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Naira Redesign: CBN can’t continue to snub Nigerians

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The Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Muda Yusuf, has criticised Nigeria’s Central Bank (CBN) over its defiance of public institutions’ outcry to extend the deadline for the phasing out of the old naira notes.

The CEO spoke at the weekly episode of PREMIUM TIMES’ TwitterSpaces titled “ New Notes scarcity vs. January deadline and the implications for Nigerians.”

PT TwitterSpaces is an innovation of PREMIUM TIMES put together to advance conversations around issues of national concern.

This week’s edition of the programme — the first to be held this year, had Mr Yusuf; Global Analytics Consulting Limited CEO, Tope Fasua; Iyaloja of Abuja, Toyin Badmus and other stakeholders feature as guest speakers amidst lingering lamentations from Nigerians across the country over the grossly inadequate circulation of new notes ahead of the 31 January deadline.

Mr Yusuf said it has become very obvious that the central bank has grossly underestimated what it takes to execute this transition from the old notes to the new notes.

“So I think the logical thing to do is to extend it. We are in a democracy, the CBN cannot afford to continue to snub our democratic institutions the way it has done so far.”

He added that Nigerians have seen clear evidence of lack of capacity with respect to production from the bank because if something is available in adequate supply, it would show and if otherwise, it will still be obvious as is currently the case with Nigerians.

“So clearly we are dealing with a situation of acute shortage, that’s when you relate what’s made available to the demand of the new notes. Even up to last week, last Friday, some banks and ATMs were still dispensing the old notes,” Mr Yusuf lamented.

Godwin Emefiele, governor of Central Bank of Nigeria (CBN).
Godwin Emefiele, governor of Central Bank of Nigeria (CBN).

He explained that the current situation is not a result of a lack of trying on the part of the citizens, but the aftermath of the banking system’s inability and lack of capacity to respond to the exponential demands for new notes.

“So if that is the case, I think the logical thing to do would have been to extend the date. I was really shocked and amazed when I heard the CBN governor during the MPC meeting say that he doesn’t have good news for us that the deadline stands,” the CEO said.

Mr Yusuf said the new notes shortage crisis is not the making of Nigerians but that of the CBN.

“From the beginning, I have challenges even with the very proposition of redesign. Redesigning is good. But when you contextualise it within the priorities that this economy needs at this moment, it is the least of our problems. I am not saying it is not desirable, but you situate things within the context of your priorities,” he added.


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Scarcity

In recent weeks, Nigerian citizens and Deposit Money Banks across the country have been lamenting over their inability to access the newly designed naira notes. As the 31 January deadline for phasing out of old notes approaches, the cash-dependent informal sector of the economy has had to scramble for the new notes.

While this subsists, many Nigerians on social media have expressed reservations about the circulation of the new notes, with many fuming that they are yet to see or feel the new naira notes.

Others have also complained of hoarding on the part of the commercial banks, while some mobile cash point vendors are said to be exploiting the situation by hawking the new note.

Dangote adbanner 728x90_2 (1)

In the midst of this, the two chambers of the National Assembly have asked the CBN to extend the deadline for acceptance of the old Naira notes.

READ ALSO: Naira Redesign: Yobe governor appeals to CBN to extend deadline


However, earlier in the week, the CBN governor, Godwin Emefiele, after the apex bank’s Monetary Policy Committee (MPC) meeting in Abuja, insisted that the 31 January deadline that the apex bank announced for the validity of the old N200, N500 and N1,000 notes remains.

Mr Emefiele claimed that kidnapping and ransom-taking incidents have reduced since the three banknotes were redesigned, arguing that the time given for the swap of the old naira notes with new ones was enough for Nigerians to get the new notes from commercial banks without much pressure.

Major concerns

Due to the CBN’s hesitancy to shift grounds on the deadlines despite several appeals from public institutions and governors across party lines in the country, Mr Yusuf expressed worries about the CBN’s action and its implication for the economy.

“The House of Representatives has appealed to the Central Bank of Nigeria, the Senate has appealed to the Central Bank of Nigeria, the governors have also done the same thing and yet the CBN is saying that there is no going back on the deadline. That worries me a lot about how much power the CBN thinks it has over the sovereignty of this country,” he said.

“In an average market today, close to 50 per cent of the currencies in those markets are old notes. So how are we going to deal with that if you are insisting that we are not extending?”

Based on this, the policy analyst said there is no other option than for the CBN to extend its deadlines.

