There is increasing pressure on the Federal Government and Central Bank of Nigeria (CBN) to ease palpable tension across the land as a result of the naira redesign policy which has brought untold hardship to the people.
Yesterday, the Supreme Court overruled the central bank on the February 10 deadline for old naira to cease to be legal tender in the country.
A call also came from the International Monetary Fund (IMF) to the CBN to extend the February 10 deadline set for the swap of old high value naira notes as the hiccups in getting the new notes persist.
The Supreme Court verdict may have further pushed the apex bank to a tight corner, necessitating a meeting between President Muhammadu Buhari and Godwin Emefiele, governor of the CBN, yesterday, aimed at resolving the logjam.
Emefiele, who has been frequenting the State House since the currency swap policy was initiated, however did not speak with the journalists after his engagement with the president.
BusinessDay gathered that part of the briefing was preparations for the National Council of State meeting called by the president for Friday 10, where far-reaching decisions are expected to be taken on the naira redesign and the petrol scarcity.
“In light of hardships caused by disruptions to trade and payments due to the shortage of new bank notes available to the public, in spite of measures introduced by the CBN to mitigate the challenges in the banknote swap process, the IMF encourages the CBN to consider extending the deadline, should problems persist in the next few days leading up to the February 10, 2023 deadline,” IMF resident representative to Nigeria, Ari Aisen, said in statement issued on his behalf by Laraba S. Bonnet, office manager for Resident Representation for Nigeria on Wednesday.
With the Supreme Court verdict, analysts say the banking public will heave a sigh of relief from the frustrations and disappointment they have suffered as a result of the cash crunch.
Read also: IMF urges CBN to extend naira swap deadline as scarcity bites
“In compliance with the Supreme Court order, we urge the CBN to immediately allow the old and new currency notes to co-circulate until such a time when the old notes are gradually and completely withdrawn. This is global best practice. This should happen within a space of three to six months,” said Muda Yusuf, CEO, Centre for the Promotion of Private Enterprise (CPPE).
Yusuf said all the cash that has been mopped up should be released to their owners, unless there are reasons to suspect such lodgements and this should be escalated to the anti-graft agencies.
“Citizens that have lodged their cash for purposes of the cash swap should be allowed unfettered access to their money,” Yusuf said.
Legal minds also believe that the Supreme Court acted within the powers granted in section 6 of the Constitution of the Federal Republic of Nigeria, 1999, as amended in restraining the Federal Government and the CBN from implementing the February 10 deadline of the old 200, 500 and 1000 naira notes to stop being legal tender.
The court had based on the decision of a seven-man panel led by Justice John Okoro, in a unanimous ruling, granted an interim injunction restraining the FG, CBN, commercial banks etc from implementing the February 10, deadline for the old 200, 500 and 1000 naira notes to stop being a legal tender.
The court further held that the FG, CBN, commercial banks must not continue with the deadline pending the determination of a notice on notice on in respect of the issue on February 15.
Wale Olanipekun, a constitutional lawyer and senior advocate of Nigeria, while reacting to the judgement, said the Banks and Other Financial Institutions (BOFI) Act, under which the central bank derives its powers is subject to section 6 of the 1999 Constitution of Nigeria that vested all powers to interpret the laws on the judiciary.
He stated that since the CBN belongs to the executive arm of government, whatsoever action it takes, in pursuant to the BOFI Act, must be subjected to the constitution
They are subject to the provisions in Section 6 of the Constitution of the Federal Republic of Nigeria, as amended.
Olanipekun, while noting that the suit objecting to the deadline was raised by three governors, namely, Kaduna, Zamfara and Kogi states, said it is only the Supreme Court that has ample jurisdiction to adjudicate in matters between the states and the Federal Government.
“A lot of powers are vested in the Courts in Section 6 of the Constitution which they hardly exercise,” he said.
“We operate a system of Separation of Powers amongst the three Arms of government, namely, the Executive, the Judiciary and the Legislature, So, the judiciary has powers to restrain the excesses of the Executive and the power to do so, lies with the Supreme Court,” he added.
Goddy Ehimikhuare, an Adamawa based lawyer, in his contribution, noted that “the Supreme Court has done nothing extraordinary in stopping the process.
“What the court has done is to grant a temporary order to the CBN to stop the exercise pending the full determination of the case. So, it is now left for all the parties to argue their case”
“Do not also forget that given the sense of urgency, the plaintiffs have also filed for accelerated hearings. So, let us wait for the final outcome”
Mike Ozekhome, senior advocate of Nigeria, said the Supreme Court has not decided on the deadline surrounding the naira swap. He said this while speaking at Channels Television.
On 26 October 2022 the Nigeria’s central bank received the approval of President Muhammadu Buhari to redesign the N200, N500, and N1000 Nigerian banknotes.
According to Emefiele, available data at the apex bank showed that in 2015, Currency-in-Circulation was only N1.4trillion. As of October 2022, currency in circulation had risen to N3.23 trillion; out of which only N500 billion was within the banking system and N2.7 trillion held permanently in people’s homes. Ordinarily, when CBN releases currency into circulation, it is meant to be used and after effluxion of time, it returns to the CBN thereby keeping the volume of currency in circulation under the firm control of the CBN.
“As the new deadlines approach, please permit me to express our sadness over the unscrupulous and unpatriotic conduct of some of our colleagues in the banking industry, whose greed and malevolence are sabotaging the CBN’s efforts. I assure you all that the enforcement agencies are on the prowl of these unpatriotic colleagues and their collaborators,” Emefiele said.
