According to the Central Bank of Nigeria (CBN), exporters will now receive an N65 rebate for every dollar of non-oil export proceeds sold to third parties through the importers and exporters (I&E) window.
The central bank stated this in a circular issued on Friday and signed by O.S. Nnaji, director of trade and exchange.
The rebate is part of the non-oil export proceeds repatriation rebate scheme, which is a key component of the CBN’s RT200 FX program, which aims to attract $200 billion in foreign exchange earnings from non-oil export proceeds over the next three to five years.
The I&E FX window is a market trading segment for investors, exporters, and end-users that allows FX trades to be made at exchange rates determined by the I&E FX window.
The naira is currently trading at N416.52 at the I&E window (NAFEX), which the CBN has designated as the country’s official rate.
According to the CBN, the rebate scheme was specifically designed to incentivize non-oil exporters to encourage repatriation and sale of export proceeds into the FX market.
The circular states that “the scheme shall pay N65 for every US$1 repatriated and sold at the I & E Window to Authorised Dealers and Banks (ADBs) for other thirty party use.”
“And N35 for every US dollar repatriated and sold into I&E for personal use only on eligible transactions.” The spread, however, should not exceed 10 kobo.
“The incentive will be paid on a quarterly basis.” Exporters who qualify for rebates must have their accounts credited no later than one week after the end of the quarter.”
According to the apex bank, the incentive is only available to exporters of finished and semi-finished goods.
“Exporters will only be eligible for rebates if repatriated export proceeds are sold at the Investors & Exporters Window (I&E),” the circular adds.
“Eligible transactions that qualify for incentives under the scheme shall be exports of finished and semi-finished goods wholly or partly processed or manufactured in Nigeria, unless otherwise specified by the CBN; and exports of goods and services (IT and creative businesses) that are permissible and excluded under the existing export prohibition list.”
To ensure the scheme’s success, the CBN stated, “Banks are therefore expected to demonstrate full understanding about both the real and perceived objectives of this Circular as any attempts to circumvent the Scheme’s intent shall result in the suspension of the ADB’s FOREX dealership licence for 24 months.”
The central bank warned that any exporter who presented fraudulent documents would be barred from receiving the incentive for a period of 24 months.