FOR the umpteenth time, industrialists, financial experts and other professionals, on Friday, said Nigerians must stop the Governor of the Central Bank of Nigeria [CBN], Mallam Lamido Sanusi from going ahead with the planned introduction of N5,000 note in the country.

They faulted what they regarded as a policy somersault, which was bound to cause dire consequences to many critical sectors of the national economy and the general welfare of the  populace.

A former CIBN President, Mazi Okechukwu Unegbu, said the country did not need higher denomination now as it was at cross-purpose with the cashless policy introduced earlier in the year to check corruption, money laundering and cash management.

Unegbu, who was also a former chief executive of the defunct Citizen International Bank, said the current state of the economy which is characterised by dearth of funds, low productivity and  high interest rate regime could not withstand any further dislocations.

He, however, picked holes on claims that higher bill would fuel inflation, explaining that there was no relationship between high denomination and high inflation.

Dr, Dele Kaleijaiye, a lecturer at the Lagos State University, accused Lamido of deriving satisfaction from controversies.

He alluded to the fact that the apex bank did not articulate the policy before making it public, stating that all the CBN had been doing was to react to comments and observations from those opposed to the policy.

He said the higher denomination was not only anti-people, but borne out of a desire to cripple the ordinary Nigerian on the street, adding that it did not have any economic value.

The President, Manufacturers Association of Nigeria (MAN), Kola Jamodu, only saw the introduction of N5000 note in the realm of contrasting the cashless policy.

He told Saturday Tribune that as manufacturers, higher denomination provided choice to them, urging the government to come up with realistic policies that would encourage the use of coins.

Also, the Director General, Lagos Chamber of Commerce and Industry (LCCI), Muda Yufuf , said the higher denomination which would be a tool for tightening liquidity in the system because of inflation, would further stifle industries, particularly the small businesses from accessing credits in the financial sector.

He also noted that it would enhance the activities of counterfeiters because of its value which would make it attractive.

A renowned economist and Chief Executive, Financial Derivatives, Bismarck Rewane, dismissed the widespread attention generated by the policy, just as he picked holes in the introduction of the policy alongside the cashless policy, saying there might be some contradictions, while an economist and  university lecturer, Dr. Sola Akinyelure,  said the policy did not make any economic sense.

He alleged that the CBN governor was acting a script from the multilateral agencies, particularly the International Monetary Fund (IMF).

“This is rather unfortunate. The truth is that Sanusi cannot even defend the policy. The IMF just sold it to him and he bought it hook, line and sinker. This is certainly not the best,” he said.

Akinyelure, who lectures in a private university, queried the economic management skills of CBN managers, stating that the apex bank should have started with N2,000, just the way the Obasanjo government did.

The Institute of Chartered Accountants of Nigeria (ICAN) said the policy was  an indirect devaluation of the currency.

 It argued that it was inappropriate to introduce a higher denomination at a time the size of government deficit was about 2.8 per cent.

Comments (3)

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ON THE PROPOSED N5000 NOTE
written by Uwem Essia, September 15, 2012

There is ordinarily nothing wrong with issuance of new currencies and restructuring existing ones. But I share the concern of many on how expedient such an expensive exercise is now and to what extent currency restructuring and the new N5000 note will enhance performance of the economy, as former President Obasanjo rightly observed recently.

The banking system that the CBN is expected to superintend over is currently fighting hard to meet up with Internet connectivity needs of the cashless policy. There is urgent need for dedicated satellites and Internet backbone for the country’s banking system. The billions Sanusi hopes to put into a cosmetic exercise as currency restructuring can be donated as seed fund to the Bankers’ Committee to use and improve the Internet connectivity of banks.

The primary function of CBN is to serve as bankers’ bank. We need to see Sanusi address his mind to the core concerns of banks, instead playing politics and frantically crafting ways to get commissions and kick-backs. Sanusi has fought hard to send the Chief Executives of ‘failed’ banks to prison, but it beats my imagination that few people to date have questioned what has happened to the bank inspectors of CBN assigned to regularly monitor and report on the operational sanctity of those failed banks!

Uwem Essia

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Waiting for Sanusi
written by Maadeniyi, September 16, 2012

I'm happy for the time of people and organisations that have come out to condem the proposed introduction of the 5,000 naira bill. Lasst week Sanusi called Obasanjo a bad economist..so now I'm waiting for what he will call these learned eminent Nigerians.

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