Volkswagen and the government of Egypt have signed an agreement to develop a feasibility study on a shared automotive painting facility in the East Port Said Automotive Zone (EPAZ) within the East Port Said Industrial Zone (EPSIZ), in Cairo.

The agreement was signed by the chairperson of the general authority for the Suez Canal Economic Zone, Waleid Gamal Eldien, Egypt Sovereign Fund CEO Ayman Soliman, East Port-Said Development Company MD Dr Ahmed Fikry and Volkswagen Group South Africa (VWSA) chairperson and MD Martina Biene, in the presence of the Egyptian Prime Minister, Dr Mostafa Madbouly.

The signing ceremony was also witnessed by the Minister of Planning and Economic Development, Dr Hala Al-Saeed.

Biene is responsible for the African market.

The German car maker says the Egyptian government has shown “earnest commitment to the advancement of localising the automotive industry in Egypt”. 

The commitment was formalised in June last year with the announcement of this North African country’s Automotive Industry Development Programme (AIDP). 

The AIDP aims to foster local value addition, increase vehicle production volume, boost and attract investment and improve emission standards.

Volkswagen has, in turn, expressed interest in expanding its presence in the Egyptian market by participating in the AIDP. 

As such, Volkswagen says it will explore the feasibility of establishing a multimodel automotive painting facility in the EPAZ.

The EPAZ is set to become an automotive manufacturing and logistics hub within the EPSIZ. 

EPSIZ is situated within the Suez Canal Economic Zone of Egypt.

“Volkswagen is excited about the prospects of establishing its presence in the Egyptian market as part of its long-term growth plans for the continent, especially in North Africa,” says Biene.

“The AIDP is one of the most progressive automotive programmes on the continent, which Volkswagen intends to be part of. 

“The signing of the strategic cooperation agreement with the government of Egypt is the continuation of Volkswagen’s strategy to play a pioneering and leading role in the development of the automotive industry in Africa.”

Volkswagen has been manufacturing vehicles in South Africa for more than 72 years. 

It has three other vehicle assembly facilities in sub-Saharan Africa. 

The facilities are in Kenya, Rwanda and Ghana. 

In addition, Volkswagen has a presence in 17 countries in sub-Saharan Africa where it sells passenger and commercial vehicles through licensed importers.