From Creamer Media in Johannesburg, this is the Real Economy Report. The Linde Group recently invested in a new R200-million air-separation unit at its Afrox Pretoria West site as part of a three-year R1.5-billion investment programme, which aims to boost customer service levels as well as support the company’s growth strategy in South Africa and emerging sub-Saharan African markets. Joanne Taylor reports.

Joanne Taylor:
The ASU plant produces high purity oxygen, nitrogen and argon to service the merchant and medical markets in the bulk business area in South Africa and neighbouring countries.

Owing to market changes, in 1999 Afrox discontinued the supply of oxygen and nitrogen and operated one of its two 750 t/d ASUs at its Pretoria West facility in maximum turn-down mode. Afrox took the opportunity to replace the existing plant with more modern and efficient technology by installing the new 250 t/d ASU.

The facility is remotely controlled from a global operations facility in the UK to ensure optimal outputs.

Afrox MD Brett Kimber:
We’ve looked at our portfolio, we’ve looked at our opportunities, we’ve looked at what our capabilities are and we under-invested for many years so 1; it’s a catch-up and 2; it’s to position ourselves to take advantage of what we see as future opportunities not only in South Africa but also in the rest of emerging Africa.

Part of what we have looked at is that South Africa and Afrox is unique as we manufacture welding products and welding rods and we taking that and turning it from being a distribution arm from Afrox to a manufacturing facility ¬– an OEM from which we will supply products not only for South Africa through Afrox but through the Linde Group globally so its putting more focus on manufacturing. One unique thing we do have good R&D capability so we are going to design new products, which we will sell globally – it’s that R&D capability which we’ve had an we’ll better utilise going forward.

Shannon de Ryhove:
Other news making headlines this week: Reserve Bank governor Gill Marcus says South African trade is still recovering after being dragged down by the world economy and mine strikes; and SAA moves on its fleet and network overhaul as a turnaround ‘custodian’ is confirmed.

Despite a marked improvement in South Africa’s terms of trade since 2010, the country’s exports has seen a slow recovery, weighed down by lagging global recovery and widespread stoppages in the mining sector, says South African Reserve Bank governor Gill Marcus.

South African Reserve Bank governor Gill Marcus

South African Airways CEO designate Monwabisi Kalawe will be expected to become the “custodian” of the troubled national carrier’s long-term turnaround strategy when he takes over in the coming weeks, including those elements of the plan that are already being implemented, such as a network overhaul and a “refleeting” plan.

Public Enterprises Minister Malusi Gigaba

That’s Creamer Media’s Real Economy Report. Join us again next week for more news and insight into South Africa’s real economy.