Naira redesign and unintended consequences, By Bashir Abdullahi II

The Nigerian problem has never been lack of good ideas and plans, but implementation. It is against this background that I humbly call on President Muhammad Buhari to urgently address the problems caused by the naira redesign by allowing the old notes and the new notes to coexist, otherwise the people they are meant to serve will be targeted. early graves in millions as a result of unintended grief unleashed on them.

Let me start this off with a disclaimer. I am a card carrying member of the New Nigeria Peoples Party (NNPP). Let me also make it abundantly clear that the party and I are not against the naira redesign policy. In fact, no human being is sane. In the 21st century, we must go the way of the world. Cashless policies are the norm and have become the mainstay of most economies, both developed and developing. I commend President Muhammadu Buhari for his resolve, determination and commitment to conduct free, fair and credible elections. There is a chance that, if carried out successfully, this could become the talk of the presidential legacy.

Having said this, I would like to add that for a country with an area of ​​almost a million square kilometers, the time allotted for such a policy is not only adequate but it is almost impossible to implement it in the time allotted. And this should be appreciated against the background of the level of general inefficiencies of our system and how such reforms can be resisted, and in some cases thwarted outright.

Data available from the National Bureau of Statistics show that most households have an average of at least five people. Obviously this means many people struggle every day. Living in Nigeria itself is a challenge, every day. This is something recognized by various political hues seeking power, which is why many issues are promised when elected to office.

The 1999 constitution, as amended, states the equality of states, in terms of federalism, but a blind person can see that Lagos State in the south-west, for example, is not the same as Yobe State in the north-east, and Ebonyi is not in the south- east, similar to Kano in the northwest. Clearly, Lagos is more urbanized than Yobe and similar to Kano in relation to Ebonyi. This means that Lagos is more likely to have better banking services than Yobe. A similar argument can be made for Kano and Ebonyi. Service penetration is uneven and the data on banking services in Nigeria clearly shows this. In a sense, banking services are more sophisticated, more in the city. This is certainly the main innovation in banking services, which again follows the logic of where money is concentrated.

The unintended consequences of the naira redesign policy are in number, but what is striking is the “neglect” or inattention of the Central Bank officials in formulating the policy, as to what could go wrong. Part of the general housekeeping intricacies of public policy is the IF factor. The question must, therefore, be: what is wrong if we (ie the Central Bank) do this or that? Nigeria’s apex bank missed many signs and insinuations…

While it is true that every government policy should be done in the interest of the people, today I will quickly review the cashless policy of the Central Bank of Nigeria on the negative consequences and unintended suffering it has brought to the people it claims. to serve. And it bears repeating here that this is not an attack on the policy, as some have made it out to be.

The Governor of the Central Bank of Nigeria, Mr. Godwin Emefiele, has, on several occasions, explained the objectives of the naira redesign policy and no one has made claims for political or non-economic reasons. The policy is purely monetary, with expected positive economic results for Nigeria. However, like all policies, especially if they are not well thought out, they tend to fall victim to unintended consequences. The apex bank may have good intentions to deliver a workable monetary policy, but its implementation has created major difficulties.

The unintended consequences of the naira redesign policy are in number, but what is striking is the “neglect” or inattention of the Central Bank officials in formulating the policy, as to what could go wrong. Part of the general housekeeping intricacies of public policy is the IF factor. The question must, therefore, be: what is wrong if we (ie the Central Bank) do this or that? Nigeria’s apex bank has missed many signs and innuendos, which are clear and open, and more importantly beyond its capabilities. The responsibility of the Central Bank of Nigeria, for example, does not include the assessment of possible social disruption, and the disenchantment that the unintended consequences of the redesign of the naira will cause. This again, shows, that the bank works in silos, does not reach, consult, or collaborate. Perhaps, what is it, the Central Bank seeks glory but brings a gory story.

It remains to be seen if the Central Bank of Nigeria considers what could go wrong if the naira is redesigned when implementing the policy. It also raises the question of whether the three months planned to complete the training is sufficient. Three problems are obvious from this. First, is Nigeria’s banking infrastructure as good as it seems? Second, is the Central Bank of Nigeria missing a clear challenge or opportunity that there is still work to be done, in terms of the depth and breadth of the country’s banking system? Nigeria’s banking system remains largely urban-based and has expanded greatly to serve rural areas. Perhaps, this is why top bank governors constantly complain about the amount of cash outside the banking system. This clearly shows that there is a gap in the efforts of the CBN to provide banking services across the country. The banking system must innovate a new financial infrastructure that not only solves many of the problems Nigerians currently face but also improves and expands inclusiveness and participation.

…in some respects, the monetary authorities failed to fulfill their responsibilities due to timing, because they did not anticipate the appropriate time for implementation. Herein lies the basis of the political interpretation of the CBN’s decision on timing. The question is about when and for what duration, and not about what. More importantly, however, policymakers must be able to anticipate the unintended negative consequences of their proposed policies.

The question of policy timing is important. Arguably, and there is no right time to change or redesign the country’s currency, the Central Bank Act is clear on this point. Thus, in some respects, the monetary authorities failed to carry out their responsibilities due to timing, because they did not anticipate the appropriate time for implementation. Herein lies the basis for a political interpretation of the CBN’s decision on timing. The question is about when and for what duration, and not about what. More importantly, however, policymakers must be able to anticipate the unintended negative consequences of their proposed policies. Across the country there are long queues of Nigerians at ATM galleries across the country wanting to access the new currency notes. We have also seen videos of Nigerians stripping naked in the banking hall, shouting and crying to access their own money. In the episode apparently involved comics, including the number of fights breaking out in the banking grounds and all the difficulties that come with it, asking questions. The failure in the exercise can be seen in the level of exploitation of citizens trying to access their own money from POS operators and various money agents.

The only hope of the traders, fishermen, civil servants, students and market women who are suffering now is the Supreme Court to exercise original jurisdiction in A’s case.Attorney General of Kaduna, Kogi and Zamora States vs. Attorney General of the Federation.

The Nigerian problem has never been lack of good ideas and plans, but implementation. It is against this background that I humbly call on President Muhammad Buhari to quickly address the problems caused by the naira redesign by allowing the old notes and the new notes to coexist, otherwise the people they are meant to serve will be targeted. early graves in millions as a result of unintended grief unleashed on them. By the way, people vote for you and get paid to listen to their cries.

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The voice of the people, the voice of God!

Bashir Abdullahi II is a mentor, entrepreneur, policy student and head of planning and strategy for the RMK Presidential Campaign Council.