Note: In their official statement, the Federal government did not say they will ban
the importation of tokunbo cars. But their new tariff will indirectly achieve that purpose.
In effect, they are banning the importation of tokunbo cars without expressly saying so.
An article on this subject recently made the front page. Unfortunately, the poster did not
include what can be deemed the most important paragraph which is:
[The Director-General, National Automotive Council, Mr. Aminu Jalal] added that
importers could still clear imported vehicles at the old rates until February 28, 2014,
provided “they can prove that they had opened a letter of credit for the vehicles
before October 3, 2013.”
This answers one of the questions many of us have which is: When will the new tariff come
into effect”? Now that we know it is February 28, 2014, we can plan accordingly. That part
is clear and concise. Unfortunately the second part of that quote is not. In it, the
Director-General said:
…provided “they can prove that they had opened a letter of credit for the vehicles
before October 3, 2013.”
Is he saying that tokunbo cars purchased after October 3, 2013 will incur the new higher
tariff? It is not very clear but that appears to be what he is saying. In the meantime, it
will be advisable to thread cautiously on all new imports until that statement becomes
clearer.
WINNERS AND LOSERS
A policy change of this magnitude will no doubt have many winners and losers.
WINNERS: Once again, Cotonou will become the main entry point for smuggling
tokunbo cars into Nigeria. This will enrich the economy of Cotonou, their car dealers,
Border Agents on both sides and Cotonou clearing agents. Local spare parts dealers in
Nigeria will also be favoured by this policy as people use their cars for longer periods.
LOSERS: The obvious losers include everybody that imports or sells tokunbo cars. For
the past several years, importing a tokunbo car into Nigeria has been so easy that even
a primary school boy can do it. That’s all about to change for the worse. The average
Nigerian will also be a big loser. Soon he can no longer afford a car (new or tokunbo).
It remains to be seen whether this will be good or bad for the Nigerian economy.
Government sources are claiming it will be a positive development. But most Nigerians
including myself doubt it.
WHAT YOU SHOULD DO
If you have serious plans of buying a tokunbo car, do it now. Do not wait any longer.
Prices are bound to go up drastically once this policy comes into effect early next year.
the importation of tokunbo cars. But their new tariff will indirectly achieve that purpose.
In effect, they are banning the importation of tokunbo cars without expressly saying so.
An article on this subject recently made the front page. Unfortunately, the poster did not
include what can be deemed the most important paragraph which is:
[The Director-General, National Automotive Council, Mr. Aminu Jalal] added that
importers could still clear imported vehicles at the old rates until February 28, 2014,
provided “they can prove that they had opened a letter of credit for the vehicles
before October 3, 2013.”
This answers one of the questions many of us have which is: When will the new tariff come
into effect”? Now that we know it is February 28, 2014, we can plan accordingly. That part
is clear and concise. Unfortunately the second part of that quote is not. In it, the
Director-General said:
…provided “they can prove that they had opened a letter of credit for the vehicles
before October 3, 2013.”
Is he saying that tokunbo cars purchased after October 3, 2013 will incur the new higher
tariff? It is not very clear but that appears to be what he is saying. In the meantime, it
will be advisable to thread cautiously on all new imports until that statement becomes
clearer.
WINNERS AND LOSERS
A policy change of this magnitude will no doubt have many winners and losers.
WINNERS: Once again, Cotonou will become the main entry point for smuggling
tokunbo cars into Nigeria. This will enrich the economy of Cotonou, their car dealers,
Border Agents on both sides and Cotonou clearing agents. Local spare parts dealers in
Nigeria will also be favoured by this policy as people use their cars for longer periods.
LOSERS: The obvious losers include everybody that imports or sells tokunbo cars. For
the past several years, importing a tokunbo car into Nigeria has been so easy that even
a primary school boy can do it. That’s all about to change for the worse. The average
Nigerian will also be a big loser. Soon he can no longer afford a car (new or tokunbo).
It remains to be seen whether this will be good or bad for the Nigerian economy.
Government sources are claiming it will be a positive development. But most Nigerians
including myself doubt it.
WHAT YOU SHOULD DO
If you have serious plans of buying a tokunbo car, do it now. Do not wait any longer.
Prices are bound to go up drastically once this policy comes into effect early next year.
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