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Chinese Firms Eye Morocco As Way To Cash In On US Electric Vehicle Subsidies

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Chinese Firms Eye Morocco As Way To Cash In On US Electric Vehicle Subsidies

After the United States passed new subsidies designed to boost domestic electric vehicle production and cut into Beijing’s supply chain dominance, Chinese manufacturers began investing in an unlikely place: Morocco. In the rolling hills near Tangiers and in industrial parks near the Atlantic Ocean, they have announced plans for new factories to make parts for EVs that may qualify for $7,500 credits to car buyers in the United States.

At least eight Chinese battery makers have announced new investments in the North African kingdom since President Joe Biden signed the Inflation Reduction Act, the $430 billion U.S. law designed to fight climate change. By moving operations to U.S. trading partners like Morocco, Chinese players that have long dominated the battery supply chain are seeking a pathway to cash in on increasing demand from American carmakers like Tesla and General Motors.

The United States and European Union have both imposed major new tariffs on Chinese vehicle imports since May. The United States also finalized eligibility rules governing the tax credits in May. The latter limit companies with ties to U.S. adversaries, but give carmakers time to reduce their reliance on China. To qualify for the subsidies, carmakers cannot source critical minerals or battery parts from manufacturers in which China and other “foreign entities of concern” control more than 25% of the company or its board.

In Morocco, a largely agrarian economy where the median income is $2,150 a month, giant industrial parks full of American, European and Chinese component makers have sprung up in the rural outskirts of Tangiers, Kenitra
and El Jadida. Expanding on infrastructure that has made Morocco a car manufacturing hub, they hope to meet growing demand and overcome rules designed to exclude them from the incentives the Inflation Reduction Act is injecting into the U.S. car market, the world’s second-largest.

Many are joint ventures that have cited their ability to tinker with board seats and governance to comply with U.S. rules. The Chinese battery projects include at least three joint ventures and several that reference Morocco’s trade ties with the United States. The largest among them is Chinese-German battery-maker Gotion HighTech, which signed a deal with Morocco last year for $6.4 billion investment to construct Africa’s first electric vehicle battery factory.

Investments also include Youshan, a joint venture backed by Korean giant LG Chem and China’s Huayou Cobalt. It declined to provide details about the size of their investment but said the Morocco base means their cathodes “will be supplied to the North American market and subsidized by the U.S. Inflation Reduction Act as Morocco is a signatory to the U.S. Free Trade Agreement.” LG Chem said the venture would adjust ownership shares as necessary to comply with U.S. rules.

China’s BTR Group’s announcement of a cathode factory in April noted that Morocco’s trade status with the United States and Europe would ensure “a seamless entry for the majority of its manufactured products into these regions.” Officials in Morocco have publicly and privately worked to foster ties up and down the automotive supply chain in both the East and the West. The country hosts more than 250 companies that manufacture cars or their components, including Stellantis and Renault as well as Chinese, Japanese, American and Korean factories that make seats, engines, shock absorbers and wheels.

The industry exports almost $14 billion in cars and parts annually. As the world transitions to electric vehicles, Morocco may appear to be a surprising beneficiary as China, the United States and Europe compete for market share. But its officials worry that anti-competitive policies like tariffs and subsidies could ultimately make it more difficult to lure investment. Ryad Mezzour, the country’s minister of industry and trade, said in an interview that all the new investment doesn’t tell the full story. Morocco has also lost out on some projects due to what he called “a new age of protectionism.”

The investment has been a boon to countries like Morocco. But in Washington, Chinese firms have raised alarm by angling to access the American subsidies. “Under the Biden administration’s electric vehicle regulations, America’s working families will have to watch their hard-earned tax dollars go to line the pockets of Chinese billionaires and businesses with links to the Chinese Communist Party,” U.S. Rep. Jason Smith, a Missouri Republican, said
of the new guidelines

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Nigeria Grants Rwandans 30-Day Visa-Free Entry to Boost African Integration, Trade

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Nigeria Grants Rwandans 30-Day Visa-Free Entry to Boost African Integration, Trade

 

The Nigerian Government has commenced a 30-day visa-free entry policy for Rwandan nationals, in a move aimed at strengthening continental integration, boosting trade, and enhancing mobility under the African Continental Free Trade Area (AfCFTA) framework.

 

The policy, which takes immediate effect across all entry points, follows an announcement by President Bola Tinubu at the Africa CEO Forum held in Kigali, Rwanda, where he reiterated Nigeria’s commitment to easing movement across African borders.

 

In a statement issued on Thursday, the Nigeria Immigration Service (NIS) confirmed that operational arrangements had been concluded for the full implementation of the directive at airports, land borders and seaports nationwide.

 

Under the new arrangement, Rwandan citizens will be allowed to enter Nigeria without a visa for up to 30 days for legitimate purposes, including tourism, business engagements and official visits.

 

The Service, however, clarified that visitors wishing to stay beyond the approved period must obtain the appropriate visa through Nigerian diplomatic missions abroad or apply via the Nigeria e-Visa platform.

 

“Under this bilateral arrangement, Rwandan nationals may enter Nigeria without a visa for a period not exceeding thirty (30) days for lawful purposes, including tourism, business, and official engagements,” the statement read.

