From Uche Usim, Abuja
The Association of Motor Dealers of Nigeria (AMDON) has raised the alarm over a new government policy that abolishes the importation of vehicles above five years old or trucks or trucks that are older than 10 years.
The proposed ban is consistent with the fuel grade and emission standards regulation of the ECOWAS Commission. It was approved by ECOWAS Ministers and Heads of States and Governments in September 2020 based on a report by its consultant CITAC which recommends new gasoline and diesel specifications and vehicle emission standards for ECOWAS countries effective January 1st, 2021.
Speaking at a media briefing in Abuja on Friday, the National President of AMDON, Mr Ajibola Adedoyin warned that the new order, among other things, will further impoverish Nigerians.
He said: “AMDON is alarmed that the proposed regulations as recommended by ECOWAS’ consultant ICCT, contains grievous errors which if implemented will have adverse effects on Nigeria’s economy and every strata of our lives.
“The ECOWAS Commission will soon issue a “Directive” to member countries on the said regulations to restrict the importation of passenger vehicles of no more than five years old and heavy duty vehicles of no more than 10 years old. The implementation of this regulation will have significant negative socio-economic consequences for Nigerian consumers, along with minimal environmental and health benefits.
“It will lead to a huge increase in the cost of imported used automobiles and fuel prices, at a time of economic uncertainty and recession; if the Nigerian government goes ahead with the implementation of the regulation, as proposed.
To avert the economic calamities listed above, Adedoyin recommended that the Federal Government immediately suspends the implementation of the new regulation.
He advised the government to consult widely with key stakeholders with the aim of reviewing the errors in the final ECOWAS report to prevent a major socio-economic pitfall, rather than rushing to commence its implementation in Nigeria from January 1, 2021.
“From then, it will be illegal for Nigerian businesses and consumers to purchase any imported vehicles older than the 2015 model year”.
He averred that “further assessment of the proposed ECOWAS regulations as recommended by ICCT has revealed many errors and inconsistencies. While the ECOWAS consultants submitted in their report that the implementation will result in net benefits to society to the value of $107bn between the period 20192050, a preliminary independent analysis has determined that the $107billion net benefit presented in the Final Report is incorrect. In fact, the implementation of the ECOWAS regulations will have a net cost of $78.1 billion, with approximately two thirds of the net cost impacting Nigeria negatively”.
He stressed that “the ECOWAS regulation can be likened to a total ban of vehicle importation as no one will be able to afford such vehicles, except for the privileged few which consist of less than 0.5% of our population. The adverse effect of the regulation can only be imagined”.
According to Adedoyin, “while the consultant’s final report assumes the cost of newer vintage vehicles is $297 per automobile based on incremental cost of improved vehicle emission control system, findings reveal that the estimated cost of purchasing newer vehicles is a whopping $11,065. This does not include the significantly higher cost in replacing diesel vehicles which are the major source of pollution”.
The AMDON president confirmed that, “while the report did not consider the huge incremental technology cost and incremental operating cost of implementing the regulations, a preliminary independent study had placed such costs at $106.4 billion and $10.7 billion respectively, which will further place a huge burden on Nigeria’s already stressed foreign exchange”. Adedoyin also noted that the proposed ECOWAS regulations has a comparably less societal and net benefits as claimed by the ECOWAS’ consultant.