WHY’ll NIGERIA CHANGE OR RE-DESIGN NAIRA CURRENCIES?
It was like a bolt from the sky, the announcement that the CBN, Central Bank of Nigeria, had scheduled to redesign, change and recall all the currencies of the Naira denominated in N200, N500, N1,000 notes. This gigantic war had never been publicly discussed or mentioned, and has never been tied to any social, economic or security problems of the country. The secrecy was as if a war was imminent in Nigeria, or that the citizens belonged to a different planet, Mars, and so were hard of hearing and did not hear about the currencies redesign.
Thus, the first question is: what was the principal reason for the decision to re-design the currency, how crushing was that matter particular that was so deterministic; if it was that so hard and heavy how come it was not in the public domain for discussions and debate; when did the origination of the policy get dated?
Still there are many more questions that will be tendered to get to the root of this future tsunami that will further tear Nigeria apart and cause so much suffering for the ordinary Nigerian.
QUALITY OF THE NIGERIAN NAIRA NOTES
At best, the quality of the Nigerian currency, the Naira, could be said to be of low standard. When Nigeria changed from the Pound to the Naira in 1973, forty nine years ago, the primary reasons tendered by the Military Government was modernism, digitization and Nigerianism, meaning that the global future of mathematical accounting was quickly shifting to decimals of ten, away from older counting orders of twelve and the dozen. It was said that mentally tens were easier to follow or recall: our mundane developing society and educational populace needed easier inspiration to catch up, necessitating the need to change, and stand with the rest of the globalization that was taking root, which justified the desire. To further domestic our new avenue, the nomenclature of the currency was onomatopoeically made Nigerian by adopting the name NAIRA, as opposed to the Pound which had its base, Latin and British roots. To further localize this, numerals on the currency were printed in Arabic letters, later changed to Hausa, Igbo and Yoruba when the public commentary that Arabic was not local, except in the context of the Islamic religion which was still not practiced by 100% of the national population: till date the issue of the Arabic lettering on the Naira has not been resolved, and as usual the government is secretive on these matters, rather than use public involvement to create patriotism and sentiments that glorify the country.
With respect to the actual quality of the Naira, the lower denominations were determined by the public to be very poor, and improvements were made by the use of higher quality polymer, water resistant materials that withstood degradation from frequent debased use, folding or storage. The denominations of N20, N50 and N100 were this improved on, and less complaints were made by the sensitive public. The issue of value and pricing of products, which are grave matters of the growth and resilience of the economy, was overtaken by urbanism, middle class greed, and the oil boom. Banks, business leaders, contractors and the military elite were insulted by the regression of not being able to carry less currency, and so coinages quickly became irrelevant, unnecessary and anachronistic.
In the rural areas, especially in the North, the need to continue stabilizing the place of the wealthy and the not so wealthy, the value, and quantity of purchasable goods and services, continue to reverberate to sustain the use of coins. Last ditch efforts to continue the use of coins, enunciated during the tenure of Charles Soludo as CBN Governor, fizzled to failure till date: the race towards sophistication and higher denominations has been steady, leading to institutional phenomenal corruption, the devaluation and debasement of the Nigerian economy and financial stability. We are yet to hear the final words in this regard, which is why the current effort to redesign and change the currency is so fruitless and unnecessary.
RECALLING THE OLD NAIRA NOTES IN SIX WEEKS
The figure of N3.7 Trillion is estimated to be the total quantity of Naira notes in circulation in Nigeria currently. How did the CBN determine this? Why is it so important to have this information? Over a period of ten years, the CBN has the records of printed currency supplied by the foreign facilities that produce its paper money. It excludes coins, which woefully has been demised in Nigeria for about 30 years now. Printing paper money is called Ways and Means in Economics, and is used to determine the strength of an economy to produce wealth and domesticate the per person wealth of the populace, especially those of working and productive age. The more money printed within an economy, juxtaposed with the number of working people, the easier it is to calculate the wealth of that society. That is why Central Banks very grudgingly print money, and are very secretive when they do. With a bulging population of 250 million people, to estimate that the quantity of currency in Nigeria is N3.7 Trillion is to very grossly under determine the value of the wealth of Nigeria. Again, juxtaposed against the mineral incomes of Nigeria for the past 50 or so years, is to graphically degrade, downgrade and distort the ability of Nigeria to sustain our economy. In the current effort regarding the redesign of the currency, issues related to the total quantity of the currency in circulation is futile, illusory and a seeking after the shadow. The question is: Can the CBN recall, evacuate, store and destroy N3.7 Trillion currency notes now in circulation? The easy answer is No! The operational and logistical capacity is not there, and the effort will not be successfully completed in 3 years, if carried out on a daily basis. Do Nigerians have the capacity to troop out on a daily basis to go and deposit old notes in the banks, in order to get new redesigned Naira notes. It is neither possible or even necessary: what the CBN Board and the Government of President Muhammadu Buhari, PMB, are pursuing is ECONOMIC ABRACADABRA: it is best for the public to routinely collect new currencies from Banks, ATMs, POS Agents, sine die, until all the old notes are recalled and evacuated. The Banks must stop issuing the old notes to the public. That is how it is done in other climes, and Nigeria cannot be different.
