Investing in South Africa

Nestlé opens R500m factories in SA

8 August 2012

Swiss multinational food company Nestlé has opened two new factories in the town of Babelegi, north of Pretoria as part of a R500-million investment in its South African operations, creating over 130 permanent jobs in the process.

The two new factories are for the manufacturing of the company's breakfast cereals - Milo and Cheerios - and the addition of new production lines for the manufacturing of Maggi noodles.

It means these products will no longer need to be imported into South Africa. The project has created over 130 permanent jobs, as well as 300 indirect jobs over a 20-month period during the construction phase.

Speaking at the launch, Trade and Industry Minister Rob Davies said South Africa and the rest of the African continent had a significant role to play in food security around the world and in many food-deficient countries.

He also urged African businesses to add more value to their agricultural products.

"This investment is one of the several investment opportunities that has taken place recently in South Africa by a global multinational company in the agro-processing area, and it is reflecting the fact that we as the South African government are trying to position ourselves and deepening the presence of agro-processing in our country and companies," he said.

Nestlé's Global CEO, Paul Bulcke, said the company had a long history in South Africa and Africa, and that consumers and their employees held an important key role in their products and services.

"Forty percent of our products are sold in emerging economies and are expected to grow up to 50% in 2020," Bulcke said.

"We have been present on the African continent for more than 100 years, and we see great growth opportunities for the future."

The company said it would continue to invest in South Africa in line with their long term commitment to business sustainability, growth and economic development.

Nestlé was granted approval for the project in accordance with Section 12I Tax Allowance Programme of the Income Tax Act. Davies approved the tax allowance deduction for Nestlé of R168-million in terms of their investment and training needs.

The 12I Tax Allowance Programme allowance is geared towards providing investment support in new manufacturing assets and the training of employees.

Source: SANews.gov.za