It is suggested that the Nigerian Federal Government expand the nation’s automobile sector with the money it receives from the Tax on imported automobiles. This suggestion was made at the conclusion of the first auto industry summit in Lagos, which was hosted by the National Automotive Design And Development Council (NADDC) and the Nigerian Auto Journalists Association. Participants in the summit included representatives from the National Automotive Design and Development Council and the Ministry of Industry, Trade, and Investment.
The suggestion was also made by the Lagos State government, the Nigeria Customs Service, the Nigeria Automotive Manufacturers Association (NAMA), the Automotive Local Component Manufacturers Association of Nigeria, and other significant players in the automotive sector. Following discussions on a number of challenges pertaining to Nigeria’s automotive sector, short, medium, and long-term solutions were reached. Prompt fixes include passing Legislation enacting the National Automotive Industry Development Plan (NAIDP), examining the import discrepancy between fully assembled and fully disassembled commercial cars, and establishing Compressed Natural Gas (CNG) drives.
Money collected from the vehicle import levy should be allocated expressly.
Additionally, the government is asked to prioritize automotive parks, streamline the CNG process, support locally built cars, and finish the Automotive Safety Test Centers by 2025. A law requiring all government agencies to utilize locally assembled vehicles and requiring imported second hand cars to have integrity certificates are two examples of medium-term resolutions. Particularly with regard to the Vehicle Credit Scheme, the money collected from the vehicle import levy should be allocated expressly toward the growth of the automotive sector.
Due to local manufacture only meeting a small portion of the country’s demand, Nigeria’s automobile industry now makes up a negligible portion of GDP. Vehicle imports require a large outlay of foreign currency. By putting the suggestions into practice, local production may rise by 50%, thousands of employment would be created, and millions of foreign exchange might be saved. A statement also included a quotation from the Director-General of the National Automotive Design and Development Council (NADDC).
A task force may be formed to supervise examination of import differentials.
He said, “The successful implementation of these recommendations will mark a turning point for Nigeria’s automotive industry, fostering Economic Growth and technological advancement.” A task force may be formed to supervise the examination of import differentials and the formulation of a thorough CNG policy, after which the government might set a deadline for enacting the National Automotive Industry Development Plan (NAIDP) into law. Frequent measures for monitoring and evaluating the Vehicle Credit Scheme’s utilization of import levy proceeds would guarantee its appropriate administration.
Successful implementation of automotive industry strategies by nations like South Africa and Morocco has resulted in a significant increase in local production and exports. Nigeria could take comparable approaches that are adapted to its own industrial and economic environment by learning from these nations. Nigeria’s automotive sector has experienced a number of difficulties, such as erratic legislation, poor infrastructure, and a dearth of funding. These problems have frequently hampered previous attempts to revive the sector, which makes the current recommendations even more important.
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An importer would voice worries about prospective rises in import costs, whereas a local manufacturer might be upbeat about further government assistance. While consumers may be happy to see local industries grow, they may be concerned about the cost and quality of cars made in their own country. The long-term goal might be to turn Nigeria into an African center for automobile manufacturing, become self-sufficient in the production of automobiles, and sell locally produced automobiles to nearby nations. Achieving these objectives would necessitate persistent work on Infrastructure construction, policy execution, and ongoing stakeholder involvement.