When CBN Redesigns Currency Notes to Halt Naira Slide Amidst the shock and confusion trailing the free fall of the naira in the foreign exchange market, the Central Bank of Nigeria is set to introduce new
Amidst the shock and confusion trailing the free fall of the naira in the foreign exchange market, the Central Bank of Nigeria is set to introduce new naira notes as other stakeholders in the nation’s foreign exchange market continue to explore means of halting its slide and fortify the economy against the impact of the current global challenges, reportsFor most of last week, the exchange rate between the naira and the US dollar closed at N441.
The new notes will be in form of N200, N500 and N1000 and the old notes will cease to be legal tender as of January 31, 2023.However, financial analysts differed on whether the new naira notes can affect the economy or not. His view was corroborated by a Professor of Economics at the University of Abuja, Prof Oyinlola Olaniyi, who maintained that the decision would be a major shock to people who have hoarded stolen funds that they can’t account for.
He said: “There is no reason why it should have any effect. Currencies get withdrawn from circulation and are replaced with new ones routinely. So, if you want to change the design and withdraw the existing one from circulation, it is not too far from withdrawing worn-out currencies and replacing them with newly printed notes.
However, when contacted, the President of the Association of Bureau de Change Operators of Nigeria , Mr. Aminu Gwadabe, said the naira has not been able to respond to some of the previous regulatory interventions because the attention of the apex bank was mainly focused on the wholesale end of the market, leaving the retail end, which is the largest stranded.
According to him, “The naira is among the worst performing currency against the dollars in the world as a result of our trade payments imbalances and dwindling reserves.”Given the paucity of dollars in the kitty, and the uninspiring performance of the oil sector as a revenue earner, Gwadabe said Nigeria can begin to bank on remittances while calling for the break of the gap between the official and parallel market rates.
According to the latest Economic Complexity Report, the top exports of Nigeria are crude petroleum , petroleum gas , scrap vessels , Special purpose ships , and refined petroleum , exporting mostly to India , Spain , China , Netherlands , and South Africa .