Naira Redesign Policy and the Economic Implications -By Femi Amosun

I am often fascinated by the Nigerian political history and development. At the height of the devastating Nigerian Civil war, in 1968 the Government of the day changed the currency to suppressed the Secessionists. In January 1973, the Government unilaterally decided to change from the metric to decimal and introduced Naira as our national currency. It is also on record that in 1984, the Military regime led by the then Major General Muhammad Buhari swiftly changed the colour of Naira notes under the pretext to “fight Corruption”. The Democratic government led by former President Olusegun Obasanjo (ki Agba pe lori le o. Ase!) redesigned the Naira notes to “curb Corruption”. It’s somewhat incredible that Fifty years after Naira was introduced as the Legal tender of our national economy, an Agency of government would dare attempt to repeat the same old strategy.

Having enunciated a brief historical perspective, it is imperative to note that for a number of years many Nigerians have failed to grasp how the Central Bank of Nigeria consistently control our lives. Firstly, they forced NIN on Nigerians and linked it to individual bank Accounts; they introduced POS (by the way, POS is an outdated model in Western world) and charge customers exorbitant fees; they also imposed Internet banking on Nigerians. With the sudden and forceful introduction of the current new Naira notes; scarcity of Naira notes; and the adverse hardships inflicted, Nigerians need to realize that the role of Central Bank of Nigeria is not about economic management (i.e., trade and industry, revenue-generating activities, profitability) but rather as a “Lender of last resort”.

It is a public knowledge that Mr. Emefiele has penchant for acrimonious outbursts. The CBN Governor is on record for openly been peevish about the amount of money people keep in their Domiciliary accounts. Prior to his irritable disposition, he attempted to raid people’s Dormant accounts. Where else in the world would you see a Central Bank governor openly talking about people’s private savings? So when Mr. Emefiele started his rambunctiousness about the Trillions of Naira in people’s homes, we should hastily remind him that he is NOT an elected public Office holder but a mere political Appointee. So therefore, in light of the ongoing economic disruption we may not accord any respect to some so-called “patriotic” Nigerian(s) attempting to distract fellow citizens by calling the CBN Governor a “pawn, poodle and pimp”. The CBN Governor is not the sole body of the Central Bank of Nigeria. The Central Bank of Nigeria is a national Institution, and Mr. Emefiele is simply the head of that Institution. In plain expression of clear understanding, the CBN Governor and any other Public officials in our dear country are not some form of special human being and should be perceived, and treated, like anyone else.

Let me further articulate that the self-proclaimed “celebrity” CBN Governor should know that he cannot hide behind “Our Mandate” to inflict hardships, and aggravate pain, on fellow citizens. As much as we understand that the CBN is responsible for money supply and monetary control in Nigeria, it does not have the Mandate to fight Corruption. The CBN is not a Corruption-fighting Agency. The EFCC and the Independent Corrupt Practices and Other Related Offences Commission (ICPC) are both vested by law with the responsibility to fight corruption and other related offenses in Nigeria. It is, therefore, perilous to see the CBN Governor made laughable argument about his intention to curb corruption. How Corruption-free is the CBN?

Let’s progressively put things in economic context. At the basic level, Economics is concerned with the production, distribution, and consumption of goods and services. Money, by definition, is an acceptable means of exchange and a measure of value. The conventional wisdom also dictates that Microeconomics focuses on Individuals, sectors and industries, that is, the Micro units. On the other hand, Macroeconomics is about the total sum of economic activity, dealing with issues of growth, inflation and unemployment. In tackling these issues, Monetary policy and Fiscal policy (concerned with the various types of taxes and their effects upon individual and corporate activity) may be considered to drive growth and control inflation. This has direct implications for Microeconomics. The whole essence of all these concepts and principles is about how the micro segments of the economy tend to make economic decisions, i.e.; the purchasing power parity and the propensity to spend or consume goods and services.

The above globally accepted economic understanding distinctively show how a Country may function economically. The economic foundation of a nation is not built on individual personality or personalities; it is build up on a set of economic principles. The prevailing argument, therefore, is that if a government (through it financial institutions) prevent it citizens from accessing their deposited funds, or capital, how would they be able to buy goods and services and help to grow the national economy? Is it not obvious that the Gross Domestic Product (GDP) which measure the overall size of economy will be negatively affected? The CBN Governor needs to understand the basic i.e. the demand for many products in our country is markedly ‘income elastic’ meaning where the demand changes significantly with changes in income and in disposable purchasing power. An understanding of this basic economic principle should have helped the CBN to implement seamless Naira Redesign Policy.

The outcry and violent backlash across the country is a stark reminder of poor strategic decision based on poor planning. This is why Impact Analysis and Assessment (to predict the consequences of disruption and process and gather information needed to develop appropriate strategies), must be diligently carried out prior to the introduction of any major Policy that may directly impact people’s lives and livelihoods. In implementing the Naira Redesign policy, the CBN should have meticulously considered the Operational and logistical issues. Any competent Operations management professional should know that logistics is the process of planning and executing the efficient implementation of plan to meet customer requirements in a timely, cost-effective manner.

In a nutshell, the Naira redesign policy is a deliberate interference with the free operation of market forces. As a consequence, Mr. Godwin Emefiele should be sacked and arrested along with other CBN Senior management for the crime of economic sabotage.

In the halcyon days of NEPA reign, it made life miserable for millions of Nigerians until it disappeared into maelstrom sea. The Central Bank of Nigeria must not be allowed to turn itself into a replica of NEPA.

Femi Amosun is a politico-economic analyst with distinctive flair for sustainable development through responsible governance and accountability. femi.amosun11@gmail.com