ENUGU, Nigeria (VOICE OF NAIJA)- The Central Bank of Nigeria (CBN) has given its nod to a substantial increase of 43 per cent in the import duty rate.
This decision, affecting the exchange rate for duty collection, has raised concerns among importers and stakeholders in the trading community.
Previously set at N951.842 per $1 as of December 2024, the exchange rate for duty collection has now surged to N1356.42, catching importers off guard.
This abrupt increase has sparked reactions from various quarters, expressing apprehension about its potential impact on the already challenging economic situation.
Dr. Muda Yusuf, the Chief Executive Officer of the Center for the Promotion of Private Enterprises (CPPE), expressed shock at the development, highlighting the potential negative consequences for the economy.
According to Vanguard, he questioned whether the implications of these actions were thoroughly considered.
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Yusuf voiced his concerns, stating, “This increase will definitely affect every area of our economic life. Already, we recorded a drop in the volume of import last year, so you imagine what will happen with this increment.”
He emphasized that the sharp depreciation and the increment of import duty would impact various components of cost, including transportation, shipment, and clearing.
This, in turn, is expected to slow down activities in the maritime sector, compounding the challenges already faced.
Warning against an upward review of the exchange rate for the computation of import duty, Yusuf stressed that such a move would have devastating effects on both the economy and the citizens.
He said, “I am shocked at the development, I mean with all these suffering, with all these costs, we have not recovered from the unification of the exchange rate they just did, now another increase in duty.
“The sharp depreciation and the increment of import duty will no doubt affect the volume of trade because the cost of import is going to increase significantly and this will affect practically all the key components of cost.
“That is the cost of transportation, the cost of shipment, the cost of clearing and this will slow down the velocity and the tempo of activities in the maritime sector. And that tempo has already reduced anyway and it further reduces.”
Former Executive Secretary of the Nigerian Shippers Council, Mr. Hassan Bello, echoed concerns about the impact of the depreciating Naira against the Dollar.
Bello emphasized the need for the country to focus on exporting more than importing, recognizing the potential consequences of further depreciation on importation.