The Central Bank of Nigeria, CBN, has approved an increase in the import duty rate by 43 percent.
Recall that the exchange rate for duty collection is usually determined by the CBN.
Importers and stakeholders in trading woke up on Friday to find the increase in the exchange rate, which before now was set at N951.842 per $1 as of December 2024, taken up to N1356.42.
Reacting to the development, Chief Executive Officer of the Center for the Promotion of Private Enterprises, CPPE, Dr. Muda Yusuf, expressed shock at the development, saying that the increase will further worsen the already bad economic situation.
Yusuf wondered if anybody was advising the Governor of the CBN on the implications of these actions.
He said, “I am shocked at the development, I mean with all these suffering, with all these costs, we have not recovered from the unification of the exchange rate they just did, now another increase in duty.
“This increase will definitely affect every area of our economic life, already; we recorded a drop in the volume of import last year, so you imagine what will happen with this increment.
“The sharp depreciation and the increment of import duty will no doubt affect the volume of trade because the cost of import is going to increase significantly and this will affect practically all the key components of cost.
“That is the cost of transportation, the cost of shipment, the cost of clearing and this will slow down the velocity and the tempo of activities in the maritime sector. And that tempo has already reduced anyway and it further reduces.”
He warned against the upward review of the exchange rate for the computation of import duty, adding that it would be devastating for both the economy and the citizens.
Speaking in a similar vein, former Executive Secretary of the Nigerian Shippers Council, Mr. Hassan Bello, said that the velocity of the exchange rate is affecting every sector of the economy, adding that the country needs to export more than import.
He said, “As the Naira further depreciates against the Dollar, we will have less importation.”
