New Naira Notes: Finance Minister Kicks Against Plan, Says Ministry Not Aware

Posted by African Examiner Featured, Latest Headlines, News Across Nigeria Saturday, October 29th, 2022

(AFRICAN EXAMINER) – The plan by the Central Bank of Nigeria (CBN) to redesign the Naira is enmeshed in confusion as the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, kicked against the plan.

The Minister said she and her ministry were not aware of the policy but only heard of it in the media.

She said yesterday that she would not comment on it “as regards merits or otherwise” because her ministry was not consulted by the CBN.

The Finance Minister, who commented on the policy in response to a question raised by Senator Opeyemi Bamidele (APC – Ekiti Central) during the 2023 Budget Defence session she had with the Senate Committee on Finance, warned the CBN of consequences that may arise from the action.

Senator Bamidele had in his observation told the Finance Minister that barely two days after the policy was announced by the CBN, the impact of it on the value of Naira to the US dollar was being felt.

Bamidele said: “Just two days after the announcement of the policy, the value (exchange rate) of the Naira to the US dollar has risen from N740 to N788 due to a rush in exchange of stashed Naira notes for foreign currencies, particularly the U.S. dollar.

“To me, the policy may be a well-conceived one, but the timing, going by the realities on ground, is very wrong as 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.”

But the Minister in her response said she and her Ministry were not aware of the policy but only heard of it from the media.

Ahmed said: “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 the value of the Naira to other foreign currencies.

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

Contacted on the telephone yesterday, the CBN Director, Corporate Communications Department, Mr. Osita Nwanisobi, said the apex bank read the Minister’s position that she was not aware of the CBN’s plan to redesign the naira, just like other Nigerians did.

But he said the apex bank would not comment on the minister’s position until it was in possession of the full details of her interaction with the Senate committee.

“The CBN cannot comment on such information until we get the full details of the Minister’s meeting with the Senate Committee. That’s the CBN’s position on the matter,” Nwanisobi said.

A senior official of the CBN, who asked not to be named, however disclosed that redesigning the currency is part of the apex bank’s responsibilities.

The official said: “An exercise like currency redesign and issuance is the sole responsibility of the CBN with the approval of Mr President.

“The functions of the CBN are: to ensure monetary and price stability; issue legal tender currency in Nigeria; maintain external reserves to safeguard the international value of the legal tender currency; promote a sound financial system in Nigeria; and act as banker and provide economic and financial advice to the Federal Government.”

The CBN Governor, Godwin Emefiele had on Wednesday said that the apex bank would redesign the country’s currency from N200 denomination to N1,000 notes.

He said that the action was taken in order to take control of the currency in circulation just as he insisted that the bulk of the nation’s currency notes were outside banking operations, adding that the CBN would not allow the situation to continue.

The planned policy, he added, was in line with Sections 19 subsections A and B of the CBN Act 2007, upon which the management of the CBN sought and obtained the approval of President Muhammadu Buhari to redesign, produce, and circulate new series of banknotes at N200, N500, and N1,000 notes.