After dark on Exotic Street in China’s eastern city of Yiwu, three Yemeni boys crowd round a large charcoal barbecue rack selling lamb kebabs and baked breads. They order in confident Mandarin, chatting rapidly between themselves in Arabic.

Inside the adjoining Erbil restaurant, two Jordanian men share a plate heaped with barbecued meat and vegetables, while on the street corner two men sit smoking shisha pipes. The Zekeen supermarket sells both instant noodles and halal meat, and an African woman wearing a hijab carries out bags of shopping. Opposite, two young Russian women emerge from a shop that sells the unlikely combination of trainers and sex toys.

This mix of communities, religions and languages has augmented Yiwu’s reputation as one of China’s most multicultural cities; a risk-taking new frontier drawing fortune hunters from across the world. As Mark Jacobs puts it in his book Yiwu, China: A Study of the World’s Largest Small Commodities Market, “anything can be had for a dollar or a yuan”.

Local government has its eyesight trained on bringing foreigners in, but at the market attitudes are a little different Daniel Whelan

The reason they come here is simple. Yiwu boasts a breathtaking emporium covering 5.5 million sq metres with more than 75,000 shops and stalls. This is the supplier of stuff for discount stores the world over: fake flowers, coloured beads, hair ties, inflatable toys, tinsel, party hats, umbrellas – Yiwu is the source of more than 1.8m products, including 70% of all of the world’s Christmas decorations.

“Today, retailers from anywhere in the world can’t survive without Yiwu products,” says businessman Girdhar Jhanwar, who in 2002 became the first Indian trader to set up in Yiwu, before it had paved roads and skyscrapers. “Anyone can come and set up a business in Yiwu, and get items to sell in countries all around the world. They don’t have to go anywhere else in China. Yiwu has become a one-stop shop.”

‘One-stop shop’: a trader waits for customers. Photograph: Kevin Frayer/Getty Images

Keenly aware a market needs a steady flow of buyers, the government has been pushing the message that all foreigners are welcome. Signs at the train station are in Chinese, English and Arabic, the government publishes a weekly newspaper in English, recently opened the city’s first international school, and is considering teaching Arabic in public schools, given the large number of traders from the Middle East and North Africa.

They also host an annual meeting with members from the 13,000-strong resident foreign community; in a three-hour meeting in February, 13 officials discuss problems with residents from countries such as Turkey, Oman, Egypt, Malaysia, South Korea and North Sudan.

It’s not only this collaborative meeting that is unusual across China - Yiwu’s society enjoys greater autonomy in general. In his research published in African academic site Pambazuka, Adams Bodomo, now professor of African Studies at the University of Vienna, concluded Yiwu residents were given an “unusual freedom of worship” and the city’s large, modern mosque draws thousands for Friday prayers. The Yiwu government also hosts celebrations for religious festivals such as Eid and Diwali.

“The city government is committed to providing a better environment for the foreign community to live, to work, to do business,” says Xiong Tao, vice-mayor of Yiwu’s municipal government. “Yiwu has always been a testing ground. The real development began after the launching of reform and opening up in the 1980s. When people were still afraid, and waiting for the bosses to tell them what to do, we didn’t sit and wait. We tried to find a way to make ourselves rich.”

Xiong says they have tried to simplify bureaucracy as far as local powers allow, issuing two-year residency permits – twice the standard length – putting a tax and visa office inside the market, offering online registration, and introducing foreigner ID cards.

A warm welcome to outsiders isn’t always the case in China. In contrast to Yiwu, media reports and academics have detailed prejudice and hostile attitudes towards Guangzhou’s African community, particularly from the police. Locals named the area around Xiaobeilu “Chocolate City”, and a CCTV feature on integration in Guangzhou featured one local telling the interviewer Africans “smelled bad”.

“We are lucky here compared to places like Guangzhou,” says Xiong. “In Yiwu, the foreign community is mostly composed of businessmen, which means they are in general better educated and already had an occupation. Yiwu has always been a friendly and accommodating city too, because we are a city of trade.”

However, not everyone in the city reflects the government’s open approach. Several African traders, reluctant to go on record, complain of a growing racial tension in Yiwu, particularly towards Muslims. “When we do business in China, they try to cheat us every time,” says one.

