Currency Review: How Much Do You Know About The Planned Introduction Of New N5000 Note?

The currency review announced by the Central Bank of Nigeria (CBN)’s Governor, Sanusi Lamido Sanusi has generated a whole lot of furore and heated debates for or against the intended policy. On blogosphere, in public fora, business places, at work, everywhere, the talk in town is the new “N5000” note. “It will lead to inflation” some argue yet others say, “it will make corruption easier” among other well rehashed cliches. In the same vein, the planned introduction has pitched economists and financial analysts against themselves as they argue back and forth, mostly in economic and financial jargons that the layman barely understands. Therefore, we ask, what do you understand about the planned currency review?

Here, our job is to keep you informed thus, we bring you a well researched and detailed analysis of the CBN’s latest policy drive by public affairs commentator, author, financial and economic analyst, Tope Fasua as gleaned from his facebook wall. Enjoy…

WILL CBN EVER DO ANYTHING RIGHT?

My ‘childhood’ friend, Richard Ogunmodede, now a ‘big man’ at First Bank, always invited me to the banks’ Annual General Meeting parties at the Hilton, Abuja. It provided a good opportunity for us to meet and hug as brothers, and relive the days we both drove our rickety Toyota Camrys, as young bankers living at the pothole-ridden, traffic-snarled Oke-Afa, Isolo, Lagos. At those parties about 5 or 6 years ago, one man always stood out – Sanusi Lamido Sanusi. He was then ED, Risk Management or something of that sort. Always noticeable, not only because of his slim-fitted tuxedos and bow ties, but the manner he waltzed through the crowd, greeting people, throwing banters and generally feeling very much at home, even though First Bank’s AGMs always have a heavy Yoruba theme – often Yoruba music and a lot of Agbada and ‘abeti-aja’ caps. This SLS man governor was someone that fascinated me – from a distance. I just loved the fact that he was something of a ‘Funky Mallam’.

A year or two later, he would be appointed as Nigeria CBN governor, after a short stint as FBN’s MD. His becoming an MD of First Bank itself went against the grain, for the reason state above. As an ex-banker myself, I know that there used to be – and still exists – ‘Ibo Banks’, ‘Yoruba Banks’, and ‘Hausa Banks’. First Bank was solidly a Yoruba bank, even though things are changing in this age of globalization. I naturally rooted for Sanusi, and had to call off a training I was facilitating on the 3rd of June 2009, to watch, alongside my trainees, the incoming Central Bank Governor’s interview at the Senate. Before then the rhetoric – especially from southern Nigeria – was that another ‘cattle rearer’, who studied Sharia Law and does not know anything, was about to be installed as CBN governor by Umaru Yaradua, as another way of consolidating the Hausa/Fulani hegemony. Hmmm. By God, I hope we get tired of that rhetoric, but not when Reuben Abati, presidential spokesman, still inserts such balderdash into his every write up!

To my delight, the Sanusi man, ‘tweeted’ while he spoke in impeccable English during the Senate interview. I didn’t even know he could speak like that! It was then he revealed that he was an ex-Kings College boy, and obviously he had a lot of exposure abroad. Wow! I beamed at my co-watchers of the interview. This is my man! At least he was as cerebral as the departing Charles Soludo, whose policies I found somewhat gregarious. I did not quite believe in banking consolidation (the banks are now back to niche-playing), and I exited the banking industry just on the onset of that policy. Banking consolidation was a policy that was in tandem with an era where the managers of the economy felt that they had arrived, and that banks could now regulate themselves. Needless to say, it led to banks becoming ‘Too Big To Fail’, and course a phenomenon called ‘Regulatory Capture’; a scenario where the bank regulator begins to report to the banks it is meant to regulate. I also opposed Soludo’s proposal to ‘redenominate the Naira, like Ghana did, even though I held some trainings for the CBN. That policy has turned out disastrous for Ghana as we speak. But I digress.

My praise for Sanusi turned into consternation when he was asked about the crazy targets that banks set for their workers (which leads to prostitution, stress and toxic working environments), and he answered that banks have a right to set targets and nothing can be done about that. He also responded to the problem of high interest rates and bank charges by talking about the high cost of running power generating sets in the nation’s banks. I was consternated! So in my article in Sunday Trust after he was confirmed, titled ‘Rain Check for Sanusi Lamido’, I wrote as much and asked him to wake up to his responsibilities and ensure those grey areas are dealt with. Sanusi sent me a text acknowledging the article and promising to look into the areas I mentioned. He went to work naturally – not because of my article but because he knew what he intended – and a few bank MDs who thought they were untouchable, but who had apparently lost touch with reality – lost their shirts… and their many many properties. SLS asked me to do a writeup for him on what he needed to do to clean up the banking sector, which I did, but which was never acknowledged. He apparently knows much more than I could ever know, about what needed to be done. And he did them.

