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The leadership of Lagos Chamber of Commerce and Industry (LCCI), has called on the federal government to quickly review the 2013 Auto Policy which raised tariff on imported cars from 20 per cent to 70 per cent to grow local production.
In an interview with the Director General of LCCI, Muda Yusuf, he said “The national automotive policy is biting harder on the economy and must be urgently reviewed, because its presence has made the cost of vehicles beyond the reach of many individuals and corporate bodies”.
According to him, “The review has become very necessary to drive economic growth.
Business Hilights recalls that roundly criticized automotive policy was introduced in 2013 as a strategy to reduce importation of vehicles and boost the capacity of domestic vehicle assembly plants.
However, happenstances have shown that other factors that are supposed to drive the traction of investors in the auto industry are not salutary and therefore have rendered the policy useless in the face of realities.
Yusuf averred that “The automobile sector was hit by the double shock of currency depreciation and a hike in tariff from 20 per cent to 70 per cent (in the case of new cars).
“Whereas, there is very little that can be done about the currency depreciation, a great deal can be done about the policy, which is a creation of government,.
Continuing, LCCI boss revealed that “The affordable vehicles promised at the inception of the policy are yet to be seen. The economy has suffered incalculable consequences and shocks as the cost of vehicles reached levels that are unprecedented in the history of the country.
“Virtually all aspects of our economic and social lives have been adversely affected by the situation because over 90 per cent of the country’s freight and human movement are done by road, which implies heavy dependence on cars, commercial buses and trucks.
“Manufacturers and other real sector investors suffer from sharp increases in haulage cost because of the high cost of trucks; school buses have become unaffordable by many institutions.
“Many hospitals cannot afford new ambulances; many corporate organisations have drastically cut down on their fleet. Car ownership is now completely beyond the majority of the middle class,” Muda Yusuf observed.