Tag: Exporters

  • CBN to begin payment of N65 rebate to exporters

    CBN to begin payment of N65 rebate to exporters

    The Central Bank of Nigeria of Nigeria (CBN) said it would begin payment of N65 rebate to exporters who sold their goods through the importers and exporters (I&E) window, at the end of the first quarter.

    CBN Governor, Godwin Emefiele, said this shortly after signing the Term Sheet between the Infrastructure Corporation of Nigeria (InfraCorp) and the Independent Asset Managers, on Friday in Lagos.

    The apex bank had in February announced policies, plans and programmes for non-oil exports that would enable Nigeria earn 200 billion dollars in foreign exchange repatriation.

    The RT200 FX Programme, which stands for the “Race to 200 billion dollars in FX Repatriation, is a set of policies for non-oil exports to enable Nigeria attain the goal of 200 billion dollars in FX repatriation.”

    Emefiele said, “you will recall that we effectively started in March, but, I have said that by the latest, after the end of the quarter, we will issue cheques.

    “We will make payments to all those who have exported, their proceeds have come in and they sold them through the I &E window to import goods and services into the country.

    “So, the first set of payment for the rebate will be done by next week and we are actually making it public so that Nigerians can know.

    “And so that they can also encourage other exporters to say that the era when you export and your rebate never comes in five years, that that era is gone,” he said.

    The CBN governor expressed the bank’s determination to ensure the success of the initiative.

    He added that the kind of numbers that the apex bank got from the banks showed the policy was working very well.

  • CBN begins e-invoice for importers, exporters Feb. 1

    CBN begins e-invoice for importers, exporters Feb. 1

    The Central Bank of Nigeria (CBN) says it will begin e-invoices for imports and exports in the country from Feb. 1, 2022.

    The apex bank made the disclosure in a circular to all authorised dealers and the general public, and signed by its Director, Trade and Exchange Department, Dr. O. S. Nnaji, and posted on its official website on Friday.

    It explained that all import and export operations would require the submission of an electronic invoice authenticated by the authorised dealer banks on the Nigeria single-window portal – Trade Monitoring System.

    The circular is titled ‘Guidelines on the introduction of e-valuation, e-invoicing for import and export in Nigeria”.

    It informed dealers and the general public that the introduction of e-valuator and e-invoice replaced hard copy final invoice as part of the documentation required for all import and export transactions.

    “This new regulation is primarily aimed at achieving accurate value from import and export items in and out of Nigeria,” it said.

    The apex bank said the e-invoicing guidelines required that products that were more than 2.5 per cent around the vertical price would be queried and would not be allowed successful completion of Form M or Form NXP as the case may be.

    According to the circular, an importer/exporter of goods into Nigeria must ensure that the purchase/sale contract with a foreign supplier/buyer stipulates compliance with the obligations set out in this regulation.

    It said that the supplier’s/seller’s invoice must be submitted in electronic format and authenticated by authorised dealer bank as part of the documentation for payment.

    “No importer/exporter may effect payment to the credit of any foreign supplier unless the electronic invoice has been authenticated by authorised dealer banks presented together with the relevant document for payments”.

  • CBN to sanction non-compliant exporters of Forex

    The Bankers’ Committee on Tuesday announced the commencement of sanctions against exporters who fail to repatriate foreign exchange (forex) proceeds from their business into the economy.

    The sanctions will be implemented by the Central Bank of Nigeria (CBN).

    Addressing newsmen at the end of the Bankers’ Committee meeting in Lagos, Citibank Nigeria Managing Director/CEO Akin Dawodu spoke of a provision in the Central Bank of Nigeria (CBN) Foreign Exchange Manual that mandates all exporters to repatriate export proceeds back to the country to support the local currency and the economy.

    There is a 90-day grace period during which all proceeds from non-oil exports must be repatriated to the country and all arrears cleared. Dawodu said after the moratorium, non-compliant exporters will be blacklisted and banned from accessing banking services as well as forex from the CBN.

    He said repatriating export proceeds will boost Nigeria’s balance of trade.

    Also speaking, CBN Director, Banking Supervision, Abdullahi Ahmad, said the apex bank is monitoring non-oil exporters and assessing compliance levels. “The period of grace is gone and now is the time for heavy sanctions against defaulters. Defaulters will be banned from accessing banking services,” he said.

    Nigeria’s foreign exchange reserves have hit $42 billion, according to Ahmad, who added that the economy remained at its lowest risk rating at present.

    Nigeria’s capital market is the best in the world; inflation has been coming down, even as Gross Domestic Product (GDP) growth is expected to be sustained above two per cent,” he said.

