In a move that has significant implications for importers and clearing agents, the Federal Government of Nigeria has adjusted the Nigerian Customs Service (NCS) Exchange Rate calculations for import duties.
The Guardian reports that the rate has been shifted from N770.88/$ to N783.174/$, marking a change in policy five months after the Central Bank of Nigeria (CBN) floated the Naira.
This adjustment, reflected on the NCS portal, aligns with the CBN’s decision to authorize banks to sell foreign exchange at market-determined rates.
The shift towards a single exchange rate regime, in line with President Bola Tinubu’s commitment, was intended to bring stability.
However, economic challenges and fiscal policy measures have resulted in a 70% drop in importation, contributing to higher costs for clearing cargoes in Nigeria compared to other African countries.
During a recent meeting with port stakeholders, the Minister of Marine and Blue Economy, Adegboyega Oyetola, highlighted the issue of abandoned and overtime cargoes. Some cargoes have remained at ports for over ten years due to clearing bottlenecks, prompting a need for decongestion efforts.
The NCS has inaugurated a committee to address this issue, responding to the new Customs Act that empowers it to dispose of containers exceeding their allotted time within the ports.
The Comptroller-General of Customs, Adewale Adeniyi, emphasized the paramount objective of port decongestion, promising increased efficiency and trade facilitation.
The import and export value chain stakeholders are now grappling with the consequences of the exchange rate adjustment. Importers and clearing agents will need to adapt to the new rates when making quotations for new jobs, potentially leading to increased business costs.
The economic impact is already being felt, with concerns about the effect on the prices of used cars and other goods.
As the government seeks to boost revenue collection, with the NCS reporting a 66.5% surge in revenue between July and October 2023, industry experts warn that 2024 may bring increased hardships for the masses.
Rising prices and the impact on businesses could lead to discontent, posing challenges for economic players and potentially causing disruptions in various sectors.
Analysts argue that the government should be sensitive to the challenging economic conditions and consider palliative measures for citizens and businesses.
The increased costs imposed by harsh fiscal policies may further strain an already delicate economic situation, with potential consequences for local and international trade.
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