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Emefiele’s Naira Renewal: A Dangerous Gamble

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By Eric Elezuo

Like it did in 1984, the administration of President Muhammadu Buhari has proposed to redesign the higher denominations of the nation’s currency. The announcement was contained in a statement released by the Central Bank of Nigeria (CBN) Governor, Mr. Godwin Emefiele, during a press briefing in Abuja. The bank said it is undertaking the designing project to have control of the currency in circulation, manage inflation, as well as tackle counterfeiting. He noted that the targeted notes are N100, N200, N500, and N1000, while release into the Nigerian monetary space will start on December 15, 2022, and then by January 31, 2023, the existing notes will be completed phased out of circulation.

Emefiele hinted as part of the many reasons for the action, that the currency management has faced several daunting challenges that have continued to escalate in scale and sophistication with attendant and unintended consequences for the integrity of both the CBN and the country.

However, stakeholders, analysts and the general public have been left to wonder if the CBN and Emefiele were well advised as a cross section of Nigerians believe that the project could be a dangerous gamble, seeing that there are concerns the move may lead to confusion as rural population may find it difficult to change their currency notes within the given time among a whole lot of consequences, which the Minister of Finance, Zainab Ahmed has hinted.

In his address while making public the intention of the CBN, which permission, he said has been given by President Buhari, Emefiele said: “These challenges primarily include: Significant hoarding of banknotes by members of the public, with statistics showing that over 85 percent of currency in circulation are outside the vaults of commercial banks,” he said.

“To be more specific, as at the end of September 2022, available data at the CBN indicate that N2.73 Trillion out of the N3.23 trillion currency in circulation, was outside the vaults of Commercial Banks across the country; and supposedly held by the public.

“Evidently, currency in circulation has more than doubled since 2015; rising from N1.46 trillion in December 2015 to N3.23 trillion in September 2022. This is a worrisome trend that cannot be allowed to continue.”

Emefiele’s catalogue of excuses regarding why the existing naira notes must be phased out includes the fact that the increase in the hoarding of currency in circulation has affected inflation, which hit a 17-year high in September, in addition to the menace of worsening shortage of clean and fit banknotes with attendant negative perception of the CBN and increased risk to financial stability.

The CBN governor also listed that the redistribution of the new notes will discourage ransom payment as large volumes of money won’t be accessed because the amount of cash in circulation will be drastically reduced just as it will help deepen CBN’s drive to entrench cashless economy as it will be complemented by increased minting of the eNaira.

“Also, in view of the prevailing level of security situation in the country, the CBN is convinced that the incidents of terrorism and kidnapping would be minimized as access to the large volume of money outside the banking system used as source of funds for ransom payments will begin to dry up.

“This will further rein in the currency outside the banking system into the banking system thereby making monetary policy more efficacious,” Emefiele said.

As expected, the CBN governor’s initiative has received knocks and kudos from across the length and breadth of the country with stakeholders voicing their thoughts at how the redesigning of the naira will impact on the economy, and more importantly on the lives of the citizens.

First among the early praise singers of Emefiele’s initiative is the Economic and Financial Crimes Commission, (EFCC).

In his remarks, the chairman of the commission, Abdulrasheed Bawa, described the move as “well-considered and timely” as it will address the challenges of currency management which has negatively impacted the country’s monetary policy and security imperatives.

“The EFCC, the CBN and some other regulators in the financial sector have worked closely in the recent past to determine how best to stabilize the country’s monetary policy environment. It is heart-warming that the CBN has demonstrated courage in taking this bold decision which I believe will bring sanity to the currency management situation in Nigeria,” he said, in a statement released by its spokesperson, Wilson Uwujaren.

EFCC’s involvement , according to Bawa is to monitor the process to ensure that unscrupulous players and currency speculators and their cohorts among the BDCs do not undermine the exercise. He also charged banks to be alive to their reporting obligations and not assist unscrupulous customers in laundering suspected proceeds of crimes through their system.

