CBN AND THE GYMNASTICS OF NEW CURRENCY DEMONINATIONS BY UGOCHUKWU RAYMOND OGUBUARIRI
There are reports that the introduction of new currency denominations of N2, 000 and N5, 000 notes and N5, N10, N20 and N50 coins is being mooted by the country's apex bank, CBN.
One can reasonably conjecture that in the light of the sordid revelations of the various probes which suggest a meteoric graduation of the country's thieving oligarchy from the “science” of stealing in millions to the more sophisticated, post-graduate benchmark of stealing in billions and even trillions, it is only logically expedient that the CBN intervenes to assuage the burdensome inconvenience experienced by these tribe of looters in handling slush funds of staggering amounts stolen from the public treasury.
I can hear the beleaguered Director in the Civil Service who was reportedly caught with N2 billion in his private apartment bemoaning his ill-luck and saying, “if only Sanusi had thought of this wonderful idea much earlier than now, perhaps, my benign attempt to reclaim my own (and my tribe's) share of the national cake would have had a much better success and I would have been spared the unpleasant embarrassment of a nosey EFCC as well as the opprobrium of a querulous public.”
It is difficult to decipher or articulate the economic wisdom of such a proposed policy beyond the fact that it merely exposes the propensity of CBN for wanton ambivalence and ideological summersault. Just some few years back, the CBN had guzzled fat sums of money to produce the polymer notes currently in circulation today. It also produced some set of coins meant to complement the polymer notes.
Retrospectively, one vividly remembers the seductive argument which had been bandied about during that era to the effect that it is cost-intensive to produce coins and that it would be much cheaper to have some of the lower denominations in polymer form. There was also the issue of the cumbersome weight of those coins which constituted them as a “deadly weapon” especially in the hand of any enraged combatant. Just visualize, for a moment, the spectacle of Dino Melaye having some hefty coins in his trouser-pocket while engaged in mild “parliamentary” fisticuffs with, say Dimeji Bankole. It is most certain that between the two of them, somebody must get to heaven! Surprisingly, those coins have become virtually extinct and practically useless both in value and public acceptability.
For Sanusi's CBN to now contemplate a 360 degree reversal of an introduction it had earlier celebrated as quintessentially novel and to seek a reversion to a tradition that it had denigrated as antiquated is, to say the least, tellingly dispiriting as well as puzzling.
In recent times, the CBN has operated like the proverbial “Jack of all trade and master of none.” It had unleashed a rash of policy interventions whose overall impact on the economy has been singularly disruptive than developmental. Its current policy on “cashless economy” is still mired in chaotic disarray and beset with the teething challenges of erratic power supply, epileptic telecommunications services, paucity of needed technological infrastructure, inadequate public enlightenment and the problem of safety and security of depositors' funds.
The CBN's agenda on “Banking Reforms” have orchestrated - and continues to orchestrate – devastating repercussions, especially, in the area of job insecurity and galloping unemployment. Worst, the redemptive attraction of Micro Finance Banks, MFBs, as a powerful vehicle for poverty reduction and the economic empowerment of the “unbanked” citizens mostly operating in the informal sector of the national economy has been thwarted, truncated and aborted as a result of weak and purposeless regulatory supervision from the CBN. Today, the MFBs have become a metaphor of failed vision.
Somehow, one gets the impression that the managers of our collective affairs have become so much overwhelmed and beaten by the intractability of the country's enormous problems that they are now impelled to find some means to create the illusion of “commitment” to the resolution of our national problems. Invariably, they end up with policy prescriptions that are more like first-aid treatment in the face of a serious injury; not a permanent cure. By resorting to incessant “currency gerrymandering,” the CBN is presenting itself as an economic manager that is engulfed in confusion and bereft of any initiative on how best to navigate a tempestuous financial system and a tottering economy.
The major challenge facing an average Nigerian today regarding the national currency is not about the singleness of the N5,000 note, but about the availability of economic opportunities that will enable him to generate and earn such an amount productively. The dilemma of ordinary citizens who are betrothed to abject penury has nothing to do with their being starved of naira coins, but that the coins are completely worthless in value as to secure any usefulness to them. My reference to “ordinary citizens” here is particularly instructive because I do not envisage the prospect or possibility of any member of the ruling class - including Sanusi himself – going to the market with coins.
What Nigerians earnestly desire from the CBN - and other economic managers - is the initiation of policies that will revamp an reinvigorate the diminishing value of the naira, not policies that will exacerbate its worthlessness. The downtrodden citizen on the street wants to be assured that with the N20 in his patch pocket, he can confidently walk into Mallam Garuba's kiosk and “arrange” a sizable quantum of groundnuts which he will need to drink his garri on a hot and ungracious afternoon while waiting patiently for the rapturous dividends of the government's transformation agenda to trickle down to him.
In the absence of such restorative and pocket-friendly economics, government officials can continue to wax eloquent about the achievement of “single-digit inflation,” “macroeconomic stability,” “fastest economic growth rate,” “efficient monetary and fiscal policy frameworks,” etc. But to this oppressed citizen, all such talks amount to nothing but meaningless, cacophonous mumbo-jumbo!!!