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Global Schneider Electric head convinced Africa’s growth story remains intact despite headwinds

Global CEO Jean-Pascal Tricoire

Global CEO Jean-Pascal Tricoire

11th February 2015

By: Terence Creamer

Creamer Media Editor

  

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Global energy management and automation specialist Schneider Electric says its newly inaugurated factory and office campus in Midrand, north of Johannesburg, has positioned it for both growth in the region and to meet the South African government’s growing demand for localisation.

Global CEO Jean-Pascal Tricoire, who visited South Africa this week as part of the formal opening of the facility, stresses that the investment has been aligned with the long-term growth potential that the company believes remains intact, despite current economic weakness in South Africa and the slowing of a number of other African economies, particularly those whose fortunes are strongly linked to the prospects for oil and commodities.

He also notes that the group, which has yearly sales of around $30-billion and some 180 000 employees in more than 100 countries, had remained committed to the South Africa market during even more trying times in the not-so-distant past. It has, thus, pushed ahead with the creation of new production capacity, which has also positioned the business to raise the local content of products and solutions sold to government and State-owned companies.

The Old Pretoria Road campus also houses a state-of-the-art academy, which is already being used for client and staff training, as well as to train technology entrepreneurs as part of the company’s corporate social responsibility initiatives.

Besides seeking to capture higher levels of market share in South Africa in sectors as diverse as oil and gas and mining, through to data centres and process industries, Schneider Electric is also keen to increase its footprint in Southern Africa, with a particular focus on bolstering operational capacity in Angola, Mozambique, Zambia and Namibia.

Tricoire, who spent a portion of his career based in South Africa, says the company’s technologies are trying to resolve the energy and efficiency equation for the mega trends of urbanisation, industrialisation and digitisation, which requires it to have a global presence. “When you look at those three phenomena, Africa looms big on the map.”

In addition there are the opportunities that are arising from the continent’s young and growing population and moves by various countries to address infrastructure backlogs and expand resource and industrial production.

Zone president for Africa and Caribbean Mohamed Saad notes that there are already 51 African cities with populations exceeding one-million people and that the group is keen to expand from its current position of being present in 28 of those cities. He adds that, having never disengaged from Africa, it has become more comfortable in navigating the sometimes sharp downturns experienced in some countries, describing African business cycles as “very short”.

“So the [investment] decisions we are making today are not for the next year or even the next two years, but for the long term – and we believe in the long-term potential of Africa,” Tricoire avers.

However, he adds that, as a global investor and an employer, it is always better to have a predictable economic and legal environment, a good supply of energy and policy certainty. “At the moment it is a bit more difficult to read, but we are confident that clarity will emerge in the future.”

Edited by Creamer Media Reporter

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