Regional integration, regional value chains and the automotive industry in Sub-Saharan Africa

Abstract

To date, regional automotive value chains have not developed to any significant extent in Africa. Growing demand for vehicles across the continent, closer economic integration and the desire on the part of some larger African countries to establish an automotive industry have improved prospects. But major obstacles remain: the political geography of the subcontinent and the tendency of the industry to cluster in a few locations indicate that many smaller countries are likely to miss out on attracting investments. This should not matter if they are attracting investment in other sectors. It does however imply that it is unlikely that the automotive industry will drive regional integration independently of a broader integration process which sees the development of regional value chains across a multitude of sectors helping to bind the continent into a larger common market.