Nigerian Supreme Court Suspends Currency Swap Deadline
ABUJA, NIGERIA —
Nigeria’s Supreme Court has suspended the government’s deadline to stop the use of old currency notes.
The Central Bank of Nigeria had ordered people to swap out old bank notes for currency with a new design by the February 10 deadline, but the directive led to cash shortages, protests and some attacks on banks.
The court ruling halts the move by federal authorities and the Central Bank of Nigeria to completely phase out the old 200, 500 and 1,000 naira bills by this Friday. The Central Bank has yet to respond to the court ruling, which comes ahead of another hearing next week.
The decision follows a lawsuit filed by three Nigerian state governors seeking to keep these bank notes in circulation a while longer.
Abdulhakeem Mustapha, the attorney who filed the suit on behalf of the Kogi, Kaduna and Zamfara state governors, said Wednesday the bid to transition to the new notes was causing political instability.
FILE - A person holds a new 1,000 naira note as the Central Bank of Nigeria releases the notes to the public through the banks in Abuja, Nigeria, Dec. 15, 2022.
However, economist Emeka Okengwu said the central bank has been operating within legal parameters and that the high court should not be involved.
“Clearly we can see that the CBN is making efforts. All they need to do is be able to redouble their efforts,” Okengwu said. “I don’t think they should extend it, and I think we should start respecting the sanctity of institutions. The CBN is operating based on the laws and powers that it has. This is not arbitrary, so I don’t even think that the Supreme Court should have entertained that suit.”
In late October, the central bank redesigned the bank notes to curb crime, ransom payments to kidnappers, and counterfeiting and to regain control of the amount of money in circulation.
Authorities say the measure has been successful.
But millions of citizens across the country have been scrambling to get the new notes.
The situation has been especially challenging for some 40 percent of Nigerians in rural areas who have little access to banking services.
Daily struggles have resulted in protests and attacks on commercial banks.
The CBN has blamed the scarcity of the old money on sabotage by commercial banks and has been cracking down on institutions that are not compliant.
On Tuesday, President Muhammadu Buhari held a private meeting with the central bank governor and the head of anti-graft agency the Economic and Financial Crimes Commission. The closed-door meeting followed pleas for calm as citizens protested the cash shortages.
The situation comes ahead of elections set to begin later this month.
Published on 2023-02-08