“This is a democracy, we are not in a military regime and if someone is in public office, he’s supposed to be a public servant. Public office holders are supposed to serve the people not the other way round and they are supposed to respond to the needs of the people for as long as those needs are legitimate,” he said.

“And you can see all over the country the kind of crisis it is creating.”

In his intervention, Mr Fasua argued that many people were against the CBN policy of redesigning the naira notes and that they would want the reversal of the policy.

“Why would they want the reversal of the policy is what I don’t understand,” he said.

The economist explained that part of the problem is the fact that many banks have closed down some of their branches due to certain challenges, especially in rural areas.

In such situations, he suggested that the CBN could have deployed officials in different places in Nigeria, especially places with a huge population of unbanked Nigerians.

Commenting further, he suggested that President Muhammadu Buhari wants the policy to succeed because he wants it to be some sort of legacy he would be leaving as his tenure comes to an end.

“Just as he did in 1984, he is desirous of this policy pulling through and I think he is also desirous of it being a linchpin for him to be said to have conducted a clean and fair election in 2023,” he said.

Mr Fasua said he disagrees with people saying the CBN naira redesigning policy is coming at the wrong time because of politics.

“This policy of cash management is 18 years late. In fact, we should be asking the CBN what they have been doing that they have been unable to manage our currency for 18 years since 2005,” he argued.

Lamentation

In her intervention, the Iyaloja (Head) of Abuja market women, Toyin Badmus, said the new notes are not available to market women in the capital city.

“The new note is not available. I pray we don’t run into a crisis with this situation. Petty traders are not collecting the old notes. The goods of traders that are selling perishable goods are getting rotten in the market,” she said.

Mrs Badmus said she does not understand the reason behind the urgency to phase out the old notes but that the market women need some time to effectively implement the policy.

She said a lot of people in the market don’t go to the bank.

“There are some people that do daily sales, and they keep their money in cash. So I don’t know what they want these sets of people to do,” she said.


Support PREMIUM TIMES’ journalism of integrity and credibility

Good journalism costs a lot of money. Yet only good journalism can ensure the possibility of a good society, an accountable democracy, and a transparent government.

For continued free access to the best investigative journalism in the country we ask you to consider making a modest support to this noble endeavour.

By contributing to PREMIUM TIMES, you are helping to sustain a journalism of relevance and ensuring it remains free and available to all.

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The Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Muda Yusuf, has criticised Nigeria’s Central Bank (CBN) over its defiance of public institutions’ outcry to extend the deadline for the phasing out of the old naira notes.

The CEO spoke at the weekly episode of PREMIUM TIMES’ TwitterSpaces titled “ New Notes scarcity vs. January deadline and the implications for Nigerians.”

PT TwitterSpaces is an innovation of PREMIUM TIMES put together to advance conversations around issues of national concern.

This week’s edition of the programme — the first to be held this year, had Mr Yusuf; Global Analytics Consulting Limited CEO, Tope Fasua; Iyaloja of Abuja, Toyin Badmus and other stakeholders feature as guest speakers amidst lingering lamentations from Nigerians across the country over the grossly inadequate circulation of new notes ahead of the 31 January deadline.

Mr Yusuf said it has become very obvious that the central bank has grossly underestimated what it takes to execute this transition from the old notes to the new notes.

“So I think the logical thing to do is to extend it. We are in a democracy, the CBN cannot afford to continue to snub our democratic institutions the way it has done so far.”

He added that Nigerians have seen clear evidence of lack of capacity with respect to production from the bank because if something is available in adequate supply, it would show and if otherwise, it will still be obvious as is currently the case with Nigerians.

“So clearly we are dealing with a situation of acute shortage, that’s when you relate what’s made available to the demand of the new notes. Even up to last week, last Friday, some banks and ATMs were still dispensing the old notes,” Mr Yusuf lamented.

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Godwin Emefiele, governor of Central Bank of Nigeria (CBN).
Godwin Emefiele, governor of Central Bank of Nigeria (CBN).

He explained that the current situation is not a result of a lack of trying on the part of the citizens, but the aftermath of the banking system’s inability and lack of capacity to respond to the exponential demands for new notes.

“So if that is the case, I think the logical thing to do would have been to extend the date. I was really shocked and amazed when I heard the CBN governor during the MPC meeting say that he doesn’t have good news for us that the deadline stands,” the CEO said.

Mr Yusuf said the new notes shortage crisis is not the making of Nigerians but that of the CBN.

“From the beginning, I have challenges even with the very proposition of redesign. Redesigning is good. But when you contextualise it within the priorities that this economy needs at this moment, it is the least of our problems. I am not saying it is not desirable, but you situate things within the context of your priorities,” he added.


