The Nigerian Economic Summit Group (NESG) has expressed support for the Central Bank of Nigeria’s (CBN) recent decision to discontinue the Price Verification System (PVS) for foreign exchange transactions, highlighting its potential to eliminate regulatory hurdles and enhance macroeconomic stability.
The CBN, in a circular, announced that starting from July 1, importers will no longer need to validate applications for Form ‘M’ via the Price Verification Report from the PVS. The decision, outlined by the Acting Director of the Trade & Exchange Department, W.J. Kanya, followed developments in the Nigerian Foreign Exchange Market. This move reverses a previous directive from August 17, 2023, which had introduced the PVS Portal to ensure accurate pricing in foreign exchange transactions, aiming to prevent over-invoicing and under-invoicing.
The new directive means that applications for Form ‘M’ will now be processed without requiring a Price Verification Report from the PVS Portal. This policy shift is designed to streamline procedures for authorized dealer banks and the general public, easing the administrative burden associated with foreign exchange transactions.
The NESG, in a communique released over the weekend, praised the CBN’s decision, emphasizing that a more efficient importation process will benefit the manufacturing sector by ensuring timely access to essential inputs, thus enabling higher production levels and enhancing the sector’s contribution to GDP. The NESG highlighted the positive spillover effects of increased industrial output on other sectors, stimulating broader economic activity.
The NESG also noted that reducing bureaucratic bottlenecks will make Nigerian businesses more competitive globally. By lowering operational costs and improving efficiency, businesses will be able to offer more competitive prices, increase their market share, and expand their export potential. This, in turn, will contribute to a favorable balance of trade and strengthen Nigeria’s position in the global economy.
Furthermore, the policy change aligns with the CBN’s mandate of maintaining price stability and promoting sustainable economic growth. By reducing the cost of doing business and enhancing supply chain efficiency, the new policy is expected to exert downward pressure on production costs, thereby contributing to inflation moderation. Increased economic activity and investment will support higher output growth, reinforcing the stability and resilience of the Nigerian economy, the NESG added.