Investing in SA: China’s ambitious plans take shape

Source: Pexels

The event - which included the signing of a bilateral agreement between the Chinese city of Xi'an and South Africa - aimed to deepen trade ties and economic co-operation between China and South Africa, with significant focus on expanding business and investment opportunities.

Present was Lance Greyling, director of Trade and Investment in the Mayor’s Office at the City of Cape Town as well as the deputy director of the Xi’an Education Bureau, Li Meng; deputy director of Xi’an Commerce Bureau, Ma Xiaogi; division chief of the General Office of Xi’an Municipal People’s Government (National), Lu Hailan and senior economist of the Xi’an Jiaotong University, Zhang Jun.

Vice Mayor of Xi'an, Zhang Yong, confirmed that he met briefly with Greyling before the forum to discuss business matters, agreeing that both Xi'an and Cape Town share many similarities, particularly in the area of tourism.

"Cape Town is the second largest city in South Africa and is its legislative capital. We share with it a rich cultural background, beautiful natural landscape, and a prestigious educational centre. By developing our friendship we can leverage on our mutual interests and allow for dialogue between our governments and enterprises, for the benefit of all."

Cross-border trade expansion

South African businesses will be supported in expanding across borders, with Xi'an’s government aiding their efforts to tap into both the African market and the Eurasian Economic Flow. This will enhance trade and investment between South Africa and China, two key global economic players.

The Eurasian Economic Flow is closely tied to initiatives such as China's Belt and Road Initiative (BRI). As a key starting point of the ancient Silk Road, Xi’an has been revitalised as part of the BRI, which aims to enhance global trade by improving infrastructure, logistics, and economic co-operation between countries across the Eurasian continent.

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Already as of August 2024, six South African enterprises are actively operating in Xi'an, China, the promotion forum confirmed. These companies collectively generate an impressive total annual revenue of $41.8m.

Meanwhile, the promotion forum highlighted that South African students can take advantage of Xi'an's sponsorship programmes. Xi'an, along with the broader Chinese government, supports South African students through various scholarship programmes, primarily administered via the China Scholarship Council.

South African students can apply for fully-funded scholarships for undergraduate, master’s, or doctoral programmes across several Chinese universities, including institutions in Xi'an.

Included in the MOU signings was South Africa's Nicole Mirkin, a strategic communications expert who leads Omnia Strategic Counsel & Communications, a firm specialising in PR, brand visibility, and thought leadership, particularly within the tech and startup sectors.

Strategic alliances formed

As a result of the bilateral agreement, the Xi'an businesses represented in sectors such as technology, infrastructure, and industrial development also stand to benefit from huge investments in Cape Town.

The future projects China plans to focus on in Cape Town were not addressed during this week's gathering. A source, speaking anonymously, confirmed that while specifics couldn't be disclosed, transformative projects tied to the MOU signings are expected in SA in the future.

This week's China (Xi'an) - South Africa (Cape Town) Economic and Trade Cooperation Promotion Forum aligns with the 2024 FOCAC Summit in China, which took place earlier in September this year. During his visit, SA President Cyril Ramaphosa met with Chinese President Xi Jinping, and they announced an elevation of the China-South Africa relationship to an "all-round strategic co-operative partnership".

2024 FOCAC Summit

Ramaphosa, who attended the 2024 FOCAC Summit, highlighted the valuable interactions that took place during his visit. He remarked, "During our time in China, several ministers and I had the opportunity to engage with Chinese companies currently operating in South Africa or exploring opportunities in our country. One notable example is Hisense, the Chinese electronics giant, which has become an integral part of a remarkable success story in South Africa.

"Just over 10 years ago, Hisense established a R350m manufacturing plant in Atlantis Industrial Park in the Western Cape. Having grown into a prominent brand in the South African market, Hisense is now exporting some of its products to other African countries and the United Kingdom from its Atlantis plant."

Yong highlighted that China has been Africa's largest trading partner for 15 years. "As for South Africa, it has been China's largest trading partner in Africa for around 14 years, with trade between South Africa and China valued [in 2022] at an estimate of $50bn," he said.

Under particular initiatives like the Belt and Road Initiative, bilateral trade and investment in various sectors, including infrastructure, agriculture, and technology, are major pillars of this partnership, he said.

Yong highlighted Xi'an as one of China’s oldest cities, known for its historic landmarks; drawing countless visitors yearly - and, in conclusion, said he looked forward to growing his trade relationship with South Africa.