Ghana Automotive Development Policy gets major boost with 5,000 cars capacity assembly plant
The Ghana Automotive Development Policy implemented by the government in August 2019, has received a major boost with the establishment of a 5,000 cars capacity assembly plant in Tema.
The state-of-the-art assembly plant with the capacity to assemble 5,000 new vehicles every year is established by Nissan which is currently producing Nissan and Peugeot brands of vehicles for both the Ghanaian and West African markets.
“Since June 2021, vehicle manufacturing brands such as Toyota, Suzuki and Volkswagen under the Automotive Development Policy, commenced commercial production of vehicles to which President Akufo-Addo has said the vehicles are enjoying significant local patronage.
“Mr. Speaker, quite a number of global vehicle manufacturing companies have set up assembly plants here in our country, and started producing vehicles for our market and for the West African market. The well-defined Ghana Automotive Development Policy we outdoored in August 2019 has facilitated this welcome development.
“Since June 2021, Toyota and Suzuki brands of vehicles are being produced here, commencing with the production of Hilux Pickup and Swift models. VW and Sinotruck, which commenced commercial operations in 2020, have continued to assemble their brands of vehicles and are enjoying significant local patronage.
“In addition, a new state-of-the-art assembly plant with capacity to assemble 5,000 new vehicles per annum has been established by Nissan in Tema, which is currently producing Nissan and Peugeot brands of vehicles for the Ghanaian and West African markets. I will have the pleasure to commission this new plant in Tema tomorrow. Three other vehicle manufacturers, namely KIA, Hyundai and Renault are also expected to commence commercial production this year.
“Our national iconic automobile brand, the Kantanka brand produced by Kantanka Automobile Company Ltd., also stepped-up production of its made-in-Ghana vehicles which include Nkunimdie SUV, Omama Pickup, Onantefo 4×4 Pickup, Otumfuo SUV and K71 Small SUV models,” the President stated.
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Speaking further, the President urged local assembly plant in the country to take advantage of the announced embargo on the importation of 4X4 vehicles by his government by producing vehicles for government officials.
“Now that the Minister for Finance has announced an embargo on the importation of 4×4 vehicles for official use, I hope the local assembly plants will take full advantage of the opportunity especially since government is continuing with its policy of giving first priority to locally assembled vehicles in respect of all publicly financed procurement of vehicles,” the President added.
Background
In August 2019, the government announced the Ghana Automotive Development Policy, which has a key objective of making the country a fully integrated and competitive industrial hub for the automotive industry in west Africa.
It wants to leverage a new continental free trade deal to become the region’s main auto cluster.
Under the policy, a five-year tax holiday is available for producers partially based in Ghana, while companies building complete vehicles in the country are eligible for a 10-year tax holiday.
The import duties for new and used vehicles will be raised from the current 5%–20% range to 35% to encourage the purchase of locally-assembled cars.
Furthermore, a new law prohibiting Ghanaians from importing cars that are more than 10 years old have been passed.
The vehicle assembling and automotive industry is one of the 10 strategic anchor industries that the government is developing to serve as new pillars of economic growth and to diversify the economy away from traditional industries, such as cocoa, gold and other mineral resources.
A longer-term vision for the automotive industry includes the development of an integrated local manufacturing value chain.
