First released on the 22nd of February,2022, the Central Bank of Nigeria (CBN) Guidelines on Non-Oil Export Proceeds Repatriation aims to raise $200 Billion Naira in foreign exchange from Non-Oil proceeds over the next 3-5 years.
These guidelines which will form the focus of this article are anchored on a 5-point agenda and are designed to incentivize exporters in the Non-Oil export sector to encourage repatriation and the sale of export proceeds into the FX market.
The guidelines are also aimed at earning more stable and sustainable inflows of FX in order to insulate the Nigerian economy from shocks and FX shortages.
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This article will be looking at :-
– The objectives of the CBN Guidelines.
– Eligibility criteria for this scheme regarding beneficiaries and transactions.
– Application procedures relevant for this scheme.
What are the objectives of the CBN Guidelines on Non-Oil Export Proceeds Repatriation?
The objectives of the guidelines are :-
- The enhancement of FX (Foreign Exchange) inflow.
- The diversification of the sources of FX inflow.
- Ensuring stability and sustainability of FX inflow.
- To encourage the increase in the level of contributions of Non-Oil exports economically.
Which government agency is in charge of administration of the scheme by virtue of the CBN Guidelines?
The CBN’s (Trade & Exchange Department) shall be responsible for the day-to-day administration of the scheme.
What is the eligibility criteria for the scheme regarding beneficiaries?
Eligible beneficiaries for this scheme are :-
– Exporters of finished and semi-finished goods.
– Exporters shall qualify for rebate where repatriated export proceeds are sold at the Investors & Exporters (I & E) window.
What is the eligibility criteria for this scheme regarding transactions?
Eligible criteria for transactions under this scheme by virtue of the CBN Guidelines are:-
– The transactions must involve the export of finished and semi-finished goods wholly or partly processed or manufactured in Nigeria, except otherwise stated by the CBN.
– The transactions must involve the export of goods and services (I.T & creative businesses) that are permissible and excluded under the existing export prohibition list.
– The sale of repatriated export proceeds at the I & E window.
– The completion of e-form NXP.
– Registration with the Corporate Affairs Commission (CAC) & the Nigerian Export Promotion Council (NERC).
What are the features of the scheme?
The scheme revolves mainly around incentives in the form of :-
(i). 65 Naira for every $1 repatriated and sold at the I & E window to Authorized Dealer Banks for 3rd party use.
(ii). 35 Naira for every $1 repatriated and sold into the I & E for own use on eligible transactions only. The spread should not be more than 10 Kobo.
What is the application procedure for taking part in the scheme?
The application procedure involves the following :-
- The submission of written requests from the exporter through the Authorized Dealer Bank (ADB)where the e-Form NXP was established. It shall be the responsibility of the ADB to authenticate all documents submitted for rebates.
This request will be accompanied by :-
a). A completed application form to be designed by the CBN & forwarded to the exporter through his ADB.
b). Documentation requirements for exports as stipulated in the FX manual.
c). Evidence of repatriation and sale of export proceeds at the I & E window.
The ADB shall forward the application within 5 days, after consummation of the export proceeds sale transaction at the I & E window.