The business environment in Nigeria is thought to be hostile to business owners.
Manufacturers are crying in pain while importers are struggling to stay afloat due to increase in exchange rate reflecting in customs duty.
Importers and manufacturers might begin to see this move as an insensitive one.
Increased customs duty will stunt the growth process in the industry.
Now, the Centre for the Promotion of Private Enterprise (CPPE) believes there is somryhing yhat coukd help.
It is advising the Central Bank of Nigeria (CBN) to peg the customs duty exchange rate at ₦1000\$1 for the rest of the year.
This advice was contained in a statement by its founder, Muda Yusuf, on Sunday in Lagos.
Reduce Current Hardship In The Country
Yusuf wants the federal government to stay committed to easing the current hardships on the citizens and the burden on businesses.
Have You Read: Be Patient, CBN Is Working To Strengthen The Naira – CBN Gov.
He welcomed CBN’s decision to approve the exchange rate reflected on the import documentation (Form M) at the onset of the import transaction.
The CPPE boss described the CBN’s response to the grievances of investors in the economy as laudable.
He explained that this would reduce the uncertainty around imports and related economic transactions.
However, he noted that the intervention does not address the troubling issue of the current prohibitive cost of cargo clearance at the ports.
Cost Of Cargo Clearance Rose By 40% In 2 Months
According to him, the cost of cargo clearance over the last two months had risen by over 40%.
“Production and operation costs for manufacturers and other businesses are increasing due to high inflation and high exchange rates for import duty assessment.
”The situation is influencing the cost-of-living crisis negatively 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.
Customs Duty Exchange Rate Is Too High
“The current customs duty exchange rate of ₦1488.9 per dollar is too high in the context of the current difficulties facing businesses and the citizens,” he said.
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Yusuf revealed that instances of abandoned cargo were on the increase as a consequence of escalating trade costs.
He opined that these are not good outcomes for an economy seeking to ensure recovery, drive growth, promote inclusion, and guarantee social stability.
