Exchange Rate Volatility Affects Trade Patterns As Customs Generates N1.75trn

The Nigeria Customs Service (NCS) has announced a revenue generation of ₦1.75 trillion in the first quarter (Q1) of 2025, surpassing its quarterly target by ₦106.5 billion and marking a 29.96 per cent increase over the same period in 2024. However, the Service said its operations were not without challenges, particularly the volatility of exchange rates, which continues to impact trade patterns and customs valuation.

Comptroller general of Customs, Adewale Adeniyi, disclosed this during a quarterly media briefing held Tuesday in Abuja, where he presented a detailed account of the service’s performance in Q1 2025.

According to him, the NCS collected a total of ₦1,751,502,252,298.05 between January and March 2025, exceeding its quarterly benchmark of ₦1.645 trillion and achieving 106.47 per cent of the target.

Monthly collections showed a positive trajectory, with January raking in ₦647.88 billion—an 18.12 per cent increase over target—while February and March also exceeded their respective targets.

“The 29.96 per cent annual increase and steady monthly collections confirm our strategy is working,” Adeniyi said.

In anti-smuggling operations, the service recorded 298 seizures with a total Duty Paid Value (DPV) of ₦7.7 billion—a 78.41 per cent increase from the previous quarter, though 19.7 per cent lower than Q1 2024. Items seized included 135,474 bags of rice, 65,819 liters of petroleum products, narcotics valued at ₦730.7 million, and wildlife products with a DPV of ₦5.65 billion.

Adeniyi emphasised the service’s continued focus on high-risk and high-value contraband. “From rice to wildlife, these seizures show our targeted approach,” he said, adding that NCS would continue to refine its strategies through intelligence and technology.

On trade facilitation, the Customs boss said the Service processed 327,928 import declarations and handled goods with a combined weight of over 4.9 billion kilograms and a total CIF value of ₦14.8 trillion. These figures represent significant growth in trade volume and value compared to Q1 2024. Export activities, however, showed a 24.4 per cent drop in transaction numbers, even as the export mass rose by 348 per cent, indicating a shift towards bulk commodity exports.

The total trade value processed by the Service in Q1 2025 stood at N36.3 trillion.

Adeniyi also highlighted key initiatives during the quarter, including the expansion of the locally developed B’Odogwu customs clearance platform, the launch of the Authorised Economic Operators (AEO) programme for trusted traders, and the rollout of a Corporate Social Responsibility project, “Customs Cares,” aimed at supporting communities across six thematic areas including education and health.

In addition, the Customs boss said the Service supported government food security initiatives by granting import duty exemptions on essential food items such as rice, maize, and sorghum, contributing to a 12–18 per cent reduction in food prices in 2025.

Despite these achievements, Adeniyi acknowledged several challenges, chiefly the unstable exchange rate. “We recorded 62 changes in the exchange rate during Q1, ranging from N1,477.72 to N1,569.53 per USD, with an average of N1,521.59,” he said, noting that the volatility affects the predictability of import costs and trade planning.

Other challenges included the suspension of the Financial Customs Service Operation (four percent FOB) and the imposition of a 14 per cent reciprocal tariff by the United States on Nigerian exports.

Looking ahead, Adeniyi said the NCS would intensify its modernization efforts and enhance service delivery, focusing on efficiency, transparency, and professionalism. He reaffirmed the Service’s commitment to supporting national development through improved trade facilitation and revenue generation.

“Our strategic priorities align with the vision of becoming a fully modernized customs administration that facilitates legitimate trade while securing our borders and optimizing revenue,” he concluded.