The exchange rate for import duties by the Nigeria Customs Service (NCS) continues to rise as it hits N1549 to the USD according to the latest check on the customs exchange rate portal.
This represents an increase of N37 from the previous rate of N1512/$.
The persistent increase in the customs exchange rate in July follows a relatively stable June, during which there were no significant fluctuations.
In June, there were five different exchange rates used for customs duties collection. However, this month, the Central Bank of Nigeria (CBN) has already adjusted the exchange rate for customs duties collection seven times, just ten days into the month.
Earlier on the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms had recommended that the FX rate for customs duties be pegged to the 2024 budget benchmark to assuage the effect of high exchange rates on the business community, especially manufacturers and importers. The committee recommended N800/$ till the end of the year to combat inflation and enable planning for businesses.
Renewed weakness of the Naira
The consistent rise in the customs duties exchange rate also mirrors renewed marginal weakness in the naira towards the tail end of last month and the beginning of this month despite the increase in the country’s foreign reserve.
The naira closed at N1532.58 to the USD on July 9th 2024 on the official NAFEM window according to data from FMDQ marking further weakening from the N1521/$ it closed a day earlier.
Increase in Nigeria’s foreign reserve
Nairametrics earlier reported the increase in the country’s foreign reserve to the highest in 13 months going as far as the early days of the current President Tinubu-led administration.
Nigeria’s external reserves rose by $1.88 billion, reaching $34.66 billion as of July 4, 2024, marking a 13-month high. According to Nairametrics’ historical records of the Central Bank’s external reserve data over the past year, this is the highest level achieved since the introduction of the foreign exchange (FX) unification policy in June 2023.
When the CBN announced the FX unification policy, Nigeria’s external reserves stood at $34.66 billion. However, from July to December 2023, the reserves fluctuated within the $33 billion range.
According to Nairametrics research, the external reserves reached $34.66 billion as of July 4, 2024, the highest level in over a year.
Nigeria has been experiencing a surge in exchange rates over the last few weeks, ending June above $34 billion for the first time since April.
The reserves have continued to grow in July, hitting multiple highs and culminating in the highest level in the past year.