Chinese investors signed agreements to build a $10billion (R132bn) metallurgical complex in South Africa during President Xi Jinping’s state visit last week and hope to start construction next year, an executive involved in the project and a provincial official told Reuters.
President Cyril Ramaphosa said at a joint news conference with Xi on Tuesday that China had committed to invest $14.7bn (almost R200bn) in the South African economy, but neither leader mentioned the $10bn complex.
The complex, which is still in the planning stage and envisages building a stainless steel plant, a ferrochrome plant and a silicomanganese plant, is a much-needed vote of confidence in the sputtering South African economy.
Trade and industry minister Rob Davies said on Tuesday China was considering a metallurgical project in a special economic zone (SEZ), but he did not reveal the scale of the project or timeframe.
The executive involved in the project, who did not wish to be named because he was not authorised to speak to the media, said memoranda on the complex were signed before Xi and Ramaphosa gave a news conference on Tuesday.
“The investors for the SEZ project were in the room when Ramaphosa and Xi spoke to the press,” the executive said.
Richard Zitha, a project executive at the Musina-Makhado SEZ where the complex will be based, said it was being led by Chinese state-owned companies, but he declined to name them.
He said the Chinese investors would look for black economic empowerment partners to comply with South African rules.
The investors were open to investors from other countries joining at a later stage, he said.
“The investors have been in South Africa for around a week and have visited mines to look for inputs for the project,” Zitha said. The SEZ plans to house plants with a capacity of three million tons per annum of stainless steel, three million tons per annum of ferrochrome and 500,000 tons per annum of silicomanganese.
Those capacity targets are subject to change and will be finalised by the end of the year, the executive said.
A coal-fired power plant, coking plant and coal washery are set to be built alongside the metallurgical plants, a presentation prepared for investors showed.Some of the steel output for the complex has been earmarked for export to China, while other products would be sold to countries in southern Africa, the executive said.
South Africa is already a major exporter of metal alloys to China.
Investors are hoping to receive the necessary environmental approvals by the end of March and would then start construction, Zitha said.
Russian President Vladimir Putin said on Friday he had invited Donald Trump to Moscow and that both he and the US president want further summits, despite the uproar in Washington after the two leaders met in Helsinki last week.
Following the backlash in the US over Trump’s cordial public tone with Putin at the Helsinki summit, US and Russian officials backed away from a proposal to schedule a followup summit in Washington.
But speaking to reporters at the Brics summit, Putin said: “we are ready to invite President Trump to Moscow. Be my guest. He has such an invitation, I told him that.”