Chinese to invest R11bn in SA car industry

Johannesburg - A Chinese state-owned car manufacturing company will invest R11bn in a new plant in Port Elizabeth, giving a further boost to one of the fastest-growing industries in the continent’s largest economy.

Beijing Automotive International Corporation signed the deal with the Coega Development Corporation in Port Elizabeth, Coega said in an emailed statement on Friday.

The investment is a result of agreements signed by President Jacob Zuma and Chinese Prime Minister Xi Jinping in December last year.

"The size of this investment demonstrates confidence by China and confidence in South Africa as an investment destination," Trade and Industry Minister Rob Davies said in a statement.

The Eastern Cape Province is "an automotive hub and has the potential of deepening the component supply chain, job creation and economic development," he said.

South Africa’s automotive manufacturing industry has been among the bright spots of an economy expanding at the slowest pace since a recession in 2009. The government's auto-incentive programme has attracted companies including Toyota Motor Corporation, Ford Motor and BMW to set up and invest in factories.

The industry has the potential to boost production by almost 50% to more than 900 000 vehicles a year by 2020, the local producers’ group said in May.

Read Fin24's top stories trending on Twitter:
We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For only R75 per month, you have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today.
Subscribe to News24
Rand - Dollar
15.13
+0.8%
Rand - Pound
20.50
-0.2%
Rand - Euro
17.16
-0.2%
Rand - Aus dollar
10.85
-0.1%
Rand - Yen
0.13
-0.2%
Gold
1,834.78
0.0%
Silver
24.30
+0.0%
Palladium
2,111.50
0.0%
Platinum
1,034.00
0.0%
Brent Crude
87.89
-0.6%
Top 40
68,186
-2.1%
All Share
74,835
-1.9%
Resource 10
74,924
-3.0%
Industrial 25
94,147
-1.8%
Financial 15
15,076
-0.2%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot