Abossey Okai dealers, car importers in Trouble -As Gov’t Plots Incentives for Big Car Manufacturers

The current government administration is pushing a bill that will virtually cut out small operators in the automotive industry such as the dealers in the popular Abossey Okai, Whatsup News can report.

The bill seeking to amend the Customs Act, 2015 (Act 891) seeks to discourage the importation of old vehicles of over 10 years of age and their parts to allow big automotive companies such as Volkswagen, Toyota, Suzuki, Nissan, Renault and KIA/Hyundai set up plants in Ghana and a manufacturing foothold.

The “big boys” would be operating under the Ghana Automotive Manufacturing Development Programme (GAMDP).

The bill which is being pushed as a matter of urgency by Parliament’s Joint Committee on Finance, Trade, Industry and Tourism is likely to spark agitations over the cost of motor vehicles that the big producers will be assembling in Ghana in place of the cheap options that second-hand car importers and the Abossey Okai dealers provide to the growing car market in Ghana.

“The government of Ghana in August 2019 launched the Ghana Automotive Manufacturing Development Programme to promote the manufacturing of automobiles for both the domestic market and the West African sub-region,” stated a report by the Parliamentary committee seen by Whatsup News.

The report also admitted that if the new policy to ban the importation of old cars and parts are introduced, the Government of Ghana is likely to lose a staggering GHC 802 million in the first three years of introducing the restrictions.

“…the committee was informed that the review in policy as contained in the Bill will lead to an estimated loss of GHC 802,251,785 for the first three years. This is however expected to be partially offset by the additional revenue from customs duties on vehicles not covered by the programme,” the report stated.

Whatsup News gathered that the only way the government will offset the losses it is likely to incur from banning old vehicles is to slap more taxes on the few that will be allowed in, including their knock-down parts.

This development may not particularly excite spare parts dealers and car importers who have had countless assurances from the New Patriotic Party (NPP) before it won power in 2017.