Huajian Group, a Chinese business and investment company specializing in shoe manufacturing, has signed a memorandum of understanding with the Rwanda Development Board to set up a textile factory in the country.

The Chinese company will invest $1 billion in the manufacture of shoes, clothes, bags, cellphones and computers and is expected to create more than 20,000 jobs for young Rwandans.

The investment partnership is also expected to increase the export potential of the East African nation's finished products and enable it to diversify exports of local products and increase returns for the sustainable development of the country.

The agreement is part of the company's expansion plans in East Africa.

Huajian Group Chairman Zhang Huarong says the company will initially import raw materials that will be used in manufacturing in Rwanda, with plans to source over half of these locally in the long-term.

Zhang expressed confidence about his future investment in Rwanda as he believes the country's development strategy is similar to China's.

"Rwanda is a good place to do business in Africa because the political climate is steady, the governance is efficient and the population is relatively educated," he says.

"Rwanda's development strategy is similar to China's strategy in producing high end products and increasing exports. Politics is steady, the leadership of this government is efficient."

Scholarships and training in China have been offered to over 200 Rwandan students starting this year to enhance technical skills transfer.

RDB's Chief Executive Officer Clare Akamanzi says Huajian's commitment to invest in the country will diversify and improve the export of its finished products.

According to Akamanzi, the government has already acquired land in the Kigali Special Economic Zone and it is believed that Zhang's investment will contribute to export diversification, which is in line with the country's vision.

"We are confident that Zhang's commitment to invest in Rwanda will diversify and improve exports of finished products," Akamanzi says.

"Rwanda is one of the most attractive places to do business, and much like European countries because the government is highly efficient and properly managed. The factory, too, will serve as center for East Africa."

Huajian Group's long-term plan is to invest and build five light industrial parks in developing countries in Africa in the next 10 years, producing and processing clothing, shoes, hats, suitcases, bags, electronics and other light industrial products. In the process it will provide 100,000 jobs.

The Chinese firm joins a list of other Chinese companies in the textile sector that are operating in the country - one of which is C & H Garments Factory, one of the country's fastest-growing textile companies, which currently makes police uniforms, safety vests and, most recently, military items.

Huajian is owned by Zhang and it mainly specializes in production of high-end and midrange women's shoes with three production bases, including one in Ethiopia.

Huajian has a factory near Addis Ababa that employs 6,000 people. It opened in January 2012 and has committed to jointly invest $2 billion over the next decade to create a light manufacturing special economic zone in Ethiopia, with employment for around 100,000 people. The company, which employs 25,000 workers in China expects to be able to provide around 30,000 jobs in Addis Ababa by 2022.

In Ethiopia, Huajian partners with the China-Africa Development Fund, a private equity fund promoting Chinese investment on the continent. Born out of the 2006 Forum on China-Africa Cooperation, the fund was launched in June 2007 with $1 billion provided by the China Development Bank. A further injection of $2 billion was made early last year.

Over the last six years, Rwanda has witnessed an unprecedented number of Chinese investments. The total estimated amount of Chinese investments registered in Rwanda is about $103 million, according to the Rwanda Development Board.

For China Daily

(China Daily Africa Weekly 09/22/2017 page28)