar, the German engineer working with Dantata and Sawoe Construction Company, kidnapped in January and later killed in July during a botched attempt to rescue him from his captors by the Joint Military Task Force (JTF).

Following these events, a few wealthy Indians, according to investigations, began moving their businesses to Lagos-Ibadan axis in the South-West. Our reporters gathered that other Indians who traded in canned fish, bath slippers, spaghetti and confectionery had leased out their numerous warehouses situated on the popular Zoo Road area to Chinese nationals and shifted their businesses to Lagos.  An Indian owner of a company which printed labels on bakery wrappers at Dakata Industrial area in the outskirts of Kano was said to have erased the name of his company from its premise and pullout signposts leading customers to the building, shortly after the January 20 attacks. A few others like him, who chose to stay, simply appointed indigenous managers to run their enterprises by proxy.

As for the Lebanese, a great many of them have remained in spite of the insecurity, though few families had reportedly left Kano.  Most of them, Sunday Trust learned, were born in Kano and had little or no attachment to Lebanon.  One of them, Mahir Abdeh, 28, who runs a restaurant on the busy Zoo Road, told Sunday Trust in fluent Hausa that he had nowhere to call home in Lebanon because he had lived all his life in Kano.

“I cannot leave Kano because I have nowhere to go. I can’t go back to Lebanon since I don’t know anybody there. We would always stay here no matter what,” he said.

He added it was even better for him to stay in Kano than to return to his native country because of the crisis in Syria, which he said, was threatening to spill over to Lebanon.

“I don’t believe that my country is safer than here at this moment, if you consider the war happening in Syria”, he said.

Also, Garba Nuhu (not real names), a messenger working for a rich Lebanese manufacturer in Nassarawa GRA, in Kano told our reporter that despite the insecurity in the state, his master was still not willing to leave. “My employer has been living in Kano for, at least, 20 years now. Although he travels to his country at intervals, he still maintains his company, which deals in cosmetic products in Kano. He has shown no signs of leaving because he has become so used to the environment. His two children were born here”, he said.

Sunday Trust further learned that the perennial power failure in Kano is one of the major reasons for the closure of businesses owned by expatriates. Many industries have closed shop for the unreliable electricity supply from the Power Holding Company of Nigeria (PHCN). Sunday Trust gathered that no fewer than 126 industries have been closed down in Kano, as revealed by Alhaji Sani Umar, Chairman, Manufacturers Association of Nigeria (MAN), Bompai, Kano. He said most of them were owned by Lebanese and Indians.

Kano once had flourishing textile, food and beverages, plastic and tanning industries, which provided more than three million jobs. But due to this power crisis and now insecurity, two-thirds of these industries were closed. A manufacturer who craved anonymity said companies operating in Kano were asked to pay over N100,000 as electricity bill at the end of every month. This payment was made mandatory, whether or not the industries were provided with electricity. But in spite of the payment, PHCN defaulted on its part of the deal.

He lamented thus: “Imagine, I’m asked to pay PHCN N120,000 at the end of every month but electricity is not forthcoming. I had to use my generator and then pay salaries to my workers. Tell me, at the end of it all what will be my gain?”

Some of the factories that have closed shops, according to MAN chairman include Magraps Textiles, which started operations in 1970.  It was owned by a Lebanese. Another is Ra’ad Fadouh Industries Limited which started in 1995, also owned by Lebanese. There was also Yasin Confectionary which started in 1974, also owned by Lebanese.

Others are Fawaz Steel Wood and Chemicals, which started in 1986; Nigeria Sweets and Confectionary which started in 1960, owned by Sudanese; Halawa Confectionary, which started in 1979; and Al-Hilal Company Limited that started in 1987. In addition, there are also such companies like the Nigeria Sugar Product Limited that started in 1990 and was shut down in 2007, Sheshe Company Limited, 1994 to 1997, Gaskiya Textile Mills, 1970 to 1996 among others.

A further investigation by Sunday Trust revealed that most of the foreign investors who closed shops in Kano have relocated to other African countries like Ghana, Niger, Sierra Leone, among others. Some that decided to remain in Nigeria have relocated their businesses to Lagos and Ibadan.

However, as Lebanese and Indians, who used to be the visible expatriates in Kano try to adapt to the prevailing discomfort, arising from insecurity and power problems, the sudden appearance of the Chinese in the state in overwhelming numbers has added a new dimension to the narrative.  Where the Lebanese or Indians have vacated, the Chinese are instantly filling the void, gradually dominating the economic space left by their predecessors and gaining increasing attention and relevance.

The Asians, who deal mostly in textile materials, have occupied the famous Kantin-Kwari market, which is the biggest in the sales of such materials. Investigations reveal that they hire warehouses, where they store bundles of their fabrics across various parts of Kano metropolis.  The Chinese’s presence appears to be so conspicious in Kano despite the insecurity. They operate restaurants, bakeries, and businesses that were once dominated by Lebanese and Indian expatriates.

And unlike the other expatriates who have closed shop because of power failure, the Chinese have started establishing their own companies and generating power on their own. They make use of cheap labour available in the millions of unemployed young men of Kano.

According to Alhaji Bashir Borodo, the exodus of businesses from the ancient city of Kano to other places like Abuja and the South-West was not necessarily due to the Boko Haram menace. He argued that the expatriates are not leaving Kano in droves as was suggested but however the region’s commercial nerve-centre has witnessed unprecedented closures of industries in recent times as a result of what he described as “economic sad days” literally meaning the downturn as an off shoot of the Structural Adjustment Programme (SAP) in the late 80s and early 90s which completely devastated the country’s socio-economic infrastructure.

The former President of Manufacturing Association of Nigeria (MAN) said the Boko Haram crisis and heightened insecurity have brought additional strains to businesses and manufacturing regarding demand and supply chain between the core markets and retailers which has caused trickling effect on manufacturing.

He attributed the growing spate of business switch from manufacturing to real estate by numerous expatriates in recent times to Abuja’s rapid development.

“Indeed, there has been marked decline in manufacturing. The goods being produced in Kano normally go to North East market with Maiduguri as the terminal and North West in the Sokoto axis which serves Niger Republic. At Maiduguri, people from Sudan, Chad and Cameroon came to purchase these goods. But recently we have seen a sharp decline of people who come into Kano to buy. In Maiduguri, for instance, the retailers are having problems also as people who normally came to buy from neighbouring Chad, Cameroon and Sudan are not coming as they uses to. In another vein, some retailers want to buy and stockpiles. So, we (the manufacturers) are badly hit,” said Borodo, who is also the President of West Africa Manufacturers Association.

He said though the number of expatriates doing business in Kano has dropped, some have remained in the city and are not planning to shift base.

“Yes, there have been apprehensions from the insecurity problems, as many expatriates seriously considered moving out of Kano, but we pleaded with them to stay as things would hopefully come back to normal soon. Even those who had left Kano are still doing business in Nigeria. They have shifted base to Abuja.

“A retailing company owned by a Lebanese has opened a branch in Accra, Ghana, while some have started new outlets in Abuja. A good number of Chinese, Indians, Lebanese and Syrians are staying put in Kano whereas some are changing their business operations. There have been switch from manufacturing to real estate.

“The appearance of the Chinese in Kano business circle isn’t a recent phenomenon. They have been with us since the 1960s producing plastics, ceramics, shoes and many other things. They are exporting these goods from Kano. ..The new entrants are in textiles; they came and have done the havoc to textile manufacturing, but they are now also feeling the heat,” Borodo added.