The Automotive Components Trade in Africa: Its Place and Potential (2021 Update)
At present, Africa is largely dependent on the rest of the world for automotive component imports, with the exception of the contribution of South Africa. In order to reduce dependence, deepen industrialisation and enable technology and skills transfer, Africa needs a continent-wide industrial policy logic for the automotive sector. This policy will include protection, investment and incentive provisions, but it must also feature an intelligent mechanism by which a potential regional value chain strategy could be developed. This mechanism must not just be based on the desire to distribute industry evenly across members but must be based on the actual and potential industrial and market strengths of member nations.
If continental liberalisation were to take place in the near future, almost all of the gains in this sector would accrue to one country – South Africa. A continental industrial policy for this sector could ensure that over the medium to longer term, the gains would be more evenly spread.
This Trade Brief makes use of a diverse set of data and analysis techniques to evaluate the status and future potential of the automotive components sector in industrialisation and trade in Africa.
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