China eyeing R100bn in SA deals can give Limpopo a lifeline

A young girl cries after receiving her first clean water in months, in 2016. Operation Hydrate has sent 135 000 litres of water to Modimolle in Limpopo. Picture: Mutiny Media

A young girl cries after receiving her first clean water in months, in 2016. Operation Hydrate has sent 135 000 litres of water to Modimolle in Limpopo. Picture: Mutiny Media

More than half the province’s residents live in poverty and about 2 million below the breadline amid crumbling infrastructure and projects.

A massive financial injection involving billions of rands from the People’s Republic of China into the province could provide a major boost for thousands of unemployed Limpopo residents.

Premier Stan Mathabatha announced several projects in the province, which will see China pumping more than R100 billion into projects involving power and steel production, as well as a further R3 billion in cement production in Musina, Makhado and Thabazimbi.

Mathabatha led a provincial delegation to China yesterday in an endeavour to seal these deals, which he hopes will lead to Limpopo becoming a major economic hub in a few years.

“The deal is billed to expand the Musina/Makhado Special Economic Zone (SEZ) mega projects in an effort to fight the ever-escalating poverty and unemployment that has ravaged the people of Limpopo for years,” said Mathabatha.

“The department of trade and industry led a delegation to Beijing in April on a trade and investment mission. This led to the signing of a memorandum of understanding between the Limpopo Economic Development Agency and potential investors hailing from the Shanxi province.

“We are scheduled to visit Shanxi, Henan and Hubei provinces in an endeavour to leverage opportunities and cement economic relations already established since the commencement of this significant joint venture,” said Mathabatha.

He said a milestone of this magnitude promises total transformation of the socio-economic outlook of the province and the developmental aspirations of its populace.

He added relations with China also strengthen the province’s relations with fellow Brics member countries (Brazil, Russia, India, China and South Africa).

“Limpopo is on the verge of commencing with a project worth more than R100 billion on meteorological power and steel production, which is expected to create more than 20 000 permanent jobs,” he said.

The promised economic benefits come months after Statistics South Africa revealed that more than two million people in Limpopo live below the breadline, even though the province was surrounded by the three pillars of the economy: mining, tourism and agriculture.

In April, the Quarterly Labour Force Survey announced the Western Cape, Limpopo and KwaZulu-Natal had created more jobs than any other province in the country.

Despite this, Stats SA announced that 51% of the population was living in poverty. More than 72% of Limpopo’s residents live under the upper-bound poverty line (UBPL), earning about R992 per month, 57% under the lower-bound poverty line, earning R647 per month, and 40,3% under the food poverty line, earning R440 per month.

Member of parliament and party provincial leader Jacques Smalle said this effectively means 886 400 of Limpopo households were living under the UBPL and 2 337 people go to bed hungry every night.

Steel to be a hot item

South Africa’s economy is growing fast and two-thirds of the country’s industries depend on steel rather than bricks, according to an engineering expert who also runs five steel shops in Gauteng and Limpopo, Christo van Straaten.

“These demands require South Africa to enter into steel production with speed to equal the demand,” he said.

“South Africa has to start to prepare itself for the influx of other African countries to buy steel from it because it is the economic hub of the continent and the Limpopo investments will go a long way towards satisfying this demand.”

Limpopo provincial government spokesperson Phuti Seloba said as China was a member of Brics “that makes it the easiest country to exchange business with.”

He was responding to how viable cooperation between the countries will be.

alexm@citizen.co.za

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