Later on, I would unofficially avail his email address to a group of bankers who had been suspended indefinitely, in anger, over a fraud for which they were not culpable. These kind of suspension or even termination, happens often in the banking industry, and oftentimes, it involves the exertion of inordinate penalties on lower cadre staff. They mailed Sanusi about their plight and before you could say ‘Jack Robinson’, they were recalled. I never even spoke with him. My respect for the man soared even further, because he has tried not to lose touch. He reads his mails and responds as appropriate. I see his interventions these days on some of the Nigerian listservs. The recent one was on the N5,000 note issue, where he offered some insights. At least he is not trying to shut himself in his ivory tower. But certainly the man is not perfect. No one is. The most trying period for Sanusi was perhaps his defense of this administration’s ill-advised removal of fuel subsidies in January, but even at that, unlike his colleagues who called Nigerians names – including our own Abati – Sanusi was the only one who tried to offer logical reasons. For that he almost came under mob attack in Kano; an event that may have informed the CBN’s ‘donation’ to the poor people of that great city.

It would come to pass that all of CBN’s policies will become more politicized than necessary. Or rather, because of the mercurial nature of SLS, they would attract more attention than needed. All sorts of people will join issues even on issues they are incapable of understanding. Many still see him as the representative of the much-dreaded ‘northern hegemony’, and would usually approach the policies coming out of the Central Bank, first as a ‘Sanusi’ policy, and then as a ‘religious or northern policy’. That was the fate of the Islamic Banking brouhaha, when, despite the fact that Islamic banking is now a global phenomenon, some of our financial pundits claimed it was ‘unconstitutional’, and some approached the courts. The Islamic Banking policy had been put in place by a southern CBN governor, Soludo, and the Islamic Bank – Jaiz – had only met the requirements within Sanusi’s tenure. Still, Nigerians brought the world down over the matter. I defended that policy because I am personally aware of what banks like Standard Chartered, HSBC and Barclays are doing with Islamic Banking, even in the countries from where we obtained Christianity. I am also aware that there is an Islamic Bank of Britain, with at least one branch on Edgware Road in London, among others.

Today, Jaiz Bank, Nigeria’s only Islamic bank, is tottering on the brink of collapse, according to news report, because of lack of patronage. Does that not tell anyone that the resistance to the idea was unnecessary? Has Nigeria become ‘Islamised’ since the bank opened? And was I not right, when I said then that ‘banking is not by force’, and if one did not have any business with an Islamic Bank, he didn’t have to worry about their existence? Most people who made the most noise then were actually broke, and did not have any business bellyaching about whether a bank exists or not. We should learn to concern and assist our people more with how they can attain financial stability and buoyancy, rather than get them into a flap about every arcane economic policy churned out by the CBN or any government agency for that matter. Indeed some of the policies have direct impact on the people (like this N5,000 note issue, but we have got to a point where we work up a frenzy before getting all the details). On the Islamic bank issue, the opponents of the policy greeted the news of the near-demise of Jaiz Bank, with even more sniggering, and a reminder to Sanusi that the bank is ‘unconstitutional’. No lessons learnt in fine-tuning their advocacy, or in tolerance of other people’s religion and rights. Perhaps even Muslims had churned the bank because of the negative publicity they generated for it. Who knows?

THE N5,000 NOTE PALAVER

The issue on the front-burner today, is the N5,000 note palaver. Many have commented, and many have missed the point. As a ‘Freakonomist” – those believers in Steven Levitt and Stephen Dubner, who think outside the box and applies economic theories, having in mind the peculiarities of their environment, I can tell that the real issues in this policy are:

1. Are we now properly burying the Kobo? And don’t the people need ‘debriefing’ on that matter, given that we haven’t seen Kobo around for a long time? Does the Kobo need a proper post-mortem at least to learn some lessons?

2. There may not be any inflation as a result of the introduction of the N5,000 note. At least most textbooks will say that. But by turning N5, N10 and N20 into coins, if the coins are rejected by the people still, for cultural reasons, we would see goods sold for anything between N5 and N45 presently, jumping to N50. Now that is real inflation and a serious issue for low income earners.

3. Whereas inflation – being a monetary phenomenon – does not occur as a result of currency creation (on the surface). There is a peculiarity in Nigeria, which is why Nigeria is the only country I have been (there could be others), where coins are just not in use. The word ‘coins’ is now used as an expletive in Nigeria. People abuse you by saying “I will change your money into coins!”, meaning they have more money than you do. What strategies are being put in place to ensure that the coins still do not disappear this time around like they have done several times in the past despite huge amounts spent minting them? Nigerians need assurances that yes, coins will truly come back to stay for the benefit of all of us.

