/ 23 January 2008

Indian, Chinese companies eye Coega investment

Indian companies are considering investing R16-billion in projects at the Coega Industrial Development Zone (IDZ) outside Port Elizabeth, the Coega Development Corporation (CDC) said on Wednesday.

These investments cover projects in the metals and automotive sectors.

The CDC, which operates the IDZ, said the potential investment is indicative of the growing interest among Indian and Chinese companies in investing in the IDZ.

Optimising on the increasing flows of capital from emerging markets, within a global context, the CDC last year started increasing its focus on drawing investment from these booming economies.

CDC business-development manager Belu Mabandla said after just a few visits to India and China last year, the CDC managed to gain the interest of 15 companies, some of which have shown a high level of seriousness to commit.

Three investments from India may be signed during the 2008/09 financial year.

Indian company Afro-Asia Steel has already signed an agreement for the establishment of a R75-million steel billets plant at the Coega IDZ.

Meanwhile, the Coega IDZ and South Africa are seen as a launch pad to the African continent by Chinese investors, a strategic position in light of the “Go Africa” strategy by China.

Chinese investors are looking at attractive industrial estates for greenfield projects and mergers.

The CDC said one of the projects under consideration is large enough to occupy nearly half of the automotive cluster, once all phases have been completed.

Christopher Mashigo, business-development manager at the CDC, said the level of interest from China is beyond his expectations. “There is a high level of optimism about investing in Africa, and most importantly in South Africa.”

He added: “Four to six visits are planned with Chinese companies this year for site visits and discussions regarding the project.” — I-Net Bridge