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Inconsistent Policy, Low Skilled Labor Hampering Africa’s Investment Potential

Date:2017-04-10 Source:frontpageafricaonline

www.chinatrucks.com: The problems leading to unstable currency, limited skilled work force and tax incentives must be resolve in order to attract huge investment opportunities in many African countries, says Liu Jiansen, Assistant Vice President and General Manager of Xuzhou Construction Machinery Group, Incorporated (XCGM).

 
Mr. Liu said Africa’s potential for economic development is high and although his company is contemplating opening machinery plants in Africa it is aware and wary of these lingering challenges.

Inconsistent Policy, Low Skilled Labor Hampering Africa’s Investment Potentials
 
He was speaking to a group of African journalists on Tuesday, March 21 during a tour of the company’s manufacturing plants and other facilitates in Xuzhou City, northwest region of Jiangsu Province in the People’s Republic of China. 
 
XCGM is the largest producer of cranes in the world and the fifth highly rated manufacturer of earth moving equipment including excavators, trucks, loaders, graders and road rollers amongst other equipment.
 
With over 30,000 units of equipment made every year, XCMG sold an average of around 5,000 units to Africa in 2016 with Dangota Group in Nigeria topping the list of consumers of their products on the continent.
 
The company’s assistant vice President and general manager disclosed that they are eyeing the possibilities of solidifying their presence on the continent.
 
XCGM boosts of having17.38% of its market influence in Africa and might grow stronger once plants are built in some African countries.
 
China is Africa’s largest trade partner with deals appearing to be cordial between several African nations and the world’s second largest economy.
 
Experts say trade process has being growing steadily in recent years as Africa remains a major supplier of raw materials like iron ore.
 
.Mr. Liu said Africa is a very important market which means his company is exploring investment possibilities in several countries including Algeria, Nigeria, and Ghana to setup production or manufacturing plants there.
 
Opening these plants will obviously influence economic growth and reduce import cost for consumers in Africa.
 
With increasing demands for infrastructure across the continent, construction machinery is vital commodity for many developing countries. 
 
But instability in currency exchange, country’s political situation and limited skilled manpower must be remedied, Liu says.
 
Investment experts also say these factors are complexities that distract international businesses from investing millions in most of Africa.
 
Mr. Liu assured that XCMG is ready to make huge investments in Africa but needs a favorable environment.
 
He encouraged policy makers on the continent to strive and ensure stability, stressing that government plays an important role in the economic development of any country and must avoid instability in policies that involves tax and labor cost.
 
Commenting on how the company evolves into becoming one of the best in the world, he said during its early years, XCMG focused on training local people, learning technological skills from internationally established companies including Caterpillar and then exerted efforts to elevate to the top.
 
He encouraged Africa governments and firms to adopt similar model and build their own industries and the human resources capacities of their people.
 
As a state own company, XCMG was established in 1943 as an artisanal workshop during the Japan invasion of China and after more than eight decades, the corporation has an international reputation in the production of machinery with manufacturing plants in Brazil, Germany, USA and India.

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