- Supreme Court restrains CBN from implementing deadline
- FG insists on deadline, asks apex court to dismiss states’ suit
- Nigeria needs N2trn currency in circulation for economy to function
- ‘Inadequate naira supply will shrink economy, impoverish Nigerians’
BY TIMOTHY AGBOR, MAYOWA SAMUEL
The Federal Government and governors of the 36 states of the Federation seem to be on a collision course as the two levels of government disagree over the continued implementation of the Central Bank of Nigeria’s naira redesign policy.
The scarcity of the new naira at a time when there is biting fuel scarcity in the country has compounded the hardship being faced on a daily basis by ordinary Nigerians, according to many analysts and as evidenced by trending videos of frustration-induced violence across the states.
While many economists and Nigerians at large are of the opinion that the CBN policy is ill-timed, a few Civil Society Organisations have said the CBN must not extend the deadline for the use of the old naira notes.
On Wednesday, the Supreme Court of Nigeria restrained the Federal Government from implementing the February 10 validity deadline of the old 200, 500 and 1000 naira notes to stop being legal tender.
Three northern states — Kaduna, Kogi and Zamfara — had in a motion ex-parte filed on February 3, 2023, prayed the apex court to halt the CBN’s naira redesign policy.
A seven-man panel of the Supreme Court, led by Justice John Okoro, in the unanimous ruling, granted an interim injunction restraining the FG, CBN, commercial banks, among others, 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 in respect of the issue on February 15.
By this ruling, the old Naira notes are expected to continue being legal tenders in Nigeria.
SUPREME COURT LACKS JURISDICTION TO ENTERTAIN SUIT – FG
However, in a swift reaction, the Federal Government asked the Supreme Court to dismiss the suit filed by the three northern state governments, challenging the deadline set by the CBN to end the legal tender status of the old naira notes.
The Attorney-General of the Federation, Abubakar Malami, argued that the Supreme Court lacked the jurisdiction to entertain the suit in a preliminary objection.
The AGF, through his lawyers, Mahmud Magaji and Tijanni Gazali, therefore asked the apex court to strike out the suit for lack of jurisdiction.
In the court filings, dated February 8, 2023, the AGF argued that the plaintiffs had also not shown reasonable cause of action against the defendant.
Citing grounds in support of the objection, with reference to Section 251 of the Constitution, the AGF argued that the suit falls within the exclusive jurisdiction of the Federal High Court in matters of monetary policy of an agency of the Federal Government.
Malami said, “The claims or reliefs are not against the federation, but the Federal Government and its agency, the Central Bank of Nigeria.
“The Federal Government of Nigeria is distinct from the Federation or the Federal Republic of Nigeria. The plaintiffs have no grievance whatsoever against the Federation of Nigeria.
“This suit has disclosed no dispute that invokes this (Supreme) Court’s original jurisdiction as constitutionally defined.”
NIGERIA NEEDS N2TRN NEW NAIRA NOTES FOR ECONOMY TO FUNCTION
The Chief Economic Adviser to the President, Dr. Doyin Salami, has, however, advised President Muhammadu Buhari to approve that the deadline of the cessation of the use of old notes be extended to such a time as the CBN has issued at least N2 trillion of the new notes into circulation.
In a memo to the President, dated February 3, 2023, seen by THE POINT and titled, “Ensuring Successful Implementation of the Currency Redesign and Extension of Cashless Transactions Policies”, Salami noted that Nigeria would need at least N2trillion in currency in circulation for the economy to function even with successful introduction and adoption of cashless transactions across the nation.
“Considering this significant gap, it is not surprising there has been a lot of disruption occasioned by the ongoing exercise.
“Note that inadequate supply and distribution of currency notes will lead to a slowdown, more likely a shrinkage, of the economy, leading to rise in unemployment. Worsening economic conditions created by this policy will continue to impoverish Nigerians,” he stated.
“Note that the CBN expects to have N700billion in new notes available to be issued by the end of February 2023. This is a reflection of the limited capacity of the Nigeria Security Printing and Minting Company (NSPMC),” Salami added.
