AfCFTA will boost Africa’s auto industry

zambique or rubber in Cote d’Ivoire will mean the African industry as a whole becomes more dynamic.

The AfCFTA’s rules of origin will also help set common thresholds for value-added levels, and if these are progressively harmonised across regional communities, these more general and co-equal rules will help stimulate trade.

The continent’s leadership is actively working towards improving the investment environment for the automotive sector speci cally. There is signi cant political will by African governments and private sector players to develop automotive regional value chains because of the sector’s historic contribution to industrialisation.

Afreximbank, for example, and the African Association of Automotive Manufacturers are working together to support the industry by helping harmonise automotive standards, developing a focused training programme for the public and private sectors and providing nancing to industry players across the value chain, with Afreximbank committing $1 billion to the industry through direct nancing and partner- ships. Sustainability and the global ght against climate change also stand to bene t from the new trade area. Africa could be a key region for promoting sustainable mobility by harnessing renewable energy as demand for electric vehicles and motor vehicles grows. Electric vehicles currently make up less than 1% of sales in South Africa, but demand is growing across the continent as some of Africa’s main trading partners have banned internal combustion engine vehicle sales, e ective as early as 2035. Already, there are pilot projects for sustainable vehicles in Rwanda, Egypt and South Africa, and e-mobility startups have emerged across the continent. Africa has a great wealth of the natural resources that are key raw materials for modern vehicles, and several countries have their own procurement markets for materials such as copper, platinum, cobalt, bauxite and lithium — essential materials for the suite of new technologies required to reach net-zero. There is also a huge market for motorcycles in Africa — especially in west, east and north Africa — as well as electric two-wheelers, meaning more opportunities for using domestically produced inputs in new markets by lever-