The House of Representatives on Tuesday, October 24, asked its committees on finance as well as Customs and Excise to investigate the recent lifting of the forex ban on some items by the Central Bank of Nigeria (CBN).
This followed a motion of urgent public importance sponsored by Sada Soli (APC, Katsina) who argued that the decision of the apex Bank would greatly affect local industries.
The House asked the relevant committees to invite the governor of the Central Bank, Olayemi Micheal Cardoso, and other relevant stakeholders to examine the implications of the directive from the Bank.
The apex Bank recently lifted the suspension of forex for about 43 items which include rice, cement, margarine, Palm kernel/palm oil, products/vegetable oils, Meat and processed meat products, Vegetables and processed vegetable products, Poultry chicken, eggs, turkey among others.
The lawmaker recalled that the CBN imposed the restrictions in June 2015 to conserve the foreign exchange reserves and promote local production of certain goods, including about 11 food items.
According to him, on October 12, 2023, the Central Bank of Nigeria (CBN) announced, among other issues, the lift on FOREX restrictions hitherto placed on 43 items.
He said some of the items affected have tariffs to protect local industries, as they are part of the imports prohibition list.
He argued that the decision of the CBN will greatly affect local production of items such as rice, cement, and palm oil among others, as it will force local manufacturers to hold the short end of the stick, invariably leading to factory closure and ultimately eroding our capacity to build the country’s local economy.
He maintained that almost all the 43 items are from two critical sectors which have been identified by all policy documents from NEEDS, SEEDS to Vision 2022 as being areas that are critical to economic diversification.
He said some of the listed items enjoy 60%-70% subsidy from their countries of origin, thus putting Nigeria’s local products at a comparative disadvantage and without any protection, and will lead to job losses and Social exclusion.
He expressed concern that the benefit of the cheaper imported inputs as stated by the CBN will give an undue advantage to middlemen to drive the economy, which is inimical to our economic growth and not suitable to the current Unified FOREX market in the country.
He said with the new directive by the CBN, Nigeria will not be competitive in the African Continental Free Trade Area if Our markets are flooded with imported finished goods.
He said the decision followed the rising food inflation in the country which has significantly impacted the economy and the purchasing power of consumers in the country.
He said that in reality, the lifting of the FOREX restriction on the importation of 43 items may not have a meaningful impact on the rising food inflation as a result of the soaring exchange rate.
