The Centre for Promotion of Public Enterprise (CPPE) has urged the Central Bank of Nigeria (CBN) to implement a fixed quarterly exchange rate for import duty collection, aiming to mitigate the challenges caused by frequent fluctuations in customs exchange rates and the overall volatility of the foreign exchange market.
Dr. Muda Yusuf, CEO of CPPE, expressed concern over the adverse effects of erratic changes in customs duties exchange rates, asserting that such instability hampers production, undermines effective planning, exacerbates inflation, and heightens investment risks.
Yusuf highlighted the volatility experienced in the first quarter and April, with 28 and 10 exchange rate adjustments respectively, emphasizing the negative impact on Nigerian businesses engaged in international trade.
He emphasized the necessity of fostering a conducive environment for economic growth, aligning with the administration’s commitment to enhancing investor confidence.
CPPE proposed the adoption of a quarterly customs duty exchange rate, suggesting an initial rate of N1000/$, subject to consultation with fiscal authorities to address potential trade policy implications.
The CBN, in collaboration with the Nigeria Customs Service, currently adjusts exchange rates for duty collection based on changes in the official rate via the NAFEM window. However, stakeholders have raised concerns about the disruptive effects of these fluctuations on business operations and planning.
In response, the CBN announced that the exchange rate prevailing on the date of opening the form M for importation would govern import duty assessments, regardless of the clearance date.
