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The forex exchange rate used for calculating customs import duties and cargo clearance has dropped for the fifth time in less than two weeks, falling from N1,612 per dollar on March 15th to N1,405.46 currently.
Before, the Nigerian Customs Service (NCS) had stated that the exchange rate for duty collection and cargo clearance would be decided by the Central Bank of Nigeria (CBN), based on the official market rate.
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Here’s a breakdown of the recent decline:
– March 15th, 2024: N1,612/$
– March 16th, 2024: N1,593/$
– March 19th, 2024: N1,572/$
– March 23rd, 2024: N1,448/$
– March 27th, 2024: N1,405/$
Recent observations show a steady decrease in value, indicating the naira’s strengthening against other currencies in both the parallel and official foreign exchange markets.
In the past two weeks, there has been a noticeable improvement in the naira’s value, rising from N1,615 per dollar on March 13th to N1,382 by March 26th.
Recent Reforms by the CBN:
The Nigerian Naira (NGN) has seen recent improvements, largely due to strategic measures and reforms implemented by the central bank to combat inflation and stabilize the foreign exchange (FX) market.
Last week, the Central Bank of Nigeria (CBN) announced success in clearing an over $4 billion backlog in foreign exchange forwards, benefiting businesses domestically and internationally.
Additionally, the CBN has imposed restrictions on International Oil Companies (IOCs), allowing them to only transfer 50% of their foreign exchange earnings immediately and requiring a 90-day wait for the remaining 50%.
Furthermore, the central bank has prohibited commercial banks from using foreign exchange sales profits for operational costs and dividend payments. Recently, it started selling dollars to Bureau de Change operators at a rate of N1,251 per dollar.
In its latest Monetary Policy Committee (MPC) meeting, the CBN raised interest rates from 22.75% to 24.75%, marking a 200-basis point increase.
Mr. Yemi Cardoso, the committee’s chairman, explained that this adjustment aims to control inflation, currently at 31.7%, and effectively manage the foreign exchange market.
