Alstom’s expansion into Africa on track with SA plant
ALSTOM has started development of a locomotive factory outside Johannesburg to manufacture equipment for its biggest-ever railway contract and expand on the African continent.
“We intend to make South Africa our base for serving subSaharan Africa,”Alstom chief executive Henri Poupart- Lafarge said in an interview ahead of an event in Dunnottar on Friday for the plant, which will cost as much as € 150 million (R2.5bn).
Alstom is building the factory through a joint venture called Gibela, a South African rail company in which it owns a majority stake and which has a € 4bn contract with the Passenger Rail Agency of SA (Prasa) to supply 600 trains and technical services for 19 years.
Alstom, based in LevalloisPerret, France, is focusing on rail after selling most of its energy assets to General Electric. The global industry is starting to consolidate after China’s two largest train makers agreed to merge while Japan’s Hitachi has bought Italy’s AnsaldoBreda. Poupart-Lafarge took the helm replacing Patrick Kron.
Development of the supply chain was the main challenge of the South African venture, the new chief executive said.
The first 20 trains will be manufactured at an Alstom factory in Brazil and the rest at the Dunnottar plant, which should be completed within eight months and had produced its first equipment within a couple of years.
“Technologically it’s not a complex train,” PoupartLafarge said. “Clearly the main objective of the contract is also to build a complete industrial base in South Africa.” Local content was a requirement of state-owned Prasa.
Elsewhere, Alstom is negotiating on tenders for the Makkah metro in Saudi Arabia and for one in Dubai in the United Arab Emirates, both countries hit by a slump in crude prices.
“Typically for contracts which are in force, we see absolutely zero impact from the oil drop,” he said. – Bloomberg Diamond prices are at six-year lows after slumping 18 percent in 2015, the most since the 2008 global financial crisis, according to data from WWW International Diamond Consultants.
Demand in China, the biggest market after the US, has shrunk along with a slowing economy and a crackdown on corruption that is discouraged open displays of wealth.
The creation of the stateowned company followed a refusal by Anjin Investments, the Diamond Mining Company, Jinan Mining, Kusena Diamonds, Marange Resources and Mbada Diamonds to accept nationalisation of their assets, Mines Minister Walter Chidakwa said last month.
“You cannot trust a private company in that area,” Mugabe said. “We should have learnt from the experiences of countries like Botswana, Angola, Namibia. We might go partner with a leading diamond company, one already well established.”
New York-based Human Rights Watch said in 2009 that more than 200 illegal workers were killed in Marange as they were being driven off the site by the military. Some were shot from a helicopter, the group said, citing an unidentified eyewitness. – Bloomberg