THE National Bureau of Statistics, NBS, has said that the introduction of the automotive policy by the federal government made the auto sector to grow by 26 percent in 2014. Automotive policy has been at the forefront of the Nigeria Industrial Revolution Plan, NIRP.
Prior to the introduction of the policy, industry data showed that the country’s annual spending on vehicle imports was estimated at $6 billion. However, there has been a 20 percent drop in the volume of imports since the first phase of the auto policy was introduced in July 2014. As a result of the development, the National Automotive Council, NAC, recently launched the national automotive repository portal.
The portal, according to the NAC, had been set up as a database where vehicle identification numbers for locally assembled and imported vehicles in the country will be stored. The portal, it stated, will also facilitate the tracking and auditing of vehicle registration within measures to control dumping and smuggling. To encourage local assembly of cars, the federal government announced plans to impose additional levy of 35 percent on imported used vehicles (tokunbos), raising the total tariff to 70 percent. The date of implementation has been put back three times. It was originally set for July 2014, and has since been shifted to January, April and now July 2015.
The NAC had also recently developed a few projects including the Local Automotive Components Development Fund in conjunction with the Bank of Industry. Through this fund, N10billion ($50 million) has been disbursed to 27 companies. Despite the recent growth, analysts at FBN Capital believe the sector faces multiple challenges, one of which is poor power supply.
“The actual energy generation figure nationally as at May 3, was 3,135 megawatts, MW, well below national demand of over 12,000 megawatts. Towards the end of April the generation output was as low as 2,800MW, which the federal ministry of power attributed to gas pipeline vandalism. Despite potent challenges, the NAC still insists that the country is capable of rolling out 25, 000 locally manufactured vehicles by the end of this year. A few industry players argue that the country is not ready to embark upon developing a mature auto industry. In our view, this is attainable in the long term. However, expanding the auto parts segment through the local content policy would hasten the process, “they said.
Nestle Records Impressive Performance
NESTLE Nigeria Plc is preparing to inaugurate its N4.6 billion new water factory in Abuja this year. This declaration was made by David Ifezulike, chairman, board of directors of Nestle, while addressing the shareholders at the company’s 46th annual general meeting held at the Muson Centre, Onikan, Lagos.
Nestle is set to commission the new state of the art, high technology water factory which is located in Abaji near Abuja. The new N4.6 billion facility which occupies 14.13 hectares reflects more than just an important investment to broaden Nestle Watersa operation. The factory was built based on the drive of the company to stimulate sustainable growth, increase market share capital and promote healthy hydration in Nigeria. It underpins also Nestle’s commitment to the growth of the Nigerian economy.
According to him, the new investment underpins the company’s strong belief in the potentials of local market and the resilience of the Nigerian economy. Ifezulike commenting on the company’s result said that Nestle achieved strong growth in 2014 in Nigeria. This, he said, is based on the company’s turnover of N143.328 billion, representing an 8 percent increase over N133.084 billion recorded in the previous year. He said that although the 2014 results fell short of the company’s annual growth target, Nestle significantly outperformed competition in the market place. He added that the company has delivered on its short term commitment and would continuously strive to strengthen the foundations for future growth.
The chairman of the board also used the occasion to launch the company’s third sustainability report entitled “Nestle in Society: 2014 Creating Shared Value Report of Nestle Nigeria”. The 40-page report chronicles the major CSV initiatives that the company is implementing in the areas of nutrition, rural development and responsible sourcing water as well as activities in environmental sustainability and compliance and human rights. The report is based on Nestle’s global commitment as implemented in Nigeria.
Ifezulike while commenting on the Nigerian economy commended the effort of the outgoing administration on their efforts to privatise the energy sector towards achieving stable power supply. He implored the new administration to pursue and implement favourable macro-economic policies including the fiscal prudence supported by good monetary policy to maintain inflation at single digit.
— May 25, 2015 @ 01:00 GMT