Food Machinery Nuggets African market is promising

At the 2013 African Risk Assessment Conference held at the headquarters of Deloitte & Touche CPA in South Africa, experts from the African Development Bank, Deloitte and other institutions believed that the current rapid economic growth rate in East Africa and West Africa, Africa, agriculture, mining and many other The industry has great investment potential. According to various sources, the overall investment prospects in sub-Saharan Africa deserve attention, and many foreign companies have quietly deployed in Africa. Why haven't China's food machinery investors opened their eyes to finding business opportunities in Africa?

The next five to eight years will be the “golden age” for Chinese companies to invest in Africa. China and Africa have strong economic complementarities and huge potential for cooperation. According to statistics from China Customs, the total trade volume between China and Africa in the first half of 2013 reached 105.65 billion U.S. dollars, which exceeded 100 billion U.S. dollars for the first time in half a year, an increase of 7.1% year-on-year.

Chinese companies welcome opportunities in Africa

Lin Yifu, member of the National Committee of the Chinese People's Political Consultative Conference (CPPCC), stated that investing in African countries is a "good choice" for Chinese companies. "After the labor-intensive industries in China are transferred to areas with relatively low wages, they are conducive to the shifting and upgrading of these labor-intensive industries to the manufacturing "smile curve" at both ends." Lin Yifu said, "These are labor-intensive. After the production process is transferred overseas, not only local cheap labor can be utilized, but also the domestic industrial transformation and upgrading, that is, after the transfer of production links, it is also conducive to the release of limited land resources and labor resources to engage in higher added value. New industry."

"Therefore, investment in African countries, or other developing countries can also be invested, such as Southeast Asia, or Central Asia, or even Latin America." Lin Yifu said, personally feel that there are several advantages to invest in Africa: on the one hand With a population of 1 billion in Africa, the current wage level is “very low”. “Like what we did in the early 1980s, it was a bit like “infinite construction period.” It is very suitable for the settlement of processing and manufacturing companies with very labor-intensive industries, especially Several relatively stable African countries."

Lin Yifu said that the focus of attention is only on China-U.S. trade surplus and China-EU trade surplus. “If we transfer these processing links to Africa, we can reduce the trade surplus with the United States and Europe, and we can also ease the trade pressures we face externally. Not only that, it can also win the support of African countries for our centripetal force and even for China."

The development prospects in Africa are promising

In recent years, Africa’s economy has developed rapidly. This benefits from the rich mineral and agricultural resources in the African continent. Hermariam said: “60% of the world's uncultivated arable land is in Africa. At present, Africa only cultivates 17% of arable land, and China’s investment potential in African agriculture is huge. With global food and agricultural prices continuing to rise, Chinese companies There is a lot to do in Africa."

According to a report released by the McKinsey Global Institute in June, by 2030, African agricultural output will increase from the current 280 billion U.S. dollars to nearly 900 billion U.S. dollars. The latest World Bank report predicts that in the next three years, the economic growth rate in sub-Saharan Africa will exceed 5%, and Africa's average annual foreign direct investment will reach 54 billion US dollars.

Africa's fertile land and huge agricultural potential also provide food resources that can be relied on for food processing. Dr. Ziegler, director of the International Rice Research Institute, pointed out that sub-Saharan African countries still have large areas of land suitable for rice cultivation. However, due to insufficient development, 40% of rice demand in Africa is now dependent on imports from Asia. He pointed out that if Africa is to further increase the development of grain production, the food production in Africa in the next 10 years is expected to increase significantly.

Policy Preferences Accelerate Stepping Out
In addition, the Chinese government also encourages food and food processing companies to "go out." In February 2012, the National Development and Reform Commission and the Ministry of Industry and Information Technology released the “Twelfth Five-year Development Plan for the Food Industry”. "Planning" proposes to develop international food cooperation and encourage domestic enterprises to "go global" and establish overseas rice, corn and soybean processing enterprises.

African countries have also actively promoted the development of the agricultural product processing industry and formulated relevant development plans and incentive policies. For food processing companies, it is time to go into Africa. Egypt earmarked an appropriation of 250 million Egyptian pounds (about 46 million U.S. dollars) in 2008 for the construction of a 50-acre Food Processing City in the Natru Valley. China and Africa have formulated a comprehensive plan for the development of the agricultural product processing industry, the main direction of which is the cultivation and processing of agricultural products.

