President Muhammadu Buhari on February 16, 2023 in an early morning broadcast approved the extension of the legal tender status of only the 200 naira notes by 60 days up to April 10, 2023. The immediate take-away from this broadcast is that the legal status of the currency denominations, that is the 200, 500, 1,000 notes under change, expired as announced by the Central Bank of Nigeria on February 10, 2023, regardless.
Therefore those who have piled up humongous sums of money outside the banking system for unauthorised use or nefarious activities now have their fingers burnt and must be licking their wounds by now. Since this consideration is the crux of the rabid agitations, we might not have heard the last of this matter.
One of the things we must aim to achieve in the unfolding dispensation is to intentionally target the building of strong institutions. In such environment, institutions will only be guided by the content of their extant Act. The Central Bank enjoys instrument autonomy; which means that in the pursuit of its overall mandate of the maintenance of price stability, it should be unfettered as it decides how it wants to go about doing so.
By deciding to change the currency notes, the Central Bank acted clearly within the boundary of its Act. We have not heard it express any sentiment to the contrary. If any approval was required, it is only that of the President Buhari who the CBN Governor reports to and not anyone else, including the Minister of Finance because there is no reporting relationship. It is good practice, of course, if proximate stakeholders are carried along. But we must also be open to the fact that for certain issues there might be a need for the element of surprise to underwrite successful implementation.
At some point in time, there were too many unauthorised power brokers on this matter. Some grossly implicated state governors became champions who dictated which currency was a legal tender in the country. In a particular state whose governor has a reputation that stinks, with regard to receiving bribes, it was alleged that supermarkets which refused to accept currency notes already pronounced as expired by the issuing authority were shut down. Also a vociferous state governor was caught on camera telling his constituents that since an injunction obtained from the Supreme Court had declared that old naira notes were still legal tender, they should go ahead and feel free to use the notes. Where else does one encounter such confusion but in Nigeria?
Now that such overzealous governors have egg on their faces, one is wondering where this development will leave those who believed them and followed their wrong-headed and misguided directive! One’s heart cannot but go out at this moment to those at the receiving end now holding the wrong end of the stick.
Now a critical question is where does all this leave the Supreme Court now with its reputation all but shattered and up in smoke! As the Court of last recourse the Supreme Court should have endeavoured to guard its reputation jealously. But rather following its involvements and pronouncements particularly lately that do not resonate with what everyone can see, the it has become the butt of all manner of seedy jokes.
A major reason behind the currency change is to impact vote buying by disarming those who have piled naira notes and waiting to buy votes outside the banking system. And this realisation explains the ferocity of the opposition to this exercise. Of course, there will be no prize for guessing that such illegally stocked monies will most certainly be in the 1,000 currency notes denomination. Therefore all that money is now worse than toilet paper.
Obviously a new Nigeria is possible. And as the President repeated in his broadcast, Nigerians must be free to vote for whomsoever they want with the assurance that their votes will count. Mr. President, history will remember you kindly for such a praiseworthy posture which prioritises the future of our potentially great country. A new Nigeria is really possible and it is just round the corner by His grace as all the indicators would seem to confirm.
It is on record that a certain state governor fingered a particularly notorious political party chieftain as the mastermind of an incident that occurred in his state, in which there was massive destruction and loss of life. One should have expected that by now such an individual would have been pulled in for interrogation and if found culpable, made to face the full weight of the law.
There must be fellow travellers in the perpetration of this dastardly act of masterminding insurrection and wanton destruction of life and property in many other states in the Federation. All such culprits must be fished out to face the full force of the law.
The Central Bank does not need anyone to remind it that it is in charge of this game and the buck stops at the table of the governor. Therefore the responsibility for the success or failure of the currency change exercise stops at the table of the Governor. Yes, we all support the cashless policy, but not at the expense of ordinary bank customers not having access to their deposits.
Whatever is the cause of the problem, the CBN must rise to the challenge to uproot and address such problems. What is happening now with respect to rioting and vandalism of particularly Bank property must be isolated and stopped in its track for badly needed peace to return to the polity.
The 2023 General Election is just a few days away. All stakeholders must be up and doing. They must play their respective parts for a peaceful, transparent and free election, in which all votes must count, to begin to underwrite the desired robust future for Nigeria. The security agents must be on the guard to nip any attempts to disrupt peace during and after the elections. A new Nigeria is possible and may God’s will be done for Nigeria.
***Boniface Chizea is an Economist and CEO of BIC Consultancy Services.*
