NEC recommends legislative backing for local auto firms

Abuja, June 15, 2023: The National Economic Council (NEC) has recommended the provision of legislative backing for local auto firms.

Gov. Alex Otti of Abia briefed State House Correspondents after the NEC briefing presided over by Vice President Kashim Shettima on Thursday at the Presidential Villa, Abuja.

According to Otti, the council deliberated on the removal of petroleum subsidy and the implied removal of subsidy on foreign exchange.

“The impact of these two actions definitely is increased prices; and that is a way to solve the problem and reduced the shock; a presentation was made by the National Automotive Design and Development Council on the great things that are happening in the automotive industry.

“It was that about six states in the country, including Lagos, Ogun, Anambra, Enugu, Akwa Ibom, Kaduna and Kano and have benefited from domestic production of vehicles or assembling of vehicles by Nigerian companies operating in Nigeria.

“And these companies include INNOSON, Maikano, Dangote Peugeot, Peugeot automobile of Nigeria, Stallion Hundai, Honda, Elizade/Toyota, Coscharis and Ford, Kojo Motors, Jet Systems motors.

“At the moment, about 50,000 jobs have been created by this simple action of either assembling vehicles in Nigeria or producing them Nigeria.

“A great feat is that some of these companies have gone into the manufacturing or assembly of electric vehicles and vehicles powered by Compressed Natural Gas(CNG).

“The impact of this is that the pressure on the price of petroleum products particularly PMS will be reduced; the more we use electric vehicles and CNG powered vehicles.

“Some of the decisions that we were taken include that legislative support will need to be given to these companies that are doing great things in Nigeria.’’

He said it was important to underscore the point that former president had made a commitment that by 2060 that Nigeria would join countries that would eliminate fossil fuel powered vehicles.

Otti said the commitment also entailed switching to electric vehicles in pursuit of the net zero emission that some of the countries in Europe, America and Asia had signed on to.

“So if that must happen, then we need to ramp up the production of electric vehicles and CNG vehicles.

“It is estimated that if we give legislative support to this company, that about a million jobs from the 50,000 jobs that exist in that industry would be created.

“ It was also suggested that the funding that is required by most of these vehicle manufacturers and assemblers shall be made available to them; so that we begin reduce the dependence on PMS and other fossil fuel powered vehicles.

“Finally, it was also suggested that electric vehicle development plan, will fast track the development of electric vehicles should be supported wholeheartedly by the new government.’’

The governor said that the reality remained that Nigeria could not run away from the removal of petroleum subsidy.

He said it should have been done a long time ago.

“But we must salute the courage of the current government to bit the bullet and remove it.

“ Initially, it had reduced the consumption from about 66.7 million litres a day to just about 40 million.

“And as time goes on, the consumption will continue to go down; we know there are implications particularly for the poorest of the poor.

“And that is why this government is seriously looking at palliatives to at least deal with the shock that the poor of our society goes through,’’ he said.