    External reserve was $40.4 billion as at last December. The last time the foreign reserves hit the $40 billion mark was January 2014, about five months before the crash in global oil prices. In September 2008, the country’s foreign exchange reserves hit $62 billion, with the Federal Government spending $12 billion from it to settle external debts.

    FSDH Merchant Bank Managing Director Mrs. Hamda Ambah said the Bankers’ Committee also adopted a unified rate N360/$ for all Personal Travel Allowances (PTAs), Basic Travel Allowances (BTAs), school fees and transactions without commission.

    She said the committee also urged bank customers to report any defaulting lender for appropriate sanctions. The banks are to buy dollar from the CBN at N357/$1 and sell to end-users at N360/$1.

    According to the CBN manual, proceeds of oil and non-oil exports are to be repatriated into the export proceeds domiciliary accounts of their exporters’ accounts within 90 days for oil exports and 180 days for non-oil exports. Where this policy is violated, the collecting bank will be liable to a fine of 10 per cent of the Free On Board value of the transaction, including other appropriate penalties as provided in the Banks and Other Financial Institutions Act (BOFIA).

    Likewise, where the exporter fails to repatriate the proceeds into the domiciliary account within the stipulated period, the exporter will be barred from participating in all the segments of foreign exchange market in Nigeria.

    Ahmad said many exporters, who benefited from Federal Government support scheme, have continually failed to comply with this directive. The defaulters will be barred from accessing other banking services.

    To Ahmad, since the CBN is taking strategic steps to ensure that Nigerian exporters’ businesses thrive, not sending earned dollar back to the economy is not proper.

     

  • Rice production: Exporters/importers will fight back By Ehichioya Ezomon

    Rice production: Exporters/importers will fight back By Ehichioya Ezomon

    By Ehichioya Ezomon

    The other day, I set out with my “Skelewu” dance steps when rice farmers and millers gave the assurances that, due to expected bumper harvest, and their desire to assist in the reduction of prices of goods, a 50kg of rice would crash to N6,000 in a few months.

    My happiness was twofold. One, that rice, whose price hit the rooftop at N25,000 before bottoming out between N13,000 and N15,000 lately, would soon be within reach of the average Nigerian. And two, that the Federal Government preachment, and its commitment to increasing food production, was yielding unexpected quick dividend.

    In my ecstasy, I took a journey back into time, to the Second Republic, from 1979 to 1983, when the civilian administration of President Shehu Shagari, elected on the platform of the National Party of Nigeria (NPN), promised Nigerians a “Green Revolution” in agricultural production.

    A major plank of the pledged turn-around was to increase the production of rice in order to reduce the country’s dependence on importation of the product that’s a staple of most homes in the country. To this end, the government acquired hectares of land all over the federation, and bulldozed and prepared them for cultivation only to virtually abandon the agricultural revolution ab initio.

    For all practical purposes, the government did the bush-clearing for three consecutive years, but seeded only an insignificant portion of the vast, arable land. So, each year, the cleared, vacant plots would return to grasslands and then bushes.

    Instead of the expected bountiful local production, the government, under the supervision of the powerful Minister of Transportation, the late Alhaji Umaru Dikko (1936-2014), resorted to massive importation of products, culminating in the infamous “Rice Armanda,” “Sugar Armanda,” and “Fertilizer Armanda,” to name a few.

    Meaning that the “revolution” was very “green” in one particular sector: the pockets of politicians of the ruling NPN, whose slogan of “One Nation, One Destiny” was perhaps only in their striving to corner the people’s patrimony.

    Now, leapfrog to 2017, and we are witnessing, without a code name, an actual “revolution” in agriculture. With a presidential initiative backed by appropriate policies, funding, implements, incentives and encouragement, agriculture has suddenly left the backstage to assume the second position to oil in the economy.

    As acknowledged by President Muhammadu Buhari in his October 1 Independence Day broadcast, the Governors of Lagos, Kebbi, Ebonyi and Jigawa are leading in “rice and fertilizer revolutions,” while the Governors of Ondo, Edo, Delta, Imo, Cross River, Benue, Ogun, Kaduna and Plateau States are contributing their quotas in palm oil, rubber, cashew, cassava, potatoes and other crops.

    Increased rice production has prompted the government to reduce importation that had affected local efforts in the past. An October 9 report by the New Telegraph indicated that, “Nigeria has cut rice importation by 2.77 million metric tons valued at N420 billion ($1.17 billion) since the beginning of the year (2017),” as local production reached 56.6 per cent of the total domestic consumption of 4.9 million tons valued at N742.6 billion ($2.06 billion), adding that, “this has affected Thailand’s rice adversely, as unsold stocks are piling up daily.”

