Respite As CBN Slashes Customs Exchange Rate By 3%

The naira’s continuous rise in both the official and parallel markets has brought some measures of reprieve for Nigerian importers as the Central Bank of Nigeria (CBN) further slashed the exchange rate for computing Customs duties at the nation’s seaports by about three per cent.

The improvement in the value of the naira to the dollar, many

The Customs FX duty rate was reviewed downward from N1, 448.386/$ to N1, 405.466/$ on Tuesday, March 26, according to information obtained from the official trade portal of the Nigeria Customs Service.

The value of the naira continued its gaining streak on Tuesday as it closed trading activities selling at N1,382.95 to the dollar after the Central Bank of Nigeria (CBN) allocated $10,000 to bureau de change operators at a rate of N1,251 to the dollars.

Compared to N1,420.76 when it began trading activities at the Nigeria Autonomous Foreign Exchange Market (NAFEM), the value of the naira gained N37.81 or 2.66 per cent which was more than N14.81 or 1.04 per cent appreciation it recorded on Monday.

On Tuesday, trades had been consummated between N1,486 and N1,300 to the dollar. At the end of yesterday’s trading, a total volume of $245.58 million had been traded on the NAFEM.

LEADERSHIP reports that the recent slash came barely 48 hours after the apex regulatory bank slashed the Customs exchange rate from N1,572.507/$1 to N1448.386/$1.

The slash represents 2.96 per cent reduction or differences of N42.92 between the new and the old prices. 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 Friday, 23rd 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.

It was gathered that the naira has continued to gather momentum in the official and parallel market.

The CBN, on Monday, issued a circular to Bureau de Change operators, indicating that they have provided each BDC with $10,000 at an exchange rate of N1,251 per US dollar.

In the circular, each Bureau de Change was instructed to offer dollars to qualified customers at a rate that does not surpass 1.5% above the buying price.

This indicates that Bureau de Change are advised not to sell above N1,269 for each $1.

“We refer to our letter to you referenced TED/DIR/CON/GOM/001/071 in respect of the above subject wherein the CB approved a second tranche of sale of FX to eligible BDCs. We write to inform you of the sale of $10,000 to each BDC at the rate of N1,251/$1. The BDCs are to sell to eligible end users at a spread of NOT MORE THAN 1.5 per cent above the purchase price.”

The CBN in February 2024 promised to sell $20,000 weekly to BDCs at N1,301.

A circular from the CBN indicated that the apex bank directed the BDCs to sell to eligible customers at a rate not exceeding 1.5 per cent above the purchase price.

The summary of the forex auction showed that the naira appreciated by 1.64 percent as the dollar was quoted at N1,408.04 on Monday, stronger than N1,431.49 quoted on Friday at the Nigerian Autonomous Foreign Exchange Market (NAFEM).

Data from the FMDQ showed that the intraday high closed at N1,442 per dollar on Monday, stronger than N1,468/$1 closed at on Friday. The intraday low closed flat at N1,300 per dollar on Monday as against N1,301 closed on Friday at NAFEM.

The daily FX market turnover increased by 11.06 percent to $221.80 million on Monday from $199.71 million recorded on Friday.

The CBN circular reads, “We refer to our letter to you referenced TED/DIR/CON/GOM/001/071 in respect of the above subject wherein the CB approved a second tranche of sale of FX to eligible BDCs.

“We write to inform you of the sale of $10,000 to each BDC at the rate of N1,251/$1. The BDCs are to sell to eligible end users at a spread of not more than 1.5 per cent above the purchase price.”