The Centre for the Promotion of Private Enterprise (CPPE) has warned that Nigeria risks losing cargo to neighbouring countries over a high exchange rate for import duties collection by the Nigerian Customs Service (NCS).
The group disclosed this in a statement signed by its Director/Chief Executive Officer (CEO), Dr. Muda Yusuf where they lamented the impact of the high exchange rate for import duties collection on businesses and the cost of living in the country.
According to the statement, the risk of cargo berthing in neighbouring countries could negatively impact the revenue generation drive of the federal government.
The statement reads, “The high and volatile exchange rate for import duty assessment is fuelling the already high inflation, increasing production and operating costs for manufacturers and other businesses, worsening the cost-of-living crisis, putting maritime sector jobs and investments at risk and weakening investors’ confidence. There is also the added heightened risk of cargo diversion to neighbouring countries and smuggling which could jeopardize the realization of customs revenue target.”
It is important to note that in the first half of the year, the Nigeria Customs Service reported a decline in cargo throughput despite a 127% increase in revenue during the period.
The CPPE further reiterated its appeal to the Presidency to set the customs duty exchange rate at N1000/$ for the next six months through an Executive Order. It noted that the recommendation aligns with the federal government’s current efforts to ease the hardships faced by citizens and businesses.
It explained that even the Presidential Committee on Fiscal Policy and Tax Reforms had made a similar recommendation, and the Organized Private Sector (OPS) strongly supported this approach.
It warned the customs duty exchange rate on the Nigeria Customs Service portal stands at N1578/$, a rate that has been changing almost weekly and is detrimental to the investment climate.
