ZCZC
BCN-27
GERMANY-SAFRICA-AUTOMOBILE-ECONOMY
Mercedes throws S.Africa 600-mn euro investment lifeline
JOHANNESBURG, June 27, 2018 (BSS/AFP) – German luxury car giant Mercedes-
Benz has thrown South Africa an important foreign investment lifeline with a
pledge to plough 600 million euros into the country, President Cyril
Ramaphosa said Tuesday.
The Stuttgart-based marque will make its next generation C-Class sedan in
the south east city of East London which will safguard the existing jobs at
the factory and contribute to growth in the region.
The plant, opened in 1958, currently employs 3,300 people and will be
extended by two-thirds to accomodate new manufacturing capacity. The plant
produced 110,000 vehicles in 2017.
“The announcement by Mercedes-Benz Cars to inject 10 billion rand (600
million euros, $740 million) into the South African economy signals the
positive momentum we are making to realise the ambitious target of raising
1.2 trillion rand in new investment,” President Cyril Ramaphosa said in a
statement issued by the car-maker.
The investment will come as a relief for Ramaphosa who came into office
pledging an economic turnaround but has been buffeted by soaring living
costs, a weak currency and dire growth and business confidence data.
Mercedes’ move “endorses South Africa as a favourable destination for
investment,” said Ramaphosa.
Ramaphosa, who replaced former president Jacob Zuma in February following
nine years of ballooning national debt and unemployment and weak growth hopes
to attract $100 billion of new foreign investment within five years.
Despite Tuesday’s announcement and a separate statement from Statistics
South Africa revealing that employment increased by 56,000 in the first
quarter of the year, the country still has unemployment in excess of 27
percent.
“The decision to have the new generation of the C-Class built in East
London re-affirms the plant and Mercedes-Benz South Africa,” said Mercedes
executive Markus Schaefer in the statement. “The investment is also a sign of
our commitment to South Africa and efforts to revive economic growth.”
BSS/AFP/HR/1040