Egypt to launches initiative to replace old cars before end of March

CAIRO – 9 March 2021: The first phase of the presidential initiative to replace old cars, with new ones manufactured locally and running on natural gas, will come into effect before the end of March, Minister of Finance, Mohamed Maait said Tuesday.

Maait stated that a "regulatory protocol" that includes the implementation procedures for this initiative will be signed between the relevant ministries, banks, car manufacturers and insurance companies. 

This comes in a way that contributes to settling the auto industry and the industries that feed it, creating new job opportunities, and helping to improve the lives of citizens and the level of services provided to them, according to Maait.

“Cars are required to be assembled in Egypt, with a local component ratio of no less than 45 percent,” the minister pointed, indicating that Egypt manufactures many auto components, and has become one of the most important manufacturers and exporters of a number of car-feeding industries in the world, such as electric braids, in a manner consistent with the efforts of the state relies on clean vehicles to preserve the environment and save energy.

This came during his meeting with Minister of Local Development Mahmoud Shaarawi, , in which Minister of Trade and Industry Nevien Gamea,  participated through “video conference”.

Maait pointed out that the Ministry of Finance, through the "Fund to Finance the Purchase of Certain Express Transportation Vehicles", manages the mechanism of the presidential initiative to replace old cars, and its electronic platform, and takes measures to pay the value of the green incentive to the auto companies participating in the initiative.

Maait stated that the state treasury bears the burden of financing the green incentive for the first phase of the presidential initiative to replace 250,000 old cars that have been manufactured for 20 years or more in the governorates of Cairo, Giza, Qalyubia, Alexandria, Suez, the Red Sea, and Port Said.

He explained that the cabinet agreed to grant the owner of each old car from among the beneficiaries of this initiative 10 percent of the price of the new car, with a maximum of LE 22,000, the taxi by 20 percent, with a maximum of LE 45,000, and the microbus by 25 percent, with a maximum of LE 65,000.

The minister indicated that the banks participating in this initiative finance the owners of old cars that have been manufactured for 20 years or more, at a "lump sum" annual interest rate of 3 percent, so that the loan is repaid in equal monthly installments over a period ranging from 7 to 10 years unless the car owner requests the installments for a shorter period, while allowing the ban to be lifted on the car as soon as all due installments are paid.

 Banks also finance the value of the car and life insurance policy at the same rate of the annual "lump sum" rate of 3 percent.