A brand new ford focus is about $20k in the USA. That translates to about #4M. When I hear all the talks about Nigeria cheap labor in auto factories I laugh, knowing that now, almost all auto plants are fully automated. Automated factories are cheaper to run than 'man powered'. So where will the #1.2M car price come from?

sonnie10: A brand new ford focus is about $20k in the USA. That translates to about #4M. When I hear all the talks about Nigeria cheap labor in auto factories I laugh, knowing that now, almost all auto plants are fully automated. Automated factories are cheaper to run than 'man powered'. So where will the #1.2M car price come from?

Of course they pulled that figure from off their posterior end knowing they will not suffer anything if it turns out they having been lying. The saddest part is that these folks (Aganga, Okonjo Iweala) basically earned their stripes working for some of the finest institutions in the West. Can they honestly claim that where they previously worked that they could even dream of pushing such disruptive policy based on cooked-up and faulty data and wishful thinking.
Nigeria deserves better of these people.

ikenga67:

In the US that will be patently unconstitutional. For one, there is no way that the US Federal Courts will allow Congress to delegate its taxing powers (and imprt duties is a tax...in this case a huge one!) to the executive or its agencies. Also such untramelled delegation of powers to either the presidnet or an agency (as this Automotive policy) seeks to do without clearly identifiable and in-built legislative oversight will not pass constitutional muster.
But this is Nigeria we are talking about here. You will think having borrowed the US system, we will also borrow its richly developed body of constitutional and administrative laws, but you will be fooling yourself.
I am convinced that 90% of the cause of the failure of the democratic system in Nigeria is because the practitioners (especially the legislators and the judges and lawyers) are functional constitutional law illiterates.
So the answer to your question sadly is that the courts might find it constitutional since they cannot find any language in the constitution that expressly prohibits that. They are that literal!!!

@ikenga67 are you a lawyer? Just asking because your conclusion seems "matter of fact." I'm curious because if the nigerian constitution is almost a cc of the american constitution definitely there should be language in there that prohibits actions like this. I personally don't think we need to take this lying down. I've noticed nigerian officials do all sorts until lots of negative attention is brought to it and if its consistent enough they "might" change.

The first thing the government should have done was to have a sliding scale taxation on imported cars based on the age of the cars, for instance, 10 year old cars or younger could be on 15% with emission standards set, older than 10 years could be on 35% with emission standards, the extra vehicle inspection for emissions and other safety can be done before registering the car, if your car does not meet the standards, you will be forced to either bin it or do the necessary adjustments, what this does is it helps good mechanics make some more money on getting imported cars up to standard, means they get to employ people who at least will do the inspection.
The other area the government should have focused on is the area of parts, we all know that we are buying fake spare parts, if the government can encourage companies to setup parts manufacturing plants in Nigeria, they can ban the importation of used parts and put say 15% tariff on new parts. Used cars that are older can be brought up to fairly good state by using genuine parts.
This policy is just crazy and is defined to help cronies of government.

txswat:

@ikenga67 are you a lawyer? Just asking because your conclusion seems "matter of fact." I'm curious because if the nigerian constitution is almost a cc of the american constitution definitely there should be language in there that prohibits actions like this. I personally don't think we need to take this lying down. I've noticed nigerian officials do all sorts until lots of negative attention is brought to it and if its consistent enough they "might" change.

Under a constitutional democracy, the Constitution is a framework. It is left to the practitioners (the political arms of governemnt, the courts, the legal profession and the enlightened public) to fill out this skeleton so it takes legal and political form as constitutional law and constitutional convention. A prolix Constitution (one that seeks to provide for everything) will only cause confusion and contradict itself. You can read the whole of the US constitution including all the amendments in less than 30 minutes. However, the interpretations accorded to that slim volume will fill a whole library. The point I am making is that the Consitution does not have to spell out that some powers may not be delegated. Our borrowed and inherited constitutional laws have to take care of that. All the courts have to do is adopt interpretation rules that give full weight to the intent of the constitution. Our problem is that our courts adopt a too literal reading of constitutional text, ignoring that first and foremost, the Constitution is a political document whose over-arching purpose is a scheme to LIMIT the powers of governement.
And yes, I am a lawyer - licensed both Nigeria and New York so I am actually in a position to do a little comparative analysis, lol!!

