The Special Adviser to the President on Media and Publicity, Femi Adesina, has revealed what the Governor of the Central Bank of Nigeria, Godwin Emefiele, said at the Council of State meeting convened by President Muhammadu Buhari on February 10, 2023.
The seasoned journalist gave the details of what the CBN governor said in his weekly column on Friday (today).
Emefiele was one of those who briefed the meeting that had two major issues for discussion: Naira swap and 2023 general election.
Those who attended the hybrid meeting were former Presidents/Heads of State, including Yakubu Gowon, Olusegun Obasanjo, Abdulsalami Abubakar and Goodluck Jonathan.
There were also two former Chief Justices of the Federation: Modibo Alfa Belgore and Mahmud Mohammed, and almost all the Governors of the States.
Those who briefed the meeting aside Emefiele were the Chairman of the Independent National Electoral Commission, Professor Mahmood Yakubu, and Inspector General of Police, Usman Alkali Baba.
Adesina wrote on the briefing by Emefiele:
Mr Godwin Emefiele, CBN Governor, painted graphic picture of where we were before the policy announcement, where we desire to be at the end of the implementation, and the key benefits expected from effective implementation of the redesign policy.
According to the Governor:
*The difficulty being experienced with the policy is transient, given the ultimate gain to our country.
*There are unscrupulous and unpatriotic elements among bankers, “whose greed and malevolence are sabotaging the CBN’s efforts.”
*The policy is not targeted at anyone or group of persons, but rather derived from analysis to strengthen our macroeconomic fundamentals and better our socio-economic conditions.
*The general practice across the globe is for central banks to redesign national currency within 5-8 years, but Nigeria has not done for over 19 years.
What are the aims of the policy? Said Emefiele: to make monetary policy more efficacious, increase financial inclusion, support security agencies to combat banditry and ransom-taking, and curb corruption.
Then this rather alarming disclosure. In 2015, Currency-in-Circulation was only N1.4 trillion, but by October 2022, it had risen to N3.23 trillion, out of which only N500 billion was within the banking system, and N2.7 trillion held permanently in people’s homes. Such notes are then not available for economic activities.
He said the optimal value of currency in circulation for the Nigerian economy should be about N700 billion, but we had over three trillion.
“So far, since the commencement of this program, we have collected about N2.1 trillion, leaving us with about N900 billion,” the Governor said, adding: “We are happy that so far, the exercise has achieved a success rate of over 80 percent as about N2.7 trillion held outside the banking system has been returned. Nigerians in rural areas have had opportunities to swap their old notes, leveraging on the Agent Naira Swap initiative as well as the CBN Senior Staff nationwide sensitization team exercise.”
What are the general benefits of the policy? The Governor said it would reduce the amount of cash in the underground or illicit economy, truncate the activities of racketeers, and obliterate rent-seeking businesses in the black market. It will also reduce inflation, enhance stability of the naira exchange rate.
But why the endless queue and pressure round the country? The apex bank boss said it was due to hoarding of new naira notes, tension and elevated agitation, panic, mop up of notes by some politicians, and incidences of economic opportunism.
He concluded this way: “The advantages of the currency redesign are enormous and will benefit the economy in the long run. We will take all the necessary steps to ensure that there will be a smooth flow of currency swap and minimize the inconvenience in the short term.”
Not once did the Governor complain about the capacity and ability of the Nigerian Printing and Minting Company to meet currency print run demand. And what a shock it was when a major newspaper reported in its lead story the next day that Emefiele made the claim. It didn’t happen. I was at the meeting. No word like that. Happily, the CBN promptly refuted the story.