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Egypt Minister of Trade and Industry Issues Decree Specifying Local Component Ratio in Carmaking
Source: www.export-egypt.com 4/29/2018

Egypt Minister of Trade and Industry Issues Decree Specifying Local Component Ratio in Carmaking The move aims at deepening the automotive strategic industry, according to fair and transparent criteria.

Minister of Trade and Industry Tarek Kabil issued a decree regulating the ratio of local components in Egypt’s auto industry.

The decision specified the local component percentage in car manufacturing at no less than 46%; and the contribution of assembly lines to local carmaking at 28%, to be reduced by 1% annually starting a year following its entry into force.

“The move aims at deepening the automotive strategic industry, according to fair and transparent criteria,” Kabil noted.

He said that the actual 45% local-component ratio used in car manufacturing does not reflect the reality and would never create a real car industry based on manufacturing rather than assembly.

The decree, he added, took into consideration the situation of the existing companies, giving them a one-year time limit to adjust to the new measure. According to the new decision, a committee for local car manufacturing will be formed to oversee the automaking process in Egypt: preparing a complete database for domestic carmakers and automotive feeding companies, setting up an automated mechanism to calculate the added value of the components and reviewing the local manufacturing percentage achieved for each car model.



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