The Comptroller General, Nigeria Customs Service; Adewale Adeniyi has suggested that even though it is the mandate of the Central Bank of Nigeria (CBN) to fix the exchange rate of the Naira vis a vis other currencies, there is need for a meeting point for authorities of government in charge of monetary policies and those in charge of fiscal policies.
The Customs boss spoke on Tuesday at the Senate when presenting the Service’s 2024 budget. His suggestion comes against the backdrop of criticisms that have trailed last week’s increase in the exchange rate for the purpose of Customs duty.
Adeniyi advocated for a time-specific spot rate. “Personally, what I think we can do is to get a kind of a spot rate for a period of time; We can agree that may be for Q1 2024, this should be the spot rate for the payment of Customs duty, or we could say for the first half. We will define the period and we all agree that this will be the spot rate payment of Customs duty”, he said, even as he told the Senators that those were his personal thoughts.
He gave the options, even as he affirmed that it is not the Nigeria Customs Service that determines how much is paid as Customs duty.
The Customs boss told members of Senate Committee on Customs and Excise that there has also been a fall in volume of cargoes that is imported into Nigeria.
“We showed you that in 2023, the cargo throughput reduced by as much as 30 percent”, even as he stated that the fall is as a result of the high exchange rate.
Shipping Position Daily recalls that, last Friday’s hike in Customs duty exchange rate has been met with overwhelming outcry by different personalities and groups within the nation’s maritime sector.
The Federal Government had on Friday, through the Central Bank of Nigeria raised the exchange rate for cargo clearance from N952/$ to N1.356 per dollar. This effectively translates to a spike in payable import duty.
The latest hike is coming weeks after the rate was increased from N783/$ to N952/$.
In November, the exchange rate for cargo clearance was raised from N757 per dollar to N783 per dollar, representing a 3.4 per cent increase, and was later raised from N783/$ to N952/$ in December.
A shipper, Rev. Jonathan Nicole, has decried the increase in exchange rate. He said the new exchange rate for cargo clearance would increase inflation.
“There have been a lot of sad stories as regards doing business in our domain – the maritime sector.
“The new exchange rate will increase inflation and businesses will be grossly affected, terminating projections before imports.
“The rate will affect the manufacturing sector and goods and services will increase. Cost of transportation will skyrocket.
“At the end of a transaction, the general public will be made to pay for the failure of our economic policies.
“Unemployment will increase and some companies are shutting down already due to paucity of funds,” he said.
“The success of a country is determined by the management of the commonwealth for all.
“Where the citizens are impoverished, the nation becomes epileptic and this is what is happening at the moment,” he said.
He, however, urged government to ensure fair distribution of the nation’s resources for all and sundry.
Nicole urged shippers to brace up for tougher policies noting that the current exchange rate would not be the last.
“Government is not blind to the sufferings of her citizens.
“We believe sooner than later the untold hardship will be overwhelmed with collective bargaining to prosperity for all,” he said.