Lagos, Dec. 11, 2023: Centre for the Promotion of Private Enterprise (CPPE) has called on Central Bank of Nigeria (CBN) and Coordinating Minister of Economy, Mr Wale Edun, to review the increase in exchange rate for computation of import duty.
CPPE founder, Dr Muda Yusuf, made this call in a Statement on Sunday in Lagos.
He explained that the increase in exchange rate would hurt businesses and aggravate poverty.
Yusuf said the recent decision by the Central Bank to increase the customs exchange rate from N783 per dollar to N952 would worsen the already prohibitive production and operating costs for businesses in the country.
He stated that the frequent changes in rates was also creating serious issues of uncertainty for investors and making the international trade process increasingly unpredictable.
The CPPE boss noted that the CBN had on June 24, adjusted the exchange rate from N422.30 per dollar to N589 per dollar.
He said on July 6, it was re-adjusted to N770.88 per dollar, and again on Nov. 14, to N783.17 per dollar and now to N951.94 per dollar.
Yusuf added that the development would also inflict more pains on the citizens, erode profit margins, reduce purchasing power and put the survival of businesses at an elevated risk.
“Already businesses are contending with an incredibly difficult operating environment arising from severe macro-economic headwinds
“This is not a good time for the CBN to increase the exchange rate for the computation of import duty and the clearing of cargo by importers.
“This review will impact the cost of all imports, including raw materials for manufacturers, pharmaceutical products, machineries, energy products, petroleum products and many more.
“This will make a bad situation worse for investors in the economy and will worsen the misery of the citizens amid an excruciating inflationary condition,” he said.
Yusuf stressed that trade policy measures should not be subjected to the full vagaries of the philosophy of market forces.
He said the CBN should allow for a concessionary rate for the computation of import duty to protect the economy and the citizens from the reality of unbearable inflationary pressures.
“We propose that going forward, CBN should fix the customs duty rate at 20 per cent less than the official exchange rate in the light of the prevailing harsh economic conditions,” he said.