Kogi AD

TEXEM Advert


Scarcity

In recent weeks, Nigerian citizens and Deposit Money Banks across the country have been lamenting over their inability to access the newly designed naira notes. As the 31 January deadline for phasing out of old notes approaches, the cash-dependent informal sector of the economy has had to scramble for the new notes.

While this subsists, many Nigerians on social media have expressed reservations about the circulation of the new notes, with many fuming that they are yet to see or feel the new naira notes.

Others have also complained of hoarding on the part of the commercial banks, while some mobile cash point vendors are said to be exploiting the situation by hawking the new note.

Dangote adbanner 728x90_2 (1)

In the midst of this, the two chambers of the National Assembly have asked the CBN to extend the deadline for acceptance of the old Naira notes.

READ ALSO: Naira Redesign: Yobe governor appeals to CBN to extend deadline


However, earlier in the week, the CBN governor, Godwin Emefiele, after the apex bank’s Monetary Policy Committee (MPC) meeting in Abuja, insisted that the 31 January deadline that the apex bank announced for the validity of the old N200, N500 and N1,000 notes remains.

Mr Emefiele claimed that kidnapping and ransom-taking incidents have reduced since the three banknotes were redesigned, arguing that the time given for the swap of the old naira notes with new ones was enough for Nigerians to get the new notes from commercial banks without much pressure.

Major concerns

Due to the CBN’s hesitancy to shift grounds on the deadlines despite several appeals from public institutions and governors across party lines in the country, Mr Yusuf expressed worries about the CBN’s action and its implication for the economy.

“The House of Representatives has appealed to the Central Bank of Nigeria, the Senate has appealed to the Central Bank of Nigeria, the governors have also done the same thing and yet the CBN is saying that there is no going back on the deadline. That worries me a lot about how much power the CBN thinks it has over the sovereignty of this country,” he said.

“In an average market today, close to 50 per cent of the currencies in those markets are old notes. So how are we going to deal with that if you are insisting that we are not extending?”

Based on this, the policy analyst said there is no other option than for the CBN to extend its deadlines.

“This is a democracy, we are not in a military regime and if someone is in public office, he’s supposed to be a public servant. Public office holders are supposed to serve the people not the other way round and they are supposed to respond to the needs of the people for as long as those needs are legitimate,” he said.

“And you can see all over the country the kind of crisis it is creating.”

In his intervention, Mr Fasua argued that many people were against the CBN policy of redesigning the naira notes and that they would want the reversal of the policy.

“Why would they want the reversal of the policy is what I don’t understand,” he said.

The economist explained that part of the problem is the fact that many banks have closed down some of their branches due to certain challenges, especially in rural areas.

In such situations, he suggested that the CBN could have deployed officials in different places in Nigeria, especially places with a huge population of unbanked Nigerians.

Commenting further, he suggested that President Muhammadu Buhari wants the policy to succeed because he wants it to be some sort of legacy he would be leaving as his tenure comes to an end.

“Just as he did in 1984, he is desirous of this policy pulling through and I think he is also desirous of it being a linchpin for him to be said to have conducted a clean and fair election in 2023,” he said.

Mr Fasua said he disagrees with people saying the CBN naira redesigning policy is coming at the wrong time because of politics.

“This policy of cash management is 18 years late. In fact, we should be asking the CBN what they have been doing that they have been unable to manage our currency for 18 years since 2005,” he argued.

Lamentation

In her intervention, the Iyaloja (Head) of Abuja market women, Toyin Badmus, said the new notes are not available to market women in the capital city.

“The new note is not available. I pray we don’t run into a crisis with this situation. Petty traders are not collecting the old notes. The goods of traders that are selling perishable goods are getting rotten in the market,” she said.

Mrs Badmus said she does not understand the reason behind the urgency to phase out the old notes but that the market women need some time to effectively implement the policy.

She said a lot of people in the market don’t go to the bank.

“There are some people that do daily sales, and they keep their money in cash. So I don’t know what they want these sets of people to do,” she said.


Support PREMIUM TIMES’ journalism of integrity and credibility

Good journalism costs a lot of money. Yet only good journalism can ensure the possibility of a good society, an accountable democracy, and a transparent government.

For continued free access to the best investigative journalism in the country we ask you to consider making a modest support to this noble endeavour.

By contributing to PREMIUM TIMES, you are helping to sustain a journalism of relevance and ensuring it remains free and available to all.

Donate



TEXT AD: Call Willie – +2348098788999






PT Mag Campaign AD

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