Second-hand vehicles flood Zim, SADC

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By Gracious Madondo

The importation of second-hand cars from Japan has become quite a trend in Zimbabwe and elsewhere across the Southern African Development Community (SADC) with more and more cars being imported and transported from the various ports across the region into the interior.

This is despite the fact that some countries in the region have punitive policies on second-hand car imports as they try to promote local motor industries.

The Zimbabwe government is in the process of revamping its motor industry by working on increasing production capacity at Willowvale Motor Industry in Harare and Quest Motors in Mutare.

While analysts support the move to revive the local motor industry, they point out that locally manufactured brand new vehicles are expensive and beyond the reach of many, who then resort to importing second-hand cars from Japan and the United Kingdom, among other countries.

For example, a brand new locally manufactured Mazda 3 or Datsun Go vehicle costs anywhere between US$15 000 and US$20 000 which the majority of the people cannot afford.  At the same time, one can import a used small passenger vehicle from as little as US$3 000. 

 Road transport services in the region play a pivotal role in the distribution of imported cars in and out of the region.

Due to the SADC Free Trade Area protocol which promotes regional economic integration, it is easier for one to import a second-hand car from Japan and freely transport it from any country in the region.

Logistics are pivotal for trade facilitation in the region.

Administrative costs and transit related customs procedures are crucial in determining the cost of importing a car in the SADC region.

Multinational car and motor exporting company, Be Forward, consultant in Zimbabwe Ruth Mudhumani said importing a car from anywhere in the region is very easy and it is only governed by costs that vary from country to country.

“When one orders a car from Japan, it is delivered by ship to any of the region’s ports, Walvis Bay (Namibia), Durban (South Africa), Beira (Mozambique), and Dar es Salaam (Tanzania). And from there it is transported by road to various countries across the region. It is a very easy procedure and the transportation costs are only governed by a few costs such as clearing costs, which often depend on your country, driving costs, fuel costs and insurance,” Mudhumani said.

She said vehicle clearing costs are not included on the price of the car as these depend on the requirements of the country in which the car is passing through from the port to its final destination.

“Clearing charges, duty, Value Added Tax (Vat), are not included in the car’s purchasing price. It is a requirement by a country’s revenue authorities. In Zimbabwe, the money is paid directly by the buyer to the Zimbabwe Revenue Authority (ZIMRA) and the charges are mainly handling charges from ports, storage charges and other special handling fees,” Mudhumani said.

Requirements for one to import a car from any of the four major ports in the region are simply a valid identification card (ID) and cash transfer in US dollars.

Shipment of a vehicle may take three to four weeks to reach the destination port.

According to Be Forward 2018 City Delivery Service Costs, the clearing cost of a vehicle into Zimbabwe is approximately US$300 – US$500 and the cost varies depending on country.

Transportation costs and other personal expenses such as accommodation, meals and fuel, if one chooses to import the car from Durban to Beitbridge, averages around US$300 depending on the carriage as driving an imported vehicle is prohibited in South Africa.

In 2016, the Government of Zimbabwe set up a strict set of rules and regulations that must be followed when importing a vehicle.

The Car Import Policy has a list of documents required and these include immigration declaration, passport, residence permit, import licence if vehicle ownership before importation is less than six months, registration document, invoice or agreement of sale, and a freight document.

There is a requirement of 60-80 percent customs and tax duties for all non-commercial vehicle, 25 - 40 percent for light passenger vehicles and station wagons, 0 - 60 percent for buses, mini buses and other vehicles that are used for ferrying more than 10 passengers, 40 percent for vehicles with engine smaller than 1500cc and 15 percent surtax of the value of duty purpose (VDP) on vehicles that is more than five years old.

Importing a car from Namibia through Walvis Bay Port requires one to have import paper permits, passport, original bill of landing, registration papers and invoice.

Namibia vehicle import regulations state that taxes and duties range between 13-15 percent on the value of the vehicle being imported.

Importation of left-hand drive cars into Namibia is prohibited and importation of cars more than five years in also prohibited.

Second-hand cars are very popular throughout the continent and reports indicate that in Africa, the total amount of imported cars has risen with Japanese used cars topping the list.

In Africa, Kenya (East Africa) tops the list in terms of Japanese imported cars, while in the world Chile and Russia are tops.

The SADC protocol for trade is directly benefiting the region and promoting the improved movement of goods, thereby creating a well-integrated regional market for goods and services.

 

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