The Abossey Okai Spare Parts Dealers Association has dissociated itself from any impending demonstration against the implementation of the Customs (Amendment) Law, 2020.
The law bans the importation of used cars older than 10 years, and salvage vehicles also known as accident cars.
Some vehicle importers who anticipate job losses have threatened to demonstrate against government over the new law.
Speaking to Citi Business News, the Co-Chairman of the Abossey Okai Spare Parts Dealers Association, Clement Boateng, called on government to engage more with stakeholders to review portions of the bill to get everyone to buy into the idea.
“Cars that are flooded have a negative impact on the whole electrical system of the car. It will be a problem if you bring those cars to Ghana. So, it is a step in the right direction, if those cars are not allowed to come in. But I think government should allow slight accident cars, especially those whose bumpers are slightly damaged as a result of an accident, because the damage is not so severe. So, these are the areas being raised by some of the stakeholders. They think government must address these concerns. I think those concerns are legitimate. We therefore call on the government to call for a stakeholder meeting to discuss these issues,’ he said.
Data available from the Ghana Revenue Authority (GRA), Customs Division, indicates that between 2005 and 2016, more than 1 million vehicles were imported into the country; representing an average of 100,000 cars per year.
Out of this figure, 80 percent were second-hand vehicles. According to some quarters, the trend needs to be reversed to allow for the development, nurturing and flourishing of a competitive automotive industry in Ghana.
Currently, there are penalties for over-aged cars ranging between 5% and 100% of the total cost, insurance and freight of an imported car, between 10 years, and those over 35 years at the country’s ports.
Ban on importation of ‘accident’ and 10-yr old used cars starts in Oct. 2020
Parliament in March this year, passed the Customs (Amendment) Bill, which the President later assented on April 30.
However, government says the ban will take effect from October this year
Background
The government as part of its transformational agenda identified Vehicle Assembly and Automotive Components Manufacturing as a strategic anchor industry that will promote economic development in the country, and provide incentives for auto manufacturers.
It thus launched the Ghana Automotive Development Policy, GAMDP, in August 2019, to promote the manufacture of automobiles for both the domestic market and the West African sub-region.
Commencement of Operations
In August 2019, Toyota and Suzuki became the latest companies to formally commit to setting up car assembling plants in Ghana.
This was after Volkswagen, Nissan and Sinotruk, also major automobile companies expressed an interest in Ghana.
Volkswagen was supposed to start its operation in the first quarter of 2020, Toyota in August 2020, Suzuki before the end of 2020, Nissan in the second quarter of 2020, while discussions pertaining to the operations of Renault, Kia and Hyundai are ongoing.