The Nigeria Customs Service (NCS) has rannounced a reduction of the exchange rate for import duties collection from N1238.1 to the dollar to N1,147/$.
Gatekeepers News reports that this is a decline of N91.1 since the previous reduction on April 10th, which is the longest the customs exchange rate has stayed at a particular rate in recent times.
The NCS, through the CBN, has consistently fixed the exchange rate to reflect the official market rate on the NAFEM window, which explains the regular changes in the rate.
The naira has been strengthening significantly in the past month in both the official and parallel market, thanks to the reforms instituted by the CBN.
Some of these reforms include selling USD to BDCs at N1101/$, cash pooling for IOCs, which limited the amount of FX they could repatriate immediately, among others.
Consequently, the value of the naira has gained significantly, and Goldman Sachs analysts predict that it will be one of the best-performing currencies globally.
The President of the Association of Bureau De Change Operators (ABCON), in an interview, stated that BDC operators were buying dollars at N980/$, a figure far below the FX rate on the official window.
However, many have accused the apex bank of defending the naira with the country’s foreign reserve on the back of observed declines in the FX reserve.
Nigeria’s foreign reserve has dropped by over $2 billion in the past month, with the FX reserve dropping from $34.45 billion to $32.29 billion, the lowest in about six years.
Nonetheless, the Governor of the CBN, Yemi Cardoso, has noted in an engagement during the World Bank-IMF spring summit that the bank does not intend to defend the naira. Rather, the decline in the foreign reserve was due to payment of external debt obligation.
