In an apparent response to claims by the Minister of Finance, Budget and National Planning, Zainab Ahmad, that her ministry was not carried along by the Central Bank of Nigeria, in the ongoing process of redesigning three series of the naira, the bank insists it followed the law and due process to carry out the exercise, which is 12 years due.
The Punch reports that a statement from the CBN said the spokesman of the bank, Mr Osita Nwanisobi, expressed surprise at the minister’s claim, stressing that the CBN remains a very thorough institution that follows due process in its policy actions.
Nwanisobi, the management of the CBN, in line with provisions of section 2(b), section 18(a), and section 19(a)(b) of the CBN Act 2007, had duly sought and obtained the approval of President Muhammadu Buhari in writing to redesign, produce, release and circulate new series of N200, N500, and N1,000 banknotes.
However, urging Nigerians to support the currency redesign project, he said it was in the overall interest of Nigerians, and that some persons were hoarding significant sums of banknotes outside the vaults of commercial banks. This trend, he said, should not be encouraged by anyone who means well for the country.
He noted that currency management in the country had faced several escalating challenges which threatened the integrity of the currency, the CBN, and the country, adding that every top-rate Central Bank was committed to safeguarding the integrity of the local legal tender, the efficiency of its supply, as well as its efficacy in the conduct of monetary policy.
On the timing of the redesign project, Nwanisobi explained that the CBN had even tarried for too long, considering that it had to wait 20 years to carry out a redesign, whereas the standard practice globally was for central banks to redesign, produce and circulate new local legal tender every five to eight years.
While assuring Nigerians that the currency redesign exercise was purely a central banking exercise and not targeted at any group, the CBN spokesman expressed optimism that the effort would, among other goals, deepen Nigeria’s push to entrench a cashless economy in the face of increased minting of the eNaira.
This, he said, was in addition to helping to curb the incidents of terrorism and kidnapping due to access of persons to the large volume of money outside the banking system used as a source of funds for ransom payments.
Nwanisobi, therefore, urged Nigerians, irrespective of their status, to support the Naira redesign project, as it is for the greater good of the economy.
According to The Guardian, the minister had disowned the policy and warned against its consequences barely two days after the CBN announced plans to redesign the naira with the new notes billed to be in circulation from December 15, 2022.
Responding to a question raised by Senator Opeyemi Bamidele (APC Ekiti Central) during the 2023 budget defence session with the Senate Committee on Finance, yesterday, she warned the CBN of the consequences that may arise from the move.
Bamidele had in his question told the Finance Minister that barely two days after the announcement of the policy by the CBN, the naira was already feeling the repercussion with regard to its value against the U.S. dollar.
“Just two days after the announcement of the policy, the value of naira to a U.S. dollar has risen from N740 to N788 due to rush in exchange of starched naira notes for foreign currencies, particularly the dollar.
“To me, the policy may be a well-conceived one but the timing going by the realities on the ground is very wrong as the naira may fall to as low as N1,000 to a US dollar before January 31, 2023, fixed for full implementation of the policy,” he said.
Surprisingly, the Minister in her response said she and the Minister of State for Finance were not aware of the policy, saying they only heard of it from the media.
Her words: “Distinguished Senators, we were not consulted at the Ministry of Finance by CBN on the planned naira redesigning and cannot comment on it as regards merits or otherwise.
“However, as a Nigerian privileged to be at the top of Nigeria’s fiscal management, the policy as rolled out at this time portends serious consequences on the value of the naira against other foreign currencies.
“I will, however, appeal to this committee to invite the CBN governor for required explanations as regards merits of the planned policy and rightness or otherwise of its implementation now.”
Meanwhile, a coalition of youths across the country has rejected calls for a shift in the deadline for citizens to begin to compulsorily transact with the new naira notes.
It noted that with the commencement of the general election in February 2023, it has become very imperative for the CBN to remain firm with January 31, 2023, deadline.
Briefing journalists yesterday in Abuja, the spokesman of the coalition, Meliga Godwin, said the move by CBN has dealt a fatal blow to money laundering, ransom takers, smugglers and counterfeiters.
Meliga said the move was a welcome development, adding that it would help to stop vote buying and other vices in the country.
He added that by the move, the apex bank has dealt a heavy blow on criminals that deal with cash, as it would inconvenience them.
He said: “The CBN Governor, Mr. Godwin Emefiele, announced at a press briefing in Abuja that arrangements for the new naira notes, which will begin circulation from December 15, 2022, have been finalised. The exercise would affect the highest denominations – 200, 500, and 1000 notes.
“We support this move by the apex bank because lately, counterfeiting of currency has become a common phenomenon; money has become a standardised trade unit and abused by criminals.”
According to him, “the CBN has dealt a final blow to smugglers and money laundering companies, who inject counterfeit currency into the financial system.”
He added: “This policy will also put more money in the vaults of the banks which they can use to finance the formal sector for the benefit of the economy.
“It has also improved chances of a free and fair election as vote buyers have been taken out of the equation while security will be greatly improved.
“In general, the benefits of this policy far outweigh the cost of printing the new notes and we urge the buy-in of all Nigerians and call for support for the CBN Governor.
“We appreciate and applaud the courage of the Governor of CBN. We urge him not to rest on his oars and we declare that by this singular move he has deservedly become the hero of the 2023 general election.
“It is our expectation also that having obtained the approval of the President to implement this very laudable policy, the ruling party makes a commitment not to put pressure on the leadership of the apex bank to alter the deadline as it will go to the root of the integrity of the election and the validity of the results, which will emerge from it.”
