REMANUFACTURING AND AFRICA
Presented by the Co-Sponsors of NAMA NTBs Proposal
TN/MA/W/18/Add.16/Rev.3
United States, Japan and Switzerland
UN ECA Conference, Nairobi, Kenya , April 12-14, 2010
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What is Remanufacturing?
• Remanufacturing is an industrial process that uses “cores”
or end of life components and restores to them new
condition.
• A remanufactured good is “a non-agricultural good that (1)
is entirely or partially comprised of parts (i) that have been
obtained from the disassembly of used goods; and (ii) that
have been processed, cleaned, inspected, or tested to the
extent necessary to ensure they are in original working
condition; and (2) has a warranty.”
• Remanufactured goods should meet the same technical
and/or safety specifications (standards and/or technical
regulations) that apply to an equivalent new good.
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How does the remanufacturing process work?
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What kinds of technology is used?
Industry Examples
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What kinds of goods are
remanufactured?
• Companies are using remanufacturing across
an expanding range of products.
• Examples include: earthmoving equipment,
automotive parts, medical devices,
information and communication technology
products, industrial machinery, precision
instruments, and office equipment, including
toner and ink cartridges.
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How do remanufactured goods differ
from used goods?
• A remanufactured good, unlike a used good, should
meet the same technical and/or safety specifications
(standards and/or technical regulations) that apply to
an equivalent new good (i.e., the remanufactured good
when it was originally manufactured)
• A remanufactured good should have a warranty. Used
goods often do not have warranties.
• Some countries use a labelling regime so that
customers at the point of sale or customs at the point
of entry can identify that a good is remanufactured.
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How large is international trade in
remanufactured goods?
• No separate tariff lines exist for remanufactured goods, but landmark
1998 study estimated the global market for remanufactured goods to
be $100 billion. In following 12 years, much expansion and growth.
• Global Industry Analysts recently estimated the global market for
remanufactured auto parts alone to be $104.8 billion annually by 2015.
• Through international investments we can see that remanufacturing of
industrial machinery, earthmoving equipment, electronics is growing,
especially in developing countries.
• Global market for remanufactured ink jet and toner cartridges
estimated to be more than $5 billion annually. More than 10,000
remanufacturers worldwide, employing more than 65,000 people.
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Why are environmentalists and
Ministries promoting remanufacturing?
• Remanufacturing saves manufacturers on average 85% of
energy use; 86% of water use; and 85% of the materials
used as compared to manufacturing a new good.
• Using existing metal components preserves virgin natural
resources and avoids carbon emissions caused by smelting
metal castings.
• Remanufacturing prevents metal and plastic components
from ending up in landfills.
• For Governments, remanufacturing is a way to clean up
municipal waste, save energy in domestic industries, and to
create jobs.
Source: Remanufacturing, The Ultimate Form of Recycling, Rolf Steinhilper, Fraunhofer IRB Verlag,
Stuttgart, 1998, http://www.reman.org/Publications_main.htm, page 98 – 103.
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What are the labor benefits of
remanufacturing?
• Source of “Green Jobs”
• Labor intensive industry: it takes 40 man hours to
create a new engine but it takes 120 to
remanufacture one. (Walter Stahel, Performance Economy)
• Low automation industry due to hands on
disassembly and high skills industry with
individual testing of remanufactured units.
• Some companies have established training
centers to provide remanufacturing skills and
knowledge to local workers.
• Overall better workplace safety due to lack of
furnaces and smelting of components.
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To What Extent is Africa Involved in the
Remanufacturing Industry?
Surveying business websites shows that:
• Remanufacturing is growing across the region. Some
countries have a long tradition of excellence and
international trade of remanufactured goods.
• There is increasing production of remanufactured
printer consumables in many countries.
• There is growing intra-African trade in remanufactured
goods.
• African companies are seeking to market their
remanufactured goods worldwide.
• There is much more scope for growth of
remanufacturing.
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Examples of African
Remanufacturing Facilities
Country
City/Town
Product Type
Botswana
Francistown
Printer consumables
Egypt
Alexandria
Printer consumables
Kenya
Nairobi
Printer consumables
Kenya
Nairobi
Automotive
Kenya
Nairobi
Printer consumables
Kenya
Nairobi
Food Processing Equipment
Malawi
Blantyre
Printer consumables
Morocco
Rabat
Printer consumables
Morocco
Meknes
Printer consumables
Tunisia
Jemmal
Automotive/Engineering
Senegal
Dakar
Training centre
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Examples of African
Remanufacturing Facilities
Country
City/Town
Product Type
South Africa
Jet Park
Automotive/Engineering
South Africa
Johannesburg
Construction Equipment
South Africa
Port Elizabeth
Automotive/Engineering
South Africa
KwaZulu
Fuel Injectors
South Africa
Springbok
Large diesel engines
South Africa
Silverton
Automotive/Engineering
South Africa
Bramley
Automotive/Enginnering
South Africa
Newcastle and Umhlanga
Printer consumables
South Africa
Pretoria
Automotive, Engineering
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International Trade and Long Tradition
of Remanufacturing: Ex. REMTEC, SA
•
Originally established in 1963 as Volkswagen Remanufacturing by Volkswagen of South Africa,
the company was renamed Remtec Manufacturing when it became independent in July 1995.
