If this is true it is a good thing and a bad thing all wrapped up in one and South Africa should have been looking to grow their economy without having to seek help from China. The problem with China is that nothing is free and SA will be heavily in debt to the Chinese. This looks like a good deal if you are Chinese and looking from the other side the total opposite with the SA Government selling out.
We have seen how other countries have found out the hard way when they could not meet their debt obligations and the Chinese confiscated key pieces of infrastructure for themselves. One has to look at Zambia how they lost their SOE power supply and the Zambian tv and radio stations all confiscated. Uganda losing their "international" airport of Entebbe due to similar debt circumstances.
You have to ask the question why ad there is always another reason besides the obvious. Is this to do with exports and carbon emissions that would give the Chinese a loop hole by using an African country? They moved their shipping via Vietnam when the US imposed heavier tariffs which resulted in a shortage of containers world wide.
The problem with South Africa having Chinese manufacturing companies investing and moving in is that the infrastructure as it stands is insufficient even for local demand let alone more growth. The best thig to do would be to do a total rebuild as the failing infrastructure is failing due to a severe lack of maintenance actually non existent maintenance would be more accurate and throw in theft.
The problem up until now with any major company entering the SA market is the BEE status. Black Empowerment Status which basically asks for shares and directorships for local black South Africans. Interestingly enough tat does not apply to a Chinese business as a Chinese person is considered an honary black person. This actually may come back to bite them in more ways than they can imagine.
China is SA's biggest trade partner as most of it's raw materials heads to the ports and across the sea to the Chinese mainland. I have always said this is back to front and manufacturing should take place where the minerals are mined. The transport costs alone would be saved and the finished goods are now closer to the international markets saving time and money for delivery.
South Africa currently has the highest unemployment rate in the world and this should not be the case if the government was investing in the right areas. The tax money for years never sees to flow back into the system which tells you only a few are benefitting due to high levels of corruption.
I read a report recently stating that 20% of the government procurement budget is lost to tender fraud. That would actually be a good figure if it was believable and I would suggest that figure could easily be doubled. This is why there s no work as government project spend on basic infrastructure which would normally require many jobs are not taking place.
With the Chinese announcing they will be expanding their presence in SA that does not necessarily mean more jobs. This work is often taken on by the Chinese themselves and it is a way of securing employment for it's own people. There will be more jobs for the SA people, but not the numbers people are thinking. Manufacturing is these days automated and the 60% unemployed will remain unemployed.
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