Newcastle’s Economy: The growing impact of local Chinese stores

Newcastle, KwaZulu-Natal Chinese-owned stores are making significant contributions to the Newcastle economy.

With over 50 Chinese-run shops in Newcastle, including supermarkets, grocery stores, hardware businesses, and clothing and factory stores, these businesses have become an integral part of the local economy, offering convenience, affordability, and job opportunities for the community.

According to Alex Liu of the Chinese Chamber of Commerce, the Chinese shops in Newcastle started booming after 2005 when individuals started their businesses and encouraged others to join them in Newcastle, forming a cluster of businesses that offered residents a wide variety of items in one area. Liu stated, “The early Chinese shops started in the 90s and started booming after 2005.

This is when individuals started their businesses and encouraged others to come over due to the promise that Newcastle held, forming a cluster of businesses which offered residents whatever they wanted in one area.”

One of the key benefits of Chinese-owned businesses in Newcastle is the convenience and affordability they offer to local residents.

Liu highlighted that these businesses provide their products at affordable prices, creating a competitive market that benefits the community. Liu stated, “The shops and factories create immense job opportunities in Newcastle. I estimate that 5000 to 10,000 people are employed by these businesses.”

In addition to providing job opportunities, Chinese businesses in Newcastle also contribute to the community through charitable organisations. Liu mentioned that businesses such as the Tzu Chi Foundation and the Buddhist Light Association provide necessary materials to those in need and have donated blankets and food to flood victims and sanitisers and masks to local schools during the COVID-19 pandemic.

However, despite their contributions to the local economy and community, Chinese businesses in Newcastle are facing challenges.

Local businessman Andy Hsu pointed out that the highly volatile South African economy and frequent loadshedding (scheduled power outages) are impacting both the stores and factories. Hsu mentioned that the factories alone spend significant amounts on diesel for their generators, cutting into their profits and hindering their potential for further development and job creation.

Despite these challenges, Liu and Hsu are optimistic that the Chinese community will continue to look for innovative ways to contribute to the economy through business and philanthropic endeavours.

As the Chinese-owned businesses in Newcastle navigate through these challenges, the community is encouraged to share their views and thoughts in the comment section below.