The CBN has also requested that the process of introducing the new notes and phasing out the existing ones will ensure that
1. Banks must only accept cash from customers with bank accounts, adhering fully to the principle of KYC.
2. Cash must only be paid into customers accounts. Cash must not be paid into ledgers or suspense accounts
3. CBN will no longer print large quantities of Cash. New cashless policy to be announced in January
4. Banks that receive cash from non-account holders or customers will be penalised by CBN and EFCC
The process will also involve the CBN and EFCC monitoring and tracking all deposits just as it provides an opportunity to leverage on branch networks to drive funding of accounts and drive digital adoption and opening of new accounts.
But how feasible the lofty ideas the CBN has expressed in this initiative is remains a mirage and gamble as most bodies have risen in condemnation of the process.
The first of the misadventure of the naira redesigning is the denial of the Ministry of Finance, Budget and National Planning that they are not aware of the planned exercise. The Minister, Zainab Ahmed, who commented on the policy in response to questions raised by senators during the 2023 budget defence session she had with the Senate Committee on Finance, chaired by Senator Solomon Olamilekan, dissociated herself from the Naira redesign policy.
The Minister went ahead to warn the CBN of consequences that may arise from the policy just as the Senate intoned that barely two days after the announcement of the policy by the CBN, the negative effect was already being experienced in the country’s forex. The Senate noted that just bare 48 hours later, the value of the Naira to a US dollar has risen from N740 to N788 due to rush in exchange of stashed Naira Notes for foreign currencies, particularly the dollar.

In their argument, the senators were of the opinion that the policy, a well-conceived one, but has timing deficiency, going by the realities on ground. They feared that the naira may fall to as low as N1,000 to a US dollar before January 31, 2023 fixed for full implementation of the policy.

Ahmed, who speaks for the Federal Government on monetary matters reiterated that she and her Ministry were not aware of the policy but only heard from the media.

“Distinguished Senators, we were not consulted at the Ministry of Finance by the CBN on the planned naira redesigning and cannot comment on it as regards merits or otherwise.

“However, as a Nigerian privileged to be at the top of Nigeria’s fiscal management, the policy as rolled out at this time portends serious consequences on value of naira to other foreign currencies.

“I will, however, appeal to this committee to invite the CBN governor for required explanations as regards merits of the planned policy and rightness or otherwise of its implementation now,” she said.

Reacting, Emefiele, carpeted the minister, saying that permission was sought and received from the President, and as a result need not consult any other person.

On their part, the Civil Society Legislative Advocacy Centre (CISLAC) said that the Central Bank of Nigeria’s plan to redesign the higher currency notes is not an economic priority for the country, considering the current challenges facing the economy.
The Executive Director of Centre, Auwal Musa, in a statement said that there are more pressing needs that the CBN ought to attend to, to set the economy on the path of revival, adding that concerned reactions from Nigerians was proof that the decision is a misplaced priority on the part of the CBN.
He said, “Firstly, the CBN’s decision to redesign and reissue new 200, 500 and 1000 notes is not an economic priority and barely a solution to addressing Nigeria’s poor monetary policy challenges and growing economic woes.

“Especially at a time when the country is grappling with huge fiscal deficits, a free fall of the naira, soaring inflation rates, multiple forex rates and rising borrowing costs. The reasons for this decision seem no different from those given for the forex demand management strategy which resulted in a non-satisfactory conclusion as the artificially low exchange rate failed to be as reflective of the market as possible to improve supply, but this time it only threatens damning economic consequences for Nigerians.

“The public perception that this decision holds no value proposition for the economy, reiterates the tendency of the CBN to be distracted from fulfilling priority statutory obligations.

“Various comments and responses from concerned Nigerians, show that a large number of Nigerians are worried about the misplacement of priorities of the Apex Bank to make such a decision that comes with possibly huge logistics costs and avoidable dislocations to small businesses, most of whom are in the informal sector.”

He added: “So far, the macro-economic and monetary policies of the CBN has brought untold hardship to the productive and service sectors of our nation’s economy with consequential negative effects on the lives of our citizens. The Apex Bank has floated multiple exchange rate regimes and has been accused of facilitating arbitrage between the parallel and official foreign exchange markets, providing huge financial patronage and extending forex-based favours to allies.

“Nigeria is grappling with the external pressures from the incapacity of the Central Bank of Nigeria to protect foreign exchange reserves from external outflows.

“The Apex Bank needs to do a lot to recover the confidence of the public by addressing its inability to ensure; Blockage of illicit financial flows  and checkmating the use of financial systems to fund terrorism by strengthening oversight of commercial banks used as conduits for corruption,” adding that “Foreign investors rely on authoritative indexes like the Global Terrorism Index and even economic indexes that include an evaluation of security and stability, to inform their investment decisions;

“Intensifying collaborations with relevant anti-corruption agencies to check dubious charges by some commercial banks, who keep shortchanging poor Nigerians whose reducing disposable income is further worsened by growing inflation costs and unemployment;

“Reduction of competition with other agencies by going beyond its purview to drive interventions in sectors without the consent or cooperation of the relevant coordinating ministries. The CBN’s continued and unsolicited support for MSMEs can be more effective by ensuring synergy between the fiscal and the monetary authorities on intervention funds and adopting transparent mechanisms for beneficiaries to access;

“Availability of forex to those who legitimately need it like students studying out of the country and businesses. The artificially low exchange rate has failed to be as reflective of the market as possible and this has affected access to forex for payment of foreign tuition fees, and the importation of systems and raw materials which contribute greatly to the country’s worsening economic situation. There is a huge blow to our foreign direct investment as foreign investors are leaving due to their inability to access forex;

“Sanitization of the CBN recruitment processes, which are non-transparent as they seem to be reserved exclusively for the children, wards and affiliates of politically exposed persons.

