In order to mitigate the ongoing decline in cargo importation resulting from unfavorable exchange rates, the Central Bank of Nigeria (CBN) and the Nigeria Customs Service (NCS) have reached an agreement to establish a stable exchange rate for the importation of goods. This measure aims to facilitate business planning and operations for importers and business owners.
The recent surge in the exchange rate and heightened
volatility of the Nigerian naira against the United States dollar have led to a
significant decline in the volume of imports through Nigerian ports.
For example, vehicle volume decreased by 45%, container
traffic reduced to 30%, and bulk cargo dropped to 20%.
In reference to the recent developments, the Comptroller
General of Customs, Bashir Adewale Adeniyi, confirmed the collaboration between
the Central Bank of Nigeria (CBN) and the Nigerian Customs Service (NCS). This
collaboration is being undertaken in support of the Minister of Finance and
Coordinating Minister of the Economy, Wale Edun. The objective of this
collaboration is to establish a stable exchange rate for the importation of
goods, thereby facilitating effective business planning and operations.
“With the support of the minister of Finance, NCS is working
in close collaboration with the Central Bank of Nigeria to achieve a stable
rate for import of goods to enable business plan activities,” the Customs CG
said.
The managing Director of the Centre for the Promotion of
Private Enterprise (CPPE), Muda Yusuf, has proposed a temporary fixed Customs
exchange rate for cargo clearance. He suggests setting the rate between N900/$
and N1,000/$ for a specified period, such as three months, six months, or a
year. This proposal aims to address the challenges faced by importers and
exporters due to fluctuations in the exchange rate.
In Yusuf’s opinion, establishing a fixed exchange rate for
cargo clearance within a timeframe of three months to one year would not only
contribute to economic stability but also provide predictability in
international trade within the maritime industry.
Nevertheless, in reference to the aforementioned
development, Dr. Kayode Farinto, the former acting president of the Association
of Nigerian Licenced Customs Agents (ANLCA), asserted that the sole viable
solution to the issue of low cargo volume at the nation’s seaports lies in the
implementation of a predictive exchange rate by the Central Bank of Nigeria
(CBN) specifically for customs purposes.
In recent months, there has been a notable decline in the
volume of cargo shipments in the country, primarily attributed to the
fluctuating exchange rate, as stated by Farinto.
“The only solution is for us to have a predictive exchange
rate for Customs purposes alone. It’s not too much to ask. We pegged the
exchange rate for pilgrims going to Saudi Arabia and Jerusalem during Buhari’s
era. Why can’t we do the same for importers?”
“On Wednesday, the exchange rate was N1,474. By Thursday and
Friday morning, it has increased. A cent is important to every business man
because if you’re using a bank loan you have to put all these into
consideration. We had a week where we had more than five exchange rates. That
is not too good for our economy. We have three levels of importation.
We have bulk cargo, containerised goods and vehicles. The
level of import on vehicles has dropped to about 55 percent, level of import on
containers has dropped to about 30 per cent, and on bulk cargo it is about 20
per cent. So we are not really winning the war.
“The situation has not been very rosy for us in the industry
particularly the freight forwarders. We are not faring well. We have some
people who have actually left the job, some still remain thinking tomorrow will
be a better day and we have some who have died. I can tell you that we lost a
lot of members this year.
“My prediction is that the volume of imports will continue
to nosedive if nothing is done. I’m also an importer. If you want to appreciate
what I’m saying, go to the manufacturers’ association and ask them what they
have imported in the last few months.”
He noted that the situation has also been difficult for
freight forwarders, with many losing their jobs and some even losing their
lives.
“Customs must negotiate with the CBN, draw them to the
minister of Finance, sit on a round table and involve us. I have suggested a
tripartite meeting between CBN, Customs and Ministry of Finance or CBN, Customs
and freight forwarders and we will be able to tell the CBN that what they are
doing is not helping the economy and if we continue like this, the economy will
just go in shambles, perhaps they will listen to us but up till now nothing has
been done about it.”
Speaking on the current import situation, a clearing agent
named Ikechukwu Anaba has indicated that importers are facing challenges due to
the fluctuating exchange rate.
The expert elaborated that bulk cargo imports experienced a
notable decline of 20%, while containerized goods witnessed a significant drop
of 30%. Notably, vehicle imports were severely impacted, registering a
substantial decrease of 55%.
“The unstable exchange rate set by the CBN for payment of
import duty will continue to lead to a further drop in cargo volume at the
nation’s seaports if the government fails to take prompt action to address the
problem.
The economy has been experiencing a decline in cargo volume
in recent months, with many importers and clearing agents struggling to cope
with the fluctuating exchange rate. The situation has also been difficult for
freight forwarders, with many losing their jobs,” Anaba stated.
Anaba, however, suggested fixing a permanent Customs
exchange rate for cargo clearance between N800/$ and N1,000/$, for a specified
period, such as three months, six months, or a year.
He suggested that establishing a fixed exchange rate for
cargo clearance over a period of three months to one year would not only
promote economic stability but also ensure predictability in international
trade within the maritime sector.