The Nigeria Governors’ Forum (NGF) has accused the Central Bank of Nigeria (CBN) of running the risk of driving the country into a recession. Coming out of a meeting held on Saturday, February 11, Aminu Waziri Tambuwal, Chairman of the NGF, issued a press statement on Monday stating clearly the position of members of the body.
The organisation expressed its sympathies and solidarity with Nigerians who are experiencing significant difficulties as a result of the current CBN Naira redesign and cash withdrawal restrictions policy, a situation that pushed the organisation to quickly intervene and call for an unequivocal halt of the policy.
The excuse by the CBN to migrate the Nigerian economy into a cashless economy through the naira redesign policy was faulted by the body. “It has become necessary to make a distinction between the Central Bank of Nigeria’s (CBN) naira redesign policy, backed by Section 20(3) of the CBN Act, 2007, and the aspirational policy of going cashless, both of which are mutually exclusive at this time,” it stated.
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The body accused the apex bank of not taking into consideration the impact this policy was going to have on the informal sector. With the informal sector employing more than 5.5 million people in Lagos alone, according to the International Monetary Fund, the body emphasised that the CBN should have carried out adequate understudy to assess the impact the policy would have had on the economy.
The body decried the impact the scarcity of the naira has had on the economy, with “a naira black market, severe food inflation, variable commodity prices based on the method of exchange, and long queues as well as crowds around Automated Teller Machines (ATMs) and banking halls across the country with individuals hoping to get a fraction of their money in new notes to meet their daily livelihood.”
A situation that it feared could force a CBN-induced recession. “The country runs the risk of a CBN-induced recession,” the forum said. The NGF said that it was rather disturbing that there has yet to be a change in the financial system despite the “submission of the Attorney General of the Federation that the Federal Government will comply with the ruling of the Supreme Court, which calls for the halting of the CBN’s plan to end the use of the old currency notes.”
In conclusion, the body called on the Federal Government and the CBN to respect the Rule of Law and listen to the voice of reason expressed by Nigerians and several other stakeholders, including the Council of State, before the damage to our economy becomes too great to fix by the next administration.