 

The NIS said the policy reflects the strengthening diplomatic relationship between Nigeria and Rwanda, while also aligning with broader African efforts to promote free movement of persons, trade facilitation and economic cooperation across the continent.

 

It added that the initiative underscores Nigeria’s commitment to regional integration under the AfCFTA agreement, which seeks to create a single African market for goods and services.

 

“The Nigeria Immigration Service notes that this initiative reflects the strong diplomatic and bilateral relations between the Federal Republic of Nigeria and the Republic of Rwanda, while promoting intra-African mobility, tourism, and economic cooperation in line with continental aspirations,” the agency said.

 

The Service reaffirmed its readiness to ensure safe, orderly and lawful migration in line with international standards and the Federal Government’s Renewed Hope Agenda.

 

The visa waiver comes amid growing continental momentum toward easing intra-African travel barriers, as several countries push policies aimed at improving economic linkages, tourism flows and regional investment opportunities.

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Trump Threatens Higher Tariffs on EU if Trade Talks Fail

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Trump Revamps US-Africa Relationship

Trump Threatens Higher Tariffs on EU if Trade Talks Fail

 

United States President, Donald Trump, has threatened to impose “much higher” tariffs on the European Union if the bloc fails to remove its levies on American goods before July 4, escalating fresh tensions in transatlantic trade relations.

 

Trump issued the warning after a phone conversation with European Commission President Ursula von der Leyen, stating that the EU must agree to zero tariffs on U.S. exports or face steep economic consequences.

 

“I agreed to give her until our Country’s 250th Birthday or, unfortunately, their Tariffs would immediately jump to much higher levels,” Trump said.

 

In response, von der Leyen said the European Union was making “good progress towards tariff reduction” ahead of the deadline, while reaffirming commitment to ongoing negotiations between both sides.

 

The tariff dispute comes amid renewed uncertainty over a trade agreement reached last year between Washington and Brussels, which initially proposed a 15 per cent tariff on EU exports to the United States, while Trump had earlier pushed for a 30 per cent levy on European goods.

 

Although the deal received conditional backing from the European Parliament in March, lawmakers inserted safeguards requiring assurances that the United States would also honour its commitments, particularly concerning steel and aluminium exemptions.

 

Under the proposed arrangement, EU legislators insisted they would only accept zero tariffs on U.S. goods if European exports made with steel and aluminium were excluded from Trump’s global 50 per cent tariffs on the metals.

 

Despite parliamentary progress, final approval still depends on agreement from all 27 EU member states, while further negotiations are expected to continue later this month in Strasbourg.

 

Ahead of Trump’s latest comments, European Parliament chief negotiator Bernd Lange said discussions were progressing but warned that “there is still some way to go.”

 

However, tensions were further complicated hours after Trump’s threat when a United States trade court ruled that his latest 10 per cent global tariffs were not justified under U.S. trade law, potentially opening the door to further legal challenges.

 

The court ruling, though limited in scope, questioned the legal basis used by the Trump administration under Section 122 of the 1974 Trade Act, which allows temporary tariffs to address balance of payments deficits.

 

Trump had previously introduced the sweeping 10 per cent levy in February, following earlier legal and political disputes over his so-called “freedom day” tariffs.

 

While the court decision does not immediately block the tariffs nationwide, it applies to import duties involving two companies and could encourage wider legal opposition.

 

With negotiations ongoing and legal uncertainty mounting, analysts say the dispute signals a renewed phase of economic friction between the United States and the European Union.

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Dangote Unveils Plan for 20,000MW Power Project

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Dangote Refinery To Disrupt Europe's Oil Industry, Says OPEC

Dangote Unveils Plan for 20,000MW Power Project

 

Africa’s richest man, Aliko Dangote, has announced plans to build a 20,000-megawatt power project, marking a major expansion of his industrial interests beyond oil refining, cement and fertiliser production.

 

Dangote disclosed the plan during an interview with Makhtar Diop, managing director of the International Finance Corporation, saying the project forms part of efforts to address Africa’s persistent energy deficit.

 

“We are now going into power… 20,000 megawatts,” he said, adding that the continent’s most urgent needs remain energy, fertilisers and industrial inputs.

 

Although he did not provide details on financing or implementation timelines, the proposed project, if realised, would significantly transform Nigeria’s struggling power sector, where generation remains inconsistent despite an installed capacity of about 13,000MW.

 

Dangote said Africa’s development priorities are clear, stressing that “the needs of Africa are petroleum products and fertilisers.”

 

According to him, his conglomerate is also expanding aggressively in fertiliser production and related industrial ventures.

 

“Today, in about two and a half years, we will be the largest fertiliser company in the world. We are putting up 12 million tons of urea. We are opening up mines of potash and phosphate in Congo and Brazil. We are building the biggest deep-sea port with an 18-meter draft. We are doing LNG,” he said.

 

The billionaire industrialist added that the expansion drive is being supported by stronger cash flows and improved financial flexibility within his business empire.

 

“We are now actually free of assets, and we can actually raise more money. Our cash flow now is very, very strong,” he said.

 

The announcement comes amid the ongoing expansion of the Dangote Refinery, which is currently being scaled up toward a capacity of 1.4 million barrels per day, further cementing its position as one of the largest refining facilities in the world.

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