Limited currency will hinder carmakers in Ethiopia

Subject

Outlook for Ethiopia's auto sector.

Significance

Ethiopia boasts a small auto manufacturing sector with large ambitions. The government has designs to become the top producer of cars in Africa within 20 years. Low current exports, shortages of foreign currency and quality concerns stand in the way of this grand goal.

Impacts

• Increased car ownership will spur the government to expand road infrastructure.
• South Africa's auto industry will continue to dominate the continent's production.
• Efforts by Kenya to increase automotive production could spur regional competition.