Nigeria's Ministry of Finance on Friday differed with the Governor of the Central Bank of Nigeria(CBN), Godwin Emefiele on the redesigning of the country's currency.
This is coming less than 24 hours after the CBN Governor declared that the Central Bank would redesign the nation's currency to go into circulation on December 15, 2022.
Minister of Finance, Budget, and National Planning, Zainab Ahmed said that the Ministry of Finance was not consulted on the policy and the timing for the implementation of such policy is wrong, given the realities on the ground.
The minister was reacting to a question raised on the issue by Senator Opeyemi Bamidele during the 2023 budget defense session.
Senator Bamidele, in his question to the Finance Minister, had stated that the impact of the CBN's policy on the value of the Naira to the US dollar was already being felt.
Zainab Ahmed
He noted that "Just two days after the announcement of the policy, the value of the Naira to the US dollar has risen from N740 to N788 due to a rush in exchange of stacked Naira Notes for foreign currencies, particularly the dollar."
Responding, the minister said, "To me, the policy may be a well-conceived one, but the timing going by realities on the 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, ” Ahmed maintained.
The Minister also said that she was unaware of the policy and had only learned about it via 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 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 merits of the planned policy and rightness or otherwise of its implementation now, '' Ahmed said.
Godwin Emefiele
The CBN Governor had on Wednesday, announced that the country's currency was being redesigned to allow the bank to have greater control over the currency in circulation.
According to Emefiele, available data shows that more than 80% of the currency in circulation is not kept in commercial banks' vaults, as people tend to hoard banknotes.
He said that the CBN would not allow a situation in which the majority of the country's currency notes were kept outside bank vaults, to continue.
The CBN Governor also noted that the negative perception of the CBN, the worsening shortage of clean, usable currency and the rising risk and ease of counterfeiting as shown by many security reports are some of the reasons for redesigning the notes.
Emefiele stated that in recent years, the CBN has noted much greater rates of counterfeiting, particularly at the higher denominations of N500 and N1,000 banknotes as a result of recent developments in photographic technology and printing devices that have made counterfeiting relatively easier.
He said, “Based on these trends, problems, and facts, and in line with Sections 19, Subsections a and b of the CBN Act 2007, 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 levels.
“In line with this approval, we have finalized arrangements for the new currency to begin circulation on December 15, 2022. The new and existing currencies shall remain legal tender and circulate together until January 31, 2023, when the existing currencies shall cease to be legal tender, the CBN Governor announced.
Economy
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