Emmanuel OchayiDr. Muda Yusuf, CEO of the Centre for Promotion of Private Enterprise (CPPE), raised concerns over the Central Bank’s decision to elevate the customs exchange rate, emphasizing the potential detrimental impact on businesses and citizens alike.
“Such a move worsens our production costs, erodes profit margins, and endangers business survival,” Yusuf asserted, highlighting the grave consequences of this decision.
Yusuf pointed out the troubling pattern of fluctuating rates, which he claims fosters uncertainty among investors and makes international trade increasingly unpredictable.
“This isn’t the time for such increases,” Yusuf declared, citing the already challenging operating environment businesses face due to economic headwinds.
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Furthermore, he warned against the current trajectory’s implications, emphasizing the adverse effects on import costs, potential industrial shutdowns, declining revenue, and exacerbating inflationary pressures and poverty levels.
“The review could spur smuggling and compromise product quality,” Yusuf cautioned, urging the CBN to reconsider its decision and advocate for a more stable approach to trade policy to protect the economy and citizens from inflationary pressures.
Yusuf’s proposal for a concessionary rate in import duty computation and a less volatile approach to rate reviews reflects the CPPE’s stance on safeguarding the economy from undue pressures.
“The frequency of rate reviews must decrease to provide a more stable investment environment,” he emphasized, underlining the need for consistency to alleviate uncertainty among investors.
The CPPE’s call for a revision aims to alleviate the economic strain on businesses and citizens amid existing challenging circumstances, urging the CBN to adopt a more measured approach towards exchange rate adjustments for a sustainable economic future.
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