The House of Representatives Committee on Industry has commended the Federal Government on the introduction of new automotive policy, saying the new measures would help transform the automotive sector.
Consequent on the latest approval granted by the Federal Executive Council on new measures for transforming the automotive sector to ultimately put Nigeria among the league of auto-producing countries, the Chairman of the House Committee on Industry, Mohammed Ogoshi Onawo during an oversight visit to the Ministry of Industry, Trade and Investment in Abuja on Monday, October 21, 2013 said the implementation of the new initiative would attract new investments into the sector, protect local automotive manufacturers and create employment.
Ogoshi Onawo, who was accompanied by 12 members of the committee, expressed satisfaction with the new measures used by the Ministry of Industry, Trade and Investment to transform the automotive sector. He said the use of tariff to protect local manufacturers is one of the major challenges facing the manufacturers of cars in Nigeria from the tariff structure.
"If somebody who is importing a complete car is paying less than somebody who is manufacturing, then you are not encouraging the person who is manufacturing. With the new measures being put in place by the Ministry of Industry, Trade and Investment, I am sure it will protect those investors who are willing to come to Nigeria and invest to assemble or manufacture vehicles here, "he stated.
He added that the House Committee on Industry is in support of the introduction of tariff measures to protect indigenous automotive manufacturers in order to increase the capacity utilisation of the sector.
He said, "the House Committee on Industry is very insistent on the fact that people who import complete cars will pay higher tariffs than those who manufacture here as a way of protecting those who will create employment here."
The Ministry of Industry, Trade and Investment, he explained is one of the most important ministries in the country in terms of helping to diversify the economy. He noted that given the mandate of the ministry, what it has achieved so far and what it has set out to achieve, the necessary organs of government need to be given special attention in terms of funding so that the economy can be better.
Speaking during the meeting, the Minister of Industry, Trade and Investment, Olusegun Aganga said that the ministry would continue to partner with stakeholders, including the National Assembly in the implementation of its Industrial Revolution Plan; adding that the new automobile policy would have a catalytic effect on fast-tracking industrialization, creating jobs and generating wealth for the country.
According to him, the new measures to transform the automotive sector is part of the Industrial Revolution Plan which is integrated, holistic and based on areas where the country has comparative and competitive advantage.
The Minister averred that in South Africa, the automobile industry plan has reduced the burden on the country's trade balance and caused the country's balance of payment to be neutral. "The potential for Nigeria's automobile industry plan is to save as much as N550 billion (US$3.5 billion) through the reduction of imports. We also have the regional export potential into the West and Central African market, coupled with the availability of a large and trainable workforce," he observed.
"Recognising the strategic and catalytic effects of the automotive industry in industrialisation, job creation, and wealth formation, among others, emerging economies like Brazil, China, Malaysia, India, Iran, Indonesia, Thailand and South Africa have taken deliberate steps to develop their automotive industry between the 1960s and the 1980s. Although Nigeria started about the same time in the 1970s, these countries have now developed well-advanced automotive industries in contrast to Nigeria."
Aganga said that the strategies which they followed are the ones which Nigeria earlier discarded and which required a comprehensive development plan, patronage of local products, appropriate fiscal measures and consistent application of policies over the long term. These issues, he added have all been addressed in the new measures approved by the Fedral Executive Council.
"The Nigerian Auto Development Plan will promote investments in the assembly of inexpensive cars in the country at prices which Nigerians would be able to afford and will gradually substitute the large and growing car imports coming into the country," the Minister emphasized.
Source: House of Reps Committee says new automotive policy will transform Nigeria's auto industry. (http://fmi.gov.ng/latest/32038/?utm_source=rss&utm_medium=rss&utm_campaign=house-of-reps-committee-says-new-automotive-policy-will-transform-nigerias-auto-industry)
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