Oriental City has been dubbed London's "real Chinatown"

The owner of Oriental City in Colindale, north London, wants to knock it down and rebuild it to accommodate flats and a superstore.

Mr Livingstone said the centre was an "excellent example of the contribution" made by Asian cultures to London life.

But he said it would be illegal for him to oppose the project on such grounds.

Yip Fai Liu, of the Save Oriental City campaign, said traders feel "they have been treated like second class citizens".

"We feel the mayor is more in love with developers than he is with communities," he said.

"We are extremely disappointed and disgusted that he has let us down."

Campaigners said they would urge Communities Minister Ruth Kelly to use her powers to call for an inquiry into the redevelopment plans.

'Vital contribution'

Mr Livingstone said: "London's Chinese community plays a vital part in London's economic and cultural vitality.

"Unfortunately, under my current planning powers I cannot direct refusal for the scheme on these grounds - this would be illegal under existing law."

He has earmarked �250,000 to help businesses relocate and move back once the new Oriental City is completed.

The Colindale centre attracts 10,000 people a week to its shops, restaurants and events.

Although existing tenants would be allowed to return to the new centre, they face up to three years of displacement while it is built.