New naira: Temporal hardship necessary for economy
The Federal Government on Thursday said the harsh realities faced by citizens due to the introduction of the new naira notes by the Central Bank is a necessary price for the long-term health of the economy.
Minister of Finance, Budget and National Planning, Zainab Ahmed, said this when fielding questions from journalists at the 65th session of the State House Ministerial Briefing organised by the Presidential Communications Team at the Aso Rock Villa, Abuja.
According to Ahmed, the current hardships, though temporal, are required to stifle corruption and gradually transition into a cashless economy.
She said, “We are worried. We are not happy that citizens have to queue and struggle at ATMs to be able to get their cash. But this is a temporary situation.
“Let me just give you an analogy. If you have a wound, for you to be able to heal that wound, you need to be dressed.
“And sometimes, when you go to the hospital, they put iodine on the wound and it is very painful. It is necessary to do that to be able to get the wound to heal.
“So, it’s not easy. Mr President is not happy that citizens are suffering. But we are convinced that it is something that needs to be done at this time and also the Central Bank has been responsive in terms of providing some extension and also further explanation that comes to the closing date, it is not all over.”
She insisted that with over 75 per cent of the circulating N2.7 trillion already in the banks, the policy has yielded positive results.
“The positive side of it is that there is a lot of currency that has been mopped up by this operation. And it means it has achieved a good level of success.
“But the only sore point is the pain that it has caused to citizens which is regrettable, but which is also very transient and temporary.”
Last October, the Central Bank announced that it will redesign the N200, N500 and N1000 notes.
It said some members of the public were hoarding banknotes, with findings showing that over 85 per cent of the circulating currency was outside the banks.
Consequently, the populace had until January 31, 2023, to return all old notes to commercial banks after which they will cease to be Legal Tender.
However, after meeting the President, Major General Muhammadu Buhari (retd.), in Daura on Sunday, January 29, the CBN governor, Godwin Emefiele, announced a 10-day extension from January 31 to February 10, 2023.
The new dates also include a grace period of seven days (February 10-17, 2023) when Nigerians could return old notes to the CBN.
Nonetheless, reports that the new notes in circulation have been grossly insufficient even as racketeering rings have surfaced nationwide.
Speaking in Daura on Saturday, January 28, the President argued that the FG’s currency swap is not meant to target innocent citizens but corrupt persons and terror financiers hoarding illicit monies.
He also told Nigerians that the government will ensure that they and their businesses will face no harm from disruptions caused to the entire supply chain arising from the currency swap.