Nigeria imposes 4% free on-board charge on imports

The Nigeria Customs Service has recently announced a new four percent charge on the Free On-Board Value of imports, a move that is expected to increase the cost of importing goods into the country. This decision has raised concerns among experts and industry players, especially at a time when Nigeria is grappling with high inflation and a cost of living crisis. The lack of structured sensitization efforts by the Nigeria Customs Service has drawn criticism from stakeholders, with the Lagos Chamber of Commerce and Industry describing the charge as abrupt and insensitive. Bamidele Ayemibo, CEO of 3TImpex Consulting, shared his insights on the potential effects of the new charge on Nigeria's import and export landscape. Ayemibo expressed his concern over the impact of the four percent increase on businesses, highlighting that the additional cost would likely be passed down to consumers, further exacerbating the economic challenges faced by the country. He emphasized the need for measures to reduce the burden on businesses and consumers, particularly in a time of economic instability. The Nigeria Customs Service has often been criticized for prioritizing revenue generation over trade facilitation. Ayemibo echoed these sentiments, noting that the focus on revenue generation could hinder trade transactions and ultimately affect the economy negatively. While there is pressure on the customs service to meet revenue targets, Ayemibo emphasized the importance of balancing revenue generation with trade facilitation to ensure a conducive business environment. In another significant development, the Central Bank of Nigeria has approved the inclusion of the CFA franc on the Nigeria Export Proceeds form, allowing exporters to repatriate proceeds in the currency. Ayemibo viewed this decision positively, stating that it could enhance trade within West Africa and lead to increased export volumes from Nigeria. He highlighted the potential for the initiative to streamline trade processes and support regional economic integration. Commenting on the Nigerian Export Promotion Council's 'Go Global, Go for Certification' campaign, Ayemibo acknowledged the importance of certifying SMEs to access niche markets and international certification. However, he stressed the need to focus on increasing export volumes by supporting products with high demand in the global market. Ayemibo recommended forming strategic alliances and agreements with key importing countries, such as China, to drive up export volumes and boost the value of the Naira. He cited the example of soya beans, a high-demand product with significant export potential, as a key focus for increasing export proceeds. By prioritizing high-demand products and fostering strategic partnerships, Nigeria can enhance its export capabilities and alleviate pressure on the Naira. Overall, Ayemibo's insights shed light on the challenges and opportunities in Nigeria's import and export landscape, emphasizing the importance of strategic planning and collaboration to drive economic growth and sustainability.