Following trade disruption occassioned by Central Bank of Nigeria (CBN)’s introduction of e-invoicing and e-valuation policy in a bid to digitalise the international trade processes, a key member of the organised private sector has asked the apex bank to leave all trade policy issues for the Nigeria Customs Service, Ministry of Finance and Ministry of Industry, Trade and Investment.
The private sector player expressed dismay at the involvement of CBN in current trade policy issues, saying it was not only bringing conflict into economic management issues, but also creating a lot of problems for investors eyeing the Nigerian economy.
The Chief Executive Officer (CEO), Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, in an interview with New Telegraph in Lagos, stated that it was the belief that leveraging technology boosts efficiency and enhances productivity.
He, however, said this initiative had generated concerns among stakeholders in the international trade process because of improper coordination between CBN and the Nigeria Customs Service, Ministry of Finance, Ministry of Industry, Trade and Investment.
Yusuf pointed out that the e-invoicing and evaluation policy would only worsen an already bad international trade transactions process in the areas of increased transaction cost, entrenched red tape, increased uncertainty, escalationg of disruptions, weaken investor confidence and heighten corruption risk.
The CPPE chieftain stressed that there was a strong correlation between red tape and corruption. He added that the increasing incursion of CBN into the trade policy space was an aberration in Nigeria’s economic management system and a serious cause for concern to the business community.
To him, issues of import valuation and classification are statutory functions of the Nigeria Customs Service, with the Finance Ministry as the supervising organ, adding that the decision of the CBN to undertake valuation and product price benchmarking of imports and exports is a duplication of the statutory responsibility of the Nigeria Customs Service.
With this, it will create an additional regulatory compliance burden, bureaucracy and costs for the business community. Yusuf said: “On e-invoicing, e-valuation policy as a role of the CBN, you see, we have monetary policy, we have trade policy, we have exchange rate policy.
“The responsibility of CBN as stipulated in the CBN Act is essentially about monetary policy, addressing issues of interest rate, issues of money supply, focussing on price stability.
“When we talk about price stability we are talking about using the instrument of monetary policy to stabilise prices. That is why we talk about this Liquidity Ratio, Cash Reserve Requirements and all of that. “If there is instrument of monetary policy that CBN uses, that is the main responsibility of CBN.
It is not the responsibility of CBN to now go and be valuing imports, to be determining how much the value of a product, determining the invoice, it’s a major distraction.
The Nigeria Customs Service has a whole department of valuation.” He added: “So, if there is anything they are not doing well, the CBN can collaborate with them; they are all government agencies, they are working for the same objective, they have the same principles, they can collaborate to identify whatever gaps there are in the area of valuation, invoicing and all of that.”
On malpractice in forex market, the renowned economist said: “But let me say this, all this malpractice in the foreign exchange market, over invoicing and all of that, is because the foreign exchange market itself is creating a problem. “It is when some people wants to round trip that is when they do over invoicing so that they can ship out more dollars and bring it back. But if we move away from a subsidised foreign exchange, if we have a market driven rate, all this malpractices will disappeared.