ikenga67:

Under a constitutional democracy, the Constitution is a framework. It is left to the practitioners (the political arms of governemnt, the courts, the legal profession and the enlightened public) to fill out this skeleton so it takes legal and political form as constitutional law and constitutional convention. A prolix Constitution (one that seeks to provide for everything) will only cause confusion and contradict itself. You can read the whole of the US constitution including all the amendments in less than 30 minutes. However, the interpretations accorded to that slim volume will fill a whole library. The point I am making is that the Consitution does not have to spell out that some powers may not be delegated. Our borrowed and inherited constitutional laws have to take care of that. All the courts have to do is adopt interpretation rules that give full weight to the intent of the constitution. Our problem is that our courts adopt a too literal reading of constitutional text, ignoring that first and foremost, the Constitution is a political document whose over-arching purpose is a scheme to LIMIT the powers of governement.
And yes, I am a lawyer - licensed both Nigeria and New York so I am actually in a position to do a little comparative analysis, lol!!

Ok that helps clarify a few things. Always good to hear from an expert on certain things that go beyond the average guy's educational knowledge.

Shine u Eye: solokon111 is the only one making sense here. Every country on earth protects its local manufacturers. Since the 70s Nigerians have always believed time is not right to take drastic measures to help our manufacturers. When will the time ever be right?
Progress comes at a prize and no pain no gain. If we want to join the "brics" countries, measures like these needs to be put in place. Come on, e[b]very Nigerian cleaner/labourer abroad dreams of sending a beat down toyota to make quick bucks at the expence of locally produced ones.

[/b]

What an irony. If a cleaner/laborer abroad could afford to buy, ship and clear a car with just his earnings while a banker, doctor, engr, in Nigeria would empty his life savings to buy these cars; for the seek of sounding modest, I do not even want to mention the plight of a Nigerian cleaner/laborer here. Then, something must be amiss in terms equality and standard of living when you place Nigeria and "abroad" side by side as members of the same global village. Until we see how the new policy would better the lots of common Nigerian and not cooperate greed supported by corrupt officials, lets not celebrate yet.

ikenga67: From a legal point of view, I even have serious doubt if this so-called policy can pass constitutional muster.
Here we have a policy that will have major impact on both the economy and the revenue of the Federal Governemnt, not to talk of having disruptive effect on industry. The NASS should be responsible for inititating such policies through duly passed legislation. Of course in the modern system the legislature can delegate some of its functions to the executive and other agencies, but the legislature ought to have in place a mechanism for overseeing the delegatee of such powers. I doubt if any of that has been put in place here, but again, this is Nigeria!!!

The Joint Committee on Rules/Business, Justice and Judiciary, is currently charged with studying opposing views on this very issue and advise the House on what to do.

One view is that the Customs/Excise Tariff Act empowered the President to adjust tariffs whenever necessary. Those who hold that view believe that the only way to stop the policy in question was to come by an amendment bill. An opposing view (which I subscribe to) is that the said tariff was included in the Exclusive Legislative List and could not be changed by “executive fiat” unless by a law passed by the National Assembly.

I do not believe that the matter has been settled. My guess is that the executive branch, out of courtesy, will allow the house to fully deliberate the issue before allowing the policy to go into effect. It would be wise of the executive branch to postpone the 250% tariff increase and avoid a possible legal challenge which could actually erode its perceived authority, to willy nilly adjust such tariffs. The fat lady is yet to sing.

Starting to really enjoy the input from the lawyers on this forum. With all that being said how do WE push the envelop to get this policy changed/postponed/amended etc.. I don't think this policy is completely bad but there are not enough resources on ground to validate the NEED for this policy right now.

solomon111: Don't be naive.
If it were another country,i would agree with you.
Unfortunately,this's Nigeria with all its inferiority complexes,unpatriotism and an utter disdain and disregard for locally made products.
I can assure you that as long as there's a readily available foreign alternative, Nigerians would never patronize the local manufacturers.
So,just giving the local manufacturers incentives alone will not do much for them as long as their targeted markets has been completly taken over by toyota and co.
The only way we can truely grow indigenous autoindustry in NIGERIA is to go the hard way.

