Egypt, Stellantis sign MoU to expand scope of existing cooperation

CAIRO - 30 August 2022:  The General Authority for Investment and Free Zones (GAFI) signed Tuesday a memorandum of understanding (MoU) with the international company, Stellantis, which specializes in manufacturing cars.

 

The MoU aims to expand the scope of the existing cooperation between the government and the company during the coming period.

 

CEO of GAFI Mohamed Abdel Wahab said, on the sidelines of the signing, that the MoU aims to expand the scope of the existing cooperation between the Egyptian government (represented by the Arab Organization for Industrialization) and the company in the field of car manufacturing, in light of the support provided by the “Auto Industry Strategy” recently launched by the government to encourage operating companies in this sector to inject more investments into the Egyptian market, according to a statement.

 

Earlier in 2022, Egypt has launched a strategy for the development of the automobile industry, with the aim of attracting huge foreign investments to set up projects for the manufacture of cars and industries feeding them in the industrial zone in East Port Said, to provide car imports amounting to $4 billion annually and to export cars from Egypt to African markets, taking advantage of free trade agreements.

 

The auto industry’s strategy includes facilitating customs release by amending the tariff law, establishing a higher council for the auto industry, giving more incentives for clean electric cars, and an incentive of up to LE 50,000 for consumers who buy an electric car; with the aim of encouraging this industry, and establishing 3,000 charging points initially to charge electric cars.

 

For his part, Samir Cherfan, Chief Operating Officer, Middle East and Africa, Stellantis indicated that the MoU signed on Tuesday between his company and the GAFI comes to study pumping additional investments and increasing production capacity in the factories of the Arab American Vehicles (AAV) Company, which represents a successful model for the integration of national and foreign industrial investment for more than 45 years.

 

Cherfan praised the unprecedented care that the automotive sector enjoys by the current Egyptian government, praising the concerted efforts of all ministries, agencies and relevant business organizations, which resulted in the preparation of the national strategy for the auto industry in its current form, which was launched by the Prime Minister during his visit to the East Port Said industrial zone last June.

 

He stressed that companies can benefit from the relative advantages enjoyed by the investment climate in Egypt from the availability of industrial infrastructure, qualified young labor and logistical advantages, as well as the possibility of benefiting from many free trade agreements that qualify Egypt to enter promising export markets in the region and Africa.

 

“The size of the Egyptian market is expected to grow from 1.1 million cars currently to exceed 5 million cars by 2035,” he stated, pointing out that the national strategy for the development of the automotive industry will qualify Egypt to be among the countries that export cars to the region and African markets, relying more on electric and environmentally friendly cars.

 

He added that Stellantis is currently seeking to develop its supply chain for the feeder industries, and to provide opportunities to attract new investments in the auto-feeding industries sector.

 

Furthermore, he stressed that the field of feed industries has successful experiences in exporting to Europe and various international markets, and has ingredients for success that make Egypt one of the major countries exporting these ingredients.

 

According to Cherfan, Stellantis has been working in the Egyptian market for nearly 50 years through its various brands, such as the one that was affiliated with the PSA Group, represented by "Peugeot", "Citroen", "Opel" and "DS", as well as the brands which was included under the FCA group such as "Jeep", "Fiat", "Alfa Romeo" and "Chrysler", and now the group leads the global markets with high-quality and highly competitive products, especially in providing integrated smart and sustainable transportation solutions based on a large distribution network and a highly efficient supply chain.