The Nigerian Economic Summit Group (NESG) has praised the Central Bank of Nigeria's (CBN) recent move to abolish the Price Verification System (PVS) for foreign exchange transactions.
The NESG believes this change will eliminate regulatory hurdles and enhance macroeconomic stability.
Starting July 1, importers will no longer need to validate their applications for Form ‘M’ through the PVS, as stated in a recent CBN circular. This decision comes in response to evolving dynamics in the Nigerian Foreign Exchange Market.
The circular, issued by Acting Director of the Trade & Exchange Department, W.J. Kanya, references an earlier communication from August 17, 2023, which introduced the PVS Portal aimed at ensuring accurate pricing in foreign exchange transactions.
Originally designed to prevent over-invoicing and under-invoicing, the PVS ensured fair pricing for Nigeria’s import and export activities. However, with the new directive, applications for Form ‘M’ can now proceed without a Price Verification Report from the PVS Portal.
This policy shift aims to streamline processes for banks and the public, potentially reducing the procedural burdens tied to foreign exchange transactions.
In a statement over the weekend, the NESG expressed strong support, highlighting that the streamlined import process will provide the manufacturing sector with timely access to essential inputs, boosting production and GDP contribution. Increased industrial output is expected to positively impact other sectors, further stimulating economic growth.
The NESG noted that fewer bureaucratic hurdles would enhance the global competitiveness of Nigerian businesses. Lower operational costs and greater efficiency will enable companies to offer competitive pricing, expand market share, and bolster export potential, contributing to a favorable trade balance and reinforcing Nigeria's global economic standing.
The NESG emphasized that this policy aligns with the CBN’s goals of maintaining price stability and fostering sustainable economic growth. By reducing business costs and improving supply chain efficiency, the new directive is anticipated to lower production costs and help moderate inflation.
Moreover, increased economic activity and investment will support higher output growth, enhancing the stability and resilience of the Nigerian economy.
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