Consequently, the margin between the parallel market and NAFEM rates narrowed to N1.57 per dollar from N55.79 per dollar on Monday.
Business
Customs: Vehicle tariff reduction to begin next week
- Finance Act, a short-term measure – Minister
Vehicle importers are from next week expected to start enjoying considerable reduction in tariff on automobiles they bring into the country, the Nigeria Customs Service has said.
The reduced duties on vehicles and tractors from 35 to about 10 per cent are part of the new finance law.
Comptroller-General of Customs, Hameed Ali, who disclosed this to journalists in Abuja, said the management of the service was expecting an official communication from the finance ministry on the matter any moment.
But the Minister of Industry, Trade and Investment, Otunba Adebayo, says the auto section that allows for reduced import tariff in the Finance Act is a short-term measure as part of ways to ease the difficulties coming with the recent lockdown and rise in inflation.
He said the vehicle tariff reduction, as contained in the 2020 Finance Act, was initiated by the NCS to ease the cost of transportation in Nigeria.
He said, “We are the proponents of the new tariff. I’ve been torn apart by many people criticising it, saying I used my connection to get it done. But it is in the overall interest of Nigeria.
“Now, it has become a law. We are now waiting for the finance minister to give us a formal conveyance of that Act. Once we receive it, we commence implementation immediately and inform our commands.
“We are hoping that latest by next week, it will become operational.”
On the African Continental Free Trade Agreement, Ali said all aspects that concerned the NCS had been adhered to.
He, however, noted that the service would need certain inputs from the AfCFTA secretariat, such rules of origin, as this should not be left to chambers of commerce alone, adding that the NCS should part of the team.
Otunba Adebayo said the Federal Government had activated a number of measures to assist automakers in Nigeria to ensure that they would operate well and buoyantly such as government’s agencies.
“The idea is to help people who cannot buy cars in the short term. We’re looking at the medium and long-term measures which will largely benefit the local auto manufacturers,” he said.
Business
Naira drops further to N1,421.06 per dollar
Naira drops further to N1,421.06 per dollar
The declining fortunes of the Naira persisted yesterday with further depreciation in the parallel and official markets due to the re-emergence of speculation and hoarding, even as some Bureaux De Change, BDCs withdrew from the Central Bank of Nigeria, CBN’s, dollar sales program.
Vanguard also learnt that despite the sustained nationwide raids and arrest of street currency hawkers, the Naira further depreciated yesterday to N1,435 per dollar in the parallel market, from N1,415 per dollar on Tuesday, and also depreciated to N1,421.06 per dollar in the Nigerian Foreign Exchange Market, NAFEM.
Data from FMDQ showed that the indicative exchange rate for NAFEM fell to N1,421.06 per dollar from N1,416.57 per dollar on Tuesday, indicating N4.49 depreciation for the naira.
Consequently, the margin between the parallel market and NAFEM rates widened to N13.94 per dollar from N1.57 per dollar on Tuesday.
Dollar sales to BDCs
In a bid to intervene in the retail segment of the forex market, the CBN in February resumed dollar sales to BDCs. Since then the apex bank has held three editions of the dollar. At the last edition, the CBN offered to sell $10,000 per BDCs at directing them to sell at the maximum margin of 1.5 per cent.
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BDC operators however complained dollar disbursement from CBN is too slow that and takes three to four weeks between when they make payment and when the dollars are disbursed to them.
Vanguard reliably gathered that as a result of this delay and the uncertainty in the forex market, some BDCs, have asked the CBN to refund their Naira payment.
Top BDC operators who confirmed this development to Vanguard under the condition of anonymity said that some of the BDCs that asked for refunds have gotten their money.
Speaking to Vanguard on condition of anonymity, the Chief Executive of a BDC said, “I think the CBN is overwhelmed. You pay money and it takes one month for you to collect $10,000. It is over a month now since they intervened and they have not intervened again.
Business
Naira trades at N1,415/$ on parallel market
Naira trades at N1,415/$ on parallel market
The Naira yesterday depreciated to N1,415 per dollar in the parallel market, from N1,410 per dollar on Monday.
Similarly, the Naira depreciated in the Nigerian Foreign Exchange Market, NAFEM, to N1,416.57 per dollar.
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Data from FMDQ showed that the indicative exchange rate for NAFEM fell to N1,416.57 per dollar from N1,354.21 per dollar on Monday, indicating N62.36 depreciation for the naira.
Business
CBN extends suspension of cash deposit charges by bank customers
CBN extends suspension of cash deposit charges by bank customers
The Central Bank of Nigeria (CBN) has directed commercial banks to extend suspension of charges on cash deposit until September 30 this year.
This directive was conveyed through a circular dated May 6, signed by Adetona Adedeji, the Director of Banking Supervision at the apex bank.
The banks had reintroduced fees for deposits exceeding N500,000 for individuals and corporate account holders on May 1.
Following the banks’ decision, individuals were set to incur a two per cent charge on deposits exceeding N500,000, while corporate account holders faced the same levy on deposits surpassing N3 million.
The new circular read, “Please refer to our letter dated December 11, 2023, referenced BSD/DIR/PUB/LAB/016/023 on the above subject, suspending processing charges imposed on cash deposits above N500,000 for individuals and N3,000,000 for corporates as contained in the ‘Guide to Charges by Banks, Other Financial Institutions and Non-Bank Financial Institutions’ issued on December 20, 2019.
“The Central Bank of Nigeria hereby extends the suspension of the processing fees of two per cent and three per cent previously charged on all cash deposits above these thresholds until September 30, 2024.”
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