The latest import data released by the National Bureau of Statistics (NBS) shows that Nigeria spent a whopping sum of N148 billion to import used Vehicles (popularly known as Tokunbo) in the first quarter of 2019.
According to the NBS report, out of the total N3.58 trillion worth of goods imported in the first quarter of the year, used Vehicles amounted to N148 billion. This represents about 4.63% of Nigeria’s total import in three months.
Nigeria’s top 15 imports
Nigeria’s top 15 imports constitute about 38% of total imported goods in the first quarter of 2019. Basically, the top 15 imported goods were estimated to be valued at N1.35 trillion.
Top on the list is laboratory, hygienic or pharmaceutical glassware product, which was estimated at N517 billion for the quarter. Similarly, the second item on the top 15 list of imported goods is the Premium Motor Spirit (Petrol), gulping the sum of N190 billion. Meanwhile, used vehicles are the third most imported goods into Nigeria.
- 1st – Laboratory glassware – N517 billion
- 2nd – Motor spirit, ordinary – N190.7 billion
- 3rd – Used Vehicles – N117.4 billion
- 4th – Imported motorcycles – N95.3 billion
- 5th – Gas Oil – N62.2 billion
- 6th – Machines – N56.7 billion
- 7th – Durum wheat (Not in seeds) – N43.8 billion
- 8th – Durum wheat, Seed – N43.8 billion
- 9th – Sugar Cane – N34.5 billion
- 10th – Lubricating oils to be mixed – N41.6 billion
- 11th – Used Vehicles – N31.4 billion
- 12th – Vehicles (petrol fuel engine) – N30.8 billion
- 13th – Other machine-tools – N29.3 billion
- 14th – Other Herbicides – N24.8 billion
- 15th – preparations for infant use – N23.3 billion
Billions spent on Used cars
An earlier analysis of data obtained from the U.S Department of Commerce shows that Nigeria imported used vehicles worth $526 million (N161 billion) from the U.S in 2018, as against $284 million (N87 billion) in 2017. This implies that a large chunk of Nigeria’s foreign exchange is spent on imported vehicles.
Since 2015, the total amount of money spent on the importation of vehicles from the U.S only rose significantly. Further analysis of the NBS data shows that between March (2018 and 2019), Nigeria spent the sum of N417.66 billion to import used vehicles.
Is Nigeria a dumping ground?
Importation appears to be one of the major banes of the Nigerian economy. This explains why car importation has surged over the years. The figure provided by the bureau, to say the least, omitted smuggled cars. Smuggled items and the importation of sub-standard goods have led to the death of several companies.
Recently, the CBN announced that it has concluded plans to close the bank accounts of smugglers. While this is a step in the right direction, it may not curb the importation of used cars.
Nigeria’s automobile policy: One would wonder why Nigeria’s automobile industry has been at a standstill for many years.
In 2014 the Federal Government increased import tariffs and duties on imported new and used vehicles to as high as 70 percent, while reducing tariffs on semi-knocked down and complete knocked down vehicles and assembly machinery to a range of 0 to 10 percent.
Five years later, the rigmarole still lingers as used car importation gulps billions of naira. According to the Managing Director of VON Automobile Nigeria Limited and Chairman of the Nigeria Automobile Manufacturers Association, Tokunbo Aromolaran, revealed;
“Nigeria had about five or six booming auto industries in the 70s; they all died because they couldn’t compete against the imports from China and Southeast Asia. The industry was redefined by the Auto Policy as most of you know. We have achieved partial success as envisaged when that policy was put together. Partial, in the sense that not all the requirements of the policy have been or is being implemented as it should.
“Today, South Africa has a full auto industry. They can produce everything from ink to the final car, including engine blocks. BMW is there, Mercedes is there, Toyota is there, Volkswagen is there. South African blacks like you and I are on the floors of the factories, producing those vehicles. Nothing says that Nigerians could not do the same.”
