• Fri. Sep 29th, 2023

Naira redesign, reissue: CBN does not need to inform Finance Minister – Moghalu


Oct 31, 2022

By Bassey Udo

A former deputy governor Systems Stability of the Central Bank of Nigeria, Kingsley Moghalu, has weighed into the raging controversy surrounding the planned redesign and reissue of the Naira by the apex bank.

On Wednesday, the CBN Governor, Godwin Emefiele Godwin Emefiele, announced plans to redesign, print and circulate some categories of the Naira banknotes.

Emefiele said the CBN received On Wednesday, the CBN received President Muhammadu Buhari’s to carry out the plan by the monetary authorities to reissue the N100, N200, N500, and N1,000 denominations of the Naira.

But, in what seemed like a widening gap in the relationship between fiscal and monetary authorities of the present administration, the Minister of Finance, Budget and National Planning, Zainab Ahmed, on Thursday told the Senate Committee on Finance that she was not aware of any such plan, as the Ministry was not carried along by the CBN on the issue.

“Distinguished Senators, we were not consulted at the Ministry of Finance by the CBN on the planned Naira redesigning and cannot comment on it as regards merits or otherwise.

“However as a Nigerian privileged to be at the top of Nigeria’s fiscal management, the policy as rolled out at this time, portends serious consequences on the value of the Naira to other foreign currencies.

“I will however appeal to this committee to invite the CBN governor for the required explanations as regards the merits of the planned policy and rightness or otherwise of its implementation now,” the Minister is reported to have told the lawmakers when asked to comment on the plan.

In its reaction, the CBN, through its spokesperson, Osita Nwanisobi, in a chat with reporters on Friday expressed surprise at the minister’s claim, pointing out that the CBN remained a very thorough institution that follows due process in its policy actions.

Nwanisobi said he Management of the CBN was guided by the provisions of Sections 2(b), 18(a), and 19(a)(b) of the CBN Act 2007, as it had duly sought and obtained the approval of President Muhammadu Buhari in writing to carry out the plan.

Urging Nigerians to support the plan, which he said was in the overall interest of Nigerians, the CBN spokesperson said the decision to redesign and reissue the Naira banknotes was informed by the observation that some persons he did not name were hoarding significant sums of banknotes outside the vaults of commercial banks.

Lending his voice to the controversy, the former deputy governor of the CBN, Kingsley Moghalu, said the
Finance Minister’s comment to the National Assembly should not mislead Nigerians into thinking the apex bank owed her that kind of information.

Moghalu, who stated this through his verified Twitter handle, @MoghaluKingsley said all the CBN needed to carry out the plan was President Muhammadu Buhari’s approval, which he said the bank received.

“Finance Minister Zainab Ahmed’s comment to @nassnigeria that she was not aware of the Naira redesign by @cenbank should not mislead anyone into thinking the CBN owes her that kind of information. The Bank only needs the approval of President @MBuhari for this particular exercise,” Moghalu said.

Giving further insight to the controversy, Moghalu identified only three issues covered in the CBN Act of 2007 the CBN would be required to obtain external authorization, and only from the President for its operations.

These are any alterations to the legal tender (the Naira); any investment of the Bank’s funds outside Nigeria, in and the CBN’s annual report.

He said outside these issues, the only approving authorities for CBN operations are its Committee of Governors, consisting of the CBN Governor and the four Deputies, as well as the Board of Directors of the CBN, which includes the CBN Governor, the four Deputies, and seven external members, including the Permanent Secretary of the Federal Ministry of Finance and the Accountant-General of the Federation.

The provisions of the law do not include the Minister, which is a political appointee as one of the people who the CBN was answerable to.

Moghalu said however that his criticism of Emefiele in the past was his politicizing the CBN “by routinely subjecting its operations to the whims and caprices of the Presidency far beyond what is the appropriate relationship, and compromised the independence of the CBN as a result.”

He said Emefiele’s dabbling into politics was why the Finance Minister erroneously felt entitled to be informed or consulted over the plan to redesign and reissue the Naira banknotes.

The CBN, he said, should now focus hard on the implementation of this policy, as it would impose huge pressures on the banking system.

His major concern was how those Nigerians in rural areas, including those women frying akara by the roadside, who keep most of their cash under their pillows, along with others whose monies are outside the banking system for reasons that are not negative, be aided to come into the banking system under the new CBN policy.

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