Between Naira Redesign Project and Politicians’ Vested Interest

Recent developments around the Central Bank of Nigeria’s naira redesign show that politicians with vested interest and stashed funds are bent on stalling the retirement of the use of the old banknotes, writes Oluchi Chibuzor

The Central Bank of Nigeria’s (CBN) move to phase out the old N200, N500 and N1,000 has clearly assumed as political dimension. Politicians showed their hands last week as they forced the Supreme Court to halt the enforcement of the February 10 deadline.

The court while entertaining a suit filed by Kaduna, Kogi and Zamfara states, had ruled that the February 10 deadline previously fixed by the apex bank to ban the use of the old naira notes should be temporarily halted until February 15, when the matter would be heard.

The seven-member panel led by Justice John Okoro, halted the move of the federal government in a ruling in an ex parte application brought by three northern states.

The states had specifically applied for an order of Interim Injunction restraining “the federal government through the CBN or the commercial banks from suspending or determining or ending on February 10, 2023, the time frame with which the now older version of the N200, N500 and N1,000 denomination of the naira may no longer be legal tender pending the hearing and determination of their motion on notice for interlocutory injunction.”

The move and desperation shown by governors of the ruling party confirmed allegation by a lot of persons, including some opposition political parties that governors of the ruling party had stashed funds to negatively influence the outcome of the election. It also confirmed the insinuation that politicians who stashed billions of naira outside the banking system to prosecute the general election had been moving against the policy since it was announced in October last year.

The initiative aimed at fighting corruption, checkmating money laundering, eliminating counterfeits, and ending the hoarding of the naira by kidnappers and others, appears to have thrown the politicians who had stashed billions of the Nigerian currency ahead of the general election into confusion.

Investigations revealed that many of the politicians who had perfected plans of rigging next year’s election through vote-buying and had stock-pilled the naira in their houses had vowed to do everything to stall the policy.

In line with that vicious move, as part of efforts to deliberately stall the Supreme Court ruling scheduled for tomorrow, governors of some states in the country have chosen to continue to file for joinder in the matter. The suit originally filed by Kaduna, Kogi and Zamfara states has been joined by Ondo, Kano and Ekiti states, with Rivers state also indicating its preparedness to do same.

Sources at the Federal Ministry of Justice that disclosed this, noted that the design of the state governors joining the suit was to delay the judgement and have the old currency run till after the election.

One of the sources, who pleaded to remain anonymous, said, “It is the design of the governors, who are adding many joinder suits, to delay the judgement and try to keep the state of affairs whereby the old currency would continue to be in use, while they lobby Supreme Court justices so that they cannot reach a judgement, and to push the Supreme Court decision on this matter until after the presidential election.

“They want to use the cash for the presidential election. So, they are adding more joinder suits to delay the outcome of the judgement so that the two currencies can work together. So, what we see is that the vote-buyers are fighting back.”

This revelation came just as governors of the 36 states of the federation rose from a meeting in Abuja, with a resolution to direct their Attorneys General to review the suit with a view to consolidating the legal reliefs pursued by the states.

The 36 governors also asked the federal government and the CBN to respect the rule of law and halt the currency restrictions, which they argued were causing an economic crisis.

The governors made the assertions in a communiqué issued at the end of a meeting of the Nigeria Governors Forum (NGF), which was signed by the forum’s chairman, Rt. Hon. Aminu Tambuwal.

The demonetisation policy is in continuation of the CBN’s push for a cashless economy and political analysts have pointed out that it would help minimise vote buying and other forms of financial inducement to the voters. Also, despite the short-term hardship being faced presently, it is believed that by phasing out the use of the old banknotes, INEC workers or election entrepreneurs bent on rigging the election would be frustrated.

That is why despite the push by mostly APC governors for the continuous use of the old currencies, the Catholic Bishops Conference of Nigeria (CBCN) has charged Nigerians to resist the dubious practice of vote buying. The bishops also urged the Independent National Electoral Commission (INEC) not to toy with the confidence and trust Nigerians placed on them by ensuring that the processes involved in the forthcoming elections are bereft of all forms ambiguity capable of offending the collective sensibility of Nigerians.

In his Pastoral Letter delivered yesterday, at the opening of the conference, CBCN President, Archbishop of Owerri, Most Rev. Lucius Iwejuru Ugorji, said the practice of inducing the poor and vulnerable voters to cast their votes for a particular candidate in exchange for some financial reward seeks to deny such citizens their real voice and choice in the electoral process.

“More to the point, such brazen use of wealth offends the dignity of the poor and vulnerable while making it increasingly difficult for good but poor candidates to contest and win elections.

“Therefore, we urge Nigerians to stoutly resist the odious practice and resolve to vote according to one’s conscience and convictions,” he said.

No doubt, Nigerians are facing scarcity of cash and the central bank has disclosed that it is doing everything to improve supply of the new banknotes.

Contrary to a misleading report, which misquoted the CBN Governor, Mr. Godwin Emefiele, as attributing the current challenge in the distribution of the redesigned naira banknotes to a shortage of printing materials at the Nigerian Security Printing and Minting Company (NSPMC) Plc, the apex bank clarified that the printing company has the capacity and enough materials to produce the required indent of the Naira.

