Storm over second-hand vehicle imports

THE announcement by Government that it is considering the addition of second-hand vehicle imports from Japan on the list for conformity in order to protect consumers from sub-standard vehicles as well as to promote local assemblers has torched a social media storm.

If this recommendation is approved, all vehicle imports from Japan will be subject to evaluation by Bureau Veritas and issued with conformity assessment certificates before they can be allowed into the country. Bureau Veritas is a global company that provides testing, inspection and certification services.

Zimbabwe is the only country that allows car imports from Japan to enter the country without conformity assessment certificates.

This subjects local consumers to sub-standard vehicles and dangers of exposure to radiation.

Five years ago, Japan witnessed the Fukushima nuclear disaster which exposed people to cancers associated with radiation.

There have been fears that some of the vehicles that are imported from Japan might have traces of radiation.

In a number of countries, cars from Japan are subjected to rigorous tests before they are imported.

In announcing the proposal, Industry and Commerce Minister Mike Bimha said it is the duty of Government to protect its citizens.

“Some countries are very strict about the importation of cars from Japan, which I think we need to move towards to as well. It is incumbent for every country to ensure its citizens are protected against sub-standard products,” he said.

Minister Bimha said although the process would be costly, the benefits outweigh the costs.

The importation of second-hand vehicles has been a contentious issue as local assemblers argue that the imports are pushing them out of business. On the other hand, the motoring public argues that the vehicles that are assembled locally are beyond the reach of many Zimbabweans.

A snap survey revealed that locally assembled vehicles cost between US$40 000 to US$120 000.

One can, however, import a vehicle from Japan for as little as US$3 000. Minister Bimha’s announcement solicited diverse views with players in the car-importation sector arguing that Government is crafting self-serving policies that disadvantages the “ordinary” person. On the other hand, a section of the populace argue that Government must protect the local car industry.

Questions have also been raised as to why Government officials drive imported vehicles instead of supporting the local industry.

Responding to the announcement, a blogger argued that local assemblers must introduce payment terms that make it possible for locals to buy cars on credit.

“One can get a car on zero deposit in South Africa. We need such schemes if we are to support the local vehicle industry.

Economist Mr Cephas Mashange said a number of factors make it impossible for local assemblers to introduce such schemes.

“Such schemes are not introduced by dealers but by financial institutions. Unfortunately low salaries and high interest rates make it impossible for financial institutions to avail vehicle finance,” Mr Mashange said.

According to Mr Mashange, prices for new cars are too high, with a locally assembled vehicle costing twice as much as the one that is assembled in South Africa.

He said even if the vehicles are sold on credit, the monthly payments will be unattractive and few people would afford them.

“One would be forced to pay as much as US$2 000 per month and very few people can afford that much. Locally-assembled vehicles have no target market,” said Mr Mashange. A blogger who preferred to call himself Mazano said there is no need for Government to contract Veritas. “Government must simply ban the importation of cars that are beyond the 100 000-kilometre mark. Allowing the importation of cars whose lifespan has expired does not help,” Mazano wrote. Mazano said the conformity exercise can fuel corruption and result in the prices of second-hand cars going up significantly. Despite the dangers associated with radiation and sub-standard vehicles, Zimbabweans prefer imports due to affordability. During the first half of 2016, car imports into the country amounted to $250 million, down from $365 million during the same period in 2015 on tighter duty tariffs coupled with liquidity challenges.

At the close of 2015, $469 million was spent on vehicle imports from $452 million used for the same purpose in 2014, adding to the huge import bill. Top sources for car imports in Zimbabwe are Japan, South Africa, the United Kingdom and Germany, according to Zimstats. Concerns have been raised regarding the use of Bureau Veritas, especially with regards to delays in issuing out conformity certificates.

Minister Bimha is on record saying there is a remarkable improvement in the quality of goods that are imported into the country.