    Consequently, Thailand, which has been feeding fat on Nigerians’ craving for foreign rice, is lamenting the cutback on imports, and the resultant unsold stocks. According to the president of Thailand Rice Exporters Association (TREA), Mr. Chookiat Ophaswongse, “If the situation continues like this, you will see a lot of exporters going out of business.”

    Imagine Thailand, which, for decades, flooded Nigeria with years-old chemically-stored rice! Whom did our local rice farmers and millers cry to when, according to the Central Bank of Nigeria (CBN) report in 2016, the amount Nigeria spent between January 2012 and May 2015 on rice importation “resulted in huge unsold stock of paddy rice cultivated by Nigerian farmers and low operating capacities of many integrated rice mills?”

    Sadly, Thailand and some other rice exporters are co-opting Nigerian importers to cajole, pressurize and outrightly blackmail the government to revisit or reverse its decision to cut down on rice imports to Nigeria. Their strategy is to engage in mis/false information or dish out figures that would rebut government’s numbers on its agricultural output.

    How else do we categorize figures given by the United States Department of Agriculture (USDA), contradicting the ones issued by the Minister of Agriculture and Rural Development, Chief Audu Ogbeh, on Nigeria’s rice production and importation?

    Ironically, the United States of America, whose President’s mantra is “AMERICA FIRST,” is bandying figures to counter those of Nigeria’s Minister of Agriculture, who, without sloganeering, also wants “NIGERIA FIRST” to guarantee for Nigerians employment, income and self-sufficiency in rice production.

    Well, rather than quarrel over figures, I’m euphoric that we, as a people, are about to discard the unenviable record of the world’s highest rice importer, and a dumping ground for Thailand, the United States and Vietnam. If you ask me, these rice exporters should fret “bigly” (big league), “as Nigeria cuts imports by 2m tons.”

    Really, in these recession-induced times, who cares much about “accurate figures” so long as Nigeria has begun to produce enough rice for local consumption and channel prior billions spent on rice imports to needy products we have no comparative advantages in.

    I dare say that government’s initiative is a role reversal of some sorts. We have long borne the brunt of massive importation of rice. Now that we can maximize production of the commodity, let the other side feel the pinch of the shoe!

     

    * Mr. Ezomon, Journalist and Media Consultant, writes from Lagos, Nigeria.

  • Forex deals: CBN threatens to blacklist exporters withholding proceeds

    The Central Bank of Nigeria (CBN) has threatened to sanction exporters who fail to repatriate foreign exchange (forex) proceeds from their businesses into the economy.

    The apex bank issued the warning through its director, banking supervision, Abdullahi Ahmad during the Bankers’ Committee meeting in Lagos on Thursday.

    Ahmad spoke of a provision in the CBN Foreign Exchange Manual that mandates all exporters to repatriate their proceeds back to the country to support the local currency and the economy.

    The manual stipulates that proceeds of oil and non-oil exports are to be repatriated into the export proceeds domiciliary accounts of their exporters’ accounts within 90 days for oil exports and 180 days for non-oil exports. Where this policy is violated, the collecting bank will be liable to a fine of 10 per cent of the Free On Board value of the transaction, including other appropriate penalties as provided in the Banks and Other Financial Institutions Act.

    Likewise, where the exporter fails to repatriate the proceeds into the domiciliary account within the stipulated period, the exporter will be barred from participating in all the segments of foreign exchange market in Nigeria.

    Ahmad said many exporters, who benefited from Federal Government’s support scheme, continually failed to comply with this directive, adding that the defaulters would be barred from other banking services.

    He said the CBN had continued to take strategic steps to ensure that Nigeria exporters’ businesses thrived and that not sending earned dollar back to the economy was not proper.

    He said the Gross Domestic Product (GDP) growth of 0.5 per cent, which brought the country out of recession, needed to be improved on, and called for more hard work to achieve better growth for the economy.

    The stability in the foreign exchange market, moderation in inflation and capital market recovery are indications that the economy is getting better, Ahmad said.

    Also speaking at the meeting, the Managing Director/CEO of Unity Bank, Mrs. Tomi Somefun said the disbursement of N26 billion special fund for players in the agricultural sector would begin at the end of this quarter. The fund, first announced in June, was part of the banks’ plan to finances agro-based small and medium scale enterprises (SMEs).

    The contribution follows the directives of the CBN to all commercial banks to remit five per cent of their annual after-tax profit in support of a scheme as part of the guidelines for the Operations of the Agricultural/Small and Medium Enterprises Investment Scheme (AGSMEIS). The programme was first approved at the 331st Bank’s Committee meeting, held on February 9th this year.