The CBN’s position was further reinforced by the Managing Director/Chief Executive of NSPMC, Mr. Ahmed Halilu, who said adequate arrangements had been made to continuously produce the redesigned banknotes and other denominations in line with the CBN indent for 2023.

Halilu, in a statement, also clarified that contrary to mischievous claims, De-La-Rue of the United Kingdom does not produce or supply paper substrate within the currency industry.

The central bank also said it is working assiduously to increase the circulation of the newly redesigned banknotes across the country.

The apex bank has also insisted that the redesign of the naira notes was not targeted at any individual but was done in the overall interest of the country and the economy.

It also clarified that there were no plans to close down any bank in any part of the country.

The CBN’s assurances came against the backdrop of a misleading report which misquoted Emefiele as attributing the naira banknotes to a shortage of printing materials at the NSPMC known as the Mint.

CBN Director in charge of the Corporate Communications Department, Mr. Osita Nwanisobi, stated that the CBN governor did not disclose during his presentation to the National Council of States that the Mint could not print the required banknotes.

He said: “For the records, what Mr. Emefiele told the meeting was that the NSPMC was working on printing all denominations of the Naira to meet the transaction needs of Nigerians.”

The central bank further appealed to the public to disregard the misleading report and exercise more restraint “even as we work assiduously to increase the circulation of the new notes in the country.”

Similarly, the CBN also raised the alarm over a misleading voice note trending in social media alleging that the CBN planned to shut down some banks, particularly in a particular geo-political region of the country.

Nwanisobi said: “We wish to state unequivocally that there is no such plan and that the claims are illogical and do not comply with the workings of the Nigerian banking system.”

The apex bank said it remained committed to performing its monetary policy functions, as stipulated in the CBN Act, 2007, as amended.

The CBN, however, welcomed concerns shown by all stakeholders about the distribution of the naira, stressing that “we are alarmed at the extent to which vested interests are attempting to manipulate facts and pitch the public against the bank.”

The apex bank advised well-meaning Nigerians to ignore such recordings as they did not represent its policy thrust, adding that such was part of the desperate attempts by some persons bent on inciting the public against the bank.

The CBN also insisted that the redesign of some naira notes was not targeted at any individual but was done in the country’s overall interest and the economy. Nwanisobi stated this in an address delivered at the CBN’s Special Day at the 44th Kaduna International Trade Fair.

Nwanisobi urged Nigerians to embrace alternative payment channels such as e-Naira and internet banking in the face of the cashless policy.

According to the apex bank’s Director of Capacity Development, Mohammed Abbah, who represented Nwanisobi, a major challenge that emerging countries like Nigeria continue to face is “our inability to seamlessly integrate into the global trading system, owing largely to the quality and technological content of the goods and services we produce for export.”

He said the CBN governor has always emphasised that the redesign of the naira notes was “not targeted at anyone or any group of persons; rather, it derived from the bank’s in-house analysis to strengthen macroeconomic fundamentals and better our socio-economic conditions.”

Nwanusobi said: “The principal aim of the bank, with the currency redesign initiative, is to make our monetary policy decisions more efficacious.

“Nigerians will observe that there has been a downward trend in inflation, and the exchange rates have been relatively stable.

“Furthermore, we aim to increase financial inclusion in the country by reducing the number of the unbanked population.

“Thirdly, our aim is to support the efforts of our security agencies in combating banditry and ransom-taking in Nigeria through this programme.”

According to him, “the CBN is not unmindful of the challenges some citizens have faced in the past few weeks in getting money from their banks or other alternative channels. Indeed, there have been reports of occasional transaction failures. However, we wish to assure you that the Nigerian payment system infrastructure is robust enough to handle the surging transaction volumes across all channels.

“We, therefore, urge Nigerians to embrace alternative payment channels, such as e-Naira and internet banking, as we embrace the cashless policy.”

He added that the advantages of the currency redesign are overwhelmingly enormous and will benefit the economy in the long run.

Also, the central bank has told the Federal High Court, in Akure, that extending the expiry date for the old naira notes would jeopardise the fight against fraud, corruption and criminal activities in the country.

The apex bank, in a counter-affidavit to a suit filed against it by a group, the Social Rehabilitation Grace and Supportive Initiative (SRG), justified its reluctance to extend the expiry date for the old naira notes, and said it was to save Nigeria’s democracy.

The apex bank, in a counter-affidavit filed by its counsel, Oyetola Atoyebi (SAN), urged the court to dismiss the suit, averring that the plaintiffs have no justifiable reason for filing it.

Atoyebi argued that the extension of expiry date for old naira notes of N200, N500 and N1000 would give room for vote-buying and undermine the forthcoming election.

He argued, “The extension of the timeline will jeopardise the fight against fraud, corruption and criminal activities perpetrated with the use of the old currencies.”

The CBN specifically cited the festering kidnapping crime, claiming a change in currency notes will end it.

Therefore, Nigerians must look beyond the outburst of some selfish politicians and support the naira redesign policy as well as efforts to phase-out the use of the old banknotes.