Nigeria’s central bank to eliminate forex black market; Nokia sues Apple for infringing on patent rights; Nigeria loses N200b yearly to diversion of cargoes; Naira falls again at parallel market . . .
CBN to Eliminate Forex Black Market
Abuja (ThisDay) — The Central Bank of Nigeria (CBN) is set to eliminate the foreign exchange black market in Africa’s biggest economy, the Minister of Finance, Mrs. Kemi Adeosun, said tuesday. The naira trades, sometimes 40 per cent below the official rates, against the dollar. Commenting on the wide gap, Adeosun said the CBN has been mandated to scrap the damaging market, reported AFP.
The central bank “has been directed to do this and CBN has promised to do something by putting a system in place to eliminate the black market because it’s damaging the economy”, Adeosun told a conference. A CBN spokesman, Isaac Okorafor, said the central bank was working towards “ensuring that the forex market operates as effectively as we would envisage”. He said the aim was to “ensure there is no black market” but did not give details of how this would be achieved.
A top CBN official also confirmed that that the banking system regulator was working on ways to deemphasise the black market, as it had been used over time for speculative attacks on the Nigerian currency. However, he did not give a precise time when this would happen, but said that no unorthodox means will be used to rid the country of the black market for foreign exchange.
He said: “Serious strategic thinking on how to lay less emphasis on the black market dealers is being fashioned out by the central bank rather than using unorthodox means.” Nigeria had pegged the naira to the dollar at N197-N199 since March 2015 but the CBN scrapped the 16-month-old peg in June in favour of currency free float. But that has done little to change naira’s fortune.
Nokia sues Apple for infringing on patent rights
Finland’s Nokia Corp (NOKIA.HE) on Wednesday said it had sued Apple Inc (AAPL.O), accusing the iPhone maker of violating 32 technology patents. Apple sued Acacia Research Corp (ACTG.O) and Conversant Intellectual Property Management Inc [GEGGIM.UL] on Tuesday, accusing them of colluding with Nokia to extract and extort exorbitant revenues unfairly and anti-competitively from Apple.
Nokia’s lawsuits, filed in courts in Dusseldorf, Mannheim and Munich, Germany and the U.S. District Court for the Eastern District of Texas, covered patents for displays, user interfaces, software, antennas, chipsets and video coding. “Since agreeing on a license covering some patents from the Nokia Technologies portfolio in 2011, Apple has declined subsequent offers made by Nokia.
“Apple also declined to license other of its patented inventions which are used by many of Apple’s products’’, Nokia said in a statement. However, Apple and Acacia did not immediately respond to requests for comment.
Nigeria loses N200b yearly to diversion of cargoes
Lagos (TheGuardian) — The Federal Government may be loosing about N200 billion yearly to diversion of automobile imports to the ports in neighboring countries, particularly the Port of Cotonou in Republic of Benin. The amount, according to stakeholders represents the value of tariff that should have accrued to government through the Nigerian Customs Service (NCS), if the vehicles were imported through Nigerian ports.
The NCS is responsible for collecting revenues for government through duties payable as well as guarding against smuggling activities. The Guardian learnt that more Nigerian importers are attracted to the Port of Cotonou because of lower customs duty on vehicles and other imports.
As a result, the Managing Director of PTML Terminal, Ascanio Russo, expressed support for the ban on importation of vehicles through the land borders imposed recently by the Federal Government. PTML is the leading dedicated Roll-On-Roll-Off (RORO) terminal in Nigeria, handling the largest volume of vehicles imported into the country.
Russo said the company’s operations were, however, negatively affected by the astronomical hike in the import duties of vehicles, leading to a loss of more than 80 per cent of its cargo volume.
The hike in vehicles import duty from 10 per cent to 35 per cent and the imposition of an additional 35 per cent surcharge under the administration of former President Goodluck Jonathan, led to the diversion of Nigerian-bound vehicles to ports of neighbouring countries and increased smuggling activities.
The PTML boss, in a statement said: “We fully support this ban, which we believe is going to halt the huge import of vehicles for the Nigerian market through the ports of neighbouring countries and the loss of revenues by the Federal Government, the Nigeria Customs Service and private operators.
“We are confident and hopeful that the government may want to go a step further and review downward the level of duties applied on used vehicles to make them affordable for the Nigerian people.”
The Chairman, Seaport Terminal Operators Association of Nigeria (STAON), Princess Vicky Haastrup, had said, “Since the high tariff was introduced, importers have resorted to landing their vehicles at the ports of neighbouring countries and smuggling them into Nigeria without paying appropriate duties to government. This amounted to huge revenue loss to Customs.
“The policy also led to loss of more 5,000 direct and indirect jobs at the affected port.” The Managing Director, Nigerian Ports Authority (NPA), Hadiza Bala Usman, said the Nigerian ports are capable of taking the import traffic that will emerge as a result of the ban.
She said: “We are very ready to have seamless operations of increased traffic. Some of the traffic that we are seeing dwindling was the function of some of the government policies on importation of new cars. With this ban through the land borders, we will see an increase ports activities and we have put in place mechanisms to ensure that the additional traffic will not form any bottleneck. We always had that capacity, only that it was not utilised, but now that we hopefully will get more traffic due to the ban, we will just up our ante. The terminal operators are keen and they are ready to take up the traffic on vehicle importation through the ports,”
Several other maritime industry stakeholders had, at various times, called on the government to reduce the import duty on vehicles to stem the tide of smuggling and revive operations at Nigeria’s RORO ports, which had suffered the most from the hike in vehicles import duty.
Naira falls again at parallel market
Abuja (TheGuardian) — The Naira on Wednesday fell further to N492 to a dollar at the parallel market, from N490 it closed on Tuesday, the News Agency of Nigeria (NAN) reports. The Pound Sterling and the Euro closed at N605 and N505 respectively.
At the Bureau De Change (BDC) window, the Naira traded at N399 to a dollar, CBN rate, while the Pound Sterling and the Euro closed at N604 and N510, respectively.
The Naira remained stable at the official interbank window, exchanging at N305.25 to a dollar.
Against the backdrop of the call for the abolition of the parallel market, Alhaji Aminu Gwadabe, President Bureau De Change Operators of Nigeria (ABCON) said it was a welcome development.
“The scrapping of multiple markets outside the purview of the CBN will be a welcome development.
“The existence of multiple rates is highly unacceptable,’’ Gwadabe said.
NAN reports that Reuters mentioned on Tuesday of plans by the Ministry of finance to liaise with the CBN to ensure the scrapping of the parallel market.