Business

ZIPAR calls for automotive industry development plan

KELLY NJOMBO, Lusaka
THE Zambia Institute for Policy Analysis and Research (ZIPAR) has urged Government to establish an automotive industry development plan that will accommodate the construction of a motor vehicle assembling plant in Zambia.
Responding to plans by Gonow Zambia Limited to establish a motor-assembling plant in the country, ZIPAR transport and infrastructure development research fellow Zali Chikuba said Zambia can become a regional commercial hub if it invests in an auto assembling plant benefitting the domestic and regional markets.
Mr Chikuba said in a statement availed to the Daily Mail by ZIPAR knowledge manager Euphrasia Ilunga that Government should also consider coming up with transparent incentive structures that will set a clear direction for all future investments and minimise uncertainty in the industry.
Demand for motor vehicles in Zambia has on average grown at 15 percent per year between 2006 and 2015, and is dominated by imported second-hand motor vehicles.
“The expected motor vehicle assembly plant re-affirms ZIPAR’s policy recommendations from a study on ‘Used Motor Vehicle imports and the Impact on Transportation in Zambia in which the think tank pointed out the need for local manufacture of motor vehicles to complement all other measures proposed’.
“The establishment of a motor vehicle assembly will not only accord Zambians easier access to new motor vehicle, but will also create many jobs and contribute to economic growth,” he said.
Mr Chikuba said Government must ensure strong institutional and legal frameworks are in place to support the new industry.
He also said Government must consider setting up local incubation centres for production and supply of car parts to make the assembly less dependent on imports, which is a critical requirement for the sustainability of the industry.
Mr Chikuba said the local vehicle-manufacturing plant at the right scale and cost structure has potential to reduce prices of motor vehicles in Zambia, increase tax revenue due to improved demand for high value motor vehicles, and at the same time provide motor vehicles suitable to the local condition.

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