Blame Emefiele For Fresh Naira Scarcity CBN Governor, Cardoso Tells Nigerians

Governor of the Central Bank of Nigeria (CBN), Yemi Cardoso, has said that the blame for the fresh naira scarcity currently being experienced in some parts of the country should be on his predecessor, Godwin Emefiele.

Recall that the CBN, under Emefiele, had redesigned the N200, N500, and N1000 naira notes in October 2022.

The policy pushed Nigerians into further hardship as there was cash scarcity ahead of the then dued deadline given by the CBN for the old naira notes to stop being legal tender. It later led to a nationwide protest where banks were attacked.

The CBN and the Federal Government under ex-president Muhammadu Buhari were dragged before the Supreme Court by some governors. The court in March 2023, ruled in favour of the governors and order the extension of the deadline till December 31, 2023.

Amid growing apprehension over cash scarcity in different parts of the country as the deadline remained few weeks, the CBN approached the Supreme Court in November 2023, and the deadline was extended till further notice.

Despite the court order, Nigerians have begun to groan about a fresh naira scarcity and called on the government to find a solution to it.

Speaking on Wednesday, Cardoso acknowledged the “glaring defects” in various CBN policies and announced a comprehensive review initiative.

According to him, a critical flaw in the implementation of the naira redesign policy is responsible for the prevailing cash scarcity.

“We are taking a thorough look at all our policies implemented over time. This review aims to produce an elegant document outlining clear rules and procedures for navigating the Nigerian money market,” Cardoso told the audience at the launch of the World Bank Nigeria Development Update in Abuja.

Addressing the cash crunch plaguing Nigerians, Cardoso identified the poorly executed naira redesign as the primary culprit.

“The apprehension surrounding the policy’s end date, well before the third quarter, triggered widespread hoarding. Many feared the old notes would lose legal tender status, prompting them to hold onto their cash,” he said.

The CBN Governor said the Supreme Court’s recent ruling upholding the validity of the old notes beyond the initial deadline will alleviate apprehensions and incentivize individuals to release their hoarded cash into circulation.

On the current naira scarcity, Cardoso said: “Unfortunately, the history of that lies with the naira redesign policy and coming to the end of the year, way before the third quarter, there was a lot of apprehension with respect to where this was all going to end; and whether the old currency would no longer be good for legal tender and many started hoardings. This is really what happened. Happily, Supreme Court has decided that the currency will be valid post-end of the year.”

Meanwhile, the CBN reassured Nigerians that there are enough naira notes in circulation to meet their cash needs.

This is even as the apex bank disclosed that the naira notes in circulation have increased from N1tn in February to N3.4tn in December, 2023.

These developments were contained in a statement by CBN’s Acting Director of Corporate Communications, Mrs Hakama Ali on Wednesday.

She assured that there is sufficient cash in circulation, while blaming the scarcity on the hoarding of the naira by some persons due to the challenges they faced during the naira redesign project.

She said the CBN was monitoring the situation and had released sufficient cash to its branches nationwide for onward distribution to Deposit Money Banks.

She stated, “The CBN has adequate cash to meet the day-to-day transaction needs of Nigerians. We appeal to Nigerians to be patient while the CBN does the needful to ensure the availability of cash, particularly during the Yuletide and beyond.”

She urged members of the public to continue accepting all naira notes, while encouraging them to embrace alternative modes of payment, especially e-channels, to reduce the pressure on cash.