Post by Ismail AbdulAzeez on Jul 18, 2021 19:03:44 GMT 1
Peugeot Automobile Nigeria (PAN) Laments The Negative Impact of Levy Reduction on Imported Vehicles into Nigeria On The Automobile Industry
The Federal Republic of Nigeria (FGN) has recently reduced the levy on the importation of vehicles into the country, and the Peugeot Automobile Nigeria (PAN), a foremost vehicle assembly plant in Nigeria is kicking against it.
The company argued that the reduction of the import levy from 35% to 5% on cars by the Government has taken a toll on their business.
This information was disclosed by the Chairman of the company, Honourable Aliyu Ahmed Wadada, in an interview it granted to newsmen recently in Lafia. He explained that the company had a fantastic business plan, but it has been negatively impacted by the new Government’s policy on the importation of cars.
He regretted that the policy that import levy on cars imported into the country should be reduced from 35% to 5% had become a disincentive to the local vehicle assembly plants.
Before this action, what was in place was 40% duty and 35% levy, making it a total of 75%. This total of 75% though very high, but was put in place to discourage importation of cars into the country thereby encouraging local assembly plants to grow.
The Chairman of Peugeot Automobile Nigeria (PAN) stated that this reduction in the levy that the Federal Government had implemented will open the doors of the country to a flood gate of importation of all sorts of cars into the country at the expense of locally assembled ones.
The Chairman lamented that Government had been complaining about the rate of unemployment in the country, but he could not understand how that will be achieved by the same government diminishing the fortunes of the real sector that is manufacturing.
The country is already feeling the huge impact of the depreciation of the Naira due to the reliance of the country on importation of all sorts of goods into the country.
The Chairman of the company Wadada disclosed that the Peugeot Automobile Nigeria has started diversifying its products offering by not relying solely on the sale of Peugeot products.
He happily disclosed that by the end of July 2021, the company shall be launching another vehicle brand known as Cherry. This he claimed will make vehicles available to average Nigerians employed both in the public sector and those in the private sector respectively.
However, it was necessary for us to seek and obtain the view of the government on this burning issue because it seems as if the government is working against itself.
One time you said that you want to boost the foreign exchange earnings by boosting export and reducing import, on the other hand you are reducing levy on imported cars.
The Vice President, Professor Yemi Osinbajo has declared that the reason why the government is taking that decision is not to discourage the local automobile industry, rather it is to reduce the cost of transportation on the people due to the current economic challenges.
The Vice President disclosed this when he was reacting to views expressed by one of the panelists in a meeting, Mr. Ajaere, who is the Chief Executive officer of GIG group, owners of God is Good Transport company.
Mr. Ajaere complained that making a policy summersault like that will send wrong signals to the prospective investors in the country.
He lamented that due to the high import levy, he went into partnership with some foreign investors to start investing in building a plant to start manufacturing made in Nigeria vehicles.
He said that based on that the group has spent N5billion of private funds to build the vehicle assembly plant. This action has now put the project in jeopardy.
What is going to be the condition of the project now, will the Federal Government come to their rescue?
The investors are currently at a loss on what action to take next.
The Federal Republic of Nigeria (FGN) has recently reduced the levy on the importation of vehicles into the country, and the Peugeot Automobile Nigeria (PAN), a foremost vehicle assembly plant in Nigeria is kicking against it.
The company argued that the reduction of the import levy from 35% to 5% on cars by the Government has taken a toll on their business.
This information was disclosed by the Chairman of the company, Honourable Aliyu Ahmed Wadada, in an interview it granted to newsmen recently in Lafia. He explained that the company had a fantastic business plan, but it has been negatively impacted by the new Government’s policy on the importation of cars.
He regretted that the policy that import levy on cars imported into the country should be reduced from 35% to 5% had become a disincentive to the local vehicle assembly plants.
Before this action, what was in place was 40% duty and 35% levy, making it a total of 75%. This total of 75% though very high, but was put in place to discourage importation of cars into the country thereby encouraging local assembly plants to grow.
The Chairman of Peugeot Automobile Nigeria (PAN) stated that this reduction in the levy that the Federal Government had implemented will open the doors of the country to a flood gate of importation of all sorts of cars into the country at the expense of locally assembled ones.
The Chairman lamented that Government had been complaining about the rate of unemployment in the country, but he could not understand how that will be achieved by the same government diminishing the fortunes of the real sector that is manufacturing.
The country is already feeling the huge impact of the depreciation of the Naira due to the reliance of the country on importation of all sorts of goods into the country.
The Chairman of the company Wadada disclosed that the Peugeot Automobile Nigeria has started diversifying its products offering by not relying solely on the sale of Peugeot products.
He happily disclosed that by the end of July 2021, the company shall be launching another vehicle brand known as Cherry. This he claimed will make vehicles available to average Nigerians employed both in the public sector and those in the private sector respectively.
However, it was necessary for us to seek and obtain the view of the government on this burning issue because it seems as if the government is working against itself.
One time you said that you want to boost the foreign exchange earnings by boosting export and reducing import, on the other hand you are reducing levy on imported cars.
The Vice President, Professor Yemi Osinbajo has declared that the reason why the government is taking that decision is not to discourage the local automobile industry, rather it is to reduce the cost of transportation on the people due to the current economic challenges.
The Vice President disclosed this when he was reacting to views expressed by one of the panelists in a meeting, Mr. Ajaere, who is the Chief Executive officer of GIG group, owners of God is Good Transport company.
Mr. Ajaere complained that making a policy summersault like that will send wrong signals to the prospective investors in the country.
He lamented that due to the high import levy, he went into partnership with some foreign investors to start investing in building a plant to start manufacturing made in Nigeria vehicles.
He said that based on that the group has spent N5billion of private funds to build the vehicle assembly plant. This action has now put the project in jeopardy.
What is going to be the condition of the project now, will the Federal Government come to their rescue?
The investors are currently at a loss on what action to take next.