Errend Magaena walks down the assembling lines checking if everything works properly. This is an important part of his daily work.

Magaena is a first-level supervisor at the Beijing Automobile Works (BAW) South Africa, a joint venture of Chinese vehicle manufacturer BAW and South Africa's Industrial Development Corp. (IDC), located in Springs, a small town east of Johannesburg.

The young man used to do maintenance work in a local school before being recruited as a maintenance and cleaning employee in the company. He was transferred to the production line after receiving training and then got promoted to his present position.

Magaena's story is part of the economic and trade cooperation growth experienced between China and Africa in recent years. South Africa, as a gateway to Africa, and the most developed economy on the continent, has become an important destination for Chinese companies' going-global strategy.

By the end of 2015, Chinese investment in South Africa had reached an accumulated total of $13 billion, and the number of Chinese companies investing in South Africa had reached 300, according to a report issued at the end of last year on the development of Chinese enterprises in South Africa by the China Economic and Trade Association, a non-governmental organization based in Johannesburg, with 120 corporate members, mainly Chinese companies operating in South Africa.

These Chinese companies employ a total of 26,000 people, of which 24,000 are locals, accounting for 91.56 percent of the total.

Chinese companies have continued to invest and maintain production and jobs despite the South African economy remaining sluggish, according to the report.

Job creation

One of the noticeable contributions Chinese companies have made to the local society as cited in the report is job creation.

Chinese companies operating in South Africa are mainly involved in finance, household appliances, telecommunications, automobiles, construction machinery and logistics sectors, mostly in the labor-intensive industries.

According to Gao Desheng, Senior Executive Vice President of Bank of China (BOC) Johannesburg and one of the authors of the report, household appliances manufacturers Hisense and Skyworth, information and communications technology solutions providers Huawei and ZTE, BOC Johannesburg and China Construction Bank (CCB) Johannesburg have all set good examples in creating jobs.

Entering South Africa in 1996, Hisense South Africa launched its 25.4-million-rand ($1.88-million) state-of-the-art consumer electronics and home appliance manufacturing facility in Cape Town in June 2013, creating more than 700 direct jobs and more than 3,000 indirect jobs in the local communities since then.

The company offers training to local citizens who have no previous technological background and related experience, to help them learn skills and gain job opportunities.

Another big employer is the PMC project co-funded by Hebei Iron and Steel Group Consortium and South African IDC, with a total investment of $668 million. A total of 88.86 percent of its staff are local people, with 4,359 local workers on its payroll.

Gao said many locals now entered the managerial levels of Chinese companies, playing more active roles in development, research, marketing and sales.

Performance and growth

Anil Sooklal, Deputy Director General of Department of International Relations and Cooperation of South Africa, was quoted on China Global Television Network after the launch of the report that Chinese companies in South Africa have played an important role in supporting the bilateral economic and trade cooperation.

He said that Chinese companies help promote South Africa's reindustrialization and support job creation and products design, and the transfer and training of the technologies are what South Africa needs in its economic and societal development.

In addition to job creation, Chinese investment has helped promote the development of the local economy, improve the level of science and technology, build infrastructure and boost South Africa's industrialization process, according to the report.

In the manufacturing sector, CRRC South Africa has helped make locomotives locally with cumulative contracts worth more than $3 billion. All the projects involve technology transfer, local production and training.

Automobile assembly plants such as the $80-million plant FAW established in 2012, along with the $800-million Beijing Automobile International Corp. (BAIC) plant, both in Port Elizabeth, have also been key to the country's industrialization efforts.

Meanwhile Chinese household appliance enterprises have set up factories in South Africa. With local televisions and refrigerators market share reaching 26 percent and 22.4 percent respectively, ranking first and second in South Africa's market, Hisense has become a household brand in the country.

The country's communications infrastructure is another area that has benefited greatly, assisted by telecommunications giants like Huawei, who has introduced the world's leading communications technology into the country.

The company ranks first in terms of providing products and services to local telecommunications operators, and third after Samsung and Apple in the smart phone market.

Also providing financial support to local infrastructure building, as well as supporting poverty reduction, health, agriculture and environmental protection undertakings are Chinese financial institutions. These include BOC, CCB, Industrial and Commercial Bank of China (ICBC), the Export-Import Bank of China and China-Africa Development Fund.

"Chinese companies attach much importance to their own social responsibility," Gao said. "They want to become responsible corporate citizens of South Africa."

Prospects

Chinese companies in South Africa have also met with challenges. The report cites social challenges, including public security problems, legal and labor risks, shortage of technical professionals and difficulty in obtaining work permits for required critical technical and managerial personnel.

Economically, they are facing insufficiency in energy supply, railway capacity and infrastructure investment, continuous depreciation of the currency, fluctuation of exchange rate and other adverse factors.

Despite these challenges, there are still many opportunities.

Gao noted that both China and South Africa have been actively pushing forward the implementation of the consensus reached at the Forum on China-Africa Cooperation Johannesburg Summit in December 2015. The bilateral cooperation projects have entered the implementation phase and Chinese investment will increase. In addition, the resilience of commodity prices will help improve the local economy and bring about new investment opportunities in the future.

According to Gao, the deepening of economic transformation in China and enhancing of Sino-African industrial capacity cooperation are set to bring more bilateral cooperation opportunities.

Just before the end of 2016, a governmental delegation from north China's Hebei Province and a business delegation from Sanmenxia, a city located in central China's Henan Province, came to South Africa, exploring the investment environment and seeking cooperation opportunities.

At the start of this year, China Overseas Infrastructure Development and Investment Corp., established in September in south China's Guangzhou City, entered South Africa.

With a designed investment scale of $500 million, the company focuses on projects planning, designing, investment and construction, and providing financial and intellectual support to Chinese companies involved in overseas infrastructure construction, mainly in Africa.

(Reporting from South Africa)