President Muhammadu Buhari of Nigeria on Thursday defended a currency switch that led to demonstrations and a shortage of cash, but he also ordered that old 200 naira notes remain in circulation in an effort to reduce shortages.
Since the Central Bank of Nigeria (CBN) started replacing old notes of the local naira currency with new, redesigned ones, there has been a shortage of physical currency in Nigeria.
As a result of the lack of cash, angry and frustrated bank customers have attacked and vandalized banks and blocked roads, igniting violent protests in major cities.
Days before Nigerians head to the polls on February 25 to choose Buhari’s successor after two terms in office, the weeks-long cash crisis has worsened.
Buhari called the naira policy a “positive departure from the past” and a “bold legacy step” towards free and fair elections by assisting in reducing vote buying in an early Thursday national broadcast.
President Muhammadu Buhari of Nigeria, who is leaving office after serving two terms, has defended the cash policy.
The president claimed he was moved by the struggles and suffering brought on by the financial crisis.
He said, “I have given approval to the CBN that the old 200 bank notes be released back into circulation to further ease the supply pressures, particularly to our citizens.
As a result of the policy, new 200, 500, and 1,000 naira notes have been introduced.
Along with the new notes, the old 200 naira bills will be accepted as legal tender for 60 days, or until April 10.
Old 500 and 1,000 bills should be deposited with the central bank, according to Buhari.
- Experiencing difficulty
The two leading parties in the race for the presidency, the ruling All Progressives Congress and the major opposition Peoples Democratic Party, have traded accusations over the cash shortages.
In the final weeks of their campaigns, candidates have been holding rallies ahead of the election on February 25.
Bola Tinubu of the APC, a former governor of Lagos, Atiku Abubakar of the PDP, a former vice president from 1999 to 2007, and Peter Obi of the Labour Party, who has emerged to challenge the traditional dominance of the APC and PDP, are the front-runners in the race to succeed Buhari.
In order to avoid burdening Nigerians unnecessarily, Buhari’s administration promised to “continue to assess the implementation.”
The president requested that the central bank make new notes more accessible and available through banks.
Since the central bank gave depositors until February to exchange their old notes, leaving many people cashless and irate, tensions in Nigeria have risen.
Cash is frequently used for transactions instead of banking apps by those employed in the informal economy and transportation in Nigeria.
The policy, according to the central bank, aims to remove extra and fake naira from circulation as well as discourage cash ransom payments to kidnappers and bandits.
The restriction on the use of cash by businesses was also implemented to encourage cashless transactions.
However, some state governments have sued the central bank in an effort to have the rule suspended and allow Nigerians to continue using both the old and new notes until the banks can produce enough money.
On February 22, the court is anticipated to issue a decision.