In the midst of multiple adjustments to customs exchange rates, the Central Bank of Nigeria has directed the Nigerian Customs Service (NCS) to adopt the foreign exchange closing rate prevalent on the date of ‘Form M’ submission by importers for the purpose of clearing goods and assessing import duties.
This directive was conveyed in a statement released on Friday, signed by Hassan Mahmud, the Director of the Trade and Exchange Department at the CBN. The central bank pointed out that frequent alterations in customs duties rates have disrupted the pricing structure, causing inconsistent increases in the final cost of goods in the market.
The new measure from the central bank is designed to address the volatility and frequent updates on the customs website related to the liberalization of the foreign exchange market. The directive is set to be implemented by the Nigeria Customs Service starting from the 26th of February 2024.
“To this effect, the Central Bank of Nigeria wishes to advise the Nigeria Customs Service and other related parties to adopt the FX rate on the date of opening the Form M for importation of goods, as the FX rate to be used for import duty assessment. This rate remains valid until the date of termination of the importation and clearance of goods by the importers.
“This would enable the Nigeria Customs Service and the importers to effectively plan appropriately and reduce uncertainties around varying exchange rates in determining revenue or cost structure, respectively.
Therefore, effective 26th February 2024, the closing rate on the date of opening of Form M for the importation of goods and services would be the rate that would apply for assessing goods and services. This supersedes the requirement of Memorandum 9, J (2) of the Central Bank of Nigeria Foreign Exchange Manual (Revised Edition) 2018.”
Recalls that since January this year, the Central Bank of Nigeria has raised the exchange rate for cargo clearance at least six times. The latest was the exchange rate increase for cargo clearance to N1,605 per US dollar.
The development comes amid the high cost of goods and services in Nigeria.
The National Bureau of Statistics disclosed in its latest consumer price index that headline inflation for January stood at 29.90 per cent.