Views
3 years ago

Gauteng Business 2017-18 edition

  • Text
  • Manufacturing
  • Mining
  • Infrastructure
  • Development
  • City
  • Smart
  • Business
  • Investment
  • Business
  • Invest
  • Regional
  • Gauteng
  • Johannesburg
  • African
  • Sector
  • Banking
  • Provincial
  • Economic
  • Tshwane
Gauteng Business 2017/18 is the ninth edition of this highly successful annual journal, that has established itself as the premier business and investment guide for the Gauteng province. Special features for 2017/18 include a focus on major new developments in the region’s metros, complemented by detailed overviews of the main economic sectors in South Africa’s most important provincial economy.

OVERVIEW Manufacturing

OVERVIEW Manufacturing Gauteng leads the nation in manufacturing. Manufacturing contributes 14% to Gauteng’s real economy output, and provides 40% of South Africa’s manufacturing overall. More than 600 000 people are employed in the sector, with metal products, food and beverages and chemicals being the biggest employers. Ekurhuleni Metropolitan Municipality has the greatest concentration of manufacturing enterprises, especially between Wadeville and Alrode, south-west of Alberton. Germiston is the country’s biggest rail junction and Transnet Engineering has invested hundreds of millions of rands in new equipment at its facility there. Nigel and Boksburg host Union Carriage and Wagon (UCW), DCD Rail and Lennings Rail Services, a division of Aveng. Packaging company Nampak has metals (cans), plastic, paper and glass operations at various locations including Industria West, Boksburg and Olifantsfontein. The glass plant in Germiston has nearly doubled its output (to 40 000 bottles per year) to cater for increased wine exports. The country’s biggest glass producer, Consol Glass, has facilities in Clayville, Wadeville and Nigel. Household products manufacturer Unilever represents an example of the lighter industrial capacity of the East Rand. Kellogg’s, Kimberly- Clark South Africa and Procter & Gamble all have significant manufacturing capacity in the area as well. Corrugated paper manufacturer Corruseal recently purchased the Enstra Mill in Springs from Sappi, giving it greater control of production. The southern portion of Gauteng around Vanderbijlpark and Vereeniging is synonymous with steel production. Flat iron is made at the large plants of ArcelorMittal. Scaw Metals’ chain-making factory in Vereeniging (McKinnon Chain) has invested R110-million in expanding and modernising its operations. Domestically, the main consumers of steel products are the mining, manufacturing, building and construction sectors, while a significant share is destined for the export market. There are as 35 aluminium processing firms in Gauteng, involved in both secondary processing to produce foils, cans, bars, rods and sheets, and final fabrication in the form of die-casting and sheet metal work. Within Gauteng, the automotive and packaging industries are the chief consumers of these products. SECTOR INSIGHT Lucchini’s new R200-million factory will produce forged wheels for the railways. • Scaw Metals is expanding chain production. AECI is a large manufacturing company with its roots in the mining industry. It comprises two principal divisions: AEL Mining Services (with a large factory site at Modderfontein south GAUTENG BUSINESS 2017/18 48

OVERVIEW of Johannesburg) and Chemical Services, which presides over 20 separate companies (including Senmin, the group’s mining chemicals company). Incentives The Manufacturing and Competitiveness Enhancement Programme (MCEP) of the national Department of Trade and Industry (dti) announced in 2017 that it had disbursed a total of 1 552 grants to the value of R5.8- billion which had resulted in 230 000 jobs being “sustained”. Plastics, pharmaceuticals and chemicals received 31% of the money, metal fabrication, capital and real transport equipment 28% and agri-processing 21%. Italian forged wheel manufacturer Lucchini received tax and training allowances from the dti which helped it decide to invest R200-million in a new forged wheel-making facility. Blank railway wheels imported from Italy will be completed at the Germiston plant. Lucchini previously sold its wheels in South Africa through DCD Ringrollers, itself a maker of forged steel tyre products. Lucchini has committed to increasing the local content in the manufacturing process. The Provincial Government of Gauteng has specific plans to bolster manufacturing capacity in the province’s western areas. Some of the projects include: • a bicycle manufacturing or assembling factory in Mohlakeng • continuing to buy busses for the province’s BRT system from the Busmark plant in Randfontein which manufactures and assembles buses. In 2016 a dual fuel bus was launched, with the bodies of the busses designed and built in Randfontein. • establishment of agri-parks: Westonaria hydroponic agri-park; Merafong Flora agri-park (tomatoes, cucumbers and green peppers); investment in Isigayo Milling Plant in Randfontein • revitalisation of industrial parks at Khutsong, Mohlakeng and Chamdor. The plan prioritises mining and mineral beneficiation, capital equipment and machinery, agriculture and agri-processing, tourism, retail and economic development in townships. Pharmaceuticals South Africa’s pharmaceutical sector is worth approximately R20- billion annually. Although there are more than 200 pharmaceutical firms in the country, large companies tend to dominate the field, with Aspen (34%) and Adcock Ingram (25%) the two key players, followed by Sanofi, Pharmaplan and Cipla Medpro. A number of large pharmaceutical firms have made significant investments in South Africa. Adcock Ingram, for instance, has invested heavily in its South African operation. The private sector accounts for 80% of pharmaceutical industry sales by value and 20% by volume, while this ratio is reversed in the case of the public sector. The public sector dispenses comparatively cheap pharmaceutical products to its users in public hospitals and healthcare centres within South Africa, whereas pharmaceutical products produced by the private sector in South Africa serve a niche market. Among the other big international brands active in Gauteng are Merck, which has a 55 000m² plant at Modderfontein, and Pfizer SA, which runs a laboratory in Sandton amongst its facilities in South Africa. CONTACT INFO Aluminium Federation of South Africa: www.afsa.org.za Centre for Advanced Manufacturing: www.cfam.co.za Chemical and Allied Industries’ Association: www.caia.co.za Gauteng Department of Economic Development: www.ecodev.gpg.gov.za Manufacturing Circle: www. manufacturingcircle.co.za National Department of Trade and Industry: www.thedti.gov.za 49 GAUTENG BUSINESS 2017/18

Other recent publications by Global Africa Network: