The Arewa Economic Advancement Promoters (AREA-P), a group of strategic communication specialists and academicians, has said that the Naira redesign policy by the Central Bank of Nigeria (CBN) will address the worrisome rate inflation the country has been thrown into.
It however declared that the 80% of badly-needed cash outside commercial banks has damaging consequences on the nation’s economy.
Addressing a press conference in Kaduna, the Convener, Nasir Dambatta, shared the CBN’s concerns saying, “There is urgent need to take measures to deal with the liquidity and the flow of crime proceeds in the nation and also feel duty bound to underscore the essence of the Naira redesign policy generally.”
He said, “It is necessary to follow-up the policy, at least in view of our worrisome inflation, which reached 20.7 per cent in September 2022, according to media reports.
“The CBN Governor, Mr. Godwin Emefiele admitted that as at September 2022, Nigerian banking system had N3.23 trillion in circulation andof this amount, N2.73 trillion is now outside commercial bank vaults or hidden by some citizens in crude forms.
“Our independent investigation has confirmed that the CBN wants to first and foremost mop up that N3.32 trillion back into the system, to enable the apex bank take control of money supply again, and begin to see how such a strategy will help rein in inflation.
“We also wish to draw the attention of Nigerians to the fact that the CBN has acted within limits of its monetary policy powers, on this naira redesign policy.
“The management of the CBN relied on section 2(b), section 18(a), and section 19(a)(b) of the CBN Act 2007; had duly sought and obtained President Muhammadu Buhari’s approval to proceed with releasing and circulation of new series of N200, N500, and N1,000 banknotes.”
The group also shared the Senate’s position as captured by the Committee Chairman on Banking, Insurance and other Financial Institutions – Senator Uba Sani, that the CBN’s action will address counterfeiting due to the prolonged use of the same notes, pulling the cash outside the banks will augur well for the economy as monetary policy decision making will be easier and that less notes, especially outside the banking system, will curb terrorism financing.