Impacts of Chinese Imports and Copying Strategies of Local Producers: the case of Small-scale Foot Wear Enterprises in Ethiopia.

Abstract

The footwear sector in Ethiopia is dominated by deap imports from Asia, particularly from China. This has inflicted heavy impacts on the sector, and threatened its competitiveness in the domestic market. This study examines the impact of imports and coping strategies of firms to withstand the competition. Firm level data were gathered from micro, small and medium footwear enterprises. The findings revealed that Chinese shoes are superior in design, price and quality, with the result that they have taken over the domestic market The impact of Chinese imports on local producers varied from downsizing, bankruptcy, loss of assets and property, to downgrading activities and informalising operations. Firms have pursued comping strategies that fgocysed on improving design and quality, as well as lowering prices and profit margins. Coping strategies appear to be differentiated by size of firms, and have some association with the performance of firms. The ways forward for local producers...