Oct 27, 2022 Mikel Mabasa, Naamsa I Automotive Business Council, OICA (International Organisation of Motor Vehicle Manufacturers), South African Auto Week (SAAW), Wamkele Mene
SA Auto Week – reimagining the future
Mikel Mabasa, CEO of Naamsa I Automotive Business Council, welcomed guests to the inaugural SA Auto Week at the Kyalami Grand Prix Circuit on Tuesday.
The South African Auto Week taking place between 25thand 28thof October in both a physical and online format, features local and international industry stakeholders in addition to hosting the OICA (International Organisation of Motor Vehicle Manufacturers) General Assembly and its Council meeting.
Keynote speaker, Secretary-General, African Continental Free Trade Area (AfCFTA), Wamkele Mene started this “Thought Leadership indaba” announcing that as at October, 44 countries have ratified AfCFTA, designed to create a Free Trade Area that is quota free with free movement of goods and zero tariffs. Only one African Union country, Eritrea has yet to sign. Mene said he believes “As the African continent, we have a very unique opportunity to drive growth on the back of AfCFTA.” He says the continent consists of 55 countries containing 17% of the Global population, however Africa currently contributes less than 5% (US$ 3,4 trillion) of Global GDP.
The World Bank has projected an African contribution to global GDP of US$7 trillion, however Mene is convinced that without industrialisation of the continent as a whole this unlikely to be achieved. He says the implementation of AfCFTA which has a single objective to unleash the opportunities that can industrialise the continent and help it become globally competitive. “We will only achieve global competitiveness if we become a single market,” Mene stated. We have identified four sectors that can grow the economy of the continent relatively quickly – agro-processing, automotive, logistics and pharmaceuticals.
Mene said, “the automotive sector is at the heart of Africa’s industrialisation” and can play a vital role in the global electric vehicle (EV) value chain once AfCFTA is enacted. Mene added that, as the world transitions to EVs, Africa can position itself to be a key supplier of materials, but not if countries do not have rules for free trade. He explained that for the first time in Africa, AfCFTA provides an independent dispute settlement mechanism requiring governments to both implement and adhere to the rules of free trade.
He stressed that it is not viable for all African countries to be vehicle producers, however many countries in Africa have the potential to provide production of ancillary components and materials. Mene cited copper production and refining in Zambia and DRC, alongside leather for interior and seats out of Ethiopia as well as rubber processing in Ivory Coast or Cameroon. All products utilised in EV’s and highlighting how the continent has a unique opportunity to drive industrialisation and contribute meaningfully to global output and trade in the near future.
Mene pointed out that for every positioncreated in the assembly of vehicles, four jobs are created in the component sector and with the continent’s local content likely to land in the 40% range, industrialisation on the back of the automotive sector could help alleviate unemployment and poverty across the continent whilst contributing meaningfully to global output and trade in the near future. Mene concluded that, as the world transitions to EVs, Africa can position itself to be a key global supplier of materials and products with a resulting increase in vehicle production allowing the continent to compete with the likes of India and China.”
Mene’s address was followed by a “State of the Auto Industry report” by members of the board of Naamsa. Statistics on the industry, the announcement of Naamsa’s inaugural Sustainability Report to be revealed in November as well as the launch of the “Accelerator Awards” consisting of 16 awards across 3 categories – New Vehicle Sales, Manufacturing and Dealership. Some of the awards will include New Energy Vehicle (NEV) of the Year, Top Locally Manufactured Car of the Year and Passenger Car of the Year.
Naamsa I Automotive Business Council is using the SA Auto Week (SAAW) to as a platform to showcase the industry, announce new initiatives, examine and discuss the challenges and directions available to the local industry to secure its future in a changing global landscape including the global shift towards New Electric vehicles and Hybrid options. With a schedule of local and international speakers, including representatives from National and Provincial Government addressing delegates, as well as plenary round table panel discussions SAAW promises to provide valuable insight into the local, regional and international Automotive Industry.
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