The Central Bank of Nigeria (CBN) has approved a significant 43% increase in the import duty rate, leading to a sudden surge in the exchange rate.
Previously set at N951.842 per $1 as of December 2024, the new rate now stands at N1356.42.
Importers and trading stakeholders woke up to this unexpected development, as the exchange rate for duty collection is typically determined by the CBN.
Dr. Muda Yusuf, the Chief Executive Officer of the Center for the Promotion of Private Enterprises (CPPE), expressed shock at the announcement, emphasizing that the increase could exacerbate the current economic challenges.
He questioned whether the Governor of the CBN had received advice on the potential implications of such actions.
Yusuf highlighted the potential consequences of the increase, noting that it would impact various aspects of economic life, particularly affecting the volume of trade.
He emphasized the likelihood of increased costs in transportation, shipment, and clearing, which could slow down activities in the maritime sector and further contribute to the economic slowdown.
Warning against an upward review of the exchange rate for import duty computation, Yusuf stressed that it could have devastating effects on both the economy and citizens.
Similarly, Mr. Hassan Bello, the former Executive Secretary of the Nigerian Shippers Council, emphasized the widespread impact of the exchange rate on every sector of the economy and advocated for a focus on exporting over importing.
The business leaders’ concerns reflect the potential ramifications of the CBN’s decision on the overall economic landscape, raising questions about the timing and long-term consequences of such a significant import duty rate increase.