Training the Traders

Evans Otieno, 34, is the perfect embodiment of a true go-getter, as reflected in his success in perfecting the art of making money through cross-border e-commerce.

Starting from the humble beginning of being a street vendor in Naivasha Town, northwest of Nairobi, Kenya’s capital, he has now become an automotive dealer who supplies spare parts to garage owners in Nairobi’s central business district.

“I start my day at 9 a.m. by checking the orders from my clients in order to purchase automobile spare parts via e-Bay, an American multinational e-commerce company that facilitates consumer-to-consumer and business-to-consumer sales through its website. I enjoy online retail because the shipping costs of goods is lower and it’s more convenient compared to travelling to China to buy goods, which raises the cost of doing business,” Otieno told ChinAfrica.

With major strides being made in Internet infrastructure, coupled with the emerging technology ecosystem and rapidly changing domestic market, e-commerce presents a huge opportunity for African small and medium-sized enterprises (SMEs) to scale up and expand their business operations across the globe.

It is estimated that Africa will have more than half a billion e-commerce users by 2025, with a steady 17-percent compound annual growth rate of online consumers for the market compared to 2017, according to the International Trade Administration, US Department of Commerce.   

Skills training 

Given its advantageous geographical location and natural deep water port, Djibouti is becoming more important as a regional trading and transhipment hub in the Horn of Africa.

Since Djibouti’s economy depends heavily on logistics services and trade through its international port, there has been an expanding economic footprint of China in the country, with many projects in the road, rail, port and airport sectors being carried out, in particular under the Belt and Road Initiative.

For this reason, the recent inauguration of the Centre of Innovation and Maritime Excellence (CIME) in Djibouti is in an effort to scale up e-commerce initiatives and help to improve entrepreneurs’ income through trade. 

Nearly 30 trainees from Djibouti, Ethiopia, Kenya and Uganda were selected to participate in the eight-day training programme in Djibouti. The young Africans gained knowledge about various fields including entrepreneurship, maritime logistics and ports, innovation and digitalisation through lessons, thematic lectures and seminars by Chinese and African experts, as well as visits to the Doraleh Multipurpose Port and the Djibouti International Free Trade Zone built by Chinese enterprises.

The first-ever training camp was held under the theme Digital Innovation and Cross-Border E-Commerce. It is part of laudable pragmatic measures to carry out the objectives of capacity building and human exchange envisaged in the Nine Programmes announced during the Eighth Ministerial Conference of the Forum on China-Africa Cooperation held in Dakar, Senegal, in November 2021.

“CIME will help African youths to adapt to more diversified needs of digital trade. Djibouti aspires to become a training centre for the whole world, providing Djibouti and all African youths with good employment and entrepreneurship training opportunities,” Djibouti’s President Ismail Omar Guelleh said in a live video message during the inauguration of CIME, which was supported by China Merchants Group.

Guelleh said that Djibouti will strongly support CIME to ensure the successful implementation of the programme to provide high-quality training for young people.

Growth of e-commerce

Just like Otieno’s passion to strive for a better life through online trading, Mishek Amdeselassie, an Ethiopian software engineer who attended the eight-day training session in Djibouti, said the initiative will enhance innovation in e-commerce among African entrepreneurs, a step that will boost trade and transform lives on the continent. 

“The training was timely for me as I aim to generate user-friendly software products and data that will be able to facilitate cross-border traders’ online business transactions with ease,” Amdeselassie told ChinAfrica.

Amdeselassie noted that the knowledge he acquired from the training will help to transform his firm Skytech, an Ethiopian tech startup incubator that facilitates online data and events to ensure that local entrepreneurs get professional support and consultancy services.

The trading in products and services across borders has benefitted both sides and, in particular, contributed to the growth in China’s exports recently. For instance, fashion and electronic products generate the highest sales revenues in online shopping in African markets, with annual sales of fashion products predicted to reach $13.4 billion and those of electronic products $11.2 billion by 2025.

As firms around the world transition away from the traditional way of doing business because many customers are going online for faster and efficient transactions, the promotion of African youth entrepreneurship and the development of SMEs on the continent has become a priority.

Economists say the digital economy in Africa is expected to exceed $300 billion by 2025, thanks to massive mobile penetration. Therefore, the establishment of the centre is undoubtedly a new step and a game changer in Djibouti-China cooperation.

The country’s Minister of Higher Education and Research Mohamed Ahmed Nabil said the project provides Djiboutian youth, and African youth in general, with the opportunity to master innovative tools for e-commerce, which is in development in Africa.

Meanwhile, Chinese Ambassador to Djibouti Hu Bin said China highlights the promotion of African youth entrepreneurship and the development of SMEs as priority targets.

Funded by the China Merchants Foundation and operated by the Djibouti Chinese Enterprise Association, the centre is a non-profit capacity-building project aimed at enhancing the leadership and entrepreneurial ability of Djiboutian and East African youth, contributing to the Djibouti Vision 2035, which is aimed at promoting private sector innovations and self-employment. It is intended to become a platform for services like training, mentoring, and networking.

Matildah Kulmer, an IT expert from Rwanda, noted that “the training was an eye-opener, especially because most SMEs in traditional industries in Africa lack the talents and skills of new technologies such as cloud computing, artificial intelligence and digital payments, among others.”

Rahim Tahir, head of a Djiboutian SME who is one of the local exporters of palm oil and dried legumes to neighbouring countries in the East African region, paid a glowing tribute to the Chinese-sponsored training and the launch of CIME.

“Our strategic position serves as a vital gateway to the African market and beyond, which allows local SMEs in Djibouti to leverage our geographical advantage and facilitate more export of our agricultural produce, and helps us to raise our income,” Tahir added.