CONFUSION BY GOVERNMENT
When the Minister of Finance, Zainab Ahmad, publicly complained of not being aware of the CBN Naira redesign plan, and PMB went public to state his knowledge and support of the CBN plan, it was total proof of the level of confusion of the Government. Indeed, based on Central Bank Establishment Act of 2007, and the Banks and Other Financial Institutions Act of 2010, the autonomy of the CBN is guaranteed to guide, protect and stabilize the economy and monetary system, through a Governing Board, recommended by the Minister of Finance, to the President who names and nominates all of them to the Senate that confirms their appointments. The Minister of Finance can recommend to the President to pressure the CBN Governor to resign. Especially, if futile and insensitive policies that degrade the economy is being pursued. To print N2.4 Billion new redesigned notes, Government will spend N56.2 Billion, excluding other miscellaneous costs. Would any business venture survive this level of loss or recklessness, and the Board of such a body will be retained? There is more to the policy than Nigerians have been told.
SUFFERING OF NIGERIANS TO GET TO DEPOSIT AND RECEIVE NEW NAIRA NOTES
Under the leadership of Major General Muhammadu Buhari and Brigadier Tunde Idiagbon, in 1984, the Military Government, pursuant to tracking and punishing corrupt politicians approved the recall, redesign and replacement of the Naira notes. Nigerians saw suffering, in the Banks and in the end the process was closed, with millions of Nigerians discarding old notes still in their possession. Thirty eight years after, history will repeat itself: indeed, what did the government do end of May 2022, and first week of June 2022, when the major parties Presidential Candidates were publicly exposed for buying delegates, in Abuja, with thousands of US Dollars, and the Ekiti and Osun Governorship elections, were votes were bought openly, how many politicians were investigated and prosecuted? When PMB stated in the Independence Day 2022 Speech that he was aware of the suffering of Nigerians, and the First Lady apologized on behalf of the government and her husband, Nigerians expected more humane policies: our end 2022 suffering is yet to come. Traveling over the Yuletide 2022, will be shear misery and very beggarly for millions, because only those who have obtained new monies, starting December 15, 2022, will be able to buy foods, articles, pay transportation and visit places of interest and fun: if the old notes they are holding are accepted, then it will work, if the legal tender is rejected, then they are stuck!
Does this sound normal, could anyone say that these policies were examined by qualified, experienced and tested civil servants? Nigerians rejoiced when a replacement military government began running the affairs of Nigeria, August 26, 1985. This time, a civil government will patiently recast the current monetary policies regarding the redesign, recall and replacement of old Naira notes.
EFFECT ON NAIRA – US DOLLAR EXCHANGE RATE
The consequences of monetary instability is social confusion, hoarding of goods, escalation of prices and runaway inflation. The exchange rate mechanism of currencies is entirely dependent on availability and sustainability of rational monetary policies. In our current instance, with declaration that all old notes are being recalled, those who have plenty of the old notes, will want to buy up , at any cost, all and any available foreign currencies. The price will be higher rates of the dollar, pound sterling, Euro, Yen, RMB etc. Do we need this in Nigeria between 2022-2023 and beyond? The dollar-Naira exchange rate is already N875.00 to $1.00; we do not want it to go higher. Here are policies Nigerians need now:
1. Restructure Nigeria, reduce to only 8, the Exclusive Functions of the Federal Government, while states will carry on all the other Residual Functions including State Police and Education as well. Revert to 1963 Parliamentary system, 7- year mandatory tenure, unicameral system and eliminate corrupt, delegates-votes buying, too costly Presidential system.
2. Increase to 11,600 Megawatts of Electricity, by building 7- new different multi mode electricity generation plants, paying upfront for them with 24/months delivery guarantee: revamping corrupt transmission and distribution of electricity sector.
3. Reduce by 32% cost of living in Nigeria, in the first instance, through concertation with the Organized Private Sector, OPS.
4. FREE EDUCATION , from kindergarten to University level AND FREE MEDICAL HEALTH CARE SERVICES for all Nigerians; employed persons will contribute to health care funds.
5. Peg the exchange rate of the Naira and US Dollar at N92.00 to $1.00 USD, rehabilitate street-side currency traders, prosecute all new defaulters.
6. Reduce the cost of petrol to N75.00 per liter ( same average reduction for diesel, kerosene, cooking gas, jet fuel, black oil, electricity tariff), and defend the policy.
7. Zero corruption and zero foreign loans: rely on RULE OF LAW, prosecute corrupt persons, rapidly, expand the Bench, assign only 300 case files per annum to each Judge and Magistrate, and reduce trial court processes to 3-7 months maximum. Balance our budgets and stop any new loans.
REDEMPTION AND INDIVISIBILITY OF NIGERIA
The economy and social stability of Nigeria can be redeemed, if we adopt the recommendations listed above. If we RESTRUCTURE NIGERIA the divisive forces pushing to dismember the country into small republics ( Yoruba Nation, Biafra, Arewa, Niger Delta, Middle Belt), all will fizzle away, based on equality, fairness and justice, of all citizens and religions, where no one will be dominated by Muslims, Christians, Fulani, Ibo, Yoruba; and States can hold referendums if they want to create new States or local governments, if they only, so wish. Nigeria’s diversity is her greatest strength, and honest, dedicated leadership will lift up and surge the country to new heights of prosperity for all citizens.
Signed:
Dr. Orefo Nnamdi Onochie
Ebube Dike of Ahaba & Nigeria
Former 2023 PDP-PRP Presidential Aspirant
Founder-Convener: Onochie Political Action Conference (ONOPAC)
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