The Beijing Automobile International Corporation (BAIC) has chosen the Coega Development Corporation in the Eastern Cape for its R11 billion vehicle manufacturing plant investment.
In a statement on Friday, the Minister of Trade and Industry Rob Davies said this was the biggest automotive investment in Africa in the last 40 years.
He said the investment was significant and would deepen 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,” Davies said.
He said the Coega Development Corporation (CDC), operator of the 11,500 hectares of the Coega Industrial Development Zone (IDZ), would be the beneficiary of a completely knocked down (CKD) automotive manufacturing plant.
Davies also said the project would position the Eastern Cape as an automotive hub and had the potential of deepening the component supply chain, job creation and economic development.
“The investment is strategic and is a major project in terms of our bilateral relationship and a key project supported by the Inter Ministerial Committee on Investment,” Davies said.
BAIC is a Chinese state-owned enterprise and holding company of several automobile manufacturers of passenger cars, military vehicles, SUVs, trucks and busses.
The BAIC investment was an outcome of the Forum on China-Africa Cooperation (FOCAC) that was held in Johannesburg in December last year, where President Jacob Zuma and Chinese Prime Minister Xi Jinping signed no less than 26 bilateral agreements valued at approximately R100 billion.