How this affects the Nigerian economy
Increased importation of used vehicles would affect innovation and production of vehicles in the country. As a result, the Federal Government’s auto-policy needs to address this.
- Industry sources have revealed that the Nigerian customs’ revenue is going down due to fewer vehicles coming through the ports, hence, FG loses billions of naira.
- Demand for foreign exchange to pay for the imported vehicles may also cause undue pressure on Nigeria’s fragile exchange rate system.
- Lastly, rising importation of used cars is a quick way to discourage investors in the automobile industry, and further dampens hope of revitalising the sector.
COVID-19: Lufthansa resumes flights to Nigeria after 8 months suspension
After eight months of suspension due to the Coronavirus pandemic, Lufthansa Airline has resumed its flights to Nigeria.
Lufthansa Airline has resumed its flights to Nigeria after eight months suspension due to Coronavirus pandemic. The first Lufthansa flight arrived in Lagos on Thursday, 03 December 2020.
This was disclosed in a statement issued by the airline on Friday and seen by Nairametrics.
According to the airline, it is expected to do up to eight weekly departures scheduled from Lagos and Abuja Airports to Frankfurt. The German carrier also will offer up to five weekly departures from Lagos to Frankfurt and starting on 08 December also connect the capital Abuja with three weekly departures.
Adenike Macaulay, General Manager, Nigeria & Equatorial Guinea Lufthansa Group Airlines, said, “All intending travellers to Nigeria must have tested negative for Covid-19 as PCR test in the country of departure pre-boarding. The PCR test must be done within 120 hours before departure and preferably within 72 hours pre-boarding. International travellers will require a second test to be done in Nigeria, seven days after arrival.
“All long-haul flights depart from Nigeria in the evening as overnight flights, arriving in Lufthansa’s main hub Frankfurt in the early morning. This allows all passengers from Nigeria to get the full choice of connecting flights to European, American and Asian destinations, leaving all from the same terminal 1.
‘’As we have received the final permission to reopen our flight operations, we are happy to be the first airline to reconnect Nigeria directly to the centre of Europe and onwards to all other continents. We offer a considerable number of flights to the US and Canada, allowing our Nigerian guests to have family members and friends again at reach throughout the world. Health and safety continue to be our top priority and we are committed to maintaining strict adherence to hygiene regulations for all our flights.”
What you need to know
Nairametrics Lufthansa has notified its patrons of the suspension of all flights out of Nigeria from 23 March 2020 to 19 April 2020. This was disclosed in an email sent by the airline through its agency, Lufthansa City Centre TIFA Travels and seen by Nairametrics.
In the notification, the airline explained that the decision was due to the current global situation and to curb the spread of Coronavirus, also known as COVID-19. It read,
“Lufthansa flights out of Nigeria are hereby suspended from 23 March 2020 until 19 April 2020. The last flights from Lagos, Abuja & Port Harcourt will operate on Sunday 22 March 2020, to resume on 20 April 2020 as currently planned.
“Due to the uncertainty surrounding the spread of COVID-19 in Nigeria, our offices are closed to walk-in customers until further notice, however, we can be reached via telephone lines of our ticketing offices and reservation e-mails. We hope for your understanding as we would do our utmost best to ensure a quick response to your requests.”
Abbey Mortgage Bank Plc projects N60.13 million profit in Q1 2021
Abbey Mortgage Bank Plc has projected a Profit after Tax (PAT) of N60.13million in its 2021 Q1.
Abbey Mortgage Bank Plc has projected a Profit after Tax (PAT) of N60.13million in its 2021 Q1.
According to the earnings forecast issued by the bank and seen by Nairametrics, it projected the 134.7% Q-o-Q rise from a loss of N173.49 million recorded in its most audited financial statement for Q3, 2020.
key highlights of its earnings forecast for Q1 2021 when compared with Q3 2020 figures include;
- Pre-tax profit increased to N88.4 million, +151.5% Q-o-Q.
