By Samuel Edu
The hardship being faced by Nigerians as a result of the redesigning of some naira notes is inevitable if the nation’s economy will be repositioned and monetary policy to be effective, economic experts have cautioned.
They insisted that the redesigning of the naira notes by the Central Bank of Nigeria,CBN, was driven by alarming incidence of naira counterfeiting, vote buying, worsening shortage of clean and fit notes in the system, unspecified amount of money outside the banking systems, disturbing rate of inflation, high level of insecurity in the country, kidnapping, amongst others.
They, however, noted that the success of naira redesign or otherwise will largely be determined by the sincerity of the government and concerned policy makers.
The experts also regretted the attendant hardship the process has unleashed on the masses which they blamed on corrupt practices by the commercial banks.
Those who spoke with The Hope included; Professor Olayemi Simon-Oke, Dr Egbetunde Tajudeen, Dr Adewole Musiliu and Dr Ologunwa Oluyemi all from the Department of Economics, Federal University of Technology, Akure.
Professor Olayemi Simon-Oke said a nation’s currency is expected to be reviewed between five to eight years, in any country according to international best practices.
His words: “In line with international best practices, monetary authorities are expected to review currencies at intervals of between five and eight years, the naira has not been redesigned in 20 years while CBN changed some currency notes to polymer 13 and 15 years ago.
While we all hope that the objectives behind redesigning the naira notes might be accomplished, the don said the fact remains that the opposite may be the case if not well managed.
“The question is not all about if this policy will help in reducing inflation neither is it a matter of if it will help in curbing the menace of vote buying, rather it is a question of policy implementation strategy and sincerity on the part of the government.
“I strongly believe that this will not backfire in any way if the government is sincere enough. The hardship presently faced by Nigerians is inevitable if the economy will be repositioned appropriately but the time may be wong.
Dr Egbetunde Tajudeen opined that “the determinant of the success of naira redesign is if the concerned monetary organization in terms of Central Bank of Nigeria is sincere. If the CBN is sincere, we may say it will have positive impact before considering its potential negative effect.
“The insincerity that follows CBN’s redesign of the currency calls for alarm. Look at the situation we have found ourselves as a nation, lot of the masses do not have cash at hand which is inturn killing small businesses especially those selling in villages who have no bank accounts.
“Withdrawal of money from circulation is naturally meant to control inflation but the reverse seems to be the case as we are experiencing now, their aim is to redesign the currency to curb corruption in the economy but unfortunately, the masses are suffering for it.
Dr Adewole Musiliu noted that “the aim of CBN is to increase financial inclusion. A lot of people are outside the banking system. One of the advantages of this is that monetary policies will become more effective when a lot of money is within the banking system.
“Since federal government want to control inflation, it is much easier to mop up the money they have control over rather than the one they do not have control over.
“Though we cannot shy away from the fact that there are political undertone, but the truth is that, if they are able to get majority of the people back into to the financial system, inflation will be greatly controlled just that the way it is being done is what is orchestrating hardship for the people.”
Dr Ologunwa Oluyemi was of the opinion that “there is no economic policy or theory that can work in any country plagued with corruption and other corrupt practices.”
