President Cyril Ramaphosa has hailed the multimillion-rand expansion of Procter & Gamble's (P&G) disposable diapers production line as demonstration of confidence in the South African economy that will also increase the country's trade with the continent under the African Continental Free Trade Agreement (AfCFTA).
This comes as P&G yesterday launched a state-of-the-art production line of Pampers Premium Care in Kempton Park.
Delivering a keynote address yesterday, Ramaphosa yesterday said P&G stood behind many brands that are household names in South Africa, such as Vicks, Old Spice, Gillette, Oral B and Pampers, amongst others, and has a strong manufacturing footprint in the country.
“It has, therefore, been greatly encouraging to see the company’s response to our ambitious investment drive and the investment commitments made by the company at the five South Africa Investment Conferences that we have held since 2018,” he said.
“The launch of this production line is the latest in a number of projects that have given effect to Procter & Gamble’s investment pledges. Through these and other investments, Procter & Gamble is contributing to the reindustrialisation of South Africa’s economy."
Ramaphosa said the government was working to expand and diversify the country's manufacturing base, and improve its competitiveness and dynamism in a bid to drive growth that is sustainable and inclusive.
Procter & Gamble has been in Africa for more than 50 years, has manufacturing operations in South Africa, Nigeria, Kenya, Egypt and Morocco, and has distributor operations in more than 45 countries.
The company currently exports from South Africa to Namibia, Swaziland, Mozambique and Botswana, and is set to supply the African continent from South Africa through the implementation of the AfCFTA.
Ramaphosa said South Africa remained one of the preferred investment destinations in Africa and was an important gateway for markets and other business opportunities throughout the continent.
“The African Continental Free Trade Area will unlock opportunities for the development of export markets, enhance industrial bases and regional value chains,” he said.
“We expect the continental free trade area to reduce the cost and improve the ease of doing business in Africa. We want to make the movement of products, processes and people seamless as companies increase their footprints on the continent.”
The cumulative P&G investment announcements in the country has amounted to R900 million, with a commitment to unveil more investments in collaboration with the government.
P&G’s economic footprint has seen the creation of more than 4 000 direct and indirect jobs within its value chain and these investments will create hundreds more jobs.
P&G's expansion comes at a time South Africa has just concluded the African Growth and Opportunity Act (Agoa) Forum, which sought to get the beneficial trade agreement with the US extended early for investor confidence.
Oxford Economics Africa's head of macro, Jacques Nel, said it appeared likely that the Act would be extended past its scheduled expiry in 2025, but some in the US want to see it used more aggressively to advance Washington's political aims – which could affect South Africa.
“The main takeaway from the Agoa forum that concluded in Johannesburg this weekend was that some in the US want to use the initiative as a foreign policy stick, while also increasing the size of the carrot," Nel said.
“The forum’s host is one of the biggest beneficiaries of trade under Agoa, and its business community sees the threat of the loss of Agoa benefits as a major uncertainty clouding investment decisions.”
Senior vice president and general manager P&G Sub-Sahara Africa Fayyaz Rizvi said the commissioning of the Pampers Premium Care Line, which is one of their best diapers, was a significant moment for the company because it is locally produced in South Africa.
“P&G started operations about 20 years ago and over the course of this time, we've been expanding our footprint in terms of products, in terms of the needs of the consumers, and we started to reach out to more consumer needs in more parts of South Africa,” Rizvi said.
“Today we proudly manufactured four of our key brands here in South Africa Pampers, as you just witnessed, Always, Olay and Ariel.
“The deal today that we just did on the commissioning of the Pampers Premium Care Line is not just an ordinary event. It's a promise that we make to South African consumers that we will bring the best quality product in South Africa, serving the needs of our consumers today and for the future. This is a product with the most gentlest of top-sheet for the baby that makes the mother and the baby both love the product.”
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