Hisense Appliance Industrial Park Project

Promoting sustainable development in Africa through South-South investment cooperation

After 40 years of reform and opening-up, China has accumulated rich experiences in industrial development, as well as technology, capital and talent advantages. Partnerships between China and Africa that focus on capacity help to meet African development needs and provide a strong foundation for cooperation. In March 2013, the China-Africa Development Fund and the Chinese company Hisense Group Co., Ltd. signed an investment cooperation agreement to support the construction of the Hisense South Africa Appliance Industrial Park (Hisense South Africa), with a view to improving local manufacturing and meeting the manufacturing demands of South Africa. The agreement included a total investment of US$150 million and an annual output of 540,000 refrigerators and 390,000 televisions. President Xi of China and then-President Zuma of South Africa witnessed the signing. 

Hisense South Africa promotes sustainable development in the local manufacturing industry without increasing government expenditure, as the capital was provided to build the factories. The project implemented localized management, increased job opportunities, brought foreign exchange and tax revenues to the local region, provided support based on its technical and management experience, and effectively improved the local manufacturing industry. Hisense South Africa has employed 700 local people, who account for 90 percent of its total employees. A number of local employees were trained in the country through a mentoring programme and currently hold 40 percent of the management positions. By driving demand for upstream and downstream products and services, the Park has indirectly created 2,000 jobs. In 2019, Hisense South Africa trained approximately 1,000 unemployed young people aged 18 to 25 years living in rural areas. It also collaborated with the Atlantis Secondary School to build the Hisense South Africa Technology Research and Development Training Base, which has carried out training on products, technology research and development and techniques to 1400 trainees, enabling them to master the skills needed for electronic technology, software and electrical equipment. 

The project adapted activities to the local context and aligned them with local development plans. A phased development was planned to include dimensions such as branding, operations, manufacturing, research and development, logistics, after-sales and sales channels. The goal of the project is to establish a household-appliance industry platform able to provide overall solutions, driving investment by trade, expanding beyond trade to include factory building and production, and helping to optimize and upgrade African productivity. Hisense South Africa uses advanced technologies to enhance market recognition of the brand. It produces mainly high-end green products, such as energy-saving and environmentally friendly refrigerators and smart 3D high-definition televisions, which effectively meet the growing needs of local families. In addition, the Park promotes energy conservation, environmental protection and upgrading capacity. Hisense South Africa strictly abides by these principles at all stages, from the selection of raw materials to production and processing. It has responded to the South African Government’s call to save electricity and resolve the imbalance between energy supply and demand. It has also become the first home appliance enterprise in South Africa to produce energy-saving products with low power consumption. 

Hisense South Africa won the country’s Best Product Award in 2017. The home appliances that it produces enjoy the largest sales volume in the local market and are exported to over 10 African countries. The project’s implementation has not only promoted employment and exports in South Africa but has also improved the country's manufacturing and technical capacity. Through the ‘Made in Africa’ project, it has also improved local management, logistics and post-sales service; promoted the development of related industries; won the praise of South African leaders and citizens; and become a well-known brand in South Africa. The innovative industrial park approach adopted by the project can be replicated in other African countries with adequate infrastructure and a relatively large market scale. The project entails driving investment by trade, expanding beyond to include factory building and production, and helping to optimize and upgrade regional productivity.