Volkswagen, Egypt partner to establish a $240M complex in East Port Said’s Automotive Zone

CAIRO – 13 November 2023: The Suez Canal Economic Zone (SCZONE), the Sovereign Fund of Egypt (TSFE), and the East Port Said Development Company (EPSD) partner with Germany's Volkswagen to undertake feasibility studies for the establishment of the East Port Said Automotive Zone (EPAZ).

The EPAZ project is set to attract investments totaling approximately $240 million and create over 6,000 direct and indirect job opportunities. This collaboration aims to leverage the strategic location of East Port Said and capitalize on the incentives provided to automotive manufacturers.

Under the newly signed agreement, the SCZONE and TSFE will collaborate with the EPSD to appoint qualified consultants who will conduct preliminary studies as part of the feasibility analysis. The EPSD, on the other hand, will be responsible for technical coordination with all parties involved.

Volkswagen, an automotive company, will contribute by providing technical assistance to achieve the objectives of the Automotive Industry Development Program (AIDP). This program, launched in June 2022, aims to promote localization value, boost production volume, and enhance investment and environmental compliance within the automotive sector.

During the signing ceremony, Prime Minister Mostafa Madbouly emphasized the government's commitment to enhancing the localization of the automobile industry. He highlighted the importance of the AIDP initiative and its potential to drive economic growth and development in Egypt.

Martina Biene, Managing Director and Chairperson of Volkswagen Group South Africa, expressed the group's keen interest in expanding and strengthening its presence in the Egyptian market through participation in the Automotive Industry Development Program.

Biene further disclosed the car group's intention to explore the feasibility of establishing a car paint complex in the East Port Said Industrial Zone. This move aligns with Egypt's ambition to become a central hub for car manufacturing and logistics services.

The EPAZ project is strategically designed to attract automobile manufacturers from around the world who can benefit from East Port Said's prime location and the enticing incentives offered to them.

By establishing the EPAZ, Egypt aims to position itself as a prominent player in the global automotive industry and capitalize on the sector's potential for economic growth and job creation.