South Africa is set to get an overseas steel mill from Chinese Steel Producer Hebei Iron and Steel Group, after the latter made a move to set up another mill in the country. This steel mill is expected to produce five metric tons of steel by 2019 with production beginning in 2015.
Although officials from Hebei Iron and Steel Group did not reveal the amount to go into construction of the steel mill, it has already signed a 51 percent stake venture deal with the Industrial Development Corporation of South Africa and China Africa Development Fund to construct the mill.
43 percent of steel produced around the world comes from China, yet the country has not been doing well in its global presence strategy in the steel industry. The move by Hebei Iron and Steel Company to invest in an African country comes at a time when Chinese policy group are attempting to ease China’s restrictions on investment in steel in foreign countries.
The Secretary General of China Iron and Steel Association, Zhang Changfu, noted that country has to open to globalization by allowing the increase of Chinese foreign steel mill companies.
Agni Steel mill located in Port Elizabeth Coega Industrial Development Zone (IDZ) in the Eastern Cape and whose production has started, was also set for expansion.