Naira Swap: Court Bars FG, CBN From Extending Deadline Beyond Feb. 10

…Emefiele Requests Presidential Approval To Print Additional New Naira Bills Abroad, Admits Failure Of Policy

Amidst clamour from different classes and quarters in the country for an extension of the deadline for the swap of old naira notes for the new series, an Abuja-based High Court on Monday issued an order preventing President Muhammadu Buhari and the Central Bank of Nigeria, CBN, from extending or interfering with the stipulated February 10 deadline.

This was as three northern governors, namely Kogi, Kaduna and Zamfara states sued the Federal Government before the Supreme Court.

In the judgment, the court issued the order, following an ex-parte marked FCT/HC/CV/2234/2023, are Action Alliance, AA, Action Peoples Party, APP, Allied Peoples Movement, APM, and the National Rescue Movement, NRM.

Specifically, the court, in the ruling delivered by Justice Eleojo Enenche, held: “An order of interim injunction is hereby made restraining the defendants whether by themselves, staff agents, officers, interfacing banks or whosoever not to suspend, stop, extend, vary or interfere with the extant termination date of use of the old N200, N500, and N1,000 bank notes being 10th day of February 2023, pending the hearing and determination of motion on notice.

“An order is hereby made directing the heads and chief executive officers, managing directors and/or alter egos of the 4th to 30th Defendants to forthwith show cause as to why they shall not be arrested and prosecuted for the economic and financial sabotage of the Federal Republic of Nigeria by their alleged act of hoarding, withholding, not paying or disbursing the new N200, N500 and N,1000 banknotes, being the legal tender of the Federal Republic of Nigeria to their respective customers, despite supplies of each of such currency notes by the 2nd and 3rd Defendants, thereby leading to the present currency note in circulation”.

As learnt by Theliberationnews, the court held that the orders would be for an initial period of seven days as it adjourned the matter till February 14 for a hearing.

EMEFIELE REQUESTS PRESIDENTIAL APPROVAL TO PRINT ADDITIONAL NEW NAIRA BILLS ABROAD, ADMITS FAILURE OF POLICY

Prior to the court judgment, as reliably gathered by Theliberationnews, the CBN Governor, Mr. Godwin Emefiele has engaged himself in desperate moves to get President Muhammadu Buhari’s approval to print new Naira bills abroad to make up for the shortfall in the inadequate ones printed domestically.

This unthoughtful request of his implies that the cash crisis induced by the scarcity of the new Naira notes around the country may last longer than many Nigerians had thought especially with court judgment barring a further extension.

President Muhammadu Buhari embarrassingly disclosed Emefiele’s move in his meeting with the All Progressives (APC) governors last week.

The governors, according to Theliberationnews sources, had expressed misgivings over the currency swap’s timing and its spinoffs of hardship across all classes and parts of the country.

President Buhari also disclosed his frustration because, according to him, Emefiele had assured him before implementing the currency policy that the CBN had the capacity to flood the market with quality currency bills while mopping up the old notes from the country. Now that the failed policy had put this country in a severe cash crunch, the mighty and lowly are scampering for cash from deposits banks claiming shortages of the new Naira bills. Even a former president of the country reportedly approached a governor of his state asking for new Naira bills bailout.

In view of the precarious financial situation of the country and the huge debt burdens on its neck, printing the new Naira bills abroad will deplete the nation’s foreign reserve. Also, the official promise of sustaining the deadline of February 10, or even anytime in the next few months might become unrealistic. The logistical burden of signing a contract and starting the process may impose an uncertain deadline and compound the woes of Nigerians who are already groaning under the new policy with long queues, people slumping and setting off chaos at bank offices and ATM points across the country.

One of the governors who were at the meeting reliably told Theliberationnews: “The president said Emefiele had assured him he had all the processes in place before the policy began.

“He said Emefiele gave a bill on what it would cost to implement the policy and the president approved and signed. He is now surprised that even the bank CEOs don’t have enough money.”

The president also observed that the bank chief executives have been silent about Emefiele’s claims that he had furnished the banks with enough money.

“The president said the CEOs are quiet because they are afraid of backlash from the CBN,” said the governor.

The bank CEOs have neither confirmed nor denied the CBN governor’s assertion. But their inability to dispense the new money bills indicates paralysis of the banks’ operations in carrying out the new Naira bills policy.

The governors advised the president to postpone the deadline and allow both new and old Naira bills to exist side by side because it would enable the old notes to ease gradually out of the market.

The governors believe that President Muhammadu Buhari is being held hostage by some individuals in the presidency who want to sabotage the elections and turn people against him.

This was also recently hinted at by the Kaduna State Governor, Mallam Nasir El-Rufai who said some fifth columnists in the villa who had lost out in the APC primaries were responsible for the twin troubles of fuel scarcity and cash crunch. He said this after the APC presidential candidate, Bola Tinubu, had cried out at a rally in Abeokuta about fifth columnists who wanted to derail his presidential fortunes. In Ekiti, he said their design was to foist an interim national government on the country.

Already, the country has witnessed two bursts of protests in Ibadan and Benin with another one in Abeokuta on Monday. We now have an avoidable omen of unrest hanging over major cities in the country.

Another serving governor disclosed to Theliberationnews that his state was just recovering from the EndSars destructions and would not want to go through that nightmare, again.

