News day / Babwah said he was at his wits end regarding the forex shortage as he wondered how it is new car dealers appeared to be untouched by the forex crisis while foreign used dealers continue to be blanked by the local banking sector.
Used car dealers are unable to get any amount of US dollars or foreign currency to conduct our business and we are on the verge of shutting down for two reasons.
One is because government changed the age of the cars and two, we are not getting any foreign exchange, Babwah said.
Foreign exchange we were told is in short supply. We are told it is not available but other businesses within the industry are able to declare big increase in profits while we struggle to simply survive, he said.
Babwah recalled that government had previously used the fuel subsidy as an excuse to limit the importation of foreign vehicles but he successfully lobbied both the previous Peoples Partnership and the current administration to remove taxes on hybrid and electric vehicles.
I have trained my staff on these new type of vehicles – hybrid and electric vehicles because the argument was that the old style of vehicles was a drain on the treasury and not environmentally friendly .now I am unable to get any forex to import cars, he complained.
As it stands I am unable to get money to import one car. I am not getting any money through the normal banking wire transfer system while the new car dealers would import one batch which would be a few thousand cars and that is how much we would import for the entire year, he said.
Babwah said he has approached banks for advice and was told he could use the companys credit card to pay suppliers but this is a short-lived solution since he was told to limit purchase to one car per week.
The bank has told me, I have a company credit card which could be used on a daily basis and mind you, that has an additional cost to it, because you have to pay the 3.5 percent charge plus bank interest and now last week they told me I could only use the card once for the week, he said.
It is a system that is designed to get rid of the competition and get rid of the small and medium sized businesses, he alleged.
Babwah said the only option left for dealers is to highlight the problem on both the local and international media while seeking legal advice on the way forward to keep their businesses alive.