AUTOMART AFRICA - AUTOMOTIVE INDUSTRY DIRECTORY | KENYA | TANZANIA | ETHIOPIA

Africa is the world's 2nd largest continent after Asia, with almost 1.2 billion inhabitants. In recent times, automotive manufacturers' eyes have been opened to the opportunities for investing in Africa, especially because of its low labour costs and optimistic future.

Why in Africa?

By the beginning of the new millennium, the biggest international car manufacturers and their suppliers had started to boost their business in African countries such as South Africa, Nigeria, Egypt, Morocco, Tunisia and Algeria. They used these countries not only for the local production opportunities and local services, but also to export their cars, spare parts and accessories to other African and international markets and to support production in their mother companies as well.

South Africa, Morocco and Algeria became well-known markets for the export of complete cars such as Toyota and Renault... whilst Egypt and Tunisia became well known as markets for the export of aftermarket parts.

Investments in the automotive sector in Africa

Huge investment has started to reach Africa in the last few years, especially from China. The Chinese government have stated that they will invest 5 billion USD in industrial projects in Africa (especially in the automotive sector). And some European companies have done so too.

On the other hand, we have also witnessed strong growth in another indirect side of the automotive business on the African continent, i.e. the automotive shows and trade fairs, which generate hundreds of millions of USD of business and which have helped this industrial sector to grow at an ever faster rate.

New opportunities for Egypt

After a green light had been given to the huge project of the new Suez Canal, which will be launched officially by August 2015, the Egyptian government announced that they will be opening up great opportunities in terms of free zones for projects especially in the automotive, transportation and shipping sectors, which will enhance Egypt's role on the international scene. These opportunities have attracted the attention of many international car manufacturers, who are now seeking to take advantage of them.

Economic agreements and positive polices:

Many economic agreements have been signed between African countries to facilitate their economic cooperation, such as the AGHADEER Agreement for North and West-African Arabic-speaking countries, and the COMESA agreement for Eastern and Central African countries, amongst others. These economic agreements have been signed to guarantee product movements between those countries that are free from taxation and which are to be supported by flexible polices with a view to reaching the targets set and guaranteeing further international investment in the continent. Such policies are, however, sometimes not applicable because of internal economic restrictions.

Lately, most of the advanced African countries have become interested in inviting key economic decision-makers worldwide to open new markets for their products and industries ... not only to increase profits, but also to ensure that Africa remains competitive.

Source : www.driving-news.com

Posted on : 29 Apr,2024 | News Source : ABNews