Africa

Zim battles to cope with flood of used cars streaming in

Jason Moyo

Owning a second-hand Japanese vehicle in Zimbabwe has never been so easy. All one needs is a runner and a bribe.

Each month, more than 4 000 used vehicles enter Zimbabwe, up from just 250 in 2008. (Aaron Ufumeli)

It starts with an internet search and ends with you waiting in the heat at the Beitbridge border post, a roll of rands in hand, watching your runner bribe his way through customs – that's how you import that second-hand Japanese car.

A website search finds me at one of the many Japanese car sale websites. I need a van, "one that can carry all my grandchildren", says my mother. So I click on the Honda Odyssey, a form pops up to confirm an order and I enter my details. Soon, I am transferring money from my bank to a complete stranger on the other side of the world. 

"Today we received your payment. We will email as soon as we have a date of departure for your vehicle. We will ship AS FAST AS WE CAN," the Japanese dealer emails.

More than a month of waiting passes and finally the dealer emails to say the car is in Durban, South Africa, being taken by carrier into Beitbridge. On the South African side, business is roaring. Warehousing companies are recording an increase in business as thousands of vehicles arrive from Durban and await clearance into Zimbabwe.

A week later, I am at the border post, calling the company's dealer and arranging a local runner to help me to find my way through the maze that is customs.

You need a few R100 notes, each to be paid to an official at various stages of the process to make this faster, and, if you are lucky, to have your duty reduced. It is six in the morning and bribes are already being paid by those who want to skip queues.

Thousands of imported vehicles are also in a warehouse, really a vast dust-bowl next to the border.

Competitive industry
Nearly 50 000 second-hand cars are imported into Zimbabwe each year, according to industry officials, and the country spends about $1-billion a  year on them, treasury data shows. Each month, more than 4 000 used vehicles enter Zimbabwe, up from just 250 in 2008.

At one point in 2011, before a proposed ban on the importing of older used models, Beitbridge was handling 450 cars a day as dealers rushed to bring in cars before the ban. The government later gave in to pressure and scrapped it.

Many of these vehicles are headed for Harare to be sold in illegal car dealerships, some of them run by politically-connected dealers who don't hesitate to protect their turf. Last year, a policeman who tried to shut a dealership down was beaten up and and shot.

It is a fiercely competitive industry, marked by corruption, politics and violence, and officials of urban councils countrywide are failing to cope with unlicensed dealerships.

After the shootings last August, police questioned Zanu-PF's Harare youth league chairperson, Jimu Kunaka, said to be the leader of the Chipangano militia, but no arrests were made.

The city council had announced it was shutting down more than 200 car dealerships, after finding that only one of them was licenced. But many of the dealerships are still operating and new ones continue to open.

The council recently sacked the head of its land evaluation division after claims that 27 staff members in the division had taken bribes of up to $3 000 from illegal car dealers as protection money.

Many of the illegal dealers do not pay council levies – they only pay protection fees to corrupt council officials and Zanu-PF enforcers, dealers told the M&G.

Custom duties
The central bank governor, Gideon Gono, believes Zimbabwe is spending too much on imports. He complained last week that "merchandise trade remained heavily inclined towards imports of finished consumer goods and vehicles".

But there is concern that Zimbabwe is not getting as much as it should from car imports.

A recent report by a parliamentary committee that monitors the budget pointed to possible tax evasion by importers, including car dealers. The amount of duty being collected did not tally with imports, it noted. The government's projection of $392-million in customs duty did not reflect the present volume of imports to Zimbabwe.

"The minister [Tendai Biti] himself alluded to this in his statement when he said that imports were expected to exceed $8-billion in 2012 and custom duties reflected only 4.8% of import trade when the average customs duty was in fact 35%," the committee report stated.

"He gave no explanation of this huge disparity and this is of great concern to the committee. If the minister's figure is right, then customs duties should exceed $2.5-billion and this alone would transform our fiscal situation."

Local car industry suffers
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The impact on Zimbabwe is visible. Local car assemblies have been buried by the flood of grey imports and the streets are clogged with taxis, mostly small Toyotas.

The longest queues at the Harare city council's Rowan Martin building are for those registering them. Council spokesperson Leslie Gwindi said this week Harare could no longer cope with the volume of traffic, much of it made up of imported taxis. 

Anyone can own a fleet; after a year, when a vehicle is worn out and the owner imports new vehicles, the taxi driver gets to own the vehicle.

Last year, only 400 locally assembled cars were sold, compared with 3 000 in 2003. An industry that once employed 20 000 in the late 1990s now employs fewer than 2 000, according to the Motor Industry Association of Zimbabwe.  

The local car industry was hit so badly that, in 2002, President Robert Mugabe issued an order compelling government bodies to buy locally assembled vehicles.

But not even the government buys local cars, instead turning to the local dealers of luxury brands such as Mercedes-Benz and Land Rover.

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