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Counterfeit goods in our midst: The challenge ahead

25th November 2012
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Like many other forms of corruption haunting the nation, there is now ample evidence that trade in counterfeit goods, probably in fake services as well, continues to rear its ugly head in our society.

Complaints about this situation, where our country has turned into a dumping ground of all sorts of fake commodities are often held, the contradiction that those who cry foul continue to consume them notwithstanding.

While debate on the subject has been going on and continues, yet one may dare say that it has not been an informed one, and a Chinese philosopher- cum-politician who believed in the maxim of “no research no right to talk” would have discouraged it, if he were around.

Thank God, as my readers may have been informed, the Confederation of Tanzania Industries (CTI) came up with the idea of conducting a study on the problem, and now a report entitled “The effects of counterfeit and substandard goods on the Tanzanian economy” is available to provide us with some insights as we deliberate on this vital issue.

Experts who conducted the CTI study came to the conclusion that between 15 to 20 percent of the goods imported into the country are counterfeits.

Add to this, the figure of those which are simply substandard, even if not necessarily fake; and you realize how adulterated the market has become. All sorts of goods targeting various consumers are dumped here. They include clothes, shoes, foodstuffs, medicine, electrical equipment, building materials, cosmetics, home appliances and you name it.

Counterfeit and substandard goods are considered “cheap”, in regard to buying prices, but at the end of the day their apparent cheapness is not without a price - to individuals as well as to the nation.

The usage duration of most counterfeits and substandard goods is often extremely short, implying the consumer is shortchanged, and the low price turns out to be a dirty business trick. But poor people, whose “planning” focus on daily survival shortcuts, hardly take note of the trick and keep patronizing this kind of business.

CTI findings on the impact of counterfeits and substandard goods at national level deserve our utmost attention. It is revealed that some local industries have been forced to close shop, as it becomes difficult for their products to compete with cheap counterfeit ones. Looking at this trend casually, some observers may be tempted to argue that in a free market economy local industries ought to stand up and compete rather than complain and cry for government preferential support.

But, as CTI has discovered, the competition between local producers of genuine goods and their counterparts specializing in counterfeits is not fair at all. Producers and dealers in counterfeit goods daringly reduce costs through cutting corners and engaging in all sorts of dirty business tricks, which producers of genuine products are not encouraged to adopt - hence the rationale for taking deliberate measures to protect the latter.

CTI also contends that the government loses a substantial amount of money annually through tax evasion, as dealers in counterfeit goods are not reputed for being good taxpayers. This is not surprising considering the fact that traders in this category do not necessarily use official channels and entry points in the process of bringing goods in the country.

Other negative effects of the prevalent counterfeit goods in the country are well documented. The latest revelation that people living with HIV have been unknowingly using fake life prolonging drugs is one of the incidents which have shocked the nation. However, this is the tip of the iceberg.

All sorts of medicines and cosmetics are in the market, causing unnecessary health hazards to unsuspecting consumers. Fake electronic equipment and gadgets are also reportedly causing loss to property owners through fire breakouts sparked by fake electronic wares installed in residential houses and office premises.

While the negative impact of trade in counterfeit goods to our community is well known, the challenge is on how to eliminate it. State organs specializing in fighting crime and institutions responsible for regulating trade are in place. Measures like impounding counterfeit goods, destroying them, and arraigning suspects in court are taken now and then.

Despite these efforts, counterfeit goods trade is still on the rise, tempting some observers to wonder whether our commitment to fight it is strong enough, and strategies employed are well designed. These misgivings should be addressed.

Henry Muhanika is a Media Consultant(hmuhanika@yahoo.com)

SOURCE: GUARDIAN ON SUNDAY