Governors and some civil society organisations have expressed divergent views on the order by the Supreme Court of Nigeria restraining the Central Bank of Nigeria (CBN) and the federal government from ending the legal tender statuses of the old N200, N500 and N1000 banknotes on February 10, 2023.
While the governors hailed the apex court for the ruling, describing it as a big relief for suffering Nigerians due to the currency scarcity, the CSOs said it portends danger to credible polls.
The apex court made the order yesterday following the suit filed by three state governments challenging the Naira swap policy.
LEADERSHIP reports that the governments of Kaduna, Zamfara and Kogi States had approached the Supreme Court seeking an order to stop the policy.
A seven-member panel, led by Justice John Okoro, halted the move of the federal government in a ruling in an ex-parte application brought by the three northern states.
The three states had specifically applied for an order of Interim Injunction restraining “the federal government through the Central Bank of Nigeria (CBN) or the commercial banks from suspending or determining or ending on February 10, 2023, the time frame within which the now older version of the N200, N500 and N1,000 denomination of the naira may no longer be legal tender pending the hearing and determination of their motion on notice for interlocutory injunction”.
Moving the application yesterday, counsel to the applicants, Mr A. I. Mustapha, SAN, had urged the apex court to grant the application in the interest of justice and the well-being of Nigeria.
He stated that the policy of the government has led to an “excruciating situation that is almost leading to anarchy in the land “.
While he referred to a CBN statistics which put the number of people who don’t have bank accounts at over 60 percent, Mustapha lamented that the few Nigerians with bank accounts can’t even access their money from the bank as a result of the policy.
The senior lawyer further argued that unless the Supreme Court intervenes, the situation will lead to anarchy because most banks are already closing operations.
Delivering ruling in the motion, Justice Okoro, held that after a careful consideration of the motion exparte this application is granted as prayed, “An order of Interim Injunction restraining the federal government through the Central Bank of Nigeria (CBN) or the commercial banks from suspending or determining or ending on February 10, 2023, the time frame with which the now older version of the N200, N500 and N1,000 denomination of the naira may no longer be legal tender pending the hearing and determination of their motion on notice for interlocutory injunction”.
Kaduna, Kogi, Zamfara Drag Federal Govt To Supreme Court Over Naira Swap
He accordingly adjourned to February 15, 2023 for hearing of the main sui
In his reaction, Governor Nasir El-Rufai said Kaduna State Government and millions of its residents welcomed the ruling of the Supreme Court, extending the use of the old naira notes beyond the ill-considered CBN deadline of 10 February 2023.
A statement signed by the governor’s Special Adviser on Media and Communication, Muyiwa Adekeye, thanked the justices for their decision and appealed to the federal authorities to treat the ruling as an opportunity to relieve human suffering.
The statement recalled that the ‘’governments of Kaduna, Kogi and Zamfara states were compelled to approach the Supreme Court to mitigate the needless stress imposed on ordinary people and their livelihoods by the ill-timed, incompetent planning and execution of an overnight cashless policy.
Adekeye argued that CBN advanced no emergency justification for what he described as “this callous decision to deny people access to their deposited cash.’’
The special adviser noted that ‘’we have engaged extensively with the Federal Government and the Central Bank of Nigeria. This has included furnishing evidence-based demonstration of the threat to public welfare and economic activities by this myopic policy that would have been condemned as draconian and insensitive were it being pursued by an occupying power.’’
According to Adekeye, Kaduna State Government hopes that a review of the currency swap policy would now be undertaken to fashion out a better implementation programme.
“The programme should include a timeline that provides enough old and new currency notes for our citizens, prioritises public welfare and restores economic activity,” he advised.
‘’Like other elected APC state governments, we have advised that this should be based on a whole of government approach that pulls together all the necessary institutions of the federal and state governments, and recognizes global best practices and reasonable timeline for implementation,’’ the statement added.
Also, Rivers State Governor, Nyesom Wike, has lauded the Supreme Court judgement which suspended the plan by the CBN to ban on old naira notes from February 10, 2023.
Wike gave the commendation yesterday while speaking during the Peoples Democratic Party (PDP) campaign rally at Abua, headquarters of Abua/Odual local government area of the state.
The governor said: “Let me on behalf of the government and people of Rivers State commend the Supreme Court of Nigeria for what they have done today to save the masses from suffering and to save our democracy.
“Today, the Supreme Court has stopped the Central Bank of Nigeria from embarking on something the majority of Nigerians know is anti-people.
“Like I have said before, our democracy can only survive with the support of INEC, security agencies, and the judiciary. With what happened today, the Supreme Court has shown that the hope of the common man lies in the judiciary.
“Let me commend Kaduna State, Zamfara State, and Kogi State that took it upon themselves to challenge the Federal Government at the Supreme Court. Rivers State will join them in that suit to challenge what the CBN is doing against the masses.”
Meanwhile, the apex body of all civil society groups in Nigeria, the Civil Society Central Coordinating Counci, has rejected the ex-parte order of made by the Supreme Court.
The group therefore called on President Buhari to immediately consider issuing Executive Orders to bring to effect this policy’s terminal date as the Supreme Court order did not restrain the exercise of the constitutional powers of the President.
The Council further said their rejection of the order was because it was an attack on credible elections and called on the Supreme Court not to yield its platform for such election riggers to have access to illicit cash to compromise the election.
The convener of the CSOs, Bar Obed Okwukwe, in a press briefing in Abuja, called on the apex court to immediately vacate the order as it was capable of derailing the credibility of the 2023 general election and ultimately truncating our most cherished democracy.
