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How CBN raised exchange rate for customs duty by 235% in 8 months

The Central Bank of Nigeria (CBN) has jacked up the exchange rate payable on importation six times in the last eight months.

This has created tension among importers as their imports, especially vehicles, are now stuck at the ports.

The exchange rate rose from N422.30 per $1 in June 2023 to N1,413 per 1$ in February 2024, rising by 234.8 per cent in the period under review.

The first shock came in June 2023 when CBN adjusted the exchange rate from N422.30 per $1 to N589 per $1.

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But as importers were trying to adjust to the reality on ground, the apex bank, about a month later, precisely on July 6, 2023, adjusted it for the second time from N589 per $1 to N770.88 per $1.

The fresh adjustment has generated a lot of outcry from the Manufacturers Association of Nigeria (MAN) whose members are the major importers of large consignments.

Again, on November 14, 2023, the CBN slammed another adjustment on exchange rate rising from N770.88/$1 to N783.174/$1.

In December 2023, another adjustment was implemented as the exchange rate rose from N783.174/$1 to N951.941/$1 and on February 2, 2024, while importers were just settling down, the CBN implemented the fifth increment, rising from N951.941/$1 to N1,356.883/$1.

Barely 24 hours later the exchange rate saw a another increase, reaching an all-time high, rising to N1,413/$1.

The Sea Empowerment Research Center at the recently concluded World Economic Forum (WEF), raised concerns around the drop in the global trade volumes as witnessed in 2022/2023 period.

Dr Eugene Nweke, Head Of Research at Sea Empowerment Research Center and a former president of the Nigerian Association of Government Approved Freight Forwarders (NAGAFF), stated that it is against the backdrop of the overwhelming consequences of the recent increment that the centre requested the Coordinating Minister to direct the CBN to desist from the act of incessant increment of exchange rate for customs duty assessment for the interest of the over-stretched and suffering Nigerian populace.

 

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