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Pressure mounts one day to old naira deadline
…Supreme Court, IMF seek extension
….Buhari convenes Council of State meeting
Hope Ashike-Moses, Tony Ailemen, Gbemi Famimu and Cynthia Egboboh, Abuja
There is increasing pressure on the Federal Government and Central Bank of Nigeria (CBN) to ease palpable tension across the land as a result of the naira redesign policy which has brought untold hardship to the people.
Yesterday, the Supreme Court overruled the central bank on the February 10 deadline for old naira to cease to be legal tender in the country.
A call also came from the International Monetary Fund (IMF) to the CBN to extend the February 10 deadline set for the swap of old high value naira notes as the hiccups in getting the new notes persist.
The Supreme Court verdict may have further pushed the apex bank to a tight corner, necessitating a meeting between President Muhammadu Buhari and Godwin Emefiele, governor of the CBN, yesterday, aimed at resolving the logjam.
Emefiele, who has been frequenting the State House since the currency swap policy was initiated, however did not speak with the journalists after his engagement with the president.
BusinessDay gathered that part of the briefing was preparations for the National Council of State meeting called by the president for Friday 10, where far-reaching decisions are expected to be taken on the naira redesign and the petrol scarcity.
“In light of hardships caused by disruptions to trade and payments due to the shortage of new bank notes available to the public, in spite of measures introduced by the CBN to mitigate the challenges in the banknote swap process, the IMF encourages the CBN to consider extending the deadline, should problems persist in the next few days leading up to the February 10, 2023 deadline,” IMF resident representative to Nigeria, Ari Aisen, said in statement issued on his behalf by Laraba S. Bonnet, office manager for Resident Representation for Nigeria on Wednesday.
With the Supreme Court verdict, analysts say the banking public will heave a sigh of relief from the frustrations and disappointment they have suffered as a result of the cash crunch.
“In compliance with the Supreme Court order, we urge the CBN to immediately allow the old and new currency notes to co-circulate until such a time when the old notes are gradually and completely withdrawn. This is global best practice. This should happen within a space of three to six months,” said Muda Yusuf, CEO, Centre for the Promotion of Private Enterprise (CPPE).
Yusuf said all the cash that has been mopped up should be released to their owners, unless there are reasons to suspect such lodgements and this should be escalated to the anti-graft agencies.
“Citizens that have lodged their cash for purposes of the cash swap should be allowed unfettered access to their money,” Yusuf said.
Legal minds also believe that the Supreme Court acted within the powers granted in section 6 of the Constitution of the Federal Republic of Nigeria, 1999, as amended in restraining the Federal Government and the CBN from implementing the February 10 deadline of the old 200, 500 and 1000 naira notes to stop being legal tender.
The court had based on the decision of a seven-man panel led by Justice John Okoro, in a unanimous ruling, granted an interim injunction restraining the FG, CBN, commercial banks etc from implementing the February 10, deadline for the old 200, 500 and 1000 naira notes to stop being a legal tender.
The court further held that the FG, CBN, commercial banks must not continue with the deadline pending the determination of a notice on notice on in respect of the issue on February 15.
Wale Olanipekun, a constitutional lawyer and senior advocate of Nigeria, while reacting to the judgement, said the Banks and Other Financial Institutions (BOFI) Act, under which the central bank derives its powers is subject to section 6 of the 1999 Constitution of Nigeria that vested all powers to interpret the laws on the judiciary.
He stated that since the CBN belongs to the executive arm of government, whatsoever action it takes, in pursuant to the BOFI Act, must be subjected to the constitution
They are subject to the provisions in Section 6 of the Constitution of the Federal Republic of Nigeria, as amended.
Olanipekun, while noting that the suit objecting to the deadline was raised by three governors, namely, Kaduna, Zamfara and Kogi states, said it is only the Supreme Court that has ample jurisdiction to adjudicate in matters between the states and the Federal Government.
“A lot of powers are vested in the Courts in Section 6 of the Constitution which they hardly exercise,” he said.
“We operate a system of Separation of Powers amongst the three Arms of government, namely, the Executive, the Judiciary and the Legislature, So, the judiciary has powers to restrain the excesses of the Executive and the power to do so, lies with the Supreme Court,” he added.
Goddy Ehimikhuare, an Adamawa based lawyer, in his contribution, noted that “the Supreme Court has done nothing extraordinary in stopping the process.
“What the court has done is to grant a temporary order to the CBN to stop the exercise pending the full determination of the case. So, it is now left for all the parties to argue their case”
“Do not also forget that given the sense of urgency, the plaintiffs have also filed for accelerated hearings. So, let us wait for the final outcome”
Mike Ozekhome, senior advocate of Nigeria, said the Supreme Court has not decided on the deadline surrounding the naira swap. He said this while speaking at Channels Television.
On 26 October 2022 the Nigeria’s central bank received the approval of President Muhammadu Buhari to redesign the N200, N500, and N1000 Nigerian banknotes.
According to Emefiele, available data at the apex bank showed that in 2015, Currency-in-Circulation was only N1.4trillion. As of October 2022, currency in circulation had risen to N3.23 trillion; out of which only N500 billion was within the banking system and N2.7 trillion held permanently in people’s homes. Ordinarily, when CBN releases currency into circulation, it is meant to be used and after effluxion of time, it returns to the CBN thereby keeping the volume of currency in circulation under the firm control of the CBN.
“As the new deadlines approach, please permit me to express our sadness over the unscrupulous and unpatriotic conduct of some of our colleagues in the banking industry, whose greed and malevolence are sabotaging the CBN’s efforts. I assure you all that the enforcement agencies are on the prowl of these unpatriotic colleagues and their collaborators,” Emefiele said.
