Amman, January 19 (Petra) – The Arab Investment and Export Credit Guarantee Corporation (Dhaman) announced that the automotive sector in Arab countries has attracted 184 foreign projects, with a cumulative investment exceeding $25 billion and creating over 102,000 jobs from 2003 to October 2024.

Dhaman explained in its fourth sector report for 2024, issued on Sunday, that five Arab countries Saudi Arabia, Morocco, the United Arab Emirates, Algeria, and Egypt accounted for 79 percent of the total projects in the automotive sector. These projects represent an investment cost of more than $22 billion, contributing 89 percent of the total sectoral investment, and have created over 91,000 jobs, equivalent to 89 percent of the total.

The report, which focuses on key aspects of the automotive industry, outlines four major topics: the development and projected growth of vehicle sales through 2028, foreign trade in vehicles and components for 2023, foreign direct investments in the sector, and an assessment of risks and business prospects in 2024.

China emerged as the leading foreign investor in the region, with 27 projects valued at approximately $8 billion, creating around 20,000 jobs between 2003 and 2024. The report highlighted that the top 10 companies in the sector accounted for 41 percent of the new projects, 67 percent of total capital investments, and 58 percent of the new jobs created.

Japan’s Nissan led in the number of projects, implementing 18 projects, representing 10 percent of the total. However, the Chinese company Human Horizon Group ranked highest in investment value, contributing $5.6 billion 22 percent of the total. Meanwhile, the French company Renault led in job creation, generating approximately 15,000 positions, which constituted 15 percent of the total jobs created in the sector.

The report also ranked investment incentives and risks in 16 Arab countries based on Fitch ratings, with Gulf Cooperation Council (GCC) countries leading the list. The UAE ranked as the most attractive for automotive business and investment in 2024, followed by Saudi Arabia, Qatar, Kuwait, Oman, and Bahrain.

Vehicle sales in the Arab region, which comprises 16 countries, are expected to grow by over 5 percent, exceeding 2.3 million units by the end of 2024, representing 2.4 percent of global vehicle sales. This figure is expected to reach 3 million units by 2028. Saudi Arabia, the UAE, Algeria, Morocco, and Kuwait collectively account for approximately 75 percent of total regional sales.

Private car sales in 12 Arab countries are forecasted to exceed 1.8 million units by the end of 2024, marking a 4.5 percent rise compared to 2023. Saudi Arabia leads this category with a 45 percent share of the market. Individual sales are expected to surpass 2.2 million vehicles by 2028.

The report indicated an increase in the regional vehicle fleet index, reaching an average of 307 vehicles per 1,000 inhabitants by the end of 2024, up by nine points. This figure is expected to further rise to 353 vehicles per 1,000 inhabitants by 2028, with Libya and several GCC countries exceeding the regional average.

Arab foreign trade in road vehicles and their components increased by 23 percent in 2023, reaching $126 billion. This growth was driven by a 29 percent rise in exports, totaling $29 billion, bolstered by vehicle re-export activities valued at $14 billion in the GCC alone. Imports increased by 21 percent, reaching $97 billion, with 82 percent of the total trade concentrated in five countries: the UAE, Saudi Arabia, Morocco, Iraq, and Kuwait, collectively accounting for $103 billion.

Japan ranked as the largest exporter of vehicles and components to the Arab region, recording exports valued at $17 billion, representing 17 percent of the total. Iraq emerged as the largest importer from the region, accounting for $10 billion 34 percent of total imports.

Passenger transport vehicles dominated Arab imports of vehicles and components in 2023, valued at $63 billion and representing 65 percent of total imports. Vehicle parts and accessories followed, valued at $14 billion, contributing 14 percent to total imports.

Dhaman, a joint Arab entity established in 1974 and headquartered in Kuwait, is owned by Arab countries and four financial institutions. With an A+ rating and a stable outlook from S&P, it is the world’s first multilateral investment insurance organization.

//Petra// AJ

19/01/2025 14:38:13