Nigeria currently spends a total of N550 billion on the importation of cars into the country annually.
Following this the Federal Executive Council has approved a new Automotive Industrial Policy Development Plan for the development of the Nigerian automotive industry.
This is as FEC also approved contracts worth N41billion for projects in the Federal Capital Territory.
This was disclosed by the Minister of Trade and Investment, Olusegun Aganga, alongside the ?Minister of Information, Labaran Maku, and the FCT minister Bala Mohammed, while briefing journalists, after the weekly Federal Executive Council Meeting which was chaired by President Goodluck Jonathan.
The Minister of Trade and Investment brought a memo to seeking Council’s approval of policy measures to transform the Nigerian automotive industry and attract investment ?into the sector.
Aganga, who disclosed that as at 2012 Nigeria spent a total of N550 billion ($3.4billion) and N660 billion ($4.2 billion) in 2010 on the importation of cars, added this showed that car importation takes the biggest share of the country’s foreign reserves followed after machinery.
Explaining the policy, Aganga said the policy was drawn over a period of nine months with the input of the National Automotive Council (NAC) adding that foreign car manufacturing giants like Toyota and Nissan that are expected to start announcing their specific investments in Nigeria.
He added that the success of the policy will also mean a gradual phase out of fairly used (tokunboh) cars imported into the country and create a minimum of 700,00 jobs for Nigerians.
According to the minister, the pitfalls of similar policies in the past, like the non-implementation of policies, lack of infrastructure, and inappropriate tariff regime; were considered and adequately addressed in the new policy, with even the Federal Road Safety Corps and local vehicle assembly plants/manufacturers involved.
He also disclosed that Nigeria and Bangladesh were the only top countries in the world, that did not have a successful automotive policy.
The minister outlined the points of the new policy to include the establishment of three automotive clusters in Lagos/Ogun; Kaduna/Kano; and Anambra/Enugu states to share resources and reduce cost of investments, the development and revival of the petrochemical and metal/steel sectors and the tyre manufacturing industry to support the automotive sector.
He added that new tariff regimes will be adequately set to discourage the importation of cars and encourage local manufacture while government continues taking the lead in patronage of locally made vehicles. He added that banks will be encouraged to operate vehicle purchase schemes to enable Nigerians easily purchase cars.
Council also approved that government should direct that all vehicle purchased by ?government should be from the local ?assembly plants unless it is specialized nature and NAC have certified that it is not produced in Nigeria
The Council approved that the approved recommendation should be backed by appropriate legislation to give comfort to investors that there will be no abrupt change in policy.
Council also approved the sum of N41 billion for infrastructure projects in the Federal Capital Territory FCT.
Following a memo tabled by the minister of the Federal Capital Territory, Bala Mohammed, seeking approval for the rehabilitation and expansion of the outer Southern Expressway (OSEX) from Villa Round About to the OSEX/Ring Road 1(RR1) junction including five interchanges in favour of Messrs CGZ Nig Ltd at the contract sum of N39,829,749,225.69
According to the FCT minister the project is to ensure free flow of traffic and significantly reduce travel time in and out of the city. The is aslo expected to provide employment opportunity for about 1,500 professionals, artisans, skilled and unskilled labour.
Council also approved the sum of N1.6 billion for the engineering assistance for the Asokoro District, to develop additional 50 plots of land at N1.6billion with a completion period of 12months.