It baffles me the type of profound inconsiderate attitude with which some ppl speak. Hw many Average nigerians can afford a brand new car? Most ppl buy used cars whose costs are normally less dan a mill. Finally, a good wine needs no bush if the cars are of good quality ppl will patronise, bone dt non-patronage of locally made goods mentality. Gone ar dose days ppl prefered foriegn goods to local ones it's now all abt quality and cost. Ppl don wise up o

cute-boy:


But govt should only propose increased tariff for existing manufacturing plants. As far as I know there is no single car assembly plant functioning in Nigeria. What we have are two truck and bus assembly plants: Innoson plant at Nnewi and NTM at Bauchi (not sure if NTM is still functioning).
There is absolutely no move or indication that the following importers: Coscharis (BMW, Range Rovers, Porche, Jaguar, Mini), Stallion Group owned by Vaswani brothers (Honda, VW, Audi, Skoda); Dana Group (importers of Daewoo and Hyundai), Toyota Nig Ltd (owned by Chief Adeojo), Globe Motors (Honda & Mercedes), Bras (Mercedes), RT Briscoe (Ford), SCOA (chevrolet and Nissan) have any car assembly plant under construction.

To make matters worse, govt begins to give them importation moratorium and waivers, they will simply sell at new prevailing elevated market prices once the new tariff kicks in, ripping off govt one side, and poor masses on the other.

We all know that the bulk of the cars bought by Nigerians are used cars, though the age are younger of recent. It will hit the poor and the middle class hard. Even prices of parts will go through the roof. So even if you own a car already don't rejoice yet.

The tariff increase should have been gradual, scaled to align with progress in construction and streaming of new car manufacturing plants.

Please note that objective of govt is not for manufacturers to invent new Nigerian brand of car, but to encourage importers to assemble at least the brands they currently import. So it has nothing to to with market already being taken over by Toyota and other known brands.

Guy u dey yarn sense abeg...

sonnie10: I have this friend who was able to secure a #7M loan for a brand new Toyota camry. His job could only give him car loan and no other form of loan, good enough, the interest on the loan was just about zero. He struck a deal with a new/used car dealer, got the money, but instead picked a used 2013 camry; just as good as new! (His Oga did not even know that it was used). Just for #3.8M. The rest of the money, he bought a Mack dump truck that delivers #150k every week. Do you call that being smart or stupid?

Well, here are my thoughts regarding the new policy. In every capitalist economy, they are lobbyist and interest groups, and these people have so much influence and a lot of money to push buttons for their own interest. Imagine the above scenario if you were a New car dealer; for someone to be able to drive the same car you have in your show room for half the price (camry 2013 is even less than #3.8 on Nairaland. Lol!). What you are seeing now is exactly what the result of their actions would be, in order to safe their business.

Take a look around the major cities in Nigeria today, what do you see? So many newer cars (2008...2013/14). However, they are mostly Tokumbo (pre-owned). Just a handful were bought brand New. Now, when the new policy takes effect, the table will turn over. Consumers like my friend mentioned above would be caught between paying that #7M to a Used dealer for 2013 camry or patronizing a new car dealer. My guess it that that later would win the customer.

Finally, some would say, what if I don't have the #7M. The honest but unfortunate answer is that these groups of lobbyist DO NOT CARE about you. Their targets are those who can afford these cars but prefer an alternative means which would save some money. The rest can go for older vehicles like Tiny lights, Big for nothing, Eod. etc. Who cares? Sadly, these 'not so rich folks' would have to safe a little longer to make up the difference which the new policy would cause. #800 -850k may not be enough for camry Tiny light anymore but #1.2M. It is a win win situation, both for the lobbyists and the policy makers who certainly would also benefit as well from the increased duty

addendum:
70% of a toks 2013 carmy valued at #3M is #2.1M. When you include other charges,by the end of the day, landing cost of a 2013 used carmy would be #6M plus. Same price with a brand new one!

cooperate greed

solomon111: Shut up you morøn.
How's importation of cars beneficial to a country of 170million people with over 60million youths unemployed?

Dude. Why ar u so angry, and why does it appear like u r d only one on ur lane

solomon111:
Shut up you morøn.
How's importation of cars beneficial to a country of 170million people with over 60million youths unemployed?

