Amidst the ongoing economic turbulence in Nigeria, the depreciation of the Naira has inflicted a significant blow to businesses and importers.
The latest casualty is the surge in import duty costs which have skyrocketed by 23% due to the weakening of the national currency against the United States dollar.
The cost of clearing imports has surged to N1,412.573/$ as of May 8, an increase from the year-to-date low of N1,150.16/$ recorded on April 23.
This sudden spike in import duty costs reflects a 48% surge compared to the rate recorded in January.
The surge in import duty costs comes as a result of the fluctuation in the exchange rate between the Naira and the US dollar.
While the Naira experienced a brief rally in April, providing some relief to importers, the recent depreciation has erased those gains and compounded the financial strain on businesses.
Jonathan Nicole, former president of the Shippers Association of Lagos State, voiced concerns over the destabilizing effect of the fluctuating import duty rates on importers.
He criticized the lack of consistency in Nigeria’s economic policies and said there is a need for stability to attract investments and foster economic growth.
In response to the escalating import duty costs, stakeholders in the business community have called for urgent intervention to mitigate the adverse impact on businesses.
The surge in import duty costs poses a significant challenge to manufacturers and importers, particularly those who had already incurred expenses in anticipation of stable exchange rates.
As the cost of doing business continues to rise, there are growing concerns about the long-term viability of businesses and the potential impact on Nigeria’s economy.
With the economic landscape fraught with uncertainties, stakeholders are urging the government and regulatory authorities to implement measures aimed at stabilizing the currency and creating a conducive environment for businesses to thrive.
Failure to address these challenges could further exacerbate the economic woes facing Nigeria, jeopardizing its path to recovery and growth.