“In this desperate period of economic woes for Nigeria, the CBN’s efforts will be better served in pushing robust monetary policies that are in tandem with global best practices, fighting inflation and building a strong financial system in an increasingly uncertain global economy.”

Recall that in 1984 when Buhari was the Head of State, he ordered the redesigning of the naira notes notably One, Five, 10 and 20 to trapped politicians, who were suspected to have hoarded currencies away from bank vaults. A case of deja vu!

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You’ve Nothing to Offer Nigerians, Only Insults, Akwa Ibom Gov Slams Tinubu

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Governor of Akwa Ibom State, Udom Emmanuel, on Monday, replied the presidential candidate of the All Progressives Congress, Bola Tinubu, saying that he (Tinubu) always resorts to abusing and insulting people during campaigns because he has nothing to bring to the table for Nigerians.

He also said that despite being insulted by the former Lagos State Governor, he would prefer to allow peace to reign by ignoring him and focusing on helping install good governance to rescue Nigerians from their present woes.

Emmanuel spoke on Monday evening at Government House, Uyo while inaugurating newly appointed Permanent Secretaries, Chairmen and Members of Boards and Commissions, as well as a Transition Committee to ensure the smooth transition of power to the next administration.

Recall that Tinubu had during his rally in Uyo Monday afternoon, reportedly said, “Akwa Ibom, that boy wey bring Atiku here, wey de call himself Governor, tell him enough is enough! He lives in my backyard in Lagos, If no be say we be one, I would have driven him home. You see that mansion he is living, I would just use lizards, pigeons and scorpions to put him inside.“

But reacting few hours later, the Akwa Ibom State Governor said, “for the country to remain in peace, one party must ‘play saint’ and that is why he would refrain from replying Tinubu.

Emmanuel who is the Chairman of the PDP presidential campaigns said, “I also go to other states, and if you watch our campaigns, my principal (Atiku Abubakar) has never spoken about any Governor, he has never spoken openly about Asiwaju before.”

He added that it was unfortunate that Tinubu, who was granted state-owned facilities such as the airport, security, stadium, and a good atmosphere to come in and sell his manifesto, ended up coming to insult the integrity of over 7.9 million Akwa Ibom people.

The Governor wondered if it is possible for any Akwa Ibomite to go to Lagos that Tinubu stays or the actual state that he hails from, to insult Tinubu in like manner and still be allowed to safely return home, “but here our people at the stadium including some state governors just laughed and applauded him.”

“What makes him think he will govern Nigeria? If I reply him now, people will call me and say, haba oga you are not like that. But I will reply him one day. There is nothing like ‘emilokan’ (it is my turn) here, Nigeria is in God’s hands.”

He maintained further that despite being the highest revenue contributor to the federation account, Akwa Ibom State has not gotten a single kilometre of road from the APC-led Federal Government for nearly 8 years adding that the poor response from the Federal Government also caused the delayed commencement of the seaport in the state.

Meanwhile, the governor thanked the newly appointed Permanent Secretaries for accepting the onerous task of service, and urged them to see themselves as ambassadors and work towards raising the bar of leadership which would encourage productivity and promote good working relationship with subordinates in the service.

“This is one thing I promised Akwa Ibom people that appointment of Permanent Secretaries shall be totally on merit and not by mercy, let those that can do the work be given the opportunity. Permanent Secretary is not a promotion, it is an appointment on merit.

Governor Emmanuel also reiterated his commitments towards enhancing efficiency within Civil Service, noting that during his administration civil servants have been promoted on yearly basis.

He assured that before he exits office more Permanent Secretaries would be appointed into the service to fill vacant positions left by the ones who retired.

Addressing Chairmen of Boards and Commissions, Governor Emmanuel who described them as pillars in government, acknowledged their commitment particularly, Chairman, Akwa Ibom State Environmental Protection & Waste Management Agency, Prince Akpan Ikim, for winning laurels for the state through his outstanding performance in keeping and making the state the cleanest in Nigeria for five consecutive years from 2018 through 2022, and tasked others to create an impact that will stand them out.