4. I have always said that ‘EVERY POLICY IS BAD, WHEN THE PEOPLE ARE DISUNITED, IGNORANT OR FUNCTIONALLY ILLITERATE AND VICE VERSA’, because the policies of government will be effected and used by the people. In the current state that Nigeria is, with the country being more divided than ever, and with many Nigerians just poised to exploit government policies to their own advantage – and the disadvantage of all others – there is a likelihood that this policy will be misused and turned against the poorest of us. Perhaps there should be a longer period of public engagement

5. There is a need to deal with our culture – which has been altogether neglected. Traveling out of town every weekend, there are boys who hold N10, N20, N50 and N100 mint notes which they sell at a discount for normal notes for those going out of town to spend. An average Nigerian wedding costs between N2million and N8million. The not-so-average ones cost over N50million. People have held on to the old culture of spraying, and many empty their meager savings each weekend, on these ‘functions’. There is an ‘inflation’ related to this cultural phenomenon. Those who ‘spray’ N10, and N20 will now graduate to spraying N50 and N100. And people will naturally ‘graduate’ along that line. The CBN has been unable to stop our people from ‘spraying’ money at parties and thus dancing on top of money and soiling them fast. So this ‘spraying’ phenomenon, and the change in spending pattern as a result of the introduction of a new denomination, will change spending patterns. In fact, the real ‘big boys’ will not spray and spend only N5,000 notes, creating a new stampede for ‘get rich quick’ in society, and attendant ‘inflation’. Nigeria needs to document these kinds of economic phenomenon itself, because they are hard to explain to oyibos down at IMF and World Bank.

6. It is the type of phenomenon in 5 above, that is responsible for a certain type of inflation caused by ‘cashless’ policy. First of all, the availability of ATMs in all nooks and cranny of Nigeria means that people dash to make withdrawals at all times of the day. At times, it is better for one’s money to be out of reach. Because if it is within reach, one will spend. In our clime, with so much interdependency between people, there is a tendency to spend more since ATMs are all around. One will have to be determined, and sometimes heartless, to refuse to go to the ATM over the weekend, in order to entertain that your 4th cousin, who just appeared at your door – with his wife and 4 children in tow, just to ‘greet you. To make matters worse, the same people who can now access ATMs, can also do transfers for all sorts of purchases online. As someone who has lived abroad before, I know for a fact that availability of all sorts of bank cards – Debit or Credit Cards – is an impetus for spending. And this is why most people in ‘developed’ countries live mainly on credit. Savings is not even in their dictionary. Do we need to take our people down this route for now?

Many more reasons can be adduced to get the CBN to back down on the policy, but anyone proffering them must do their homework well enough, because the CBN has good reason to do what it is doing. We all have our day jobs and may not be able to take the kind of rigour that the CBN would have taken, with all the eggheads in its employment, in order to arrive at such policies. A regular Joe will never be able to comprehend some of the policies. There was even an explanation by one of the CBN officials on TV, that on some our currencies, Nigeria does not have all the rights to issue ie, there are agreements that Nigeria may have signed in the past, giving money to who-knows, for every of those currencies printed! Now, how will I know such a fact except I am an executive in the relevant department at the CBN?

THE JUSTIFICATION

The justifications are many – some have been adduced by the CBN while some can be surmised by a fair knowledge of how economies operate. What one may not be able to comment on are whether the timing is right, and whether the policy will fail like others. Also of contention is whether the amount to be spent on this policy is appropriate. To answer these questions, one needs some things. One, a very good HP Calculator, an Excel Spreadsheet at least, and data regarding how these things are done elsewhere, especially different quotations from different companies in different countries. This was one may arrive at whether there is corruption embedded in the figure submitted or not. It may not be fair to assume. One will also need a crystal-ball that can allow us look into the future to see whether the policy will fail, because it is a chicken-and –egg scenario. Once you say ‘go’, and it is done, we can only live with the consequences. We cannot turn back the hands of time. The people are however fairly justified in their apprehension that the policy may fail like others before it – after all we had at least two false starts under Professor Soludo, and government policies in Nigeria are usually fraught with inefficiency, poor planning and the big C, corruption.

