- Nigeria to import N3tn used automobiles this year
Many vehicle assembly plants in Nigeria including Peugeot Automobile Nigeria (PAN) will shut down their operations this year following a recent reduction in import tariff on vehicles by the Federal Government.
Chairman of PAN, Ahmed Wadada Aliyu, who stated this, also predicted that Nigeria would import used cars and motorcycles worth N3 trillion this year as a result of the new policy.
Aliyu, who is a former member of the House of Representatives, condemned the tariff reduction on imported vehicles, describing it as a policy somersault.
The policy was based on the recommendations of the Automobile Standing Committee set up by the Federal Government through the Bureau of Public Enterprises (BPE) to examine factors hindering the growth of the automotive sector.
Ahmed, who spoke on Tuesday in Abuja during a media parley on ‘The tariff regime for automobile assembly plant in the 2020 Finance Bill’, accused the Comptroller-General of Customs, Col. Hameed Ali (rtd), of succumbing to the lobby of vehicle dealers with no matching investments in local vehicle assembly.
Aliyu expressed concern that the new policy would affect PAN Kaduna Limited, which had already secured a financing of $150 million over the next three years for its operations.
He added that the tariff reduction would mean the imminent closure of PAN and other auto assembly plants.
“The tariff portion of the Finance Bill was stepped down. But to our dismay, it was smuggled again into the Finance Bill and subsequently approved,” he stated.
He accused the Customs boss of abusing the direct access that he has to the presidency.
He said, “The Nigeria Ports Authority revealed in December 2020 that 13 vessels off-loaded used vehicles at the terminals. In 2020, the country imported used vehicles and motorcycles valued at N1.28 trillion.
“It means in 2021, Nigeria is likely to go berserk and triple the amount to N3 trillion. Forty per cent of the budget on importation of all manners of used cars is a direct consequence of the tariff reduction.
“The comptroller general intends to flood Nigeria with ‘Tokunboh’ vehicles and ensure the closure of all assembly plants whereas the assembly plants have put in place a car financing scheme for Nigerians to own brand new vehicles at affordable rates.
“We strongly believe the comptroller general succumbed to the lobby of ‘Tokunboh’ dealers who are glorified car dealers with no matching investments in local vehicle assembly, and without linkages and value chain components that can precipitate long term industrial growth of Nigerian economy.
“PAN Kaduna Limited has just been acquired and has already secured a financing of $150 million over the next three years, and the implication of this review means the imminent closure of PAN and other auto assembly plants due to misguided recommendations by the comptroller general.
“We categorically state that this tariff review will become more detrimental to the long-term competitiveness that the automotive industry must achieve if it is to play any dominant role in Africa continental free trade area.”
But the Nigeria Customs Service (NCS) dismissed the PAN chairman’s allegation, saying that Nigerians are happy with the new policy.
Public Relations Officer of the NCS, Mr Joseph Attah, said the position of the NCS was well known on the matter, adding that Nigerians were happy with the reduction of tariff on imported vehicles.
“Our position is well known and Nigerians are happy. Anyone can criticise our position. What you then ask yourself is on which grounds. I am not a businessman, but when people criticise based on their interests, I don’t know what you want me to say. Our position is well known and anyone can criticise us,” he stated.
Oil Prices Continue to Climb on Supply Disruptions As Brent Hits $78/1
Brent crude futures rose more than 1% to above $78 a barrel on Friday, the highest since October 2018 and widening a weekly gain to 3.6 per cent amid global supply concerns following storms in the US that damaged facilities on the Gulf coast.
WTI crude rose for the fifth consecutive week, with futures up almost 3 per cent to an 8-week high of $73.98 a barrel boosted by growing fuel demand and falling US crude inventories.
Disruptions in US Gulf Coast production following Hurricane Ida and other storms have led to sharp draws in US and global inventories. EIA data showed US crude stocks fell by 3.5 million barrels to 414 million last week, the lowest since October 2018. Capping some gains was China’s first public sale of state oil reserves. State-owned PetroChina and private refiner and chemical producer Hengli Petrochemical bought four cargoes totaling about 4.43 million barrels.
Buhari: Five million homes to get solar power by 2030
Nigeria is working on an ambitious energy plan including decentralised solar energy solutions that will substantially reduce the energy shortcomings by the year 2030, President Muhammadu Buhari has said.
