Naira redesign: Nigerians deserve apology from Buhari, Emefiele, says CPPE

The Centre for the Promotion of Private Enterprise has described the naira redesign policy as “a needless disruption of economic activities’, saying Nigerians deserve an apology from President Muhammadu Buhari and the Governor of the Central Bank of Nigeria, Godwin Emefiele.

The CPPE commended the ruling of the Supreme Court on the use of the old currency naira notes as legal tender, expressing hope that Buhari, the CBN governor and the Attorney General of the Federation would comply with the court order in the interest of the rule of law, good order and public interest.

“We welcome the Supreme Court ruling as it protects the citizens from a policy which is, by all accounts, disruptive, repressive and draconian.  It is also punitive, cruel and insensitive,” it said in a statement on Friday.   “Indeed, Nigerians deserve an apology from the promoters and proponents of the policy, especially the arbitrary and uninformed mopping up of cash in the economy.”

The Chief Executive Officer of CPPE, Dr Muda Yusuf, said the currency redesign policy inflicted “indescribable agony, suffering and distress” on majority of Nigerian citizens. 

He said, “The trouble was not with the redesign, but the deliberate and unrestrained mopping up of cash in the economy. To date the CBN had mopped up about N2 trillion cash from the economy thereby paralyzing the retail sector, crippling the informal economy, stifling the agricultural value chain, immobilising the transportation sector and disrupting the payment system in the economy.

“It is true that the CBN has the right to redesign currency, but it does not have the right to dispossess the citizens of their cash. The choice of the mode of store of value is a fundamental right of citizens. The CBN has no right to impose that choice on citizens. It is a flagrant violation of the rights of citizens for the CBN to withhold the cash of citizens under the guise of currency redesign.”

Yusuf said the claim by the CBN that the economy has too much cash outside the banking system has no basis in economic theory, nor can it be supported by empirical evidence.

“As at December 2022, to total money supply was N52 trillion, cash component of money supply was N2.6 trillion, which was just 5 percent.  Similarly, the country’s Gross Domestic Product was N202 trillion, which gives a cash-to-GDP ratio of 1.3 percent,” he said. “These ratios are some of the lowest around the world which shows that the Nigerian economy is not really a cash-dominant economy.”

According to him, the bigger threat to monetary policy effectiveness and inflation is the N22 trillion ways and means finances of the CBN. 

“The entire exercise was a needless disruption of economic activities, especially among the most vulnerable segments of the economy, unfortunately,” Yusuf added.

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