Nigeria Customs Implements 22.8% Exchange Rate Surge, Sets Cargo Clearance at N952/$

In a recent development, the Nigeria Customs Service (NCS) has implemented a significant adjustment in the exchange rate for cargo clearance, escalating from N783/$ to N952/$, denoting a noteworthy 22.8% increase. A thorough examination on the federal government’s single-window trade portal of the customs service, as scrutinized by Infostride News, reveals the modification of the previous exchange rate of N783.17 to the USD to a revised rate of N951.94.

The Nigeria Customs Service is renowned for imposing duties on imported cargoes before their clearance from the ports. These duties vary from 5% to 35%, in accordance with the harmonized commodity and coding system (HS code). The revenue generated from these fees and additional tariffs constitutes a substantial portion of the customs service’s financial inflow. Notably, within the initial half of the current year, the service reported an average monthly collection of N202 billion from these tariffs and levies.

**Delving into the Background**

Taking a retrospective look, Nairametrics previously reported an increase in the exchange rate for customs tariff collection in November, ascending from 757.023/$ to N783.174/$, reflecting a notable N26.15 surge. Surprisingly, this recent adjustment marks the second within a span of just over one month, inching closer to parity with the exchange rate prevalent in the parallel market.

According to the latest update from Infostride News, the naira concluded its recent trading session at N951.22 to the USD on the official market, experiencing an Intra-day high of N1159.10/$1. This showcases a substantial 15.19% decline when compared with the rate reported just a day earlier.

**Nigeria’s Persistent Currency Conundrum**

Nigeria has grappled with an ongoing exchange rate crisis since the Central Bank unified the exchange rate market in June, relinquishing control to market forces for the determination of the naira’s value. Since this policy shift, the naira has witnessed a significant depreciation, losing over 100% of its value and trading at an average of N460/$ before the Central Bank’s intervention in June.

Acknowledging the severity of the situation, the apex bank reportedly carries a backlog of around $7 billion. Governor Yemi Cardoso has candidly expressed that resolving this backlog constitutes the short-term priority for the central bank. Recent reports indicate that the Central Bank of Nigeria has initiated the clearance of some of its backlog, with prominent entities such as PZ Cussons confirming the commencement of cash repatriation to its holding company abroad.

In conclusion, Infostride News sheds light on the unfolding dynamics of Nigeria’s currency landscape, emphasizing the intricate interplay between customs service policies, exchange rate adjustments, and the broader economic challenges facing the nation. As stakeholders closely monitor these developments, the resilience of the Nigerian economy amid these currency fluctuations remains a subject of critical concern and analysis.