The Central Bank of Nigeria (CBN) has reacted to the claim by the Minister of Finance, Budget and National Planning, Zainab Ahmad, that her ministry was not informed of the redesign N200, N500, and N1,000 denominations of the country’s currencies carried out by the Central Bank of Nigeria.
Recall that on Tuesday, October 25, CBN governor, Godwin Emefiele, announced that the apex bank had obtained President Muhammadu Buhari’s approval to redesign some naira notes.
However, while defending her ministry’s 2023 budget before the Senate Committee on Finance in Abuja on Friday, October 28, Ms. Zainab claimed that the CBN failed to consult her ministry on the proposed redesign of the denominations.
“We were not consulted. It was an announcement that we heard and there are also consequences.
We are also looking at what the consequences will be. There will be some benefits but there are some challenges. I don’t know if the monetary authorities have looked very closely at what the consequences are and how they can be mitigated.
I still advise that you have that discussion with the monetary authority,” she had told the senate committee
Reacting to the Ahmad’s statement, the spokesperson of the CBN, Osita Nwanisobi emphasised that the apex bank followed due process in its policy actions.
He said the management of the CBN, in line with provisions of section 2(b), section 18(a), and section 19(a)(b) of the CBN Act 2007, had duly sought and obtained the approval of President Muhammadu Buhari in writing, to redesign, produce, release and circulate new series of N200, N500, and N1,000 banknotes.
“The management of the CBN, in line with provisions of section 2(b), section 18(a), and section 19(a)(b) of the CBN Act 2007, had duly sought and obtained the approval of President Muhammadu Buhari in writing to redesign, produce, release and circulate new series of N200, N500, and N1,000 banknotes” he said
According to Nwanisobi, “currency management in the country had faced several escalating challenges, which has threatened the integrity of the currency, the CBN and the country. Every top-rate Central Bank was committed to safeguarding the integrity of the local legal tender, the efficiency of its supply as well as its efficacy in the conduct of monetary policy.”
On the timing of the redesign project, Nwanisobi explained that the CBN had waited long enough for 20 years to carry out a redesign
”The standard practice globally was for central banks to redesign, produce and circulate new local legal tender every five to eight years.”he said
While assuring Nigerians that the currency redesign exercise was purely a central banking exercise and not targeted at any group, the CBN spokesman expressed optimism that the effort will, among other goals, deepen Nigeria’s push to entrench a cashless economy in the face of increased minting of the eNaira. This, he said, is in addition to helping to curb the incidents of terrorism and kidnapping due to access of persons to the large volume of money outside the banking system used as a source of funds for ransom payments.