Zimbabweans imported 206k cars worth over $606 million

ZIMBABWEANS imported 206,519 cars worth over $606 million between January and November last year, shock new statistics reveal.

Finance and Economic Development Minister Patrick Chinamasa says the unregulated importation of second-hand vehicles is costing the country millions.

But he admits the government got $250 million in import duty during the same period.

Chinamasa made known his reservations at a consultative meeting with tourism industry stakeholders and Tourism and Hospitality Industry Minister Walter Mzembi last week.

The meeting was to review the government's introduction of Value Added Tax on accommodation for foreigners, a policy the tourism sector feels adversely affects their business as witnessed by cancellation of bookings.

The government tried to ban second-hand vehicle imports four years ago but backtracked following an outcry from local car dealers and the general public.

The sentiment was that it would be prudent to first attract international car assemblers to satisfy local demand.

At the consultative meeting, Vengai Nhau - a tour operator and professional hunter - had asked that those in the tourism sector be allowed to import second-hand vehicles duty-free as they recovered from the economic recession the country experienced in recent years.

In response, Chinamasa said this was not possible, and he in fact had reservations on the importation of second-hand vehicles.

"Already, I've misgivings about the importation of second-hand vehicles. A lot of them are junk. The United States dollar is precious currency and what's being brought here is junk; and to spend our hard-earned foreign currency on that is a bit unfair," said the Minister.

"You know the problem with us is, because we're using US dollar, we don't regard it as foreign currency anymore, but it's hard-earned. We shouldn't throw it away to buy junk."

Kumbirai Katsande, a former president of the Confederation of Zimbabwe Industries, said the government should lead by example by compelling State entities to buy locally, including supporting Willowvale Mazda Motor Industries (WMMI).

"They're using taxes created locally to buy vehicles from foreign countries. Why create an institution like Willowvale that you'd shun? There's need to strike a balance between what the local industry can produce and allow the gap that would resultantly be created and allow imports to cover that vacuum," said Katsande.

He said WMMI was now a white elephant because most people and institutions, including government departments, ministers and legislators were importing cars.

A manager with a major car dealership said there was need to introduce policies that protected local industry to allow it to adequately supply the market.

"We need credit lines so that our local car industry can be resuscitated. The capacity is there, but what's lacking is the necessary supporting policy measures that include funding," he said.

Four years ago, the government promulgated a legal instrument banning importation of vehicles that were more than five years old.

This triggered a public backlash from car dealers who said this would throw them out of business, and from ordinary people who said it was cheaper to import than to buy from WMMI.

Analysts warned that such a policy would see the government losing millions of US dollars in import duty.

Late last year, Hurungwe West MP Temba Mliswa (Zanu-PF) criticised the government in the National Assembly for buying state-of-the-art vehicles like Mercedes-Benz and Ford Ranger models from countries that were hostile to Zimbabwe.