It is no longer news that the Central Bank of Nigeria (CBN) has embarked on the redesigning and re-issuance of the 200, 500 and 1,000 naira notes, a move it announced on October 26, 2022.
It is also no longer news that barely two days after the policy was made public by the Governor of the CBN, Mr. Godwin Emefiele, during a special briefing held in Abuja, the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, not only disowned the initiative, but also denounced and condemned it. She also went to great lengths to paint a gory picture of how that CBN policy would hurt and very negatively impact the economy.
Ahmed ended up calling on the Senate Committee on Finance to summon the CBN boss for necessary interrogation as to the reasons for the policy and possible benefits (if any).
Like wildfire, other critical stakeholders took over from the minister’s criticism, and practically poured their venom on the currency redesign and its authors, querying the spirit and intendment of the monetary measure. Indeed, some otherwise responsible and respected bodies like the Lagos Chambers of Commerce and Industry (LCCI) rejected every reason for the CBN move and called for a halt to the execution of the policy.
They said whatever problem the CBN wanted to solve via the naira redesigning was the “least” of the country’s current economic challenges. A statement by the Director-General of the Chamber, Dr Chinyere Alumona, said the CBN initiative could worsen the economic problems of Nigeria and warned that the apex bank ought to have concentrated on the more important issue of paucity of foreign exchange and its management.
Towing the LCCI line, some economists and policy analysts also contended that the Currency initiative ought not to have come up at this point in time when, according to them, the only dominant issue in the public space should be the ongoing electioneering and the 2023 general elections. With the same mindset, they criticized the ‘line up’ of three key events—the Naira redesigning, 2023 general elections and the proposed National population census in April 2023—not minding that these are unrelated projects organized and supervised by three disparate agencies namely, the CBN, Independent National Electoral Commission (INEC) and the National Population Commission (NPC). But just to be on the bandwagon for the deprecation and criticism of the CBN policy, many public affairs commentators chose to lump the three programs of the Federal Government together—to tar all with the same brush—even though the apex bank was undertaking a policy initiative strictly within its purview to better stimulate the economy.
Apparently, the CBN foresaw the deluge of unwarranted attack and twisting of its policy coming, and on October 31, 2022, issued a statement, detailing a step-by-step approach as to how the Deposit Money Banks (DMBs) and the banking public should go about implementing the currency initiative within the intended timeframe. In the circular addressed to all banks and signed by the Director of Banking Supervision, CBN, Haruna B. Mustafa, the apex bank said among other things “no cash deposit by any customer should be rejected provided such deposits are lodged into an account with a BVN.”
It said further that “all deposits by new or walk-in customers should be accepted by banks subject to compliance with the requisite account opening documentation and KYC requirements.” The circular also warned that “splitting of deposits is not permitted under any circumstance. All unusually large deposits should be paid into customer’s accounts with BVNs as a bulk amount.”
In all, the 17-point circular provides almost a watertight Naira redesign implementation guide that hardly gives any room for economic saboteurs. Unsurprisingly, the document has provided a ‘brick wall’ against fraudsters, counterfeiters, money launderers and economic saboteurs who are bent on sabotaging the policy from the outset. Thus, although about N53 billion cash is said to have been deposited into the DMBs in the first two weeks of compliance with the Naira redesign initiative, the polity is tensed up with all kinds of clandestine and nocturnal moves to ‘dispose of’ billions (if not trillions) of Naira notes buried in soak-away, cesspools, toilets, latrines and private vaults by dubious ‘money bags’ and economic saboteurs.
Rather than carry the huge volumes of the high denomination Naira bank notes to banking halls to be deposited, the ‘smart’ economic saboteurs and fraudsters have been clandestinely carrying their ‘loads of cash’, chasing operators of bureau de change (BDCs), to ‘buy’ dollars and other hard currencies at whatever rates. They are ready and willing to take a dollar for one thousand Naira or more; all in a bid to use the foreign currency as their store of value. They also want to escape the noose of the CBN and the Economic and Financial Crimes Commission (EFCC) and end up ruining the local currency.
Stories are out there about how some of the desperate politicians who had stacked billions of 1,000 Naira notes in their private vaults are now secretly reaching out to their ‘followers’ and sharing out huge sums of money for each of them to go deposit in different DMBs on their behalf. Some, in order to play safe and remain safe, have been giving nocturnal assignments to their henchmen to evacuate long-stored and now rotten huge bundles of Naira notes and other currencies in their private vaults.
Yet, some are embarking on some sort of ‘trade by barter’, paying hundreds of millions (even billions) of Naira in cash to owners of real estate properties and chattels who are willing and ready to do such ‘deals’—just to ensure the cash is not carried to any DMB as required by the CBN. Even some state governments are said to have announced that salaries of their civil servants for the rest of this year would be paid “in cash”—to enable them empty the numerous vaults in ‘Government House’ and secret tills of highly placed persons.
Some of these desperadoes are even said to be paying upfront for refundable airfares for no planned trips—but with the intention to ask for refund outside the Naira redesign timeframe. Obviously, as the Naira redesign project progresses, economic saboteurs and their henchmen would be devising ‘ingenious’ ways of ensuring that the well thought aims and objectives of the monetary initiative are defeated. That is why they were rattled by the announcement of the policy—and deployed all manner of pent up and irrational excuses to invoke public criticism and opprobrium on the authors of the initiative. All said therefore, the apex bank should remain single minded, focused and determined to see through the Naira redesign and reissuance process to its logical conclusion. All distractions must be resisted.
•Okeke is an economist, sustainability expert and business strategy consultant.