BAIC boosts industrialization in South Africa

A Chinese automaker is building the largest vehicle factory in South Africa.

Beijing Automobile International Corporation or BAIC, China's fifth largest car maker, is building a vehicle manufacturing plant in the Coega Special Economic Zone in Port Elizabeth.

Vehicles produced by Beijing Automobile International Corporation. [Photo: China Plus]

With an investment of 100 million US dollars, the project is to implement one of the MOUs signed between China and South Africa at the Forum of China Africa Cooperation held in Johannesburg in 2015.

It is being built in two phases and aims to produce 100-thousand cars per year.

Du Rong, spokesperson for BAIC South Africa, says the project is going well, as more and more local people learn about the brand.

"It's estimated that by the end of this year, we're going to produce 1-thousand cars. And the number will be increased to 10-thousand by 2020. Our company is developing very fast and our brand is getting poplar among local consumers."

The plant will have an assembly shop, paint shop, energy center, and sewage treatment works.

BAIC is increasing its localized development, planning to produce 60 percent local content while the parts will be sourced from local component suppliers.

Du Rong says the company is cooperating with medium and small enterprises in the Coega Special Economic Zone and they are active participants in the project.

"A number of medium and small enterprises are taking part in the construction of the plant. And we are also going to buy vehicle components from local suppliers."

Meantime, over 90 percent of the employees are from the local community.

Batandwa Moyesha, CFO of BAIC South Africa, says the country benefits from this kind of investment.

"I think that is the best strategy especially for South Africa. South Africa needs this kind of investment. It is part of the investment policies that are encouraged by South Africa as well. Also from the South African community, we seriously need job creation, projects like these that come and produce in South Africa. They increase job creation and the opportunities for business people as well."

Figures suggest South Africa's automotive industry is one of the largest of the country's manufacturing sectors, contributing 7.5 percent to the economy.