‘Buy Nigeria’ project
As part of efforts to promote and sustain the NIRP, the government has reactivated the dormant ‘Buy Nigeria’ project and has compelled its Ministries and agencies to buy more locally manufactured cars and other products. Last October, the government approved a new national automotive policy as part of a strategy to halt a drain on the nation’s foreign reserves and to encourage foreign car manufacturers to invest in the country. Nigeria reportedly spent over N550bn ($3.4bn) in importing cars in 2012. The government hopes to protect new investors in the local car industry by introducing a new higher tariff regime on imported used cars, effective from 1st March 2014.
It is estimated that investments in local car manufacturing could create up to 700,000 jobs. But, given that Nigerians seem to have an insatiable appetite for imported luxury brands, it remains to be seen how ‘Buy Nigeria’ policy will succeed.
In the past, a locally assembled Peugeot was the official vehicle for top government functionaries. But poor patronage and high production costs have rendered the 42-year-old Peugeot Automobile Nigeria (PAN) assembly plant in Kaduna largely uncompetitive and near comatose. Imported and cheap second-hand cars, which offer locals an alternative, have also contributed to this sad state of affairs.
The plan is laudable and makes economic sense. But we have been here before. Perhaps this time it will be different for Nigeria. Perhaps this time Nigeria will really seize the moment and use its enormous advantages, including potentially limitless energy, the biggest population on the continent, a rich agricultural sector and a reliable flow of FDI (estimated at $20bn over the last three years) to finally make good on its promise.