Some respite is finally in sight for Nigerians, who have suffered greatly over the past two months due to an acute scarcity of cash for basic transactions. In a belated announcement, the Central Bank of Nigeria (CBN) stated that the old N200, N500 and N1,000 banknotes it is replacing remain legal tender alongside the newly redesigned notes. This clarification was long overdue.
President Major General Muhammadu Buhari (retd.) repeatedly countermanded, and later ignored, Supreme Court rulings that authorized the continued use of the old banknotes. The equally reckless CBN Governor, Godwin Emefiele, followed suit, turning cash into a scarce commodity and inflicting misery on citizens. The CBN must now do everything possible to make both old and new banknotes available and to unshackle the economy from this unwarranted gridlock. The currency redesign policy, the problems it created, and the chaotic way it was implemented offer important lessons. A major reality is that Nigeria’s supposedly democratically elected government wilfully imperils the supremacy of the rule of law; Buhari epitomises this, and Emefiele has borrowed from his playbook.
It took the federal government and the CBN ten days to obey the Supreme Court’s substantive judgment, which mandated that old banknotes remain legal tender until 31 December 2023. Before the March 13 announcement, Emefiele had pointedly ignored the highest court’s ruling, which ordinarily should have been complied with immediately. He acted only after intense pressure from the populace—including state governors, the Nigerian Bar Association, the organised private sector, and labour unions. He claimed that the decision to allow the old banknotes to remain legal tender until year‑end followed a meeting with the CBN Bankers’ Committee on 12 March, offering no apology. Banks will now dispense limited amounts, and normalcy will take time to return.
The Attorney‑General of the Federation, Abubakar Malami, also tainted his office. If he protested this latest assault on the rule of law to the President, it has not entered the public domain. Only threats by state governments to initiate contempt of court proceedings against him and the CBN governor, and rumours of an impending nationwide strike by organised labour, finally forced the three officials to abandon their defiance. Previously, Buhari had broadcast a decree accepting only the old N200 note, directly contradicting the Supreme Court’s interim order that all banknotes—including the N500 and N1,000—should continue to be used pending a final judgment. He failed to issue a prompt directive complying with the final court order. In a belated statement, the Presidency’s spokesman Garba Shehu claimed the Presidency never asked anyone to disobey the ruling, shifting responsibility to Emefiele. The statement read: “The Presidency wishes to react to some public concerns that Buhari did not react to the Supreme Court judgment on the issue of the N500 and N1,000 old currency notes, and states here plainly and clearly that at no time did he instruct the Attorney‑General and the CBN governor to disobey any court orders involving the government and other parties.” Their impunity is insufferable. The Supreme Court had emphatically declared the President’s legal power to direct the CBN on the currency matter, yet he dithered. Now, they must work hard to revive the economy.
The effect of the CBN’s bungling and Buhari’s rashness may take years to wear off. Needless deaths have been recorded as a result of hardship caused by the lack of money to buy food and other necessities, and during riots that followed the policy’s implementation. The Centre for the Promotion of Private Enterprise estimates that the economy may have lost up to N20 trillion due to deceleration, commercial meltdown, paralysis of rural and informal sectors, and job losses. In 17 reported attacks on bank branches nationwide, banks lost assets worth N5 billion; ATMs, buildings and vehicles were vandalised and torched by angry customers and criminals exploiting the chaos. Unquantifiable amounts have also been lost to network problems that characterised failed transfers and other non‑cash payments, with fears that some funds may never be recovered.
The OPS reports that many small businesses have collapsed, as most SMEs in Nigeria rely on cash transactions. Traders in perishable goods lost their produce because they could not access cash. A similar banknote redesign policy introduced by Buhari as a military head of state in 1984 failed, yet he fell back on it in 2023, ostensibly to prevent vote‑buying, reduce currency in circulation, and curb insecurity such as kidnapping‑for‑ransom, banditry and money laundering. Modern economies have changed; brute force and outdated policies cannot solve current problems. Buhari and Emefiele have inflicted unnecessary hardship on Nigerians and the economy; they must now pull out all the stops to remedy the debacle.
The CBN should work round the clock to make both old and new notes available, accepted by banks, businesses and individuals in accordance with the court judgment. It should severely punish banks and bankers that reject old banknotes or fail to dispense cash when available on all channels. The government should mobilise the police to arrest and prosecute cash hoarders, shy‑loan POS operators, bankers, and those who abuse the naira by “spraying’’ it at social events. Traders, transporters and service providers who reject old banknotes should also be arrested and prosecuted. State governments must follow up their orders that all banknotes be freely used with massive public enlightenment, assuring the public that their money remains legal tender until December.
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