The Centre for Promotion of Private Enterprise (CPPE), a local think tank, has revealed that the increase in exchange rate by the Central Bank of Nigeria (CBN) is disastrous for the import industry, News About Nigeria reports.
The Chief Executive Officer of CPPE, Dr. Muda Yusuf, made this revelation in a report on Sunday, stating that the increase in the exchange rate for cargo clearance will make more industries rely on smuggling, as it will be difficult for most industries to afford the exchange rate proposed by the CBN.
He noted that a lot of industries that depended on the imported raw materials may shut down, adding that the revenue from customs will dwindle as it becomes increasingly difficult for industries to import their goods through official channels.
He maintained that these will worsen the already bad inflation the country is currently facing, in addition to worsening an already bad poverty situation and the welfare conditions of the citizens, increase the intensity of corruption vulnerabilities in the international trade ecosystem, and also increase the importation of substandard products amid the high and increasing cost of products.
Muda further stated that the inconsistent exchange rates of the CBN posed a great threat of uncertainty for investors planning to invest in the country and also made the process of international trade unpredictable.
Recall that the CBN on Thursday increased the exchange rate for cargo clearance from N783/dollar to N952/dollar.
He therefore called on the CBN to review its decision to increase the exchange rate for customs duty computation, adding that the frequency of rate reviews should also be reduced to minimise uncertainty and risk for investors.