Typical Naija unproductive mentality? Win with facts not sentiments and curses. Spend ur energy on facts not shouting on people. We are unproductive because folks like u want to stifle dissenting opinions without facts

arewa queen: Power is the backbone of industrialisation and for now we do not have stable power so I wonder how this policy will work. I believe the govt is very broke and by increasing tariffs, they will have more funds for 2015. OP don't worry I don't think this policy will be effected as 2015 is round the corner and Jona needs our support. So the last thing he will do is make us suffer more

It's like u r underestimating the capabilities of a power drunk president

solomon111: The manufacturing companies have already made commitment to come.
Nissan and toyota will begin manufacturing in Nigeria this year.
But then i can assure you that if we abandon this policy due to pessimism or the temporary discomfort we may encounter in the course of this policy,we will be losing much in the long run.
I won't be surprised if in the nearest future we start importing cars from kenya and morroco just like we are currently importing from southafrica.

close your mouth there. what happened to the refineries they promised after the discomfort?

solomon111: Nigeria needs importation of cars?
lol.
You must be high on crack.
You are just a black man that only care about his own stomach.

This ill bred guy is here again with his insults trying to defend his masters Policies designed to always take money from the pocket of the masses.

See how daft you appear in the midst of the posters of the FP now.

Fuel prices have gone higher, car prices are about to follow while the FG now have money to embezzle.

Meanwhile, how many Nigerians could afford Brand new cars in the first place??

Why not provide the alternative of cheaper brand new cars and attractive financing to lure people from used cars??

I'm with voting these clowns out of office.

In as much as I see the sense in this policy, I totally disagree with you on the supposed jobs it would create. The job creation benefit from this policy, would be infinitesimal because most automotive production plant operate using robots, computer systems. So in this regards it would not create as much job as it would be putting dealers out of jobs. I also think policy implementation should only commence when all the right structures are in place so as to reduce to the barest minimum difficulties.

Abariwiseman: FG should have placed ban on imported vehicle instead of increasing the tarrif.
I believe this automotive policy will creat alot for jobs for Nigerians

Clearly this is a very selfish decision by Jonathan, how many Nigerians can afford a brand new car of 4-5million naira?, i regret voting that man. Just some few weeks ago, he banned importation of fish, fish business has crippled and price of fishes has sky-rocketted. Why is jona making life miserable for the common man?, i weep for this nation. i weep for this generation and the generation yet unborn. The poor keeps getting poorer while they (the politicians) keep faking certificates and siphoning our money. Only God can judge them now. Jona will weep profusely too in 2015 and we the common Nigerian will smile cos victory will be ours, if we can just endure and survive jona's tenure, there is a brighter day ahead. May God curse him and bless us the common man.

When we discuss topical issues such as this I can not but get amazed at the argument pro and against put forward by respective individuals. One that never cease to amaze was govt programs and policy and nigerians should not be deceived,govt preoccupation is just political/self gain/power at all cost .

Back to used vehicle 70% policy anyone in his right senses knows that it is all a rouse to promote some influential persons ahead of general elections.money and not people matters to them at the elections otherwise govt should be saddled wth saving graduates turned clearing agents,car dealers,attendants,sparepart dealers,transporters, and many more.

solomon111:Nigerian rice is cheaper or at most, at the same price with the imported rice.
The only problem was that Nigerians chose the imported ones and abandoned the local rice.
What this policy is trying to achieve is to make the imported rice more expensive than the local rice so that Nigerians would then turn to the local rice.
So yes, increase in the price of imported rice is part of the overall objective.

I think the policy makes no sense. What needed to be done is simple.: Encourage local production of rice through soft loans, machineries and quality of the rice for cultivation and if the quality is as good as the imported but cheaper, the imported rice will disappear by natural selection over a period of say five years p.! same principle that was used in Gsm. Nitel was bad and could not compete and died naturally..
note that rice is not the only commodity that can be done like that ..there are others too
IBB did these during his regime but where are we now? starting all over again.. IBB SAP was meant to address things like this and made the common man to suffer and later abandoned. We should always think through policies so people wont suffer unnecessarily and at the end no gain
what are the gain's of IBB SAP ..nothing just pains ..I was a teenager then and now as adult same rigmarole policies and pains to the masses
let us have a grown , well though out polices not some western policies that cant fit into our system because of inbuilt deficiencies common to us.
who told you that by 2015 and with the hawks and vultures in power, they wont jettisoned these policies and yet the masses would have suffered
so why cant the govt be patient and see that local production is on first?

