Giant automakers encouraged

 -  as the ban of imported vehicles get on

It is important to note that the Ghana Automotive Manufacturing Development Programme (GAMDP) developed in August 2019 has come out with measures aimed at promoting locally manufactured cars for the local market and West African sub-region.

A new law banning the importation of vehicles more than 10-years old was passed on March 3, 2020 to strengthen the programme.

Ghana's automobiles are mainly dominated by rickety vehicles with questionable standards. Indeed, over 70 percent of passenger vehicles imported into the country are often found to be from five to twelve-years old.

The automobile sector has been a driver of growth for the country, as it is one of the most visible sectors to receive foreign investment.

President Nana Addo Dankwa Akufo-Addo recently announced that a new policy has been developed, explaining that the operations of automobile vehicle investors in the country calls for a clear-cut policy to govern the automotive industry.

The import restrictions on vehicles could cost government as much as US$143million in Customs revenue during the first three years after implementation, according to parliamentary documents. Used-car sellers offer more affordable deals in a country where auto loans are rare.

The law, signed by President Nana Akufo-Addo on April 30, also bans the importation of cars which have been involved in accidents - which dealers bring in and repair to provide even cheaper options for consumers. The ban on these will take effect from October, regardless of their date of manufacture.

As part of measures to transform Ghana's vehicle fleet into a safe, modern and environmentally-friendly vehicle fleet, compulsory vehicle standards will be required to ensure that all components and parts of vehicles meet the appropriate international standard; and that their proper assembly and testing are confirmed before vehicle registration by the Ghana Standards Authority (GSA).

This will be based on a homologation certificate from a recognised certification body.

The new law also provides import-duty rebates for companies that manufacture or assemble cars in Ghana, according to the act of parliament obtained by the B&FT.

Clearly, therefore, this will have some positive effects in the automobile value chain by allowing for asset-based vehicle finance and insurance. In addition, it will also have a positive effect on the industry and promote efficient distribution and after-sales service networks that will benefit all market players.

With the current release of Toyota, VW and Kantanka vehicle brands, with time it will help to phase-out older vehicles that are not energy efficient and environmentally friendly.

All these measures are being taken to ensure safety of road users as well as vehicle owners, by protecting them against vehicles that are not suited for the climatic and road conditions in Ghana.

In addition, this arrangement seeks to increase the overall level of security and protection from vehicle theft and cloning. The new scheme being introduced in Ghana is also meant to help local assemblers and importers to provide effective warranties and controlled guarantees.

This is because the scheme will help the insurance and finance industries to improve risk management and traceability for vehicles in Ghana. Again, there will be a need to cater for equipment fitment in older vehicles.

Thus, dealers and retailers will be able to provide suitable equipment fitments for older vehicles.

A number of draft standards have been prepared by the GSA as identical adoptions for Ghana by the National Technical Committee on Automobile Industry Standards (GSA/TC 05). Some of them are: GS 4003:2019 – Retro-Reflecting Devices; GS 4006:2019 – Direction Indicators; GS 4013:2019 – Braking; GS 4007:2019 – Front and Rear Position Lamps, Stop-lamps and End-outline Marker Lamps; and GS 4051:2019 Noise Emissions, among others.

These draft standards have been circulated for public comments before their finalisation and their gazette as National Standards. Copies can also be viewed on the GSA website.

The president's vision of encouraging automobile manufacturing companies to establish assembling plants in Ghana is therefore meant to implement an efficient Vehicle Marking System, to positively identify vehicles throughout their life-span and to limit loss of revenue, avoidance of taxes and duties, smuggling of vehicles, fraudulent transactions and also collusion between selfish, wicked and unscrupulous elements and those in licencing centres, among others.