South Africa and China inked about 26 deals on Wednesday during the second state visit of Chinese President Xi Jinping to the African country. The deals emphasized the progress between the two countries in terms of business.

The $500 million (12 billion yuan) agreement for a car manufacturing plant was one of the deals signed by Beijing Auto Works and Industrial Development Corporation. According to the agreement, China Development Bank will finance the construction of the facility in South Africa.The plant is expected to produce vehicles that will be exported to countries all over the continent. African customers continue to import cars from China and other parts of the world.

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The total amount the loan that China will give to South Africa based on their 26 deals amounts to about $6.5 billion, BBC reported. Up to $2.5 billion from this loans will go to the state-owned rail operator of South Africa for the development of the country's transportation system.

According to Business Day live, China is South Africa's largest trading partner. South African countries in turn trade in oil and raw materials with the world's second largest economy and this has helped China support its ever-burgeoning manufacuturing sector.

But as usual, defects are inevitable when it comes to business transactions. China's Ministry of Commerce recently revealed that Chinese investments have decreased by 40 percent. The recent slow down in China's economy has affected many countries in Africa that depend on the former for export of raw materials.

The new agreements between China and South Africa is expected to boost the economy of the African country as fears mount that China's economic troubles would weight it down, says Trade and Industry Minister Rob Davies. The agreement will create 2,500 direct jobs and 7,500  indirect jobs.

President Jacob Zuma and President Xi expressed desire to deepen the ties between South Africa and China. Zuma highlighted progress both nations have made in trade and industralization.

TagsSouth Africa, Jacob Zuma, Agreement, China Development Bank, chinese investment, Chinese luxury car market, car manufacturing, China-South Africa, South Africa Economy, Xi Jinping Africa Tour