Officials discuss problems with foreigners from countries including Turkey, Oman, Egypt, Malaysia, South Korea and North Sudan. Photograph: Helen Roxburgh

Keen to keep trading relations as smooth as possible, the government has given almost half the places on the trading market’s 50-strong mediating committee to foreigners. This helps settle disputes that arise efficiently, they say, because they can match languages and cultures.

“The city entirely relies on migration, both interior migration and traders from other countries,” says director Daniel Whelan, who spent months in Yiwu filming the documentary Bulkland. “While the local government has really got its eyesight trained on the outside world and bringing foreigners in, at the market attitudes are a little different. Obviously, the market wouldn’t exist if it wasn’t for these guys coming from all over the world, but both parties are completely suspicious of each other.”

Global economics have further increased tensions. Ammar Mohamed Kamal Eissa Ashour is an cheerful and ambitious Egyptian businessman; the type of foreigner the Yiwu government wants – fluent in Chinese with a degree in Chinese business and an MBA. But while he’s been in Yiwu for eight years, he is worried about longer-term prospects. “We have economic problems in Egypt at the moment,” Ashour says. “And countries we mostly do business with – Yemen, Libya, Iraq, Syria – are also having different problems, and trade is going down. Compared with last year, trade is maybe half of what it was.

‘Reviving the old Silk Road’: a freight train from Yiwu arrives in Barking, east London. Photograph: AFP/Getty Images

“So, now I’m thinking what I want to do next. It can be hard to make a long-term plan as a foreigner in China.”

The changing economy, China’s reducing focus on exports and racial tensions in Yiwu is making many foreign traders question their longer-term business models in China, and several talk of leaving.

Ashour has been successful in Yiwu, and has financed the education of his three younger brothers in Egypt. But it hasn’t been easy. “When we do business here, it can be very tough. I want to run a good, high-level business, but I’m increasingly feeling tired.”



Tensions flared in 2012 after the kidnapping of Indian traders over a business dispute, and the Indian embassy even issued advice at the time to Indian traders and businessmen “not to do business with Yiwu”.

Officials aren’t only facing the challenge of integrating domestic and foreign residents. The 771,000 locals are dwarfed by 1.25 million non-local residents – mostly poorer Chinese workers who congregate hopefully on the street outside the job centre. The influx of Arab traders has also drawn Chinese Muslims in search of opportunities, including from the Hui and Uighur communities, who speak both Mandarin and Arabic.

A trader in Yiwu. Photograph: Alamy

These migrant workers are sharply different to wealthier traders from overseas and the native population, in that they often have lower education levels. It is estimated that fewer than 5% of total Yiwu residents have a university degree.

To maintain Yiwu’s economy, the local government needs to retain all three groups; workers, sellers and buyers. But as China’s economy readjusts away from an export-led model, Yiwu must also redefine itself. The government is trying to shift focus from exports to imports, introducing a new market for imported goods, a service that helps traders build websites to compete online, and an innovation park they hope will encourage more growth companies and startups.



A key part of the shifting focus is the new 12-day freight train to London, the first of which arrived in London in January. The train was carrying 34 containers of Yiwu goods including clothes, bags, suitcases and small household items, having already offloaded 10 containers in Duisburg, Germany. The company running the service, Yiwu Timex Industrial Investments, says the price of carrying freight by train is half that of air cargo and two weeks quicker than travelling by sea.

Having passed through Kazakhstan, Russia, Belarus, Poland, Germany, Belgium and France into Britain, the Yiwu-London route is the 15th running directly between Europe and China, and Yiwu itself already has direct freight train links with Madrid and Riga, plus Iran, Afghanistan and Kazakhstan. The train also forms part of president Xi Jinping’s “One Belt, One Road” policy, a bid by the Beijing government to revive old Silk Road trading routes and usher in a new era of trade opportunities.



Xiong denies claims Yiwu’s foreign community is in decline; he says there was a 10% increase in visiting foreigners last year, and 6% more resident permits issued. But in private, many business owners talk about leaving – falling trade is the primary reason, tensions of one sort or another the second.

Guardian Cities is dedicating a week to the huge but often unreported cities on the front line of China’s unprecedented urbanisation. Explore our coverage here and follow us on Facebook. Share stories via WeChat (GuardianCities) and by using #OtherChina on Twitter and Instagram