South Korean motor company KIA Motors and Dana Motors Ltd have signed an agreement to set up a vehicle assembly plant in Nigeria within two years
Jacky Hathiramani, managing director of Dana Motors, and Homer Kim, an official from KIA Motors, signed the agreement in a bid to improve the West African country's auto industry.
KIA's decision to set up the plant in Nigeria followed the launch of the Nigerian government's latest auto policy, which raised import duty on fully built cars to 70 per cent from 22 per cent. The policy will attempt to discourage vehicle importation and encourage local production. When fully implemented, the policy will aim to create a number of employment opportunities and wide range of technologically-advanced manufacturing opportunities.
Hathiramani said the new policy would set the stage for a new era of industrial, micro, small and medium enterprises development in Nigeria.
Based on data from the Nigerian Bureau of Statistics (NBS) and the United Nations Conference on Trade and Development, 400,000 vehicles (300,000 used and 100,000 new), valued at US$3.4bn, were imported in 2012 alone.