The Central Bank of Nigeria (CBN) has once again adjusted the Customs exchange rate, further exacerbating the challenges faced by Nigerian importers. This adjustment marks the fifth time in 2024 alone, reflecting a persistent trend of increasing rates.
The upward trend in 2024 recorded a movement to N1, 356.883/$ on February 2, and on February 3, it was raised to N1, 413.62/$, on Saturday, February 10, it was changed to N1,417.635/$, on Monday, February 11, it was to N1,444.56/$1 and currently, Wednesday, February 14, the CBN adjusted the exchange rate to N1481.482/$1 representing a 2.56% increment over the previous adjustment.
The frequency of these revisions has raised concerns among maritime experts and industry stakeholders, who predict adverse effects on importers and the overall trade landscape. Import duties, which are tied to the dollar, are expected to rise accordingly, placing additional financial strain on businesses.
Dr Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise (CPPE), emphasized the detrimental impact of the latest adjustment, stating, “The upward adjustment will further worsen the challenges of importers by increasing the cost of import and reduction in trade.” Yusuf’s sentiments echo those of many within the business community who fear inflationary pressures and diminished profit margins.
Former chairman of the Association of Nigeria Licensed Customs Agents (ANLCA), Bisiriyu Lasisi Fanu, highlighted the broader ramifications of the CBN’s actions. Fanu noted that the frequent adjustments in Customs duty rates, driven by high FX rates, will inevitably affect all goods in the market, as imported inputs are integral to various commodities. Moreover, Fanu criticized the CBN’s approach, expressing concerns over the viability of importers who had previously calculated costs and profit margins based on lower exchange rates.
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“The frequency at which the CBN is adjusting the exchange rate has become worrisome,” Fanu remarked, shedding light on the logistical challenges faced by importers attempting to reconcile sudden cost discrepancies.
This latest adjustment adds to a series of previous revisions initiated by the CBN since the administration of Chief Tinubu began in May 2023. Notably, the exchange rate has experienced significant fluctuations, with adjustments ranging from N422.30/$ to the current N1481.482/$1.
The implications of these adjustments extend beyond the realm of importers, affecting consumers through potential price increases and contributing to the accumulation of overtime cargo at ports.