- Interest income increased to approximately N515.9 million, +55.45% Q-o-Q.
- Net operating income increased to N421.94 million, +79.9% Q-o-Q.
- Interest expense increased to N208.06 million, +63.95% Q-o-Q.
- Operating expenses declined to N333.52 million, -17.9% Q-o-Q.
- Credit loss expense increased to N19.83 million, +100% Q-o-Q
- Gross earnings of N649.83 million
- Taxation of N28.3 million
- Other income of N133.84 million.
Despite recording not too impressive results in its last financial statements, the firm is, however, optimistic going for Q1 2021 as reflected in its forecast.
This optimism might be premised on the news of a positive general economy by Q1 2021, which will trickle down to various sub-sectors of the economy.
Nigeria needs $3trillion in 30 years to reduce infrastructure deficit – Osinbajo
Vice President Yemi Osinbajo has stated that Nigeria will need $3trillion in the next 30 years to reduce its infrastructural deficit.
The Vice President, Yemi Osinbajo has said Nigeria will need $3trillion in the next 30 years to reduce its infrastructural deficit.
He disclosed this while featuring at a webinar organized by the Bureau of Public Enterprises (BPE).
Osinbajo told the webinar that Nigeria needs to adopt new models of investments for infrastructural developments because relying on public expenditure alone is not sustainable.
The seminar discussed the roles of Public-Private Partnership (PPP) in developing Nigerian infrastructure. The Vice President said Nigeria still face a huge infrastructural deficit, despite government investment which is a roadblock to rapid economic growth.
“The Federal Government recognizes this fact, which is why we are considering other approaches to complement and boost financing for the development and maintenance of infrastructure in Nigeria.
“It is clear that this deficit can only be made up by private investment. Private sector is 92 per cent of GDP, while the public sector is mere 8 per cent. So, the synergy between the public and private sector through Public-Private Partnerships (PPP) is really the realistic solution.
“The fact that only N2.49 trillion was appropriated for capital expenditure in 2020, reflects the importance of deliberate and pragmatic action to boost infrastructural spending.
“It seems to me to be quite clear that the financial outlay and management capability required for infrastructural development and service delivery outstrip the financial and technical resources available to government.
“In other words, the traditional method of building infrastructure through budgetary allocations is inadequate and set to become harder because of increasingly limited fiscal space,” he said.
He revealed that the FG has launched a series of PPP’s to enable Nigeria meet its infrastructure deficit needs, citing the roles of agencies like the BPE with PPP’s.
“The Federal Government has recently issued a circular on the administration of PPP projects in the country to provide the much-needed clarity.
“The circular re-emphasises that the BPE shall be responsible for the concession of public enterprises and infrastructure already listed in the First and Second Schedules of the Public Enterprises Act.
“The circular equally stipulates that the BPE shall act on behalf of the Federal Government, as the counterparty on all infrastructure projects being developed on a PPP basis,” he said.
He disclosed that the Infrastructure Concession Regulatory Commission (ICRC) would continue to act as the regulatory agency for PPP transactions, with directives including inspections and monitoring PPP projects.
“It is expected that this new policy direction would provide clarity to stakeholders and foster the improvement of PPP programmes in the country.
“Ministries, Departments and Agencies, as well as the multilateral agencies and our development partners are urged to support the PPP policy objectives and institutional arrangements already put up by government,” he said.
What you should know
- Nairametrics reported last month that Moody Investors Services revealed that Nigeria needs to spend about $3 trillion in over 30 years to bridge the infrastructural gap experienced in the country.
- The Minister of Works and Housing, Babatunde Raji Fashola, revealed that the Federal Government needs at least N500 billion annually for the next 3 years to develop and fix its 35,000 kilometres road network, as work continues on 13,000 kilometres of the network.
- Nairametrics also reported last month that the FG approved the establishment of an infrastructure company that will be wholly focused on critical infrastructural investments in the country.