“The Supreme Court must redeem its image immediately and show Nigerians that it is not deliberately against free, fair and credible elections bearing in mind some very controversial orders and judgments of the court in the recent past,” he said.
He also said opponents of the currency redesign and cash withdrawal limit policies deadline are pushing for a shift of the February 23 general election.
According to him, they have credible intelligence that those behind the campaign for shift in the deadline of the new currency redesign and cash withdrawal limit are now pushing that the 2023 general election be shifted.
He said “this evil idea will throw Nigeria into a constitutional crisis and lead to the collapse of constitutional democracy. Now these anarchists realizing they cannot win the general election are now looking for ways to destroy democracy and undermine President Buhari.
“These men who have benefited from President Buhari now want to destabilize and hurt our dear President and our democracy in their selfish bid of running errands for their new godfather in town.”
Judgement Has Saved Nigeria From Anarchy, Economic Meltdown – Tinubu
On his part, the All Progressives Congress (APC) presidential candidate, Bola Ahmed Tinubu, has applauded governors of the 36 states of the federation for securing the ruling of the Supreme Court which voided the deadline for the swapping of old naira notes with new ones.
In a statement by director, Media and Publicity of the APC presidential campaign council, Bayo Onanuga, the APC standard bearer hailed the governors for standing on the side of the Nigerian people over the Central Bank of Nigeria’s new Naira and cashless policies that have subjected the masses to hardship.
Tinubu noted that the governors, especially the APC governors who instituted the suit against the CBN and federal government at the Supreme Court, acted well on behalf of the hapless Nigerians who have been made to bear the brunt of Naira redesign policy that has been poorly implemented
With the apex court ruling, Tinubu noted that the governors have saved the country from needless political and economic crises and miseries which have clearly become the unintended consequences of the monetary policy of the apex bank.
He added that the Supreme Court ruling coincided with the advisory of the International Monetary Fund urging for the extension of the deadline for the swap of the old naira notes, going by the problems being experienced across the country in getting the new notes.
He said, “The federal government and relevant stakeholders can now sit down and work out a better framework on how to proceed with the new policy without causing any social and economic disruption and inconvenience to our people. We have examples of other countries that have successfully and seamlessly changed their currencies to learn from.
“Those countries give a long time, at least 12 months, to effect the currency change. They do not engage in CBN-like fire-brigade approach.”
He called on the CBN to ensure that the Supreme Court ruling is effectively executed by taking all necessary steps to (i) ensure sufficient availability of Naira notes (whether old or new) and (ii) properly sensitising the public on the ruling and the consequent validity of old naira.
Judgement To Rescue 30m Nigerians—CPPE
The restraining order of the Supreme court on the timeline for the Central Bank of Nigeria (CBN)’s currency swap will rescue the large rural economy and the over 30 million unbanked Nigerians who were greatly affected by the policy, the Centre for the Promotion of Private Enterprise (CPPE) said, yesterday.
The chief executive officer (CEO) of the centre, Dr. Muda Yusuf, while reacting on the ruling, said given the huge population of over 200 million, the large informal sector which accounts for over 40 per cent of the Gross Domestic Product (GDP) as well as the unbanked Nigerians, the CBN cash swap model and timeline were greatly flawed.
The CPPE said the court ruling would restore normalcy to economic activities, especially in the distributive trade sector, the informal sector and rural economy.
“It would also douse current social tension and the risk of social unrest in the country. The small businesses and the ordinary citizens were the biggest victims of the unspeakable disruption and hardship inflicted by the impractical deadline given by the CBN for the cash swap. They are the biggest users of cash,” it said.
Yusuf further said it is inappropriate to arbitrarily cut down on currency in circulation without due regard to data, empirical studies and global best practices.
“We affirm our position that N2.6 trillion currency in circulation is not too much for the Nigerian economy with a GDP of about N250 trillion. Any attempt to arbitrarily cut it will create a crisis. It is unacceptable that citizens are denied access to their cash deposited for purposes of cash swap.
“This could undermine the confidence of the citizens in the banking system and pose a major risk to the financial inclusion objective of the CBN. Onboarding citizens unto the cashless platform should not be decreed or forced on them. It should be voluntary and incentive-driven.” Yusuf said.
In Nigeria, he noted that cash to GDP ratio is less than 1.5 per cent, while Cash/Money supply ratio is just about 5 per cent, adding that these are some of the best currency ratios globally and mark of the remarkable progress that has been made in cash-less policy drive.
He also noted that cash to GDP in United States is about 9 per cent and in the Eurozone, it is about 10 per cent.
This, he said, underlines the fact that cash is not the problem of the Nigerian economy or monetary policy effectiveness.
“The CBN Ways and Means financing of over N22 trillion is a much bigger problem for liquidity management. It is regrettable that a purely monetary policy management issue has been profoundly politicised as witnessed in the past few weeks. This had obscured fundamental economic conversations.
“Meanwhile, in compliance with the Supreme Court order, we urge the CBN to immediately allow the old and new currency notes to co-circulate until such a time when the old notes are gradually and completely withdrawn. This is global best practice. This should happen within a space of three to six months,” he noted.
To this end, he said, all the cash that has been mopped up should be released to their owners, unless there are reasons to suspect such lodgments and that this should be escalated to the anti-graft agencies.
“Citizens that have lodged their cash for purposes of the cash swap should be allowed unfettered access to their money,” Yusuf emphasised.
