CDG plans to invest 300 million euros ($280 million) in the first phase of Gotion's Moroccan project and support its operations.
Volkswagen-backed Chinese battery giant Gotion High-tech (SHE: 002074) has secured funding for its battery project in Morocco from a financial institution in the North African country.
On November 13, Gotion signed a memorandum of understanding with Moroccan investment agency CDG Group, which plans to invest 300 million euros ($280 million) in the first phase of Gotion's Moroccan project, according to an announcement today.
CDG, Morocco's largest public financial investment institution, will support Gotion's operations of the project in Morocco.
The first phase of the project, which covers power batteries, energy storage batteries and cathode and anode materials, is expected to directly create more than 2,000 local jobs, Gotion said.
Morocco plans to generate 50 percent of its electricity from renewable energy sources by 2030, and the country has abundant solar and wind energy resources, said Khalid Safir, chairman of CDG.
The partnership will help increase local energy storage levels and improve the energy mix in Morocco and Africa, Safir said.
Gotion's project in Morocco is in line with the local strategy for the development of a sustainable transport ecosystem and paves the way for the Moroccan automotive sector to enter the era of electrification, he added.
Gotion's chairman, Li Zhen, said the company will bring its advanced production lines, technology, and management to Morocco and work with CDG to make this project a benchmark for energy transformation in Morocco.
In June, the Moroccan government signed an investment agreement with Gotion for a battery factory with a total investment of 12.8 billion dirhams ($1.3 billion) and an initial battery capacity of 20 GWh.
The Moroccan prime minister's office said at the time that Gotion planned to increase the plant's capacity to 100 GWh, and the final investment could reach $6.5 billion.
Morocco's geographic proximity to Europe, free trade agreements with major markets in the EU and US, and an existing automotive sector make it attractive to Chinese EV battery makers.
Gotion is one of the world's largest EV battery makers, with a share of 2.5 percent in the January-September period, placing it eighth globally, according to South Korean market researcher SNE Research.
($1 = 9.9706 Moroccan dirhams, $1 = 0.9476 euros)
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