In order to encourage Nigerians buy made in Nigeria cars as well as own brand new cars, The Federal Government has concluded all necessary plans to launch an automotive credit purchase scheme latest by next month, a scheme that will offer Nigerians an opportunity to pay for purchased vehicles over a period of time as obtained in other countries.
The Minister of Industry, Trade and Investment Olusegun Aganga made the disclosure on the side-lines of the 69th United Nations General Assembly, in New York recently.
“In England if you enter a house, you see beautiful furniture and all that most of it is on credit. So we are saying we want to come up with credit purchase scheme whereby rather than buy that N800,000 used car, you buy a new N1.5 million car, you pay over four years at interest rate that you can afford. That is what National Automotive Council (NAC) is using that levy for, to work with banks so that you can be assisted to buy a new car. We hope to launch that very soon. So when you come with any new policy you have to think through, what do I need to do to make it work and ensure that there are things already in place to make it work” he said.
“Why would anyone say is hasty? We had auto strategy 30 years ago when Peugeot came into the country we killed it and we are resuscitating it. Now you said we are in a hurry when nothing happened in 30 years?
“The way to look at it is that it is going to happen any ways whether it is today, five years time. So that is not the issue, the issue is what is government doing and how are we trying to solve the problem. Is government aware? The answer is yes. That is why in every country where they have introduced auto policy, they banned importation of used cars immediately because if you don’t ban used cars most people will not buy new cars therefore there is no market for investors to come in. In every country they banned it but in Nigeria we have not banned it. Secondly, the duty should be 35 per cent, levy 35 per cent but we said for used cars we keep it at 35 per cent, we have not introduced the levy until we feel the condition is right. We had waved it until December and December we halved it for another six months. That is the second thing we are doing.
“The third thing that is important that we are also doing is the fact that we said for this to work, government must do two things. Encourage those coming to assemble affordable cars. That is why today you hear Nissan said they have cars for N1.5 million or N1.6 million. Fourthly, we will encourage banks to set up credit finance schemes. The reason you are spending, 800,000 to buy car is not because you want to buy a used car that you may spend a lot of money maintaining because you are required to pay cash. Nobody anywhere in the world pays cash for this sort of thing,” he said.