The President spoke on the sidelines of the 76th United Nations General Assembly in New York on the High-Level Dialogue on Energy.
Spokesman for the President, Mr Femi Adesina, in a statement Friday night, quoted Buhari as saying, “Nigeria’s commitment to a just transition is reflected in our ambitious Energy Compact, which includes the government’s flagship project to electrify five million households and 20 million people using decentralised solar energy solutions.
“This is a major first step towards closing our energy access deficit by 2030. Nigeria’s commitment is also reflected in the development of our Energy Transition Plan, which was developed with the support of the UK COP26 Energy Transition Council.”
He called for support from developed countries to unlock the financing needed to accelerate a just energy transition for all.
“The focus of our discussions on transition must now evolve how we help countries develop detailed energy transition plans and commitments to mobilize enough financing to empower countries to implement those plans,” he said.
The President said the scale of financing required for Nigeria to achieve net-zero would amount to over $400bn across the Nigerian economy in excess of business-as-usual spending over the next 30 years.
He said, “This breaks down to $155bn net spends on generation capacity, $135bn on transmission and distribution infrastructure, $75bn on buildings, $21bn on industry and $12bn on transport.”
Buhari, however, said that gas would continue to have a big role to play before phasing it out, explaining that solid fuel cooking was still wreaking havoc in Africa:
He said, “As a global leader on the energy transition, it is imperative that I flag a major risk to development that stems from the current narrative around the energy transition, particularly on the role of gas and the lack of financing.
“Nigeria’s Energy Transition Plan has laid out our road map to reach net-zero and highlights the scale of the effort required, which includes the development and integration of renewables into current grid infrastructure at tremendous scale and electrification of all sectors.
“This is challenging for any country, especially a developing country. On our development objectives, gas will have a key role to play here for some years before being phased out.”
President Buhari noted that these plans must also take into account the provision of access to electricity and clean cooking solutions for those in Nigeria and around the world currently without access.
He also stressed the essential role of gas in addressing clean cooking challenges.
“Globally, there are 2.6 billion people who lack access to clean cooking – which is unacceptable. Even more concerning is that solid fuel cooking in Africa causes almost 490,000 premature deaths annually, making it the second-largest health risk in Africa,” he stated.
States can’t collect VAT, it’s on exclusive list – Malami
State governments are not empowered to collect value-added tax (VAT) in the country because it is on exclusive legislative list, the Attorney-General of the Federation and Minister of Justice, Abubakar Malami, has said.
The AGF gave this position on Friday night in an interview with Channels Television.
The Federal Inland Revenue Service has been at loggerheads with Rivers and Lagos State governments over VAT collection. And the matter already receiving the backing of some other state governments is current in court.
Malami, who said the collection of VAT in the country is under the exclusive legislative list, posited that only the National Assembly could make laws on VAT.
He said, “A lot has precluded the state from collecting value-added tax. One, generally speaking, as you rightly know, the issue of the value-added tax is an issue on the exclusive legislative list.
“And the implication of being in exclusive legislative list matter is that only the national assembly can legislate on it. The question that you may perhaps wish to address your mind on is whether there exists any national legislation that has conferred the power on the state to collect VAT. And my answer is ‘no’.
“In the absence of a law passed by the national assembly in that direction, no state can have a valid claim to collection of value-added tax.
“The responsibility, right and constitutional powers to legislate on collection of VAT are exclusively and constitutionally vested in the National Assembly and not in the state.
“Where the national assembly has not passed any law in that regard authorising the state to collect VAT, then it goes without saying that no state can arrogate unto itself the powers to collect VAT.”
According to the minister, it will be reckless for any state to go ahead to collect VAT, despite the court’s decision asking parties to maintain the status quo.
He said, “I don’t see any state perhaps taking the law unto its hands without allowing the judicial process to take its natural course and in breach of the prevailing legislation.
“I don’t see the states acting arbitrarily and setting a very bad precedence as far as governance is concerned with particular regard to the fact that the matter is receiving judicial determination.
“I can’t understand. I can’t perhaps bring that thought into consideration that I believe it could amount to a high level of recklessness on the part of any state government to be operating in breach and to be operating a lawless governance style as far as the Nigerian state is concerned.”
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