Nigeria loses N20tn to CBN’s naira policy

Nigeria has lost N20 trillion to the naira redesign policy of the Central Bank of Nigeria (CBN) since it started in January 2023.

This is according to a report by the Centre for the Promotion of Private Enterprise (CPPE).

According to the report signed by the CPPE’s Director-General, Dr Muda Yusuf, the losses emanated from the deceleration of economic activities, crippling of trading activities, stifling of the informal economy, contraction of the agricultural sector and the paralysis of rural economy.

The report said the economy was gradually grinding to a halt because of the collapse of payment systems across all platforms, noting that digital platforms were performing sub-optimally due to congestion.

“Physical cash is unavailable because the CBN has sucked away over 70% of cash in the economy; and the expected relief from the supreme court judgement has not materialized. The citizens are consequently left in a quandary,” the CPPE said.

The CBN began the implementation of the new naira policy on December 15, 2022. The policy incorporates setting weekly withdrawal limits for individuals (N100,000) and corporate entities (N500,000), as well as redesigning of N1000, N500 and N200 notes.

Read also:E-payment in Nigeria falls by N1.9trn in February

The apex bank claimed that the policy “will help check. counterfeiting…. strengthen the economy, reduce the expenditure on cash management, promote financial inclusion, and enhance the CBN’s visibility of the money supply.”

“However, a perceived poor implementation has led to shortages of the N200, N500, and N1,000 notes across the country. Economic agents from farmers to traders who depend on cash are struggling to have access to the local currency to carry out life-saving transactions.”

The CPPE said there had been huge job losses in the economy so far and President Muhammadu Buhari did not seem to appreciate the enormity of the issues at stake.

“Evidently, President Buhari has not seemed to appreciate the gravity and enormity of the suffering and pain that Nigerians have been experiencing since the onset of the currency redesign policy. We again plead with the President to immediately intervene to put an end to the devastating and traumatic outcomes of a repressive, poorly conceptualized and badly implemented currency redesign policy,” the private sector-led organisation said.

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