Actom unpacks expansion intent as AfCFTA, energy transition take shape

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Actom unpacks expansion intent as AfCFTA, energy transition take shape

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Actom group CEO Mervyn Naidoo unpacks the group's expansion intensions.

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19th October 2023

By: Marleny Arnoldi

Deputy Editor Online

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Sub-Saharan electromechanical products manufacturer Actom is gearing up to make the most of the opportunity presented by the African Continental Free Trade Area (AfCFTA) that is taking shape, as well as the booming renewable energy sector on the continent.

During the company’s 120-year anniversary celebration on October 19, Actom group CEO Mervyn Naidoo told Engineering News that he expected significant demand for Actom’s products and services in more African markets as the AfCFTA and energy transition unfolded.

Additionally, the continent had a fast-growing population that was poised to reach 1.6-billion by 2050, compared with about 1.3-billion people currently. However, Naidoo explained that, despite Africa having the same number of people as India and China, the continent only generates 10% of the power those countries do.

“With a growing population, coupled with more industrialisation, Africa will have the biggest economically active population in the world. As we gear up for power generation, there is a need for transmission and distribution products and services,” Naidoo added.

Instead of exporting products from South Africa to other African countries, Actom decided to create industrial hubs in key areas on the continent, including in Zambia, to leverage opportunities provided by the Copperbelt.

Actom will transfer much of its intellectual property (IP) to these industrial hubs, employ local people and create more jobs in those countries, while benefitting those economies.

In South Africa, Actom has a rich legacy of developing IP, which bodes well as plans to build more transmission lines unfold.

The company’s range of IP in low-, medium- and high-voltage products spans a spectrum of transmission and distribution products, as well as power generation and associated products.

Naidoo said the group’s diverse range of products used across many industries, as well as its geographical diversification, had enabled sustainability for the group despite capital and aftermarket cycles.

Actom also recently announced that it would invest R100-million across its facilities to expand production capacity and improve efficiency, especially in respect of transmission and distribution products such as transformers.

The company currently employs 7 000 people and has supply and aftermarket service facilities in five countries – South Africa, Namibia, Zimbabwe, Botswana and Kenya.

As a group that has been active in the electrification of South Africa since the second industrial revolution, Naidoo believes South Africa has the potential to follow in China’s footsteps in growing its economically active population and industrialising the economy further.

He said the key issues hampering industrialisation in the country pertain to electricity reliability, logistics and crime. However, Naidoo is confident that the majority of crime will dissipate should unemployment levels improve in the country.

Naidoo projected that South Africa may well reach saturated capacity for power generation, transmission and distribution products, hence Actom’s investment in capacity in other markets.

Likewise, Actom is also investing in increasing its skills development capacity, since more people will be required as capacity ramps up.

During the 120-year anniversary event, Actom honoured some of the scholars and students it had been sponsoring through scholarships. The company has long been developing home-grown engineering knowledge and skills, while providing opportunities for young people to be empowered.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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