China Urges Major Companies to Invest in South Africa, Boosting EV Industry and Economic Ties

China is calling on its leading companies, especially electric vehicle (EV) manufacturers, to consider moving operations to South Africa, signaling deeper economic cooperation between the two nations.

“We encourage Chinese companies to very seriously consider moving assembly lines or value-added operations to South Africa,” said Wu Peng, China’s ambassador to South Africa, in an interview with Bloomberg.

This push aligns with South Africa’s ambition to become a key player in the global EV industry. China, as the world leader in EV production, could play a significant role in helping the African nation achieve its goals.

A Strategic Opportunity

South Africa’s automotive industry, valued at over R271 billion in exports annually, is heavily reliant on European markets. However, with the EU planning to phase out demand for traditional combustion-engine vehicles, South Africa must pivot to align with the global transition to EVs.

To support this shift, the South African government introduced a 150% tax deduction on investments in EV manufacturing facilities earlier this year. However, detailed guidelines for the initiative are still pending.

Broader Investment Plans

Beyond EVs, Ambassador Wu Peng highlighted opportunities in infrastructure, new energy, and mineral processing. Prominent Chinese companies like Huawei Technologies, Hisense South Africa, Zijin Mining Group, and ZTE Corp already have operations in South Africa and are expected to deepen their involvement.

“I’m convinced that in the future, more and more Chinese enterprises will come to South Africa, invest in South Africa, and build for South Africa,” Peng stated.

Collaboration between China and South Africa promises significant benefits for both nations. For China, South Africa offers a gateway to the African market and critical resources like minerals needed for EV batteries. For South Africa, Chinese investments bring the potential for job creation, technology transfer, and a stronger position in the global EV supply chain.

With China as South Africa’s largest trading partner, the move could strengthen economic ties further, opening new doors for collaboration and growth.

The call for Chinese companies to invest in South Africa comes at a pivotal time for the nation’s automotive and energy sectors. As South Africa prepares for the EV revolution, partnerships with global leaders like China could accelerate its transformation and create long-term economic benefits.

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