[quote author=ndu_chucks]

The Joint Committee on Rules/Business, Justice and Judiciary, is currently charged with studying opposing views on this very issue and advise the House on what to do.

One view is that the Customs/Excise Tariff Act empowered the President to adjust tariffs whenever necessary. Those who hold that view believe that the only way to stop the policy in question was to come by an amendment bill. An opposing view (which I subscribe to) is that the said tariff was included in the Exclusive Legislative List and could not be changed by “executive fiat” unless by a law passed by the National Assembly.

I do not believe that the matter has been settled. My guess is that the executive branch, out of courtesy, will allow the house to fully deliberate the issue before allowing the policy to go into effect. It would be wise of the executive branch to postpone the 250% tariff increase and avoid a possible legal challenge which could actually erode its perceived authority, to willy nilly adjust such tariffs. The fat lady is yet to sing.

My friend if you look at it from a constitutional perspective, you will agree that the NASS, out of sheer ignorance of its constitutional role have essentially abdicated (not even delegated) its constitutional duties in this instance (and sadly, in so many other instances) to the president. Firstly, the power to impose tariff is the power to riase taxes. Even an elementary grasp of consitutional law will tell you that the power to tax is supremely a legislative power. It was the need to raise taxes that prompted the English monarchs to summon the first parliaments. It should be sacrosanct that no money ought to be raised or spent without the stamp of the NASS.
Secondly, this policy makes a serious impact on major sections of the economy. It even impacts the right of private property by depriving some of their livelihoods and bestowing benefits on others. Such discriminatory policies might be necessary sometimes in the public interest but they have been deployed very narrowly after a complete and open factual finding and done within the bounds of what is reasonable and prudent.
What I find most depressing with your post (though sadly true) is your opinion " that the executive branch, out of courtesy, will allow the house to fully deliberate the issue before allowing the policy to go into effect". I am sure Oliver Cromwell will be rolling in his grave if he reads that. I have said it before, 90% of our problem is that we just do not undetrstand the concept of constitutional democracy...3 decades of military rule has destroyed Nigeria

Let look at the policy as it affect low income earners and fresh graduates who cannot afford to get a vehicle for N1.5m ..... The policy is rubbish, i feel there should only be tax wavers for indigenous companies (companies solely owned by Nigerians) who assemble Cars... Company like INNOSON should be encourage and the Government agencies and officials should only use made in Nigeria Cars.

The tokunbo cars should compete with the brand new assemble Cars in Nigeria and the people (masses) should be free to choose. how many People in Nigeria can afford to buy a Car of N1.5m. am sure only a small segment of the population.

i deal in Tokunbo Cars - www.largemanmotors..com

One view is that the Customs/Excise Tariff Act empowered the President to adjust tariffs whenever necessary. Those who hold that view believe that the only way to stop the policy in question was to come by an amendment bill. An opposing view (which I subscribe to) is that the said tariff was included in the Exclusive Legislative List and could not be changed by “executive fiat” unless by a law passed by the National Assembly.

I have no doubt that suchn Act as above exists to justify what the president is doing. My point is that legislations like that whether passed by the NASS or by the military (and grand-fathered in by the Constitution) are patently unconstitutional as improper delegation of legslative powers.
Under US consitutional law (and I dont see a special circumstance that stops us from following the precedence, sicne we borrowed the same system), the Congress might rightly delegate some of its powers, but such delegation has to be narrowly tailored with clear guidance regulating its exercise. A blanket delegation of power to raise or reduce tariff or ban or un-ban imports will clearly fail that test.
We just have to imbibe and internalize the political philosophy that (except in a few circumstances) the powers surrendered to the governemnt under a constitution is first and foremost powers surrendered to the senior branch of governemnt (the legislature) which is also the truly representative branch and the custodian of the people's sovereignty

