The African Export-Import Bank (Afreximbank) has committed US$1 billion to financing Africa’s automotive sector as it seeks to boost manufacturing, attract investment and reduce the continent’s reliance on imported vehicles.
The bank said in a statement on Monday that the funding was part of its strategy to promote industrial development and intra-African trade, with a focus on developing regional automotive supply chains under the African Continental Free Trade Area (AfCFTA).
Speaking at the Africa Automotive Investment Forum in El Alamein, Egypt, Afreximbank Executive Vice President for Intra-African Trade and Export Development Kanayo Awani said the automotive industry could help accelerate Africa’s industrialisation and create skilled jobs.
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“The automotive sector is a critical pillar for advancing Africa’s industrialisation,” Awani said, adding that investment in the industry could strengthen manufacturing capabilities, support economic diversification and improve the continent’s competitiveness.
The two-day forum, held on the sidelines of the Alamein Africa Forum, brought together policymakers, vehicle manufacturers and component producers to discuss investment opportunities and reforms needed to develop the industry.
Afreximbank said opportunities existed in vehicle and component manufacturing, particularly through partnerships that could transfer technology and build local production capacity.
Africa’s deposits of minerals such as lithium, cobalt, manganese, nickel and copper could also support the development of automotive supply chains, including those for electric vehicles, Awani said.
The forum saw South Africa’s Malben Engineering and Egypt’s El Araby Group sign a joint venture agreement to manufacture automotive components for the Egyptian, South African and wider African markets.
The partnership combines El Araby’s industrial and engineering capabilities with Malben’s more than 50 years of experience in manufacturing and forming metal automotive components, the bank said.
African Association of Automotive Manufacturers President, Tarek Mosaad, said the agreement on AfCFTA automotive rules of origin provided a basis for developing a more integrated regional industry.
He said priorities included increasing local content, improving cross-border movement of automotive products and strengthening Africa’s role in the global mobility industry.
“Investors are not looking at 54 separate African markets. They are looking at one integrated opportunity,” Mosaad said.
AfCFTA Secretary-General, Wamkele Mene, said the continent needed investment-ready projects, competitive production locations and stronger regional supplier networks to advance its automotive strategy.
The AfCFTA Secretariat and the African Association of Automotive Manufacturers also signed a memorandum of understanding to cooperate on implementing the strategy, including customs procedures, trade facilitation, automotive standards, supplier development and investment mobilisation.
The forum also saw the establishment of an Egypt-South Africa Business Council to develop trade and investment projects in sectors including automotive manufacturing, mining, renewable energy, agriculture and transport infrastructure.
Delegates visited vehicle manufacturers Nissan Motor Corporation, General Motors Egypt and Al Mansour Automotive, as well as component producer Mobica, to examine manufacturing and supplier-development opportunities.
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