Respite As CBN Reduces Customs Exchange Rate By 1.3%

Nigerians are expected to heave a sigh of relief in the coming days as the Central Bank of Nigeria (CBN), on Tuesday, reduced the Foreign Exchange on cargo clearance at seaports and airports from N1593.41/$1 to N1,572.507/$1.

According to data on the Federal Government Single Window for Trade platform, the reduction represents 1.3 percent and a difference of N20.903.

It was gathered that the Customs exchange rate which was the third time in eight days was firstly reduced from N1,617.96/$1 to N1,593.41/$1 and now to N1,572.507/$1.

The slash, analysts argued, was as a result of the naira that strengthened against the dollar at the official window, on Tuesday.

At the the Nigerian Autonomous Foreign Exchange Market (NAFEM), also known as the official market, the Naira strengthen against the dollar trading at N1560.57/$1.

To this end, importers that opened Form M, on Wednesday, will pay less to clear their cargoes as import duties are benchmarked against the dollar.

Also, importers will open Form M at a lower rate compared to those who opened Form M on Monday, 18th March, 2024 according to the apex bank’s new directive to Customs to use the rate on the date of submitting Form M for calculating import duties.

However, economic experts have warned that there will be significant decline in imports and abandonment of cargoes at seaports, if the customs exchange rate fluctuation continues.

According to the President of Lagos Chamber of Commerce Industry (LCCI), Gabriel Idahosa, Customs duty hike is killing several industries.

“With the very frequent increase in the Customs duty rates, importers and manufacturers can no longer afford to import or produce and still make profit. It is certainly killing a number of industries.

“The solutions lie in going back to the primary problem which is the exchange rate and finding out how the nation can increase the supply of foreign currency into the economy to make the naira stronger,” the LCCI President said.

He lamented that Nigeria has millions of importers but very few exporters, stressing that the prevalent fiscal challenges should force many Nigerians to go into export business for goods, services and manpower.

“In the ICT space, there are lots of opportunities for Nigerians to work and earn hard currency without leaving the nation. There are also numerous Nigerian products that are ready for exports. These are medium and long term solutions to the forex challenges. Nigeria has built a reputation in the world as the biggest importers, it is time to change that narrative to the biggest exporters,” the LCCI boss remarked.