A state-owned car manufacturer based in China concluded a deal on Friday to invest R11 billion in a new vehicle manufacturing plant near Port Elizabeth in the Eastern Cape.
After the Coega Development Corporation signed the pact with the Beijing Automobile International Corporation, Trade and Industry Minister Rob Davies hailed the project as “the biggest automotive investment in Africa in the last 40 years”.
He added that Coega would be the beneficiary of a completely knocked down automotive manufacturing plant.
The Nelson Mandela Bay Business Chamber said the deal would create 2 500 direct jobs and 10 500 indirect jobs.
“An investment of this scale ... is expected to be a major catalyst for the region’s economy,” the chamber added.
The deal follows on from the Forum on China-Africa Cooperation, held in Johannesburg in December, where President Jacob Zuma and China’s president, Xi Jinping, signed 26 bilateral agreements, valued at about R100 billion.
Calling Friday’s new joint venture “significant”, Davies said it “deepened South Africa’s economic relationship with China”.
“The size of this investment demonstrates confidence by China and confidence in South Africa as an investment destination.
“The project positions the Eastern Cape as an automotive hub and has the potential of deepening the component supply chain, job creation and economic development.”
Coega Development Corporation, which has been in existence since July 1999, has attracted and signed 54 new investors with a combined investment value of almost R32 billion over the past four years.
The Coega industrial development zone is located adjacent to the deep-water Port of Ngqura and has container, car, break-bulk and bulk terminal facilities.