Story from Haruna Yusuf, Abuja
The Nigeria Employers’ Consultative Association (NECA) has condemned the CBN’s poorly implemented new naira banknotes policy declaring it as a policy that is ruining lives and livelihoods.
NECA urged the Buhari administration to look beyond the politics of the naira redesign and focus on the damaging effects on businesses and the economy at large.
The director-general, Adewale-Smatt Oyerinde, made the call in a statement on Sunday in Lagos, he said ‘’In the last few weeks, with the cash squeeze and the purchasing ability of Nigerians greatly impaired by the poor implementation of the policy, the economy has witnessed a significant bashing. This is so with report stating that the Real sector witnessed about 40 percent drop in productive activities,” explained Mr Oyerinde.
READ ALSO:Deposit old naira notes in any CBN branch nationwide – CBN
He added, “As the cash crush continues, thousands of productive hours are lost daily on queues by employees and many cannot even get to work. The value chain in the formal and informal sector with over N10 billion cash transaction daily is almost destroyed with consequences for employment, business sustainability and National development.”
The NECA director-general called for critical and immediate efforts to be made to improve or upgrade alternative routes to cash, thereby ensuring seamless transactions before going digital.
According to him, the series of actions taken by the CBN now in the form of having naira swap agents among others, are afterthoughts, after resistance by Nigerians.
‘’It is callous to deprive citizens of the new naira notes after cajoling them to deposit the old ones in the banks. We urge the CBN to sanction the commercial banks that have been found to be complicit in the whole show of shame, even as the CBN cannot extricate itself from being complicit,” stressed the NECA chief.
‘Mr Oyerinde further mentioned that “as an immediate action, we align with the position of the Council of State that the CBN should release more new naira notes into the economy or allow the use of the old ones, pending a time when it will demonstrate competence by not always putting the cart before the horse in the implementation of monetary policies.”
The NECA boss pointed out that the CBN naira redesign policy with the objectives as stated by the apex bank was laudable.
He said however, that like many of the bank’s policy initiatives, this was also flawed by shortsightedness in implementation.
READ ALSO:How not to redesign the naira, by Hassan Gimba
‘’For a definitive monetary policy as the naira design, it is expected that the CBN will not only take lessons from other countries like India, Myanmar, Australia, Venezuela, Zimbabwe and the European Union, which witnessed various degrees of successes and failures when they implanted their currency redesign,” said the NECA director-general, urging CBN to do a “thorough analysis and simulation of likely social and economic challenges that might arise and definitive response to those challenges.”
He further stated that “it does not seem that the CBN understands the challenges nor have solutions to the economic issues, thereby allowing speculators and economic saboteurs to have a field day at the expense of legitimate businesses and the economy.
Recall that due to the effects the Central Bank of Nigeria (CBN)’s naira redesign policy is having on the residents of their states, the governments of Kaduna, Kogi and Zamfara have dragged the Federal government before the Supreme Court, seeking a restraining order to stop the full implementation of the policy.
In a motion ex-parte filed on their behalf by their lawyer, AbdulHakeem Uthman Mustapha (SAN), the three northern states are urging the apex court to grant them an interim injunction stopping the Federal Government either by itself or acting through the CBN, the commercial banks or its agents from carrying out its plan of ending the timeframe within which the now older versions of the 200, 500 and 1000 denominations of the Naira may no longer be legal tender on February 10, 2023.
The Plaintiffs in the suit are the three Attorneys-General and Commissioners of Justice of the three states, while the Attorney-General of the Federation and Minister of Justice, Abubakar Malami (SAN), is the sole Respondent.
The Plaintiffs said that since the announcement of the new naira note policy, there has been an acute shortage in the supply of the new naira notes in Kaduna, Kogi and Zamfara States and that citizens who have dutifully deposited their old naira notes have increasingly found it difficult and sometimes next to impossible to access new naira notes to go about their daily activities.
READ ALSO:Old Naira Notes Validity: Supreme court restrains CBN from implementing Feb. 10 deadline
They also cited the inadequacy of the notice coupled with the haphazard manner in which the exercise is being carried out and the attendant hardship same is wrecking on Nigerians, which has been well acknowledged even by the Federal Government of Nigeria itself.
The Plaintiffs further maintained that the ten-day extension by the Federal Government is still insufficient to address the challenges bedeviling the policy.
In the suit filed at the apex court, the Plaintiffs have also filed a motion on notice to abridge the time within which the Respondent may file and serve his Counter-Affidavit to this Suit and an order for an accelerated hearing of this matter.
The states are seeking a declaration that the Demonetization Policy of the Federation being currently carried out by the Central Bank of Nigeria under the directive of the President of the Federal Republic of Nigeria is not in compliance with the extant provisions of the Constitution of the Federal Republic of Nigeria 1999 (as amended), Central Bank of Nigeria Act, 2007 and actual laws on the subject.
They are also asking the court to make a declaration that the three-month notice given by the Federal Government of Nigeria through the Central Bank of Nigeria under the directive of the President of the Federal Republic of Nigeria, the expiration of which will render the old Banknotes inadmissible as legal tender, is in gross violation of the provisions of Section 20(3) of the Central Bank of Nigeria Act 2007 which specifies that Reasonable Notice must be given before such a policy.
The Plaintiffs are also urging the court for a declaration that given the express provisions of Section 20(3) of the Central Bank of Nigeria Act 2007, the Federal Government of Nigeria, through the Central Bank of Nigeria, has no powers to issue a timeline for the acceptance and redeeming of banknotes issued by the Bank, except as limited by Section 22(1) of the CBN Act 2007. The Central Bank shall at all times redeem its bank notes.
The Plaintiffs further want the court to direct the immediate suspension of the demonetisation of the Federal Government of Nigeria through the Central Bank of Nigeria under the directive of the President of the Federal Republic of Nigeria until it complies with the relevant provisions of the law.
In an affidavit filed in support of the suit and sworn to by the Attorney General and Commissioner for Justice, Kaduna State, Aisha Dikko, she averred that although the naira redesign policy was introduced to encourage the cashless policy of the Federal government, it is not all transactions that can be conveniently carried out through electronic means.
She maintained that several transactions still require cash in exchange for goods and services hence the need for the Federal Government to have sufficient money available in circulation for the smooth running of the economy.
Dikko also pointed out that the Federal Government has embarked on the policy within a narrow and unworkable time frame, and this has adversely affected Nigerian citizens within Kaduna, Kogi and Zamfara States as well as their Governments, especially as the newly redesigned naira notes are not available for use by the people as well as the State Governments.
“That the majority of the indigenes of the Plaintiffs’ states who reside in the rural areas have been unable to exchange or deposit their old naira notes as there are no banks in the rural areas where the majority of the population of the states reside.
“Most people in rural areas of the Plaintiffs’ states do not have bank accounts and have so far been unable to deposit their life savings which are still in the old naira notes.
“There is restiveness amongst the people in the various states because of the hardship being suffered by the people, and the situation will sooner than later degenerate into the breakdown of law and order.
“The Plaintiff State Governments cannot stand by as they are duty-bound to protect citizens in their states and prevent the breakdown of law and order.
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