. Targets local manufacturing, regional value chains, jobs

The African Export-Import Bank (Afreximbank) has committed $1 billion to financing Africa’s automotive sector as part of efforts to boost local manufacturing, deepen intra-African trade and accelerate industrial development across the continent.

The commitment is aimed at supporting the development of an integrated pan-African automotive industry, including vehicle and component manufacturing, regional supply chains, technology transfer and investment in emerging automotive technologies.

This was disclosed at the Africa Automotive Investment Forum, organised in partnership with the African Association of Automotive Manufacturers (AAAM), the African Continental Free Trade Area (AfCFTA) Secretariat, Egypt’s Ministry of Trade and Investment and South Africa’s Department of Trade and Industry.

The two-day forum brought together policymakers, original equipment manufacturers (OEMs), investors and component manufacturers to explore investment opportunities and identify policy reforms needed to strengthen Africa’s automotive industry.

The bank said the sector remains a strategic priority because of its potential to drive industrialisation, create skilled jobs, strengthen small and medium-sized enterprises (SMEs) and reduce the continent’s dependence on imported vehicles.

Speaking, Executive Vice President, Intra-African Trade and Export Development at Afreximbank, Kanayo Awani, said the sector is central to the bank’s ambition to support structural economic transformation and expand trade under the AfCFTA framework.

She said investment in the industry would help build manufacturing capacity, integrate regional value chains, stimulate employment and position African producers to compete more effectively in the global industrial economy.

She identified vehicle component manufacturing as a significant investment opportunity, noting that Africa could leverage its growing skills base and abundant raw materials, including lithium, cobalt, manganese, nickel, copper, iron and steel, to develop a more competitive automotive ecosystem.

AAAM President, Tarek Mosaad, said the agreement on AfCFTA Rules of Origin for the automotive sector provided a foundation for building a more integrated continental industry.

He said the priority is how to translate policy commitments into factories, stronger supplier networks, employment opportunities and increased trade in automotive products across African markets.

He identified three priorities, including increasing local content through regional value chains, easing the movement of automotive products across borders and ensuring Africa played a meaningful role in shaping the future of mobility.

He urged investors and policymakers to approach the continent as an integrated market rather than a collection of separate national economies.

Secretary-General, AfCFTA Secretariat, Wamkele Mene, identified the development of investment-ready projects and competitive production locations, stronger regional supplier networks, deeper localisation and commercially viable regional production as priorities for implementing the African automotive sector strategy.

To advance these objectives, the AfCFTA Secretariat and AAAM signed an agreement to strengthen cooperation in developing the continent’s automotive industry.