The Minister of Industry Trade, and Investment, Olusegun Aganga, Thursday said the new automobile policy announced earlier in the week was not aimed at an outright ban on the importation of used vehicles, as suggested by opinions in some quarters.
Aganga stated that the policy would focus on promoting investments in affordable made-in-Nigeria vehicles on the long-run, and has nothing to do with a ban on importation of used cars.
Speaking in Abuja, while intimating journalists with the content of the new automobile document tagged: “New Automobile Industrial Policy Development,” was on Wednesday approved by the Federal Executive Council (FEC), Aganga clarified the government’s position on the matter, saying: “This policy will not result in the banning of the importation of vehicles in Nigeria but focus on promoting investments in affordable made-in-Nigeria vehicles that will in future minimise the importation of vehicles.”
The minister explained that what government had done was only to raise tariff on importation with a view to discouraging the influx of used vehicles into the country, while also encouraging local manufacturing.
However, some Nigerians remain unconvinced, saying the policy would raise the price of the used cars which had until now afforded many Nigerians the opportunity of owning their own cars.
Aganga maintained that no responsible government would ban importation of used cars without putting in place viable alternative.
“The importation of Tokubo cars will not be a major threat to the plan. Production of vehicles is in stages and involves a long process. You do not remove a thing without providing a viable alternative.
“We must also continue to make sure that we educate Nigerians to understand that it is cheaper and better to buy a new car that can be serviced locally, than importing a car that after one or two years, you cannot maintain and you lose your money. We are determined to provide alternative for them,” he explained.
He lamented that while at present, the total contribution of the manufacturing sector to the country’s Gross Domestic Product (GDP) remained at all low 4.5 per cent; auto industry alone in South Africa contributed seven per cent GDP.
“In many countries around the world, the automotive industry plays both strategic and catalytic roles in economic development, particularly in employment creation and wealth generation; small and medium enterprises developments (as it relates to auto parts components and services); skills development and technology acquisition,” Aganga said.
Director General, National Automotive Council (NAC), Mr. Aminu Jalal, also spoke of the advantages of the policy, saying it would help to open up the industry to many international automotive manufacturers.
For instance, he said, Toyota, Nissan, Renault and GM had indicated keen interest to invest in Nigeria following the development of a comprehensive automotive development plan.
“These companies are now conducting a feasibility study on vehicle assembly in Nigeria, assuming that a comprehensive automotive plan will be in place. The elements of the plan, which will ensure competitiveness and increase productivity of the sector, are: industrial infrastructure improvement, skill development, standards, investment promotion, market development and anti-smuggling measure.”
Chief Executive Officer of PAN Mr. Ibrahim Boyi, commended the federal government for the new initiative, but urged it to map out strategies for a gradual banning of importation of used vehicles.
“It is something that we have been clamouring for and something we have been hoping for. When you look at the performance of the industry, it has been a very unfortunate situation for the country.
“Apart from the environmental effects, importation of Tokunbo cars has remained a great challenge to the industry. Most of the vehicles that are being shipped into the country fall short of the stipulated environment standards of the exporting countries,” he noted.