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Volkswagen has announced its plan to establish a car assembly in Ethiopia, a huge boost to the country’s manufacturing industry. The announcement was made in the presence of German President Frank-Walter Steinmeier as he visited the country.

The automaker has been opening new vehicle assembly facilities across sub-Saharan African countries such as Kenya, to advance its development strategy.

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“Ethiopia is a priority and focus country for Germany under the G20 ‘Compact with Africa’ initiative,” the automaker said in a statement.

Currently, many Ethiopian citizens do not own cars due to high import taxes of up 200 per cent. The 2014 Deloitte report said that Ethiopia has the lowest rate of car ownership in the world, with only two cars per 1, 000 inhabitants.

In Kenya, the German carmaker has a plant in Thika.

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