Egypt's complete vehicle imports encounter an "invisible threshold"? Industry says customs clearance is slowing down

Recently, there has been discussions in the market about "the Egyptian government tightening vehicle imports." Some importers have reported that the customs clearance and release process of some complete vehicles has been significantly extended, while the import of auto parts and production materials has remained relatively smooth...

According to Egyptian commercial media "Enterprise" and local industry news, there has been recent discussions in the market about "the Egyptian government tightening vehicle imports." Some importers have reported that the customs clearance and release process of some complete vehicles (CBUs)has been significantly prolonged, while the import of auto parts and production materials has remained relatively smooth. Although there is no new official ban, it is widely believed in the industry that Egypt's automobile policy is gradually leaning towards supporting local manufacturing and assembly.

According to the report, some importers have recently encountered many practical obstacles when handling customs clearance for overseas complete vehicles, but the import of parts and components has not been similarly affected. At the same time, the Egyptian Ministry of Finance and Customs are preparingto implement a new automobile import tariff system by the end of August this year. The market is also waiting to see whether the new tariff will further affect the pace of complete vehicle imports.

In fact, this change is not without warning. Two weeks ago, Egypt's Industry Minister Khaled Hashem publicly stated that the government wanted to further "regulate and manage" the car import market. This statement was interpreted by some importing companies as a signal toreduce dependence on vehicle importsand promote the development of the local automobile industry. However, government officials and local manufacturing companies told Enterprise that the current policy focus is not to restrict imports, but to increase the proportion of local production and assembly by optimizing resource allocation.

The report mentioned that since the beginning of this year, Egypt has begun to implement some adjustments. For example, the import of China brand cars is in principle the responsibility ofofficially authorized dealersand recognized enterprises, and requires the provision of completeafter-sales services, while gradually improving the level of localized supporting facilities. A person from the Egyptian Ministry of Industry said that this arrangement is also related to the requirements of some China car companies themselves, because manufacturers hope to ensure vehicle configuration, after-sales and quality assurance through authorized channels to avoid service problems caused by vehicles of other market versions entering Egypt.

It is worth noting that the policy is not simply tightening imports. Data shows that Egypt'sforeign exchange quotafor passenger car imports has increased to approximately US$2.5 billion this year, up from US$1.8 billion last year. This shows that the government has not reduced the scale of automobile imports, but is more inclined to optimize the import structure and prioritize the allocation of limited foreign exchange resources to parts and manufacturing to support the development of the local automobile industry.

At the same time, Khaled Saad, secretary-general of the Egyptian Automobile Manufacturers Association, publiclydenied the existence of new import restrictions. He said that the current automobile import management is still implemented in accordance with Law No. 9 of 2022, which includes the establishment of a nationwide after-sales service network, the proportion of local parts and components should not be less than 15% of the import value, and the requirement that vehicles should be equipped with at least two airbags.

However, Saad also admitted that there are indeed some changes at the actual operational level. For example, the import registration cycle through ACI (Advance Cargo Information System) is longer than in the past, and individual applications may be delayed or not approved. In addition, when allocating foreign exchange, banks also give higher priority to ensuring the import of auto parts and production materials, while the financing priority of vehicle imports has declined.

 written in the end 

At present, Egypt has not officially introduced a new vehicle import restriction policy, but market operations have undergone significant changes: customs clearance efficiency, foreign exchange allocation and industrial orientation are all leaning towards local manufacturing. In the future, in the Egyptian market, the space for vehicle trade alone may gradually narrow. Establishing a complete industrial chain around CKD assembly, parts supply, after-sales service and localization cooperation will be more in line with local policy directions and more conducive to long-term development.

Source: Guangdong Good Car

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