How many opportunities for Nuggets Africa

However, due to insufficient processing capacity, a large part of African coffee can only passively export raw materials depending on the needs of developed countries. Constrained by the fluctuation of the prices of the international raw material market, it means that the economic lifeline is in the hands of others. This also seems to provide a new platform for the Chinese food machinery industry. China Food Machinery Equipment Network invited experts believe that: This is a rare opportunity for China's food machinery exports. The machinery manufacturing industry in Africa is very weak, and machinery and equipment are basically imported from Western countries. China's machinery and equipment performance is no less than the West, but the price is competitive. Especially for food machinery, exports have increased year by year.

In addition, our country's grain processing level is relatively high, and the processing capacity is also excess. It has certain advantages in the processing technology of some grain varieties. Taking corn processing as an example, in recent years, China's corn processing and conversion capacity has grown rapidly, with an annual growth rate of about 20%. Especially in major corn producing areas such as Jilin, Heilongjiang, Liaoning and Shandong, the corn deep processing industry has developed rapidly. The scale of the original corn deep-processing enterprises has continuously expanded, and newly-built and proposed deep-processing companies continue to emerge. Judging from the proportion of actual corn processing of corn deep-processing enterprises in each province, Shandong and Jilin have the highest proportion, accounting for about 45% of the country's total.

China has a more meticulous classification of food processing machinery, including baking equipment, drying equipment, conveying equipment, and sterilization equipment. In the later period, packaging machines such as sealing machines and packing machines will also be involved. Liu Min, Marketing Director of Changzhou Xinyi Equipment Co., Ltd. stated that the company mainly manufactures baking and drying equipment, mostly exports to Southeast Asian countries, and a small amount of exports to Russia and the Middle East. It is still blank for non-business. At present, many food processing machinery enterprises in China are still not common to non-exports.

With the development of China’s economy and the deepening understanding of Africans with China, the African concept of Chinese products is gradually changing, and the demand for Chinese machinery products is also increasing. In front of such a huge income, the African coffee producing countries expressed their determination to “be unwilling to do wedding dresses for others”. For example, the government of Côte d’Ivoire proposed that most of the coffee in Côte d'Ivoire will be processed locally after 2015, and raw materials exports will only account for 5-10%.

Improve your internal skills and make it more solid

In response to the debt crisis in Europe, which is still China’s largest export market, Chinese food machinery manufacturers are targeting South East Asia, Africa, and South America to begin their global market journey. Where does the domestic food machinery manufacturer come from overseas and based on overseas?

Independent innovation is the key to the success of domestic companies going abroad. The leap-forward improvement in the technological innovation capability, product development capability, manufacturing capability, and industrial chain control capability of China's food machinery industry has also led to a rapid leap in global industrial status. With the rapid upgrading of industrial structure, domestic food machinery research and development continue to advance toward high-end, large-scale, and intelligent, allowing “Made in China” to have more selling points and advantages in overseas markets.

It is the foundation for the internationalization of food machinery companies to improve internal strength and increase scientific and technological input. All enterprises engaged in the production of food machinery should clearly understand that the core of the international competition for food machinery in the future is technology content. Only when enterprises increase their investment in science and technology, continuously increase their technological content, develop safe, effective, and distinctive high-tech products, emerge from low-level price wars and advertising campaigns and turn to high-level technological warfare, can they create brands and go international. The mainstream market.

China's food machinery enterprises should take the scientific concept of development as their guide, change the concept of development, strengthen independent innovation, increase market awareness, and effectively promote the development of the domestic food machinery industry. At the same time, we must adhere to the "going out" development strategy and actively expand foreign markets. It should strengthen scientific and technological investment, put an end to excessive dependence on foreign high-end technologies and strengthen independent innovation so that it can enhance its competitiveness and take a place in the international market.

Xiao Bian concludes: Various facts have proven that Africa is an investment option for food machinery companies worth considering. However, mercantile warfare is unrelenting. Before going non-gold-raising, Chinese investors should also be fully prepared. In business operations, we must fully consider the geographic environment, legal system and labor protection awareness in Africa. Finally, we must pay attention to personal safety. Before many people in Africa went to Africa, they fought with regard to security issues. In Africa, it took a long time to discover that it was not so terrible to relax their vigilance. As a consequence, because of their carelessness, such lessons must be kept in mind.