The President of the Republic, H.E. John Dramani Mahama, announces plans to introduce a minimum local production requirement for vehicle assemblers seeking to benefit from government tax exemptions and incentives.
The President makes the announcement when he commissions the third assembly plant of Zonda Tec Ghana Ltd in Tema. President Mahama says the Ministries of Finance and Trade, Agribusiness and Industry are finalising a new incentive regime designed to deepen local manufacturing and ensure that companies benefiting from government incentives make a stronger contribution to Ghana’s industrial development.
“We do not want companies bringing in fully built vehicles, removing only the steering wheel and tyres, and claiming they assembled them in Ghana,” President Mahama says.
He adds that the move is intended to prevent companies from importing fully built vehicles, carrying out minimal work locally and presenting them as locally assembled products.
According to the President, a percentage threshold is being established to determine the level of local assembly and production manufacturers must achieve before qualifying for the VAT exemption.
The revised incentive package, including incentives for semi knockdown (SKD) automotive assembly, is announced by the Minister for Finance in the forthcoming national budget.
“The Ministry of Finance and the Ministry of Trade and Industry are finalising discussions on incentives for semi knockdown automotive assembly,” President Mahama says, in response to remarks by Zonda Tec CEO Madam Yang Yang on SKD incentives.
He says government’s objective is to move beyond vehicle assembly towards an integrated automotive industry capable of producing components locally, creating jobs and reducing dependence on imported vehicles.
An Important Milestone in Ghana’s Industrial Development
President Mahama describes the commissioning as an important milestone in Ghana’s industrial development and says Ghana’s sustainable prosperity depends on producing more of what the country consumes and increasing its capacity to export locally manufactured goods.
“Zonda Tec’s growth is itself a remarkable Ghanaian success story. From modest beginnings, Madam Yang Yang began as a vehicle distributor in the year 2010. The company she established has steadily transformed itself into Ghana’s leading assembler of heavy duty vehicles, SUVs and small cars.’’
Prez. Mahama
He says investments such as the Zonda Tec assembly plant reflect a growing confidence in Ghana’s economy and the capabilities of its people, while creating decent jobs for present and future generations.
The expansion demonstrates what can be achieved when private investment is supported by an enabling business environment and a clear industrial policy. The Minister for Trade, Agribusiness and Industry, Hon. Elizabeth Ofosu-Adjare, discloses that the commissioning of Zonda Tec Ghana’s third assembly plant has increased the company’s annual production capacity to approximately 3,000 heavy and light vehicles.
“With this third phase, Zonda Tec’s annual production capacity rises to approximately 3,000 heavy and light vehicles, further positioning Ghana as a credible automotive assembly base within the sub-region.”
Hon. Ofosu-Adjare
The Expansion Strengthens Ghana’s Position as Automotive Hub in West Africa
Hon. Ofosu-Adjare says the expansion further strengthens Ghana’s position as a credible automotive assembly hub in the West African sub region, while supporting Government’s agenda to expand industrialisation, create jobs and promote local manufacturing.
She says the development aligns with the government’s industrialisation agenda, including efforts to attract investment, create jobs, promote technology transfer and increase local value addition.
President Mahama says the investment being celebrated today significantly expands employment opportunities. He says it is expected to almost double direct employment at Zonda Tec while creating approximately 1,000 additional indirect jobs across logistics, maintenance, component supply, distribution and other supporting industries.
The Establishment of Zonda Tec Foundation
He also commends Zonda Tec for establishing an academy to train young Ghanaians in automotive skills and for starting the Zonda Tec Foundation, which announces scholarships for young Ghanaians to study automotive manufacturing in China.
He says by giving young people the technical know-how needed to work in the industry, these investments in skill development support the growth of the automotive sector.
President Mahama calls for greater local production of automotive components, including batteries, tyres, wiring harnesses, glass, plastics, seats and metal parts.
“Assembling, however, cannot be our final destination. Our goal is to develop an integrated automotive industry in which locally produced materials and components feed directly into vehicle manufacturing.”
Prez. Mahama
President Mahama says, he therefore urges Zonda Tec to identify and invest in producing some components locally. Doing so will strengthen domestic supply chains, retain more value within our economy and create additional jobs for Ghanaians.
He says locally produced components should eventually feed directly into vehicle manufacturing, creating stronger links between major assembly plants and Ghanaian small and medium-sized enterprises.
A Vehicle for More Agricultural Production
The President also says the vehicles that roll off the expanded plant do far more than transport people. He says they move agricultural products from farms to markets, support mining operations, strengthen the construction industry and facilitate regional trade.
He says government is also positioning Ghana to become a leader in electric mobility by using its strategic minerals, including lithium, and growing renewable energy capacity to develop an integrated battery and electric vehicle industry.
“Our vision is clear: from minerals to batteries, from batteries to vehicles, from vehicles to exports, all proudly made in Ghana,” he says. He adds that government is preparing an electric vehicle policy that provides clear regulations for investors interested in establishing EV charging stations, with emphasis on solar-powered charging.
President Mahama further calls for the development of long-term vehicle financing schemes to make locally assembled cars more affordable. He says expansion of assembly plants must be matched with financing options that allow workers to purchase locally manufactured vehicles and pay for them over time.
Prez. Mahama Proposes Long Term Credit Scheme for Salary Workers
He proposes long term credit facilities that allow salaried workers, including doctors, teachers, nurses and corporate executives, to acquire vehicles through hire purchase arrangements and repay from monthly incomes.
“We’re ready to sit down with the banks and come out with financing instruments that allow people who are employed and engaged and receive an income to be able to take a car of their choice and pay monthly over a certain period until they have defrayed the cost of the vehicle.”
Prez. Mahama
The Chief Executive Officer of Zonda Tec Ghana Ltd, Madam Yang Yang, commends the Minister for Trade, Agribusiness and Industry, Hon. Elizabeth Ofosu-Adjare, for her significant role in facilitating the company’s operations and ensuring the successful introduction of Chery vehicles in Ghana.
She describes the Chery vehicle brand as the “baby” of the Minister, in recognition of Hon. Ofosu-Adjare’s commitment and support towards making the brand’s presence in Ghana a reality.
Madam Yang Yang says the company now considers Ghana its second home and plans to deepen its investment in the country while creating jobs, developing local skills and retaining more value locally.
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