Will manufacturing shift from China to Africa?

In 2000, when William Hickey, president and CEO of US-based packaging company Sealed Air, took a long-term view on the future of his company, he predicted that by 2050 Africa would have replaced China as the world’s manufacturing hub.

William Hickey

William Hickey

“Eleven years later I think we are behind . . . 2050 becomes a challenge [but] I still think it is doable,” Hickey said during a session at the recent World Economic Forum on Africa, held in Cape Town.

Headquartered in New Jersey, Sealed Air manufactures a wide range of packaging materials and equipment for the food, industrial, medical and consumer industries. The New York Stock Exchange listed company has a presence across the world, including Africa.

“I know of one company, and only one at this point, that has moved their manufacturing operations from China to Africa. I thought that would be the tipping point, but that was six years ago and I know of no other customer of ours that has moved its manufacturing from China to Africa,” Hickey noted.

He said Africa’s manufacturing sector faces numerous challenges, including a shortage of skills; rigid labour laws; inadequate electricity supply; cumbersome and expensive transport within the continent; low levels of productivity; political instability; and corruption.

Hickey, however, remains an optimist on Africa. “But I’m hopeful, we are prepared to invest, and we are prepared to help the continent . . . to overcome [these] issues.”