Until the government realises; that successful economies are actually driven by small and medium scale enterprises, there will be no salvation for our country. When basic infrastructure like pipe-borne water, electricity, and good roads are taken care of; development, and progress will swiftly follow. Everything the government formulates is always to favour multinationals, and other companies that have access to their cronies in power. A classic case of making the masses pay for the government's inefficiencies.

ikenga67: My point is that legislations like that whether passed by the NASS or by the military (and grand-fathered in by the Constitution) are patently unconstitutional as improper delegation of legslative powers.
Under US consitutional law (and I dont see a special circumstance that stops us from following the precedence, sicne we borrowed the same system), the Congress might rightly delegate some of its powers, but such delegation has to be narrowly tailored with clear guidance regulating its exercise. A blanket delegation of power to raise or reduce tariff or ban or un-ban imports will clearly fail that test.
We just have to imbibe and internalize the political philosophy that (except in a few circumstances) the powers surrendered to the governemnt under a constitution is first and foremost powers surrendered to the senior branch of governemnt (the legislature) which is also the truly representative branch and the custodian of the people's sovereignty

Good points up there. Unfortunately, neither the legislative branch nor the executive branch is willing and ready to test the constitutionality of the executive branch's power to raise or reduce such tariffs, in court. The test certainly will not come because of the new policy on Tokunbos.

Both the branches will be busy fighting over the budget in the next few weeks. If I were a betting man, I'd put money on the postponement of the 250% tariff increase. When all is said and done, we'll end up with a compromise of probably 50 - 75% increase.

ndu_chucks:

Good points up there. Unfortunately, neither the legislative branch nor the executive branch is willing and ready to test the constitutionality of the executive branch's power to raise or reduce such tariffs, in court. The test certainly will not come because of the new policy on Tokunbos.

Both the branches will be busy fighting over the budget in the next few weeks. If I were a betting man, I'd put money on the postponement of the 250% tariff increase. When all is said and done, we'll end up with a compromise of probably 50 - 75% increase.

Forget the legislative branch. They do not even deserve the hallowed name "Parliament" in the anglo-saxon sense and tradition. It is a shame that while we all dissipate all our energy screaming "Jonathan-this", "OBJ-that", "2015-this", we allow the most important institution in a constitutional democracy based on our heritage to just go to waste. If only we an devote a fraction of the emotional energy we dissipate on shouting ourselves hoarse about the presidency and just look to see if our so-called reps are even making the effort to do the people's work, Nigeria would be a much better place.
Is it not sad and ironic, that we have such a weak president and he still call all the shots?

ikenga God bless u for sayng this, imagine the powers NASS is being confered with but yet they cant exercise it. bulk of our problems is from them, hw can mr president brings a yr budget n u see 1billion naira for food n u pass it N U leta told the public the president budget for food was 1billion which is too much but we passed it. who is fooling who now? no abt this tokunbo car thng if the govt n the people abide by govt policies i think it will work for our good though we might bear the hardship along the line but definately it will be better.

I don't want to speak too much grammar. People wey sabi grammars pass me have already spoken and have heavyweight points.

The truth of the matter is, this a nonsense policy.

This policy was made for the benefit of a few people. It will only make life more difficult for average Nigerians.

Jonathan and his crew right now are looking for evey way they can use to rake in billions of naira to be utilised in the upcoming 2015 elections.

This is the same motive behind all this car vehicle registration palava.

Ngozi Iweala maybe an Harvard graduate and a pride to the World Bank and Breton Institutions like the IMF etc, but she is a disgrace to Nigeria. Personally I believe she's been compromised. America will never for instance, give a woman or man who spent all of his or her growing years and all his or her education in Russia an important post that is critical to the American economy or security.

Then why does GEJ chooses every new year to dash us these evil presents.

Ngozi Iweala, Aganga and the rest of them talk pass this for the fuel subsidy issue. Infact there was nothing they did not say to convince us. A picture of Nigeria where infrastructures will start springing up everywhere was painted for us.

More than two years now that fuel prices have gone up, can anyone point to any benefit for the masses. Jonthan and his people only had more money to embezzle.

Such a sad country.

GEJ till ?

Honestly, how many Nigerians can afford a N1.5m car?