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Thursday, January 27, 2005 - Web posted at 7:41:11 GMT Govt vehicle import ban 'set to crash' SME sector PETROS KUTEEUEDOZENS of Namibians have been left stranded by Government's controversial decision to slap a ban on second-hand vehicle imports from Asia, while industry pundits fear that the move will damage the country's SME sector. |
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It emerged yesterday that vehicles ordered last year by second-hand car dealers and individuals before the January 1 2005 ban was announced have already arrived in South Africa. They are now set to be sent back. The Government ban came like a bolt out of the blue and has rocked sections of the Namibian motor industry. Fearful of being pushed out of business by the influx of "cheap" vehicles mainly from Japan, established car dealers seem to be revelling in the Government move. However, Namibians and car dealers who had already paid for these vehicles have now been left stranded because of orders which cannot be delivered because of the ban. One importer, who preferred anonymity, told The Namibian that his consignment of Japanese second-hand vehicles had been standing at Durban harbour, South Africa, since the new law came into effect and will soon be returned to Asia. "It is a terrible situation. I stand to lose a lot of money ... this whole move caught us off-guard because surely Government was lobbied into it," he charged. Another importer of Japanese second-hand vehicles, Provinin Moodley, said that although his business was not affected, he was concerned about the impact the ban will have on the Small and Medium Enterprise (SME) sector. "The decision has crashed the SME sector. Imagine how many people and their families benefited from these imports and Government is just simply turning its back on them," Moodley lamented. Established dealers, operating under the auspices of the Retail Motor Industry (RMI) have been accused of twisting Government's arm on the decision to ban imports of Japanese vehicle older than five years. Apparently the Asian imports had started to seriously rival South African-manufactured second-hand cars. Although established dealers claim that their main concern was to "get the playing field level" - there have been allegations of tax evasion - there are clear indications of what some in the industry call "a vicious campaign" to discredit those involved and the products they bring into Namibia. Earlier this week, the RMI flew in an "expert" from South Africa's Business Against Crime, Lee Dutton, to address Namibians on how "the fraudulent importation of used vehicles began, the current modus operandi of dealers and the damages such transactions have done in the various market places". The RMI claimed that sales of imported used vehicles reached N$450 million, and that Government lost N$33,75 million in Value Added Tax (VAT) due to what it termed "the fraudulent declaration of value" of these vehicles. They alleged that the under-recovery of import duties in that year was apparently N$62,035 million, while the depreciation of the national vehicle fleet because of the under-valuation of used imported vehicles was N$735 million. Representatives of the local motor industry have argued that there would be no price difference between imported Japanese cars and locally available used vehicles had the 'correct' duties and VAT been paid by the importers of the Asian vehicles, which are said to be cheaper. The RMI vehemently denied that its Chairman and business mogul Harold Pupkewitz had actively promoted the ban. "The Pupkewitz Group merely, on behalf of RMI, arranged for the placements of newspaper notices intended to warn owners and potential owners of the risk of purchasing unhomologated used vehicles ...," the RMI said. |
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