In the same vein, the Transition Committee members were handed the task of ensuring a seamless transition of government to an incoming administration, and also verify all projects executed by the present administration.

The newly appointed Permanent Secretaries are; Mfon Inuaesiet Edemekong Esq., Dr. Stephen Effiong, Atim Chelly Okoko, Iquo Okon Abia Esq., Uwem Sunday Andrew-Essien, Isaiah Robson Ntekim and Emaeyak Nyong Akpan as Auditor-General for Local Government.

The Transition Committee has Mrs. Ekereobong Umoh -Chairman, Uko Udom SAN, Prof Augustine Umoh, Dr. Ini Adiakpan, Mrs. Nsemeke Daniel, Dr. Nathaniel Adiakpan, Mr Elijah Udoiyak, Mrs. Esther Inyang, Pastor Uwem Andrew-Essien, Mr. Isaiah Ntekim, Mr. Effiong Ekpenyong and Mrs. Bella Akpanya as members.

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PDP Condemns Attack on Buhari in Kano, Blames Tinubu, Ganduje

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The Peoples Democratic Party Presidential Campaign Council, has blamed the presidential candidate of the All Progressives Congress (APC), Asiwaju Bola Tinubu, and the governor of Kano State, Abdullahi Ganduje, for the attacks on the convoy of President Muhammadu Buhari, during a visit to the state on Monday.

The spokesperson of the campaign council, Dino Melaye, who shared one of the videos from the reported attack, wrote, “The fight between Tinubu and Buhari is entering a new dimension. The attack in Kano was properly coordinated and funded allegedly by Asiwaju.

“The meeting to push Buhari to submission or face sponsored attack in the north was said to be hatched in Bourdillon. Me, I am busy with Atiku.”

A political activist, Deji Adeyanju, who shared another video of the reported attack, said, “They are showing Buhari and APC Shege in Kano and many northern states.”

Similarly, the PDP in a statement signed by its National Publicity Secretary, Debo Ologunagba, on Monday also blamed Tinubu and the Governor of Kano State, Abdullahi Ganduje, for the attack.

According to the party, the attack was designed to undermine the Presidency, cause confusion, trigger violence in the country, disrupt the conduct of the 2023 general elections “and derail our democracy having realised that he cannot win in a peaceful, free and fair electoral process.”

The statement read in part, “The PDP invites Nigerians to note how Governor Abdullahi Ganduje attempted to abridge President Buhari’s movement and even tried to stop him from visiting Kano State.

“More disquieting is the fact that the APC Presidential Campaign sought to humiliate and harm President Buhari while performing his official duties in Kano.

“It should be noted that the APC presidential candidate has been displaying open aversion and making inciting statements against President Buhari since Mr President’s declaration, in line with democratic best practice all over the world that Nigerians should freely vote for any candidate and party of their choice in the 2023 general elections.

“The apparent frustration of Asiwaju Tinubu to resort to encourage or condone violence is fueled by his entitlement mentality, that it is his turn to be President, despite his numerous ineligibility and disability baggage.”

Ologunagba reminded Nigerians about Tinubu’s infamous statement in London where he declared to his supporters that “political power is not going to be served in a restaurant, it is not served a la carte.”

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Organ Harvesting: Ekweremadu Battles for Freedom, Appears in Court Tuesday

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A former Deputy President of the Senate, Ike Ekweremadu, will on Tuesday appear again in court in the United Kingdom where he has been accused of human trafficking.

The lawmaker was in June 2022 arrested at Heathrow Airport in London after Staines Police Station received a report from a young man claiming to have been trafficked into the UK.

The young man, who made the report shortly after arriving in the UK from Nigeria, also alleged that he was made to undergo some medical tests, none of which he consented to.

Ekweremadu was immediately arraigned before a Magistrate’s Court for bringing a child into the UK to harvest his organs.

While the lawmaker had been in custody since June 23, his wife, Beatrice, who was arrested with him, was granted bail by a criminal court in London shortly after their arrest.

Monday (today) makes it 221 days since Ekweremadu was placed in the custody of UK authorities.

The case against the lawmaker which had been slated for May was later scheduled for January 31.

The 60-year-old, who denied the allegations against him, will again appear before High Court Judge, Mr Justice Johnson.

His daughter, Sonia, had on November 7, 2022, appeared in court to defend the accusation of trafficking a homeless man into the UK to harvest his organs for herself.

According to Daily Mail, the 25-year-old, who is battling a kidney-related illness, pleaded not guilty to the charge level against her when she appeared again in court on January 13.

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