Swiss mining specialist Xstrata expects to begin production from the first phase of its huge Lion Project in Wonderkop, South Africa, by the second quarter of 2007.

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frica could be looking up in terms of its prospects for increased foreign direct investment in coming years, with South Africa and Egypt among the nations projected for substantial growth.
   The latest United Nations Conference on Trade & Development (UNCTAD) figures on FDI during 2005 show the continent saw a rise of 55 percent from US$18.7 billion in 2004 to $28.9 billion in 2005. South Africa set the pace percentage-wise in its growth rate with an 803-percent increase, or a rise from $800 million to $7.2 billion. UNCTAD notes that while the increases are historically significant, most if the investment is coming in projects related to oil and other natural resources.
   Another hint of positive news from the continent comes from a recent report by consulting firm A.T. Kearney: While the region has some of the world's highest business costs, weak governance and poor growth, it is being viewed more positively by global investors. Kearney says about 17 percent of senior executives are more upbeat on Africa's outlook while just 11 percent have become more negative about the continent's outlook.
   Kearney says leading African nations that might attract future FDI are South Africa, Nigeria, Egypt, Morocco and Kenya. Corporate investor interest and FDI are limited to just a few nations in Africa, Kearney notes.
   The U.N., in its annual "World Economic Situation & Prospects" report, however, notes that the major challenge on the continent continues to be "the still lackluster status" of manufacturing. It notes that the sector absorbed more losses last year with the end of the Agreement on Textiles & Clothing and increased competition from Asian textile mills. Major threats to the African economy remain the possibility of a worsening AIDS epidemic or an avian flu epidemic, or new civil conflicts, according to the U.N. report.

   As a world leader in mining, it's not surprising that recent investments in South Africa would include big developments in that sector.
   These include projects by Swiss-based metals and mining firm Xstrata, which is investing $125 million to build a new chrome ore plant at its Wonderkop site. The Zug-headquartered company ex-pects to commission the new plant by the second quarter of 2007.
   Xstrata's joint venture Xstrata-Merafe Chrome is undertaking the expansion. The company says the additional capacity will enhance its mining and operational efficiencies and reduce operating costs for its Western smelting operations.
   Xstrata's mammoth three-phase, 10-year, Lion Project in its alloys business began last year. It is a 1-million-metric-ton ferrochrome expansion that will boost production by 63 percent from the current capacity of 1.6 million metric tons. Production from the first phase of the $264-million project will begin during the second quarter of 2007.
   The automotive industry is another leading FDI recipient in South Africa. Among the latest developments is Volvo Trucks' new factory in Durban. Production was moved from the company's facility in Botswana, which served the South African market. The plant assembles CKD (completely knocked down) kits.