The Customs exchange rate for import duties has crashed below the official market rate.
NewsOnline Nigeria reports that the Nigeria Customs exchange rate of import duties and cargo clearance has dropped below the official market of N1251/$.
Checks on the Nigeria Customs foreign exchange portal reveal that the exchange rate of import duties is N1246.66/$- a difference of around N5 from the exchange rate at the close of business on Friday.
The decline in the customs exchange rate below the official market rate is surprising considering in the past few months, the service’s exchange rate has been consistently above the official market rate.
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Strengthening of the exchange rate
Over the past few weeks, there has been a noticeable decline in the exchange rate applied to import duty payments on the customs portal, indicating a strengthening of the naira in the foreign exchange market. Previously, this rate peaked at N1,624.7 per US dollar and has since been falling to its current value.
The Customs Service has acknowledged that the Central Bank of Nigeria (CBN) often modifies the exchange rate to align it with the current official market rate.
Over the past few weeks, the naira has strengthened more on the parallel market than on the official NAFEM window. This can be attributed to the CBN’’s decision to sell forex to Bureau De Change (BDC) operators at N1251/$– a little below the official market rate then. This has resulted in an alignment of the official and parallel market rate in recent times.
Convergence of exchange rate on parallel and official market
The convergence of the official and black-market exchange rates signals the successful implementation of the Central Bank of Nigeria’s (CBN) foreign exchange market policies.
Among these measures, restrictions were placed on International Oil Companies (IOCs), allowing them to immediately repatriate only 50% of their foreign exchange profits, while requiring them to wait 90 days before transferring the remainder.
Furthermore, the central bank has imposed a ban on commercial banks, preventing them from allocating profits earned from foreign exchange transactions for operational costs and the distribution of dividends.
