(Xinhua) -- He Houhua, a businessman from China’s
southeastern province of Fujian, came to Algeria in 2016 to set
up a pipe manufacturing factory, with an aim to tap into the
local pipe industry after careful market research.
Time has proven that He made a smart
decision. Two years later, He’s building the second factory to
meet the rising demand for high quality pipes as Algeria bans
pipes imports from Europe in order to save its foreign reserve.
“Algeria is a market with huge
potential. I see great prospect of investment here,” He said.
“Many new houses are built in Algeria
every year and they need new pipelines,” He recalled when he
made the decision to invest in Algeria. “But the domestic supply
of pipes cannot meet the growing demand, so the market has to
rely on imports.”
He Houhua is just one of many Chinese
investors who have seized on the business opportunities offered
by Algeria, the largest African country in size with rich
natural resource reserves, which has been struggling to lessen
its dependence on energy exports and diversify its economy by
developing domestic industries.
In recent years, Algeria has found an
ideal partner—China, which has enough capital, expertise and
will to invest in African countries, especially under the Belt
and Road Initiative proposed by China in 2013.
The initiative, formally known as the
Silk Road Economic Belt and the 21st-Century Maritime
Silk Road, aims to build a trade and infrastructure network
connecting Asia with Africa and Europe along the ancient trade
routes of the Silk Road.
Chinese investors now play an
important role in helping the Algerian government achieve its
ambition, by bringing in large amounts of capital and advanced
technologies to help develop the industries in the North African
To cut down foreign exchange spending
and develop its domestic industries, Algerian government has
been attracting foreign investors to set up local factories,
which He considered as a precious business opportunity.
He established his pipe factory in the
Boufarik Industrial Zone, 40 km east of the capital Algiers,
which occupies an area of 3,000 square meters.
The factory, including two production
lines operating for 24 hours a day, produces 6 tons of pipes
Its products, targeting the high-end
pipes market, are sold at a higher price than other local
products, but have been favored by the customers for the higher
“I will never reduce the price at the
cost of the quality, even it may boost sales,” He said, arguing
that only the products of good quality would be accepted by
consumers in the long run.
To slash foreign reserves expenditure,
Algeria has banned the imports of pipes, making it difficult for
construction companies to find alternatives to high quality
products which were traditionally imported from Europe.
After trying out the pipes produced by
He’s factory, local construction companies were convinced that
they can perfectly replace the European products.
Chinese investment has also helped
Algeria develop its auto manufacturing industry, through
cooperation with local businesses.
Shaanxi Automobile Holding Group, a
state-owned heavy-duty truck manufacturer in China, started
selling its products in 2007 in Algeria, where the trucks market
was dominated by European brands such as Volvo, Renault and MAN.
But now the sale of the company’s
SHACMAN heavy duty trucks accounts for 70 percent of the local
market. The company has created much-needed job opportunities by
employing over 600 workers in its assembly factory co-built with
The factory was built after the
Algerian government called on foreign auto companies to
establish factories here in 2015.
Algeria is eager to learn the auto
manufacturing expertise and technologies as the government
pledges to develop its home-grown car industry, said Yuan
Hongming, chairman of the Shaanxi Automobile.
“This provides a chance for Chinese
enterprises to expand their businesses in Algeria with their
experience and technologies, which will eventually benefit both
sides,” Yuan said.
After years of marketing in Algeria,
SHACMAN as a Chinese auto brand has gained substantial
acceptance among local customers for its competitive prices,
excellent services and flexible market strategies despite
decades-long European dominance in the sector.
On May 8, the company rolled out its
first truck assembled in Algeria. It has an estimated annual
production capacity of 3,000 trucks.
Apart from meeting local demands, the
trucks will be exported to neighboring countries including
Tunisia, Morocco and Mali in the future.
Ahmed Mazouz, the Algerian partner of
Shaanxi Automobile, lauded the high quality of Chinese trucks
and the company’s core value of integrity.
More and more Algerians choose to buy
the SHACMAN truck, with some of them having driven it for more
than 10 years, Mazouz told Xinhua in an interview.
This not only demonstrates the good
quality of the Chinese trucks, but also creates a bond between
the Chinese brand and Algerian customers, Mazouz said.
China has demonstrated its will to
help Africa speed up its industrialization, said a report
published by TSA, a major news website in Algeria.
The closer cooperation between China
and Africa will benefit both, as it will boost the economy of
African countries on one hand, and fulfill the aspiration of
Chinese investors on the other, the report said.