Preparation Program for Investment in RSA Automotive Sector

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IFC's RSA Automotive Local Supplier Development Program supports the Government of South Africa's efforts to integrate local firms into the value chains for the automotive industry and thereby deepen the domestic manufacturing sector. The initiative, which engages both IFC's advisory and investment arms (over the long term) will support development by the National Association of Automotive Component Manufacturers (NAACAM) of an electronic "Linkages" platform that will match the competencies of local Tier 2 and 3 suppliers (skills, manufacturing capacity and BBBEE ratings) to the business needs, local component quality/quantity specifications and transformation profiles of OEMs and Tier 1 suppliers in order to optimize benefits under the South Africa Automotive Plan. The Program is intended to address profound challenges to the further growth of the industry posed by the relatively weak capacity of local suppliers. Development results expected from the advisory programs include increased FDI into South Africa, the creation of high-skilled jobs and the development of skills for South Africans especially those from disadvantaged demographies.