When President Goodluck Jonathan went out of his way to assure Nigerians that the new National Automotive Policy would not inflict pain and hardship on the people, few Nigerians believed him; and for good measure. And Mr. President lived up to expectations by betraying that promise after the federal government began implementing an aspect of the new automotive policy that imposes a 70% tariff – 35% duty and 35% levy on imported vehicles and auto parts, when no automobile plant has been reactivated and new vehicles are yet to roll out, especially the much-hyped “Made in Nigeria cars.” The labored, yet unconvincing explanations proffered by administration officials to justify the hasty and ill-advised implementation of the new policy speaks directly to the insincerity and insensitivity of the Jonathan administration and its never-ending proclivity to inflict pain and hardship on beleaguered and helpless Nigerians. It is obvious that the policy aims simply to raise import duty on imported vehicles and not to manufacture new cars. The raised import duty should therefore be reversed immediately in the interest of peace.
The central nexus of the new automotive policy is to revolutionize the Nigerian auto industry by producing affordable cars in Nigeria. Raising the duty on imported cars is predicated on first rolling out the promised “Made in Nigeria cars” after reactivating the comatose auto plants and setting up new ones. Under the new policy, apart from reactivating comatose plants like Volkswagen, Peugeot, Steyr, Leyland, ANAMCO, among others, government would partner with renowned foreign automobile manufacturers to set up plants in Nigeria. The expectation is that by the time new vehicles start rolling out from the factories, it would be needless to import used vehicles into the country. And to discourage importation of used cars, a 70% import duty is imposed on imported cars. The choice would then be left to consumers to patronize locally produced cars at affordable prices or pay exorbitant import duties if they choose to import.
But Jonathan seems to be a man in a hurry. It is evident the government wants auto dealers to transform their showrooms into assembly plants, where Completely Knocked Down (CKD) auto parts could be assembled into new cars; adding value to the local production chain, creating jobs, enhancing technology transfer and increasing the overall Gross Domestic Product (GDP). This of course, is merely stating the obvious. The problem is the timing and sequencing. First things first; prior to the collapse of the auto industry, Nigeria had reached about 45% local content in car manufacturing. Given that the automobile industry is yet to be revitalized, there is no rational basis for implementing the new policy.
With the hostile economic environment engendered by poor infrastructure, erratic power supply, high overhead cost, lack of technical manpower, among others, how does the government intend to bring back the complex production processes that sustained the auto industry in yesteryears to make the new policy work? Since the policy on local content is predicated on non-existent ancillary industrial infrastructures to manufacture tires, batteries, seat belts, windshields, wipers, bolts, nuts; this begs the question: which component of the cars that will be assembled in Nigeria will be locally sourced? Where, for instance, is the research effort to support the planned industrialization as schools are not training the required manpower?
The President must be told in whatever language he chooses to understand that the new automotive policy cannot be realized by presidential fiat. It requires time for the lofty objectives of the new policy to be attained. Arm-twisting auto dealers to transform overnight into assembly plants is a self-defeating strategy; at least in the short term. It amounts to putting the cart before the horse, and would not address the vital question of value creation. Jonathan must understand when one part of the new policy should start and end and when the other part begins. The explanation that in the event of a shortfall of made in Nigeria cars, the assembly plant owners alone would be allowed to import road-ready cars at 35% tariff to bridge the gap, is hardly credible. This amounts to importation of new and used cars by another name and opens up avenues of rent-seeking and corruption.
Mr. President had assured that the implementation of the new National Automotive Policy (NAP) would not inflict pains on the people. However, the imposition of the 70% tariff, when no automobile plant has been reactivated and new vehicles are yet to roll out, is plain deceitful and cast serious doubts as to the sincerity of government.
Nothing underscores more the culture of insensitivity and impunity that has crept into the federal government than this brazen rail-roading policy to fleece the citizens. With no efficient mass transit system; and while the standard of living of an average Nigerian deteriorates daily and majority of its citizens have helplessly become hostage to poverty, disease, hunger and insecurity, public officials continue to make outlandish policies to raise revenue to satisfy their unbridled quest for primitive accumulation and conspicuous consumption. The irony of this repugnant policy is that it is coming at a time Nigerians are complaining bitterly about the atrocious perks enjoyed by serving political office holders. The preponderance of opinion is that Nigeria is saddled by kleptomaniacs who are known to have made enough by graft, for their unborn generations of children.
And contrary to all expectations, Nigeria is now a victim of her corrupt, inept, clueless and lawless leadership. Her citizens on the other hand have become largely a band of docile and complacent people, who concur in the despoliation of their land by their passive indifference and cold complicity in the face of reckless, arbitrary and ungodly dissipation of their commonwealth. The audacity of the new auto policy is rooted in the docility of Nigerians, who know this is wrong and unjust, but will do no more than bemoan in the closet of their rooms, whereas democracy expects them to do more. They have the right of peaceful protest against the unconscionable policy.
Nigeria needs a strategic development agenda to be able to achieve lofty targets, such as those set out in the new automotive policy. But without putting the right structures in place, the implementation of any policy would only remain a wish. Unless government gets this policy right, Nigerian importers will shift to neighboring duty-free countries like Benin with the attendant loss of revenue. The Nigerian automobile industry has collapsed, and rebuilding it, requires strategic infrastructural and capacity development, without which, the implementation of any policy would only remain a luxurious desire and mere wishful thinking.
