South Africa has allocated R1 billion to enhance local production of electric vehicles and batteries, aiming to transition its automotive industry by 2035. This initiative is a part of a broader strategy to stimulate investment through government incentives and to secure essential minerals for production. The treasury expects that this funding will attract R30 billion in private sector investment.
The South African government has announced a budget allocation of R1 billion to promote local production of electric vehicles (EVs) and batteries. This funding aims to stimulate related manufacturing projects, and is a part of the nation’s strategy to transform its automotive sector. As the leading automotive manufacturing hub in sub-Saharan Africa, South Africa hosts major brands such as Toyota, Ford, and Volkswagen.
Incentives and policy adjustments will facilitate further investments from original equipment manufacturers in the production of EVs. The government highlighted this ambition in its 2023 Electric Vehicles White Paper, which outlines a vision for transitioning the automotive sector to include electric vehicles by 2035 alongside traditional internal combustion engine vehicles.
Additionally, the Department of Trade & Industry, in collaboration with the Department of Mineral Resources, plans to establish a regional critical minerals strategy to support the production of essential components for EV batteries, such as copper, cobalt, and lithium. These minerals play a crucial role in the global energy transition.
The National Treasury’s allocation of R1 billion will support an industrial development program that incentivizes investment in infrastructure within select manufacturing sectors, particularly automotive. This initiative aims to enhance local production and operational efficiency in new energy vehicle assembly and related projects.
The treasury anticipates that this R1 billion incentive will attract approximately R30 billion in private sector investments, potentially strengthening South Africa’s role in the global EV market. Those interested in further developments can sign up for TechCentral updates via WhatsApp.
In conclusion, South Africa’s commitment of R1 billion to support local EV and battery production reflects a strategic effort to modernize its automotive industry. By prioritizing incentives and policies that foster investment, the country aims to transition to a more sustainable automotive landscape. The collaboration with departments focused on critical minerals will further bolster this initiative, with expectations of significant private investment spurring growth and innovation in the sector.
Original Source: techcentral.co.za
