Nigerian Governors accuse central bank of currency confiscation

The Nigeria Governors’ Forum (NGF) has accused the Central Bank of Nigeria (CBN) of conducting a currency confiscation’ programme that is causing suffering for Nigerians, and called  for the halting of apex bank’s plan to end the use of the old currency notes.

Penpushing reports that the accusation by the Governors was contained in a communique issued at the end of their meeting held Saturday in Abuja, the Federal Capital Territory (FCT), stressing that the current approach of the apex bank raises concerns about the respect for the civil liberties and rights of Nigerians as it relates to their freedom to use legitimately earned income as they so wish.

“It is our considered view that what the CBN is at present pursuing is a currency confiscation programme, not the currency exchange policy envisaged under S20 (3) of the CBN Act, 2007’, the communique stated.

‘Currency confiscation in the sense that the liquidity provided to the general public is grossly insufficient due to the restrictions placed on the amount that can be withdrawn regardless of the amount deposited,” the governors  emphasized

Penpushing further reports that the communique signed by Chairman of the Forum Governor Aminu Tambuwal of Sokoto state stated that the body believes that to deploy a cashless policy and deepen digital transactions, the best practice around the world is to create a suite of incentives to attract customers; rather than a draconian approach as we have witnessed in the last three months

‘The Forum believes that to deploy a cashless policy and deepen digital transactions, the best practice around the world is to create a suite of incentives to attract customers; rather than a draconian approach as we have witnessed in the last three months,” it said.

Penpushing also reports that the Governors pointed out that the inability to use the new notes has led to severe economic consequences, including the emergence of a black market, food inflation, variable commodity prices, long lines and crowds around Automated Teller Machines (ATMs), and the risk of a Central Bank of Nigeria-induced recession.

‘The inability to use the new notes has had far-reaching economic effects, leading to the emergence of the Naira black market, severe food inflation, variable commodities prices based on the method of exchange, and long queues as well as crowds around Automated Teller Machines (ATMs) and banking halls across the country with individuals hoping to get a fraction of their money in new notes to meet their daily livelihood. The country runs the risk of a CBN-induced recession.”

Penpushing reports that the Nigeria Governors Forum (NGF) dismissed the argument by the Central Bank of Nigeria (CBN) that the astronomical increase in currency in circulation is the basis for its policy, and contrary to the apex bank’s  data  which shows that the currency in circulation increased from N1.4 trillion in 2015 to N3.23 trillion in October 2022 the governors’ forum said the Central Bank of Nigeria(CBN) did not consider the increase in the country’s nominal GDP over this period, the doubling of consumer prices, rising population, and the impact of the Ways and Means advances to the federal government by the apex bank.

The Governors posited that either the Central Bank of Nigeria (CBN) data may be incomplete or that Nigerians have done exceptionally well in transitioning to a cashless economy, and equally called on the Federal Government and the apex bank to comply with the rule of law and listen to the voices of reason expressed by Nigerians, the Council of State, and other stakeholders, before the damage to the economy becomes irreparable.

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