Federal Government Increase Exchange Rate for Cargo Clearance From N952/$ to N1356/$

The Federal Government, in collaboration with the Central Bank of Nigeria, has increased the exchange rate for cargo clearance from N952/$ to N1.356/$.

This announcement came just after a week when the Federal Government, through the Central Bank of Nigeria, increased the exchange rate for cargo clearance from N783/$ to N952/$.

Before then, the exchange rate for cargo clearance Nigerian Customs Service was increased from N757/$ to N783/$, which signifies a 3.4% increase before it was raised from N783/$ to N952/$ in December.

Not too long after the announcement, the portal of the Nigeria Customs Service on Friday was updated with the new rate.

Speaking with the PUNCH, Remilekun Sikiru, the Association of Nigerian Licensed Customs Agents, said, 

• How do we explain this? From N952/$ to N1.356/$ as of Friday morning, with about a N404 increase? It’s quite unfortunate that the prices of goods and commodities will automatically increase. Importation would further decrease and depreciate, and vehicle prices would skyrocket again.

• Since this unification, the government has refused to look inward and critically into the maritime industry regarding importation and exportation. The sector has been neglected, and things are getting worse daily. The question now is, how would freight forwarders and customs brokers agents cope with this new rate?

Following the increase in the Naira, The Central Bank of Nigeria (CBN) imposed a limit on how much local banks could hold in foreign currencies. The apex bank expressed concern about the increase of forex exposures on its balance sheet following the naira and dollar crisis, which has plunged the naira into a risky state.

This week Tuesday, the naira declined low on the official market, slipping below the unofficial parallel market rate after market regulator FMDQ Exchange changed its closing rate calculation methodology. Its dollar-denominated sovereign bonds also suffered sharp falls.

The CBN said it recently introduced a limit on lenders' net open positions of 20% of shareholders' funds for short positions and a zero limit for long positions and ordered banks to harmonise reporting, according to a circular released on Wednesday.

Back Story

In November last year, the Nigerian Customs Service (NCS) made some adjustments to its tariffs and duties to follow the country’s current foreign exchange rate as of then.

All updates made by the Nigerian Customs Service can be seen on the federal government’s single-window trade portal.

Based on the information on the federal government’s single-window trade portal, the Nigerian Customs Service (NCS) increased by 3.43%, which can be described as an N26.15% increase, reaching N783.174/$. This shows an increase from the previous rate, which was 757.023/$.

It’s also important to know that the Nigerian Customs Service (NCS) imposes customs duties in Nigeria, which are charges levied on imported goods, among other tariffs.