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Customs, importers bicker over exchange rate differentials
The Nigeria Customs Service, NSC, and importers are currently at loggerheads over foreign exchange differentials, Vanguard investigation has revealed.
Customs is insisting that importers pay duties for their goods, which Form “M” was opened before the introduction of flexible exchange rate by the Central Bank of Nigeria, CBN.
Customs CG, Hameed Ali Customs CG, Hameed Ali However, the importers are protesting the enforcement of the newly introduced market determined rate, stressing that the CBN had already approved all transactions with Form “M” at the time the exchange rate was N197 to a dollar.
But the NCS is insisting on processing all transactions at the present rate of N383 to a dollar irrespective of the amount contained in Form “M.” Despite the outcry of the importers over the effect of Customs’ insistence and the huge financial loss incurred by them, Vanguard gathered that the NCS has vowed to continue the implementation of duty collection at N383 to a dollar.
National President of the Association of Nigeria Licensed Customs Agents, ANLCA, Olayiwola Shittu, told Vanguard that the CBN agreed to allow all transactions with N197 in their Form “M” to be executed, but noted that the NCS is insisting on processing all transactions at the present rate of N383 to a dollar.
According to Shittu, “There is conflict between the CBN policy and the Customs circular. The CBN said duty should be paid based on the exchange rate in the Form “M” and Customs has a circular stating that the President had given them go ahead to execute transactions at the current rate. So that is what has been affecting us presently and that is what we are working on now.”
Shittu said the position of the CBN was reached after a meeting between the ANLCA, CBN, Nigerian Shippers’ Council, NSC and some other stakeholders. He noted that his association is working to bring the two government agencies together to reach a compromise on the issue.
Recall that Eze-Ifeoma, Vice President, Association of Nigeria Tyre Marketers, ANTM, had said that the Customs circular is having serious effect on the importing public, stressing that some people are already abandoning their goods at the port because they do not have money to clear them. He said that the policy has led to the abandonment of millions of dollars worth of imported goods at the ports.
Eze-Ifeoma explained that the devaluation of the naira which saw it move from about N197 in December to almost N400 as at the time they came back from Christmas celebration, resulted in a huge loss to importers.
According to him, “From December till date more than 80 percent of importers have not imported any goods, the goods you see coming out are goods that are pending because of the Foreign Exchange (FOREX) problem.
“You can imagine some people imported based on N200 before going for Christmas and when they came back what they heard is that dollar was now between N350 and N380. Some left their containers at the port and ran away; the value of the money to get the documents from the shipper cannot be equated with the product inside the container.
“If you have goods worth N3 million inside the container and you have to pay N6 million to the shipper and clear the same goods with N2 million, you will be looking at about N8 million and the prevailing selling price of the product in market is about N3.5 million, what will you do if you are in that situation?
“The best thing is to forfeit the container to government and you lose the money and that is what many people have done. People who insist on bringing their containers out pay through their noses, buying dollar at N400, now it is about N320 and at the end of the day importers are losing because there is no money in the country. If you go to the market today nobody is buying, it is a total disaster and it will still remain for some time.”
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