PRESIDENT Muhammadu Buhari has said that N600 billion worth of old N200, N500 and N1,000 notes are yet to be returned to banks as directed by the Central Bank of Nigeria (CBN).
He also confirmed that the old N500 and N1,000 notes would no longer be legal tender in the country.
The President said he authorised the CBN to introduce the new notes and directed the apex bank to return the old N200 notes into circulation because of the scarcity of the new notes.
The N200 notes will remain in circulation for two months, the President said.
Besides, he assured that the Presidential and National Assembly election would hold as scheduled by the Independent National Electoral Commission (INEC) on February 25, 2023.
Buhari asked Nigerians to vote for candidates of their choice at the election and be law-abiding.
He said the decision to discontinue the use of the old N500 and N1,000 notes before the 2023 elections would stop politicians from buying votes and would fulfill his promise to bequeath the legacy of conducting a free and fair election in 2023.
In an address to Nigerians Thursday, February 16, over the nationwide confusion caused by the implementation of the naira redesign policy, Buhari expressed sympathy with people in the country because of the pain they are facing over it.
The President listed the reasons for the policy and its gains.
The ICIR reported how the CBN introduced the new notes on December 15, 2022, and made the old notes cease to be legal tender on February 10.
Since its introduction, the Naira redesign policy has brought hardship to Nigerians because they have been very scarce in banks and at Point of Sale centres.
Buhari said in his address that the policy implementation fulfilled his pledge to strengthen the economy, enhance the fight against corruption and sustain our gains in the fight against terrorism and insecurity.
He said all actions taken were within the ambit of the Constitution, the relevant law under the CBN Act 2007, and in line with global best practices, adding that the need to restore the statutory ability of the CBN to keep a firm control over the money in circulation necessitated the policy.
Buhari explained that when he assumed office in May 2015, the currency in circulation was only N1.4 trillion and had grown to N3.23 trillion in October 2022; out of which only N500 billion was within the Banking System while N2.7 trillion remained permanently outside the system.
“The huge volume of banknotes outside the banking system has proven to be practically unavailable for economic activities and, by implication, retard the attainment of potential economic growth.”
He said he was briefed that since the commencement of the policy, about N2.1 trillion out of N2.7 trillion of the banknotes previously held outside the banking system had been successfully retrieved, which is 80 per cent of the notes with the public.
He further argued that economic growth projections made it imperative for government to expand financial inclusion in the country by reducing the number of the unbanked population.
Here are the gains the newly redesigned notes are bringing to the country, according to Buhari:
- Strengthening of macroeconomic parameters;
- Reduction of broad money supply leading to a deceleration of the velocity of money in the economy, which should result in fewer pressures on domestic prices;
- Lowering of Inflation as a result of the accompanying decline in the money supply will slow the pace of inflation;
- The collapse of illegal economic activities, which would help to stem corruption and the acquisition of money through illegal ways;
- Exchange rate stability;
- Availability of easy loans and lowering of interest rates; and,
- Greater visibility and transparency of the country’s financial actions, translating to efficient enforcement of its anti- money laundering legislation.
Marcus bears the light, and he beams it everywhere. He's a good governance and decent society advocate. He's The ICIR Reporter of the Year 2022 and has been the organisation's News Editor since September 2023. Contact him via email @ mfatunmole@icirnigeria.org