TCL, Elaraby to set up TV plant in Egypt

TCL Multimedia Technology Holdings Ltd, the Chinese television maker, is to set up a joint production base in Egypt with local home appliance leader Elaraby Group in an effort to tap African and Middle Eastern markets.

The first phase of the venture is expected to be operational by 2017 and will be the largest Chinese-invested LCD TV production base in North Africa, the companies say.

Elaraby will pay 70 percent of the project cost.

While signing an agreement on May 19 in Shenzhen, Guangdong province, TCL representatives said the plant's annual output will reach 2 million TV sets over the next five years.

The Chinese company is the largest domestic TV exporter to Egypt, while Elaraby is its country's largest home appliance company.

"The factory will supply African and Middle Eastern markets and allow TCL to ensure stable orders, via Elaraby's well-developed sales network," says Liang Tiemin, general manager of TCL's strategic customer business center.

He says the company expects the venture to lift its annual TV sales in Africa and the Middle East to at least 3 million sets over the coming three years, 500,000 of which will be sold under the TCL brand.

Mohyielden Elaraby, the Egyptian company's chief sales officer, adds that he is confident the partnership will expand its sales network and increase market share.

Despite TV sales stalling in China, the United States and Europe, TCL is also optimistic about its prospects in Arab, African and Mediterranean countries, with data from market researcher GfK suggesting combined demand still exceeds 20 million sets a year.

Michael Wang, chief financial officer at TCL, says trade agreements between Egypt and its neighboring countries will also help TCL boost sales.

In addition, the Egyptian government gives export tax rebates to companies that produce at least 40 percent of their components in the country.

TCL Multimedia, part of TCL Corp, set up its first overseas TV production base in Vietnam in 1999. Today, it generates nearly half its revenue overseas.

The company also has a major production base in Poland serving Europe, and one in Mexico feeding products into North and Central American markets.

In an interview in late March, TCL Corp Chairman and CEO Li Dongsheng said the company is considering production bases in India and Brazil.

Liang Zhenpeng, a consumer electronics analyst, says demand for LCD TVs in emerging economies in Asia, Africa, Latin America and the Middle East remains strong and is expected to continue growing over the next three to five years.

xujingxi@chinadaily.com.cn

(China Daily Africa Weekly 05/27/2016 page25)