Rising cost of goods: CPPE asks CBN to peg customs duty at N1000\$1

The Centre for the Promotion of Private Enterprise (CPPE) has advised the Central Bank of Nigeria (CBN) to peg the customs duty exchange rate at N1000\$1 for the rest of the year.

This advice was contained in a statement by its founder, Muda Yusuf, obtained by Ripples Nigeria on Sunday in Lagos.

According to him, the appeal is in line with the federal government’s commitment to ease the current hardships on the citizens and the burden on businesses.

Mr Yusuf also welcomed CBN’s decision to approve the use of the exchange rate reflected on the import documentation (Form M) at the onset of the import transaction.

He said this was a laudable response to the grievances of investors in the economy and would reduce the current uncertainty around imports and related economic transactions.

Mr Yusuf, however, noted that the intervention does not address the bigger and more troubling issue of the current prohibitive cost of cargo clearance at the ports, which had risen by over 40 per cent in the last two months.

“The high exchange rate for import duty assessment is fuelling the already high inflation, increasing production and operating costs for manufacturers and other businesses.

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” It is worsening the cost-of-living crisis and putting thousands of maritime sector jobs at risk.

“There is also the added risk of cargo diversion to neighbouring countries and heightened smuggling, which can jeopardise the realisation of customs revenue target.

“The current customs duty exchange rate of N1488.9 per dollar is still too high in the context of the current galloping inflation and difficulties facing businesses and the citizens,” he said.

The CPPE boss revealed that instances of abandoned cargo was on the increase as a consequence of escalating trade costs.

He opined that these were not good outcomes for an economy seeking to ensure recovery, drive growth, promote inclusion and guarantee social stability.

“Pegging the customs duty exchange rate resonates with the present intervention measures to mitigate the current hardships in the country.

“Besides, this proposition does not in any way detract from the economic reform agenda of the present administration.

“If anything, it will complement the economic transformation measures because of the expected positive impact on competitiveness, productivity, cost reduction, deceleration of inflation and employment generation,” he said.

By Babajide Okeowo

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