On the concern over the persistent non- availability of the redesigned Naira notes
By Segun Ajayi-Kadir
To be clear and I want to put this first, there is no doubt that the currency redesign is desirable. There are socioeconomic and political imperatives for the change. It is a critical element of the CBN cashless economy policy that should have far reaching positive results for our economic.
However, the continued scarcity of new the redesigned Naira notes is quite worrisome. With our growth prospects heading further south, we can ill afford a downturn in our GDP. The negative impact it portends for local producers, the agricultural and distributive segments of our economy is huge and may worsen the bashing our economy has received from both external and internal shocks in recent times.
So, this unpleasant situation actually confirms the apprehensions we had when the plan by CBN to introduce the new note was announced in October 2022, without a clear roadmap for ensuring a seamless transition. We had cautioned that adequate measures should be put in place to ensure a smooth currency transition, particularly in the unbanked areas in Nigeria.
It would appear that those measure were either not taken on time or they have proved inadequate and failed to prevent the near bedlam that we are witnessing across the country. When you now take this together with the petrol scarcity, the crippling effect of business and household country wide is enormous.
I would put a rough estimate of 25% drop on Monthly sales of domestic goods if the situation should persist for the next three weeks. As the purchases from the retail end that is mostly transacted in cash dries up, you will immediately notice a sharp drop in wholesale purchases and instant buildup of unsold inventory in your industries.
This situation is not good for anyone, the industry, the government and the ordinary citizen. You will have a compounded crippling lack of patronage for the domestic manufacturer; the denial of government revenue that would have accrued from consumption taxes and the disruption of the daily life and need of the average Nigerian.
I had expected that the CBN and the BDCs should be engaging at the highest level at this time. There is need for strategic communication and joint operations to ensure widespread and sustained availability and circulation of the redesigned Naira notes. It is baffling to approach a bank only to be told that there is neither the old nor the new Naira notes!
We hope that the resumption of payment across the counter in the banks and the intensification of the CBN special cash swap arrangement in remote areas may yield positive results.
I hope that what the country is experiencing is a temporary pain and that government will do well to bring the hardship to an end immediately. It is evident that the desperation is heading for a boiling point. Visible and far reaching steps should be taken to redress the situation. We must make haste to ensure that the price to be paid for this otherwise laudable policy does not outpace the gains.
Segun Ajayi-Kadir is the Director-General of the Manufacturers Association of Nigeria
