President Buhari’s address to Nigerians on Naira Crisis
My Dear Countrymen,
I deem it necessary to address you today on the state of the nation and to report on the efforts of our administration to sustain and strengthen our economy, intensify the fight against corruption, and preserve our gains in the fight against terrorism and insecurity, which have undoubtedly been impacted by a number of internal and external factors.
2. Particularly, I am addressing you as your democratically elected President in order to identify with you and express my sympathy for the difficulties being encountered as we continue implementing new monetary policies intended to stimulate our economy and close loopholes associated with money laundering.
3. Permit me to reassure Nigerians once again that strengthening our economy, enhancing security, and preventing leakages associated with illicit financial flows remain our administration’s highest priorities. And I will always remain committed to my oath to protect and advance the Nigerian people and the nation’s interests.
4. I authorized the Central Bank of Nigeria (CBN) to redesign the N200, N500, and N1000 banknotes in the fourth quarter of 2022.
Also Read: BREAKING: Buhari finally extends validity of old N200 notes till April 10
5. For a smooth transition, I also approved that the redesigned banknotes circulate concurrently with the old banknotes until January 31, 2023, when the old banknotes will no longer be legal tender.
6. In recognition of the systemic and human challenges encountered during implementation, and in response to the requests of all citizens, a ten-day extension was granted until February 10, 2023, to complete the process. All of these activities are being conducted in accordance with the Constitution, the pertinent provisions of the CBN Act of 2007, and international best practices.
7. In addition to requesting your patience and understanding during this transitional phase of implementation, I feel obligated to share with you a few key considerations underlying the policy decision. These consist of:
a. The necessity of restoring the CBN’s legal authority to maintain firm control over money in circulation. When this administration began its first term in 2015, the amount of currency in circulation was only N1.4trillion.
b. The percentage of currency held outside of banks increased from 78% in 2015 to 85% in 2022. As of October 2022, therefore, the amount of currency in circulation had risen to N3.23 trillion, of which only N500 billion was within the Banking System and N2.7 trillion remained permanently outside the system, thereby distorting the financial policy and preventing the effective management of inflation.
c. The vast quantity of Bank Notes outside of the banking system has proven to be practically unavailable for economic activities, thereby retarding the achievement of potential economic growth.
d. Projections of economic growth make it imperative for the government to expand financial inclusion in the country by reducing the number of unbanked individuals; and
e. The Nigerian government is compelled to increase its support for security agencies in order to effectively combat banditry and kidnapping in light of the continuously improving national security situation.
8. Despite initial setbacks, the evaluation and feedback mechanism established has revealed that the policy initiative has yielded positive results.
9. Since the beginning of this program, approximately N2.1 trillion in banknotes previously held outside of the banking system have been successfully retrieved, according to reliable sources.
10. This represents approximately 80% of these funds. In the short- to medium- and long-term, it is therefore anticipated that:
a. An improvement in our macroeconomic parameters;
b. Reduction of the broad money supply should result in a slowing of the velocity of money in the economy, which should alleviate domestic price pressures.
c. As a result of the accompanying decline in money supply, inflation will decline, slowing its rate.
d. Collapse of Illegal Economic Activities, which would aid in preventing corruption and money acquisition through illegal means;
e. Stability of the Exchange Rate
f. The availability of simple loans and the reduction of interest rates;
g. Greater visibility and transparency of our financial transactions will result in effective enforcement of anti-money laundering laws.
11. I am aware of the obstacles placed in the way of innocent Nigerians by unscrupulous banking industry officials tasked with the implementation of the new monetary policy. I am deeply distressed and sympathize with you all over these unintended consequences.
12. To stem this tide, I have instructed the Central Bank of Nigeria (CBN) to employ all legitimate resources and legal means to ensure that our citizens are adequately educated on the policy, have easy access to cash withdrawals and can make deposits.
13. I have also instructed the CBN to increase its collaboration with anti-corruption agencies in order to ensure that any institution or individual found to have impeded or sabotaged the implementation will face the full force of the law.
14. During the extended phase of the deadline for currency exchange, I received invaluable advice from well-intentioned citizens and institutions.
15. I also consulted extensively with representatives of the State Governors and the State Council. Moreover, as a representative of an administration that respects the rule of law, I have taken note of the fact that the issue is currently before the courts of our nation and that some rulings have already been made.
16. I have authorized the CBN to release the old N200 banknotes back into circulation and allow them to circulate as legal tender alongside the new N200, N500, and N1000 banknotes for a period of 60 days, from February 10, 2023 to April 10, 2023, when the old N200 banknotes will cease to be legal tender.
17. In accordance with Section 20(3) of the CBN Act of 2007, all old N1000 and N500 notes are still redeemable at the CBN and designated locations.
18. Considering the state of our economy and the legacy we must leave for the next administration and future generations of Nigerians, I urge every citizen to make greater efforts to make deposits by utilizing the CBN’s platforms and windows.
19. Permit me to assure Nigerians that our administration will continue to evaluate the implementation to ensure that Nigerians are not overburdened. In this regard, the CBN will increase the availability and accessibility of new banknotes to our citizens via the banking system.
20. I would like to reiterate my request for your patience until we overcome this difficult temporary phase as soon as possible.
21. On February 25, 2023, citizens would vote for a new president and members of the National Assembly. I am aware that this new monetary policy has significantly contributed to the diminution of money’s influence in politics.
22. This is a positive departure from the past and an audacious step by this administration’s legacy towards establishing a solid foundation for free and fair elections.
23. I therefore urge every citizen to vote for their preferred candidates without fear, as security will be provided and your vote will count.
24. However, I urge you to avoid violence and actions that could disrupt the electoral processes. I wish everyone success in the upcoming elections.
Thank you for your attention. God bless the Nigerian Federal Republic.
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