The Nigerian Customs Service (NCS) has increased the exchange rate for the for the clearance of goods by 42.7% from N951.94/$ to N1356.88/$.
A review of the federal government’s single-window trade portal of the customs service reveals that the previous exchange rate of N951.94 to the USD has been revised upwards to N1356.88.
The Nigeria Customs Service levies duties on imported cargoes before they are cleared from the ports. These charges vary from 5% to 35% based on the harmonized commodity and coding system (HS code).
Backstory
In December, the NCS increased the exchange rate for cargo clearance by 22.8% from N783/$ to N952/$.
The Centre for the Promotion of Privat Enterprise (CPPE), criticised the decision to raise the customs exchange rate from N783 to N952/$ stating that it will exacerbate the already worrisome production and operating expenses for businesses in the country.
Nigeria’s currency woes
Since the Central Bank unified the exchange rate market in June, Nigeria has been grappling with an exchange rate crisis. Market forces have been permitted to dictate the value of the naira, resulting in a depreciation of over 100% in its value. Prior to the CBN’s policy change in June, the naira traded at an average of N460/$.
The apex bank has a reported backlog of around $7 billion and the Governor, Yemi Cardoso has stated that clearing the backlog is the short-term priority of the team.
On Monday, the CBN reported the payment of $500 million to various sectors of the economy as part of the blacklog of FX forwards owed to businesses across the country.
This week the naira reached a new low of N1,461.90 to the USD and on Tuesday weakened below the parallel market rate.
The Customs boss had earlier stated that the service does not fix exchange rate rather it uses the official market (NAFEM) according to the CBN. The current rate of N1356.8/$ still falls below the exchange rate on the NAFEM window for yesterday which stood at N1,461.90 to the USD according to Nairametrics daily FX tracker.
