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Oliver Kazunga, Senior Business Reporter
THE country has recorded a 25 percent drop in the value of vehicle imports between January and this month, figures from the Zimbabwe National Statistics Agency (Zimstat) show.

Trade data from Zimstat indicates that the first six months saw motor vehicles worth $250 million being imported, declining from $365 million during the same period last year.

An economic analyst Dr Davison Gomo attributed the decline to the current liquidity crunch that has led to limited disposable income among Zimbabweans.

“The drop in the value of motor vehicle imports can be attributed to the current cash crunch being experienced in the economy. What it means is that because of the liquidity crunch people now have limited disposable income. And what might be considered as luxury goods are no longer given attention on the priority lists,” he said.

Dr Gomo said the drop in vehicle imports is not an indication that people are focusing their attention on locally assembled cars because the local industry does not have the capacity to deliver yet.

Furthermore, he said the public are discouraged from buying locally assembled vehicles because of the price factor.

“Banks are also not issuing vehicle loans.  As a result people aren’t buying locally assembled vehicles,” he said.

Dr Gomo ruled out the high import duty as a factor contributing to decline in the value of imported vehicles.

“High import duty has always been there but never stemmed out people from the desire to import vehicles. Corruption at border posts has seen people finding ways to bring in imported goods into the country.

“For example, even in cases where the Government has banned imported products like cooking oil, if you go at Beitbridge Border Post today, you still find cooking oil entering the country and this is through some corrupt tendencies.

“So, to say high import duty  has led to the decline in imported motor vehicles to a larger extent can’t be true,” he said.

Another economic analyst, Mrs Wendy Mpofu said there was a need for the Government to stamp out corruption at the points of entry to bring viable benefits to business and society at large.

“The decline in the value of car imports can largely be attributed to the current liquidity crunch.  As a result of the prevailing situation it means people now have limited disposable income to spend on vehicle imports. The decline can also be attributed to the control measures that the Reserve Bank of Zimbabwe has effected on the amount of money that can be spent on importing luxury items,” she said.

Economic commentator, Trust Chikohora said: “Due to liquidity crunch being experienced at the moment people are no longer able to import than before. Even if people want to import, there is low priority by the banks.”

He argued that high import duty was also dissuading the public from importing.

“Generally duty paid for vehicle imports has increased because Zimbabwe Revenue Authority has come up with its own schedule of calculating the value of imported vehicles.

“And although corruption is still there at the border posts, it has now been reduced due to stringent measures that Zimra has taken to stamp it out.

“And because of the new schedule that Zimra is using to calculate duty, the landing cost for a vehicle has become high thus dissuading the public from importing cars,” he said.

In 2011 and 2012, the value of motor vehicle imports remained constant at about $1 billion while in 2013 it fell to $717 million.

In 2014, the figure went down to $542 million before dropping further to $420 million by December 2015 where vehicle imports accounted for US$365 million.during the first five months of the year due to tight liquidity inflows, limited disposable incomes and high import duties.

The effect of a duty hike in used vehicles as well as some selected type of cars is being felt  by industry and commerce as a result of the persistent drop in the values of imported cars.

Chartered Institute of Procurement and Supply Zimbabwe deputy chairman Mr Preston Hwena said the drop in the value of car imports means that high import duties are making it difficult to import cars.

“It’s something we’re really worried about because it might lead to a drop in terms of business activities,”said Mr Hwena.

Harare Chamber of Commerce chairman Mr Mike Juru said the government should therefore ensure that the local car assembly and manufacturing sector produces high quality vehicle at affordable pricing models to take advantage of the drop in car imports.

“We should focus on the increase in terms of capacity to produce and export,” added Mr Juru.