Theliberationnews reported the outcome of President Buhari’s meeting with the APC governors last week where he asked the governors to give him seven days to revert to them on his next course of action.

Meanwhile, the Peoples Democratic Party presidential candidate, Atiku Abubakar and Labour Party counterpart, Peter Obi, had asked suffering Nigerians to bear with the CBN governor. The PDP flag bearer described the suffering as “little inconvenience,’” while Obi conveyed the same sentiment and described it as “some inconvenience.”

Despite Emefiele’s having wasted hundreds of billions of Naira to locally print, largely unavailable new Naira bills, he is, under his new wasteful request, demanding presidential approval for hundreds of billions of hard currency to address avoidable challenges created by his parochially thoughtless Naira policy. Nigerians, for now, remain at his mercy.

THREE NORTHERN STATES TAKE FG TO THE SUPREME COURT

Meanwhile, perturbed by the worsening effect of naira redesign policy of the Central Bank of Nigeria, CBN, on residents of their states, the governments of Kogi, Kaduna and Zamfara states on Monday dragged the Federal Government before the Supreme Court.

The three states, through their respective Attorneys-General, are seeking an order of interim injunction to restrain FG and the CBN from stopping the use of the old N200, N500 and N1,000 denominations as valid legal tenders from February 10.

They want the apex court to put a stop to the full implementation of the policy on use of the new naira notes.

The plaintiffs, in the suit accompanied with an ex-parte application, relied on Section 22 of the Supreme Court Act, to invoke the original jurisdiction of the Supreme Court.

The three states, through their team of lawyers, led by Mr. AbdulHakeem Mustapha, SAN, are praying the court to, in the interim, bar FG, either by itself or acting through the CBN, the commercial banks or its agents, from carrying out its plan of ending the time-frame within which the now older versions of the 200, 500 and 1,000 denominations of the naira, may no longer be legal tender on February 10.

The Attorney-General of the Federation and Minister of Justice, Abubakar Malami, SAN, was cited as the sole respondent in the matter.

Specifically, the states are seeking a declaration that the De-monetization Policy of the Federation being currently carried out by the CBN under the directive of the President of the Federal Republic of Nigeria, is not in compliance with the extant provisions of the Constitution of the Federal Republic of Nigeria 1999 (as amended), Central Bank of Nigeria Act, 2007 and actual laws on the subject.

A declaration that the three-month notice given by the Federal Government of Nigeria through the CBN under the directive of the President of the Federal Republic of Nigeria, the expiration of which will render the old banknotes inadmissible as legal tender, is in gross violation of the provisions of Section 20(3) of the Central Bank of Nigeria Act 2007 which specifies that reasonable notice must be given before such a policy.

A declaration that given the express provisions of Section 20(3) of the Central Bank of Nigeria Act 2007, the Federal Government of Nigeria, through the CBN, has no powers to issue a timeline for the acceptance and redeeming of banknotes issued by the Bank, except as limited by Section 22(1) of the CBN Act 2007. The Central Bank shall at all times redeem its bank notes.

Besides, the states want the court to direct immediate suspension of the de-monetisation of the Federal Government of Nigeria through the CBN under the directive of the President of the Federal Republic of Nigeria until it complies with the relevant provisions of the law.

The plaintiffs told the apex court that since the CBN announced the new naira policy, there had been an acute shortage in the supply of the new naira notes in their respective states.

They said residents in their states who complied with CBN’s directive and deposited their old naira notes, had increasingly found it difficult to access new naira notes to conduct their daily businesses.

They maintained that inadequacy of the new naira notes as well as the haphazard manner the monetary policy was being implemented, had wrought serious hardship on residents in their states, stressing that the 10-day extension of the deadline would not be sufficient to address challenges occasioned by the policy.

CASH TRANSACTION IS STILL THE ORDER OF THE DAY

Dikko added that several transactions still require cash in exchange for goods and services, hence the need for the Federal Government to have sufficient money available in circulation for the smooth running of the economy.

“That the majority of the indigenes of the Plaintiffs’ states who reside in the rural areas have been unable to exchange or deposit their old naira notes as there are no banks in the rural areas where the majority of the population of the states reside.

“Most people in rural areas of the Plaintiffs’ states do not have bank accounts and have so far been unable to deposit their life savings which are still in the old naira notes.

“There is restiveness amongst the people in the various states because of the hardship being suffered by the people, and the situation will sooner than later degenerate into the breakdown of law and order.

“The Plaintiff state governments cannot stand by as they are duty-bound to protect citizens in their states and prevent the breakdown of law and order.

“I know that if the Federal Government of Nigeria had given sufficient and reasonable time for the naira redesign policy, all the current hardship and loss being experienced by the Plaintiffs’ state governments as well as people in the various states would have been avoided.

“I know that the 10-day extension by the Federal Government is still insufficient to address the challenges bedevilling the policy. I also understand that the Federal Government cannot bar Nigerians from redeeming their old naira notes at any time, even though the senior notes are no longer legal tender.

“Unless this honourable court intervenes, the government and people of Kaduna, Kogi and Zamfara states will continue to go through a lot of hardship and ultimately suffer great loss as a result of the insufficient and unreasonable time within which the Federal Government is embarking on the ongoing currency redesign policy,” the plaintiffs added.