MINISTER of Finance, Zainab Ahmad, and the Central Bank of Nigeria’s governor, Godwin Emefiele, have been at loggerheads over the redesigning of the naira notes.
Zainab, who complained that Emefiele kept her in the dark on the redesign plan, expressed concern over the policy, saying it portended grave consequences for the nation and its economy.
The Minister’s comment was in response to an issue raised by Senator Opeyemi Bamidele during the 2023 budget defence session on Friday, two days after the CBN briefed journalists on the redesign development.
Senator Bamidele had, expressing a worry about the redesign implications, told the minister, “Just two days after announcement of the policy, the value of the Naira to a US 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 realities on ground, is very wrong as the naira may fall to as low as N1,000 to a US dollar before the January 31, 2023 date fixed for full implementation of the policy.”
Zainab responded she was not aware of the redesign plan but only heard of it from the media.
She said, “We were not consulted at the Ministry of Finance by the CBN on the planned naira redesigning and cannot comment on it as regards its 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 to 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.”
Emefiele had on Wednesday, October 26 disclosed that the apex bank would redesign the country’s currency from the N200 denomination to the N1,000 note.
Emefiele said the action was taken to control the volume of currency in circulation.
He posited that the bulk of the nation’s currency notes was outside bank vaults and that the CBN would not allow the situation to continue.
According to him, the planned policy was in line with Section 19, sub-sections a and b of the CBN Act 2007, upon which the management of the CBN sought and obtained the approval of President Muhammadu Buhari to redesign, produce, and circulate new series of banknotes.
The official spokesperson of the CBN, Osita Nwanisobi, said it would be in the overall interest of Nigerians to support the redesign policy, as 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 meant well for the country.
He stressed 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 central bank would be committed to safeguarding the integrity of the local legal tender and 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 the increased minting of the eNaira.
Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.