Monday, November 28, 2022

Finance minister counters CBN, says policy will further devalue currency

The plans of the Central Bank of Nigeria, CBN, to redesign the Naira commencing on December 15, 2022, have been disavowed by Zainab Ahmad, Minister of Finance, Budget, and National Planning.

Ahmed expressed her opposition to the policy in response to a question raised by Senator Opeyemi Bamidele during the 2023 budget defence session she had with the Senate Committee on Finance.

The Minister warned CBN of the consequences that may arise from the exercise.

Senator Bamidele had in his question, told the Finance Minister that barely two days after announcement of the policy by CBN , repercussions of it on the value of naira to US dollar was being felt.

To me, the policy may be a well conceived one , but the timing going by realities on ground , is very wrong as the Naira may fall to as low as N1,000 to a US dollar before January 31, 2023 fixed for full implementation of the policy “, he said .

The Minister denied any knowledge of the move by the apex bank, saying she and her Ministry were not aware of the policy but merely heard of it from pages of newspapers.

“Distinguished Senators , we were not consulted at the Ministry of Finance by 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 value of Naira to other foreign currencies.

“I will however appeal to this committee to invite the CBN governor for required explanations as regards merits of the planned policy and rightness or otherwise of its implementation now “, she said .

Recall that the CBN Governor, Godwin Emefiele had Wednesday dropped the hint, revealing that the incoming exercise would redesign the Nigerian currency, starting from N200 denomination to N1,000 notes .

He had explained that the policy was taken in order to take control of the currency in circulation just as he posited that the bulk of the nation’s currency notes were outside bank vaults and that the CBN would not allow the situation to continue.

The planned policy he added , was in line with Sections 19, Subsections A and B of the CBN Act 2007, upon which the Management of the CBN sought and obtained the approval of President Muhammadu Buhari to redesign, produce, and circulate new series of banknotes at N200, N500, and N1,000 levels.

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