    The Managing Director/CEO of Union Bank, Mr. Emeka Emuwa who also spoke at the meeting said the Bankers’ Committee was also worried about the return of ponzi scheme- Mavrodi Mundial Moneybox (MMM).

    He said such schemes always thrived when the end of the year approaches. “The Ponzi schemes are back and more about them as the year comes to an end,” he said.

    According to the Union Bank boss the CBN has instituted the collateral registry to help SMEs access funds, and create more jobs. “The Collateral Registry is going to facilitate lending to the SMEs and also boost employment,” he said.

    The Bankers’ Committee praised the CBN for the stability achieved in the foreign exchange market, adding that the apex bank had been steadfast in executing its policies.

     

  • Forex intervention: CBN sells $25m to investors, exporters

    T‎he Central Bank of Nigeria (CBN) on Tuesday commenced interventions in the new Investors and Exporters’ FX Window with the sale of 25million dollars to customers.

    The apex ‎bank’s spokesman, Mr Isaac Okorafor, in a statement in Abuja, said the window was established to boost liquidity in the forex market and ensure timely execution and settlement for eligible transactions.

    According to him, transactions under the new window include invisible transactions such as loan repayments, loan interest payments, Dividends, Income Remittances, Capital Repatriation and Management Service Fees.

    Also eligible, are payment of Consultancy fees, Software subscription fees, Technology Transfer Agreements, Personal Home Remittances and other miscellaneous payments as detailed under Memorandum 15 of the CBN Foreign Exchange Manual.” ‎

    He said, however, it excludes international airlines ticket sales’ remittances.‎

    On the role of the apex bank in the new FX Window, Okorafor said the CBN would be a market participant at the window to promote liquidity and professional market conduct.

    Okorafor added that the ‎CBN had auctioned 150 million dollars to authorised dealers through the interbank wholesale window, however, only 96.37 million was taken.‎

    Market reports in Abuja on Tuesday, revealed that the Naira sustained its value in the forex market, selling at N379 to the United States dollar.

     

  • Forex crisis: CBN creates additional window for investors, exporters

    Forex crisis: CBN creates additional window for investors, exporters

    The Central Bank of Nigeria (CBN) on Friday, as part of efforts to further boost liquidity in the forex market established a new Forex widow for investors and exporters.

    This was revealed in a circular signed by the ‎Bank’s Director in charge of Financial Markets, Dr Alvan Ikoku.

    Ikoku explained that the apex bank decided to open another window to cater for investors and exporters in order to facilitate timely execution and settlement of eligible transactions.

    Ikoku listed eligible transactions under the new window to include invisible transactions such as loan repayments, loan interest payments, Dividends, Income Remittances, Capital Repatriation, Management Service Fees and Consultancy fees.

    Also on the eligible list are Software subscription fees, Technology Transfer Agreements, Personal Home Remittances and other eligible transactions including ‘miscellaneous Payments’ as detailed under Memorandum 15 of the CBN Foreign Exchange Manual.

    Ikoku said the invisible transactions under this window excluded international airlines ticket sales’ remittances.

    He said that the window covered Bills for Collection and any other trade-related payment obligations, which are at the instance of the customer.

    Ikoku further clarified that the permitted invisible transactions and Bills for Collection were eligible to purchase foreign currency sourced from the CBN Forex window limited to Secondary Market Intervention Sales (SMIS) Wholesale, that is Spot and Forwards sales.

    “International airlines ticket sales’ remittances shall only be eligible to access the CBN FX window (SMIS-Retail and Wholesale)spot and forwards.

    “The supply of foreign currency to the window shall be through portfolio investors, exporters, authorised dealers and other parties with foreign currency to exchange to Naira.

    “The CBN shall also be a market participant at the window to promote liquidity and professional market conduct,” he said. ‎

    The CBN said participants at the new window would trade via telephone until appreciable progress is made with the FX trading systems on-boarding process, which is the FMDQ OTC Securities Exchange (FMDQ) Thomson Reuters FX Trading & Auction Systems.

    Ikoku advised authorised dealers to promote market transparency by encouraging their corporate clients to ensure the activities of the window are operated on the forex trading systems.‎

    As part of the operational requirements of the window, Ikoku said the exchange rates of the transactions in the window shall be as agreed between authorised dealers and their counterparties.

    He also said that the CBN reserved the right to intervene as a buyer or seller, as it deems fit, in the window, adding that information on transactions between authorised dealers would be reported to the CBN on a daily basis.

    TheNewsGuru.com recalls that the CBN had injected over 380 million dollars into several segment of the foreign exchange market this week alone with hope of improving FX liquidity in the market and firm up the value of the Naira.