Continued collaboration VW Heritage; a well-established, independent British Volkswagen
parts distributor that imports and exports goods worldwide.
•
The two companies have jointly developed a range of remanufactured air-cooled and light
commercial Volkswagen engines for the UK market and it was a natural progression for the
companies to look to Europe to increase their range and market.
•
Remtec is also the exclusive supplier of remanufactured engines to VW of SA, General Motors
of SA, Ford Motor Company of SA, Landrover SA and Nissan SA.
•
Remtec’s Port Elizabeth Plant was the first official large-scale remanufacturer in South
Africa and occupies 4,000 square metres. The layout has been specifically designed to
optimise 40 years of experience in the remanufacturing business and has been used by
other O.E. remanufacturing plants throughout South Africa.
Source: http://www.remteceurope.com/router.cfm/action/changeLang/newLang/1/pageID/1/)
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Other African Industry Examples
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Weather Station Solution by Ultimate Retail Solutions (a South African company)
helps African farmers predict the weather by tracking rain, wind speed, humidity,
etc. The company installs new software onto remanufactured PCs to produce
units that are affordable for farmers.
EbTech Solutions in Kenya advertises that they offer the highest quality
remanufactured toner cartridges at 60% costs savings over new toners. They
provide warranties on 100% of their products. They ship anywhere in Eastern
Africa.
ICC Toner is an Egyptian – US joint venture to remanufacture cartridges in Egypt
for export to the United States.
Press interview with Georginah Mothusi, a female worker in Botswana’s Eridine
Cartridges company: “remanufacturing is a challenging profession when you are a
beginner but is one of the most fulfilling careers.” She remanufacturers and
inspects 30 cartridges a day as part of her job.
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Other African Industry Examples
Personal Computers
• Community Microsoft Authorized Refurbishers (MAR) – 45
total in Africa: Burkina Faso (1), Kenya (2), Cameroon (1),
Gabon (1) Liberia (1), Mauritius (1), Nigeria (11), Morocco (1),
South Africa (20), Swaziland (1), Tanzania (3), Tunisia (1), and
Uganda (2)
• Example: UNIDO and Microsoft Unlimited Potential helped
start Uganda Green Computers Co. in Kampala in 2008
• Organization such as Digital Links and Close the Gap supply
refurbished PCs to users in many countries in Africa and have
helped establish refurbishment companies and centers
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Why NAMA NTBs?
What is the Problem?
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A range of restrictive policies are still applied to trade in
remanufactured goods, such as:
Non-automatic import licensing procedures
Import prohibitions
Excessive documentation requirements
Discriminatory product inspections
Product bans importation of used goods
Fundamental concern: regulating remanufactured
goods as used goods instead of holding them to the
quality and performance standards of new goods and
treating them as such.
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What does the NAMA
Proposal Envision?
Two Elements:
Council for Trade in Goods
• Twice a year a dedicated discussion in the Council
for Trade in Goods where Members raise and
discuss specific trade concerns.
• This gives the added advantage of members
seeing the range of policies that are being
applied, learning what policies may be trade
restrictive, and learning about best practices.
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What does the NAMA NTBs
Proposal Envision?
Second Element: Member-led Workshops on five themes:
• Industry: Companies from developed and developing countries
describing their operations, processes, and warranty practices and
barriers to trade impacting their products.
• Environment: Members’ perspectives on the environmental impact
of remanufacturing. Examine studies on its benefits.
• Regulation: Current practices and alternative approaches to
regulation.
• Development: Developing countries' experiences in development
and adoption of remanufacturing technologies; remanufacturing
industry experience in operating in developing countries.
• Infrastructure: Infrastructure and institutions need to produce,
import, export, assess conformity assessment of remanufactured
goods; capacity challenges.
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Goal of NAMA NTBs Proposal
• Meet our mandate to reduce or eliminate
non-tariff barriers to trade.
• Help to increase and pool WTO Members’
knowledge and experience with the dynamic
and expanding global remanufacturing
industry.
• Better inform regulators and operators about
international best practices.
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