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Sunday, November 27, 2022

Naira notes redesigning: Why CBN’s move may be unsuccessful —Stakeholders

By Adekola Afolabi

Plans by the Central Bank of Nigeria CBN, towards the redesigning of some Naira notes to curb inflation, kidnapping and mop up illicit money stashed in private vaults may be a mirage unless stringent measures are put in place.

Those who spoke with The Hope contended that majority of the financial institutions in the country cannot be trusted and could easily compromise with corrupt individuals to frustrate the process.

 The Hope findings showed some people might want to subvert the exercise by converting their illicit monies to foreign currencies, purchase of properties to beat the CBN policy.

The Central Bank Governor, Godwin Emefiele had last week announced that President Muhammadu Buhari approved the redesign, production, and re-issuance of some local currency notes: (N200, N500 and N1,000)

The new notes, according to the CBN governor will be in circulation by December 15, 2022.

In separate interviews with experts, they called for stricter  measures and technology capable of frustrating unscrupulous bankers to connive with fraudsters to launder stashed cash in their possessions.

According to them, Nigerians no longer have confidence in the banking system, most of the bank managers are co allies of corrupt money bags and hence, the objectives of the federal government in redesigning the naira notes may be thwarted.

Those who spoke with The Hope include: Prof Olayemi Simon-Oke of Economic Department, Federal University of Technology, Akure, Dr Ofonyelu Chris from the Department of Economics, Adekunle Ajasin University Akungba, Ustaz Nurein Balogun, a chartered accountant.

Others are:Elderstateman, Chief Femi Aluko, Mr. Adekola Olawoye, SAN,Prof. Sola Olorunfemi from the Department of Economics, AAUA, Prof. Victor Olumekun, AAUA, Dr Taiwo Kayode of Economic Dept, AAUA and others

Prof. Victor Olumekun, expressed fear that some people involved in the hoarding of the naira might have had fore knowledge of the move by the CBN, stating that it might be responsible for the persistent hike in the exchange rate of naira to dollar.

Olumekun said the integrity of financial institutions might not be guaranteed to checkmate criminal elements who might want to convert the naira notes they have hoarded to dollars, stating that those who do illegitimate transactions with dollars could hardly thrive without conniving with people in the banking sector.

Also, Dr Taiwo Kayode of Economic Dept, AAUA said the government has failed to recognize the antics of humans, hence he stressed that public office holders and political appointees who have starched billions of cash will definitely connive with bank officials to frustrate the exercise.

“Obviously, the Nigeria banking sector has people with corrupt tendencies and will not hesitate to help those who have stored the old currency convert it to new currency upon agreement for percentage benefit.

Dr Chris Ofonyelu noted that the rush by ignorant Nigerians to convert their Naira to Dollar would worsen the exchange rate.

Ofonyelu noted that a lot of Nigerians would want to cheat the process by converting the naira hoarded to dollar, so that they can convert it back to naira when the new currency notes are fully in circulation.

Prof. Sola Olorunfemi  lamented that for now, economic theories seem not to be working in Nigeria, making it difficult to recommend what the government can do to track those who were previously involved in hoarding naira notes.

While noting that by the time people who have hoarded naira begins to convert it to dollar, the exchange rate of naira to dollar will increase further, Olorunfemi suggested that Federal Government could engage the Economic and Financial Crimes Commission (EFCC) to track such individuals.

He added that the Federal government could also charge a particular percentage for each deposit made.

Prof. Simon-Oke said the redesigning of the naira notes would have made more sense few years into this present administration.

The don noted that introducing new naira policy at this 11th hour of the administration is a misplacement of priority and an indication that the government has lost direction.

“I personally have no issue with the decision of the government regarding the redesigning of the highest three denominations of the Nigeria’s currency but I feel the timing is wrong and will defeat the entire purpose.

“We just hope that the government do the needful in blocking them from converting this money because if they fail to do this, the consequence will be uncontrollable rise in inflation rate.”

Ustaz Nurein Balogun, a Chartered Accountant and businessman posited that the redesigning of the naira is a good policy in its sense but when it failed to meet what it is required to do, it becomes a pain right on the neck of the poor man.

Ustaz Nurein said Nigeria as a country has failed for the fact that economic policies are being circumvented by unscrupulous and dubious people and not because the policies are not good.

According to him, the rush by moneybags, politicians and those who embezzled public funds to convert the catche of Naira notes in their private vaults to dollars and foreign currencies is an example that government policies will keep on being compromised.

The chartered accountant believed, those at top echelons of government are the one in control and most of them stole public funds and will do just anything to see that they do not loose their ill gotten wealth.

He believes it will be an herculean task in achieving the aim of the currency redesign.

Aminullah said banks officials and management should also be prosecuted if they are found of conniving with those who bring large of amount to banks to deposit.

A legal practitioner, Mr Yinka Adeyosoye described the CBN’s plan to redesign the naira notes as a good development that will help reduce criminal activities in the country if modern technological innovations are used and called on relevant stakeholders to use the policy to identify and prosecute corrupt moneybags in the country.

An Accountant, Mr. Jimi Legbe believed that our banks cannot be trusted to resist the urge to connive with corrupt moneybags in converting their illegally acquired money which are stashed in various places into the newly redesigned naira notes.

He advised stakeholders to pay proper attention towards the activities of the corrupt moneybags and bank staff as they will attempt to use various methods to sabotage the CBN and federal government’s effort to recover illegally acquired money from the corrupt moneybags.

Adekola Olawoye, SAN, immediate past state Attorney-General and Commissioner for Justice, who believed that the advantages of the naira redesigning is greater than its disadvantages, called on the CBN and EFCC to gather massive intelligence and be on the trail of those who starched funds with a view to recover the money.

“So, in order to forestall the economy from becoming comatose something has to be done, drastically. We are at our low ebb, inflation is hyper, food scarcity is looming, flood has ravaged most of the states that are the food basket of the country. Then, for the economy to nosedive like this, it is a welcome development, so that people can rejuvenate and see whether the economy can pick up.

On his part, former Commissioner for Information in Ondo state, Chief Femi Aluko, called on the CBN not to allow those starching the money change it to dollar, adding the CBN should also go after the Bureau De Change to prevent them from conniving with the corrupt public officials and other criminal elements in the society.

“I just pity the generation coming, it is not fair. Those of us who are elders or whatever category we belong, the way we live is not good for the incoming generation. N30,000 minimum wage doesn’t go anywhere. “

Additional stories by

Victor Akinkuolie

Babatunde Ayedoju,

Jimoh Ahmed,

Samuel Edu,

Babatunde Aderoboye,

Kayode Afolabi

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