NEW car imports into Nigeria rose 15 percent in the first half of 2012, compared with the same period last year, as credit flows recovered in Africa’s second-biggest economy, dealers said on Monday.
Car sales in Nigeria are a proxy measure for consumer purchasing power and analysts see them as a good indicator of economic growth in the continent’s most populous nation.
Nigeria’s economy grew 6.17 percent in the first quarter of this year, down from 7.68 percent in the fourth quarter last year, according to official figures.
Nigerian port figures showed new vehicle imports increased to 24,158 units in the first six months to June, from 21,024 units in the same period of last year, as bank credit started to trickle in, according to vehicle importers.
Bank credit to the private sector grew 48 percent at the end of June, compared from the same period a year ago, Nigeria’s central bank figures showed, boosting demand for big-ticket purchases including vehicles.
Credit flows grew less than 2 percent in 2010 as Nigeria’s banking crisis bit.
Dealers said vehicle imports had started to recover, driven by an increase in passenger cars, after it took a hit at the start of the crisis, with credit sales then almost at zero.
Passenger vehicles accounted for 54 percent of new car imports in the first half, while the remaining were commercial, port figures showed.
Lenders in Africa’s most populous nation have all turned a profit in the first half, driven by increased lending, after a 2009 bailout and subsequent sell off of bad loans to a government-owned entity AMCON balanced their books.
Dealers said most consumers in Nigeria rely on bank financing to purchase vehicles and estimated the pent-up demand meant sales could recover sharply as credit recovers — although central bank measures to tighten liquidity this week have pushed up interbank rates, which could hurt lending.
Credit accounted for around 22 percent of a total 75,000 new car imports in 2008, before the bailout.