Operators Raise Dust As Import Duty Forex Rises Above Official Market Rate

Clearing agents operating at the nation’s seaports, on Wednesday, raised dust as Customs exchange rate rises higher than  official foreign exchange market rate of the naira and the United States Dollar.

LEADERSHIP gathered that Customs exchange rate on the Nigerian trade blurb portal revealed that the exchange rate for cargo clearance stood at N1,330.36/USD while the naira closed at N1,262.85/$1 on the official market, on Wednesday, and even much stronger on the parallel market at N1,250/$1.

The exchange rate for Customs import duties assessment had earlier been increased from N1,303.85/$1 to the current figure. This indicates an increase of N26.52 since the 31st of March 2024.

However, speaking exclusively to LEADERSHIP, the immediate past acting President, Association of Nigerian Licenced Customs Agents (ANLCA), Dr Kayode Farinto, said fluctuating exchange rate is not helping the import/export sector of the economy.

According to Farinto, he has advised the Central Bank of Nigeria (CBN), to embrace quarterly predictive exchange rate.

“I have given technical advice that we should have a predictive foreign exchange rate for Customs purposes so that whether the dollar is going up or down, there won’t be adjustment on the Customs platform. That means for the next quarter there will be a specific Customs FX rate but this current fluctuation is not helping our economy because what we have now is not inline with world bank criteria.”

“If we have a predictive exchange rate, fluctuation won’t concern or affect anyone and what importers will be concerned about will be quarterly rate but what we are having now is not technical or professional. It is only a predictive exchange rate that can help the economy and that will help the local importer plan its cargo evacuation,” Farinto stated.

Also speaking, a frontline clearing agent, Ikechukwu Anaba, said the CBN was more particular about revenue for the government than trade facilitation.

He, however, wondered how the government tend to improve the economy, saying that won’t bring about growth in the economy.

“The CBN is only concerned about revenue. You can imagine, while the dollar is coming down, Customs exchange rate is going up. Where is the sincerity of CBN,” Anaba stated.

He continued, “Customs exchange rate before now is not at par with the official rate. Customs forex is mostly lower by 10% or 20 per cent  but now, we are seeing Customs exchange rate higher than official FX,” he lamented.

Meanwhile, the Nigeria Customs Service (NCS) revealed that the service encountered major challenges with the fluctuations of the CBN exchange rate regime for import duty.

The Comptroller General of Customs, Bashir Adewale Adeniyi, while speaking during a press briefing, yesterday, in Abuja, noted that 13 different spot rates applied in March.

Adeniyi said that the repercussions of these fluctuating rates have sent concerning signals to stakeholders, affecting and disrupting activities.

Adeniyi said, “In the last quarter, a total of 28 rates were directed by the CBN, ranging from NGN 951.94 per USD 1 in January 2024 to a peak of NGN 1,662.35 per USD 1 in February 2024. While a singular exchange rate of NGN951.94 per USD 1 was maintained in January, February witnessed 15 different spot rates ranging from NGN 951.94 per USD 1 to NGN 1,662.35 per USD 1.

“March saw a total of 13 different spot rates applied, ranging from NGN 1,303.84 to NGN 1,630.16. These fluctuations resulted in an average applied exchange rate of NGN 1,314.03 per USD 1 in the clearance of Customs goods during the quarter.

“The repercussions of these fluctuating rates have sent concerning signals to our stakeholders, affecting and disrupting activities.”

Adeniyi, however, expressed delight in the relative stability in the past days, adding that the Service, with the support of the Minister of Finance, Wale Edun, has initiated periodic consultations with the apex bank to mitigate the potential impact of exchange rate fluctuations on import activities.”