Nairametrics
  • Home
  • Exclusives
    • Financial Analysis
    • Corporate Stories
    • Interviews
    • Investigations
    • Metrics
  • Markets
    • Cryptos
    • Commodities
    • Equities
      • Dividends
      • Stock Market
    • Fixed Income
    • Market Views
    • Securities
  • Industries
    • Company News
    • Consumer Goods
    • Content Partners
    • Corporate deals
    • Corporate Press Releases
    • Energy
    • Entertainment
    • Financial Services
    • Hospitality & Travel
    • Manufacturing
    • Real Estate and Construction
    • Tech News
  • Economy
    • Get Data
    • Macro-Economic News
    • Research Analysis
  • Business News
  • Financial Literacy
    • Career tips
    • Personal Finance
  • Lifestyle
    • Billionaire Watch
    • Profiles
  • Opinions
    • Blurb
    • Op-Eds
No Result
View All Result
  • Home
  • Exclusives
    • Financial Analysis
    • Corporate Stories
    • Interviews
    • Investigations
    • Metrics
  • Markets
    • Cryptos
    • Commodities
    • Equities
      • Dividends
      • Stock Market
    • Fixed Income
    • Market Views
    • Securities
  • Industries
    • Company News
    • Consumer Goods
    • Content Partners
    • Corporate deals
    • Corporate Press Releases
    • Energy
    • Entertainment
    • Financial Services
    • Hospitality & Travel
    • Manufacturing
    • Real Estate and Construction
    • Tech News
  • Economy
    • Get Data
    • Macro-Economic News
    • Research Analysis
  • Business News
  • Financial Literacy
    • Career tips
    • Personal Finance
  • Lifestyle
    • Billionaire Watch
    • Profiles
  • Opinions
    • Blurb
    • Op-Eds
No Result
View All Result
Nairametrics
No Result
View All Result
Home Business News

A look at the attendant impacts of the new Customs Exchange Rate

CSL Stockbrokers by CSL Stockbrokers
June 27, 2019
in Business News, Markets, Op-Eds, Politics, Research Analysis
AfCFTA
Share on FacebookShare on TwitterShare on Linkedin

Earlier this month, the Nigerian Customs Service (NCS) announced that the exchange rate for customs duty has been increased from the official benchmark of N306/US$ to N326/US$. This implies that importers and exporters whose products are valued and transacted in dollars now have to pay additional N20 per US$ worth of goods. Notably, the new exchange rate was implemented with immediate effect.

In defense of the customs service, the move has been described as a move to improve Government revenue.

However, the decision to hike the exchange rate has been met with strong criticism from importers and exporters alike. It was reported that the president of Shippers Association of Lagos State remarked that the Government must have been ill-advised on this new policy. According to him, the Government’s move in pursuing revenue generation rather than trade facilitation is fast crippling the economy. Our opinion about this decision is not much different.

RelatedPosts

Nigerian Stocks: List of Dividends announced in 2022

CBN says services and agricultural sectors surged amid industrial sector dip in Q3 2021

The prior exchange rate for customs duty was in line with the CBN’s official rate. However, the new N326/US$ rate creates a new exchange rate in the economy in addition to the NAFEX rate, official rate, parallel market rates, increasing the multiple exchange rate saga. The increasing practice of a multiple exchange rate system in Nigeria will only continue to increase investor’s uncertainty as regards doing business and investing in Nigeria.

[READ ALSO: “Worst is behind us” Research sees improving economy under Buhari second term]

News continues after this ad


Furthermore, stemming the increasing tide of smuggling through Nigerian borders have garnered attention over the past two years given the negative impact it has had on several businesses. We, however, believe policies that increase the cost of clearing goods at the port would only further encourage smuggling as well as increase corruption among customs officials. Thus, this implies a ripple effect on business activities which have suffered from the impact of smuggling activities.

Among the current administration’s major themes of economic development is diversification of the economy from being oil-focused. This has increased the drive to encourage non-oil exports which have led to the CBN banning access to forex for importers of over 50 products. However, the move to increase the exchange rate on customs duty would have the impact of making Nigerian exports more expensive given many of these exports are valued in dollars.

In addition, we believe the ultimate impact of this new policy would lead to an increase in the prices of commodities given Nigeria imports most of its consumption in different forms. Majority of Nigerian local producers rely on foreign inputs in the production of their goods, thus the cost of production would be impacted negatively.

News continues after this ad



CSL STOCKBROKERS LIMITED CSL Stockbrokers,

Member of the Nigerian Stock Exchange,

First City Plaza, 44 Marina,

PO Box 9117,

Lagos State,

NIGERIA.

Related

Tags: Central Bank of Nigeria CBNNigerian Business NewsNigerian Customs Service (NCS)On the Money

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

inq
avatrade
Stanbic bank
Mega Millions
UBN
Hot forex
Access Bank
Bankers Committee
First bank






    Business News | Stock Market | Money Market | Cryptos | Financial Literacy | SME |

    Recent News

    • Growth of Private Conglomerates like BUA Group Evidence of the Correctness of our Policies, Says President Buhari
    • BUAFOODS’ ascension to SWOOTs not enough to stop NGX from shedding N190 billion
    • Buhari again urges ASUU to call off strike, says it’s counterproductive

    Follow us on social media:

    Recent News

    Growth of Private Conglomerates like BUA Group Evidence of the Correctness of our Policies, Says President Buhari

    Growth of Private Conglomerates like BUA Group Evidence of the Correctness of our Policies, Says President Buhari

    August 12, 2022
    BUA Cement Plc leads stocks worth over one trillion as market cap rises by N50.80 billion

    BUAFOODS’ ascension to SWOOTs not enough to stop NGX from shedding N190 billion

    August 12, 2022
    • ABOUT US
    • CONTACT US
    • PRODUCTS
    • ANDROID APP
    • iOS APP
    • DISCLAIMER
    • CAREERS
    • PRIVACY POLICY

    © 2022 Nairametrics

    No Result
    View All Result
    • Home
    • Exclusives
      • Financial Analysis
      • Corporate Stories
      • Interviews
      • Investigations
      • Metrics
    • Markets
      • Cryptos
      • Commodities
      • Equities
        • Dividends
        • Stock Market
      • Fixed Income
      • Market Views
      • Securities
    • Industries
      • Company News
      • Consumer Goods
      • Content Partners
      • Corporate deals
      • Corporate Press Releases
      • Energy
      • Entertainment
      • Financial Services
      • Hospitality & Travel
      • Manufacturing
      • Real Estate and Construction
      • Tech News
    • Economy
      • Get Data
      • Macro-Economic News
      • Research Analysis
    • Business News
    • Financial Literacy
      • Career tips
      • Personal Finance
    • Lifestyle
      • Billionaire Watch
      • Profiles
    • Opinions
      • Blurb
      • Op-Eds

    © 2022 Nairametrics

    Social Media Auto Publish Powered By : XYZScripts.com