South Africa: Chinese investment for Mamba Cement in place

The Mamba Cement project, jointly funded by China's Jidong Development Group, the China-Africa Development Fund and a South African cement company, signed the financing agreement in Johannesburg for work to begin on the project.

The greenfield plant will cost US$220m to build and will be situated in Limpopo Province, South Africa. The capital fund of the project is US$100m, 51 per cent of which is held by Chinese shareholders.

Unlike traditional overseas investment financing, Mamba received US$120m through project financing, which is based on the projected cashflow of the project rather than the balance sheets of its sponsors.

The loans are jointly provided by Nedbank South Africa and Bank of China's Johannesburg office.

Chen Ying, vice-president of China's Jidong Development Group, said the success of the financing deal meant the South African bank's accreditation to Chinese companies.

"Project financing offers Chinese companies a new way to make overseas investments," said Chen.

The project includes a new cement clinker production line with a output of 1Mta, a waste heat generation system with a  capacity of 26.8GWh and other supporting facilities.

The electricity generation system together with the cement plant makes Mamba the first cement company possessing waste heat power generation technology on the African continent.

The Mamba project is expected to create locally at least 300 jobs.