German automakers scout Algerian suppliers as local content rules push production shift

WATCH THIS SPACE #1- German automakers are scouting Algerian suppliers as they mull setting up local bases in the North African country. Six German companies — spanning materials, engineering, logistics, and digital supply tools — are in Algeria this week to vet subcontractors and raw material providers that they could fold into their supply chains, Algeria’s daily Echorouk reports.

The timing lines up with a local supply-chain push. Turkish-owned Tosyali Algeria will start producing advanced steel for the domestic auto industry starting in July, it said last month. Stellantis, meanwhile, says it wants to push local-content rates past 30% by 2026 — ahead of Algeria's own rules, which mandate 10% within two years and 30% within five. Stellantis’s German brand Opel is also eyeing what would be its first plant outside Europe in Algeria.

WATCH THIS SPACE #2- The first thing Abu Dhabi did with Covestro, its new German chemicals champion? Point the money our way. The German maker of insulation and foam chemicals now owned by Adnoc has unveiled its first big investment since the takeover — a EUR 2 bn housing insulation plant in Shanghai at a cost of EUR 2 bn and, potentially, another in the UAE at the same cost, the Financial Times reports.

WATCH THIS SPACE #3- India may go the bilateral route on trade agreements in the GCC, wagering that one-on-one agreements will close faster than a GCC-wide deal, Business Standard reports.

Indian diplomats will keep the door open to a comprehensive agreement with the six-member block, but will in parallel use bilateral agreements with the UAE and Oman as blueprints for talks with the rest of the GCC countries. Nearly 99% of Indian exports have low-or-no duty access to the UAE and Oman, including zero-duty access for labor-intensive industries such as jewelry, textiles, leather, footwear, engineering goods, and pharmaceuticals.

Bahrain may get there first if Qatar keeps pushing to negotiate a bilateral investment treaty at the same time as the two sides pursue trade talks. The hitch: India’s Commerce Ministry is responsible for the trade talks, while the Finance Ministry is taking point on negotiations for an investment treaty.

SIGN OF THE TIMES- MENA+ developers of green energy projects will likely find it harder to get concessional finance from the World Bank and the IFC after the lender said yesterday it would “retire” its goal of having 45% of its lending flow into projects with climate change benefits. The change comes as Washington pressures the bank to back away from climate pledges it made during the Biden administration — and as the White House pulls the plug on green energy projects at home. The World Bank also said it was extending its climate change action plan, which is now in review by its executive board.

Happening today

UAE to begin compliance checks on 1H 2026 Emiratization targets: The Human Resources and Emiratization Ministry will be using a digital inspection system that flags fake Emiratization practices, and human inspectors will also verify that Emirati staff are registered with the social security fund and that contributions are being paid.

Data point

Foreign direct investment in Tunisia rose by 25% y-o-y to TND 1.3 bn (USD 440 mn) in the first four months of 2026, according to the official Tunisian news agency. The increase was largely driven by inbound interest in manufacturing (+71%) and energy sectors (+19%).

This means Tunisia may be on its way to meet its annual FDI target of TND 4 bn in 2026. Last year, FDI increased by 30% to record TD 3.5 bn also driven by European nearshoring in the manufacturing sector, as well as the IT sector, we reported last month.