Another quite cogent argument that have been advanced against the introduction of this N5,000 note, is the likelihood that it will aid corruption and money laundering, because in the era where corrupt people stash cash in the cats, hats, shoes, socks, bra, babariga, danshiki, Etiboh (Naija Delta), agbada, and god-knows-where-else, a handful of N5,000 notes will amount to a lot of money. The CBN has adduced an even stronger counter point to this, because in the case of Otedollar and Far-Crook for want of just one example, the base currency for that transaction was… yes, the almighty Dollar. Perhaps it is not the currency that will curb or increase corruption, but our ability to see the futility, folly, and stupidity of wanton earthly acquisitions, through fraudulent means.

Nigerians have also asked CBN to instead go down the route taken by Ghana. But like I mentioned earlier, the Ghanaian economy has been much worse-off for that decision called “redenomination”. When the redenominated sometimes in 2007, the Ghanaian Cedi was 0.92 to the USDollar. Today it is around 1.95, a freefall against the dollar. The Ghana Cedi has lost precisely 53% of its value since that redenomination! That means that a Ghana Cedi today is worth less than half what it was when the redenominated. The Naira has fared better, at least nominally, having lost about 24% of its value against the US dollar since then (it was N127 to the Dollar in 2007, and about N160 now, officially). This comparison with the Ghanaian situation is important, to let us know that it is not in every situation that we should rubbish our own, for oftentimes when it looks like the grass is greener on the other side of the fence, it actually isn’t. Nigeria’s commentariat should also choose their wars in order to win them.

The best of CBN’s policies and intentions, may therefore be victims of our collective past, and the precedents set by our successive governments in the area of ineffectiveness. That government includes the CBN itself. But below are the justifications which cannot be ignored, are valid and if I was a staff of CBN, I would say ‘carry go’, in Nigerian parlance:

1. THE NEED TO REDUCE CURRENCY MANAGEMENT COSTS
On one hand is the unassailable argument that since less people will handle the N5,000 note, and since it therefore stores more value for the holder, the CBN will be withdrawing that currency for destruction and reissuance, less often than the rest, therefore reducing its currency management costs in general. On the other hand is the fact that introducing the N5,000 note will lead to the printing of less of the other notes, since “M1 will not be increased” ie Money in circulation will not be increased in order not to directly fuel supply-side inflation. The currency management costs is a drain on tax payers’ money, and something needs to be done to urgently curb it. I think this argument is a strong one.

2. FORCED REINTRODUCTION OF COINS
In order to assist the country by reducing currency management costs, there is a need to bring back coins BY ALL MEANS. A coin stays much longer in circulation compared to notes. Therefore, the more value such a coin carries, the better for the economy. Perhaps that informed the decision by the CBN to convert up to N20 to coins in the hope that people will now use it. However coin-minting is expensive, and like I heard Nancy Illoh argue on her Money Show, the price of Copper and related commodities are high now in the futures market, so going for it now may be expensive. The problem however is that no one can really tell where commodity futures are going. You may wait, thinking prices will go down, and then they go up! So it may be better to do what you want to do and move on… Reintroducing coins will be a great achievement for the CBN if it is able to pull it through, but much education is required. A psychological effect of that success will be that finally, Nigeria may start to gravitate away from the “Freak” economy that it is, towards more normalcy, like other countries of the world where coins are used.

3. THE NEED TO REDUCE “VOLUME” OF MONEY IN CIRCULATION
As stated in 1 above, bringing in the N5,000 and reducing some of the others, will reduce the sheer volume of currency in circulation and the costs incurred by banks in sorting and processing them. Perhaps the banks can reduce their charges on customers’ accounts. Wink wink!

4. SEIGNORAGE
In economics there is gain to the government accruable from currency printing. Whereas the coins are minted at a higher cost than the value they command (because they are metal-based), the notes are printed often at cheaper costs than the value they command. Therefore, the higher the value on a note currency, the higher the profit made by government, from printing them and putting them in circulation. For example, it could cost the same N5 per note more or less, to print a N50 and a N5,000 note. So the government gains N45 for every N50 printed for circulation, and N4,995 for every N5,000 printed and put in circulation. That is called seignorage, and a major source of income for say the USA, because it prints a lot of its currency for use globally and the US Government makes profit from printing all those currencies, especially the $100 note. The risk here of course is that there are people waiting to counterfeit the N5,000 note, so awareness and security features must be very strong. I must say we are not faring too badly with the N1,000 note when it comes to counterfeiting.

5. STORE OF WEALTH, CURRENCY CONVERTIBILITY AND DE-“DOLLARISATION” OF ECONOMY
Even the argument about promotion of corruption and money-laundering as strong as it is, is countered by the CBN as explained above. An introduction of N5,000 creates an avenue to store wealth more compactly, and even if it is corrupt money, perhaps the thinking by CBN is that rather than such monies chasing the USDollar and thus putting the Naira under more pressure, we are better off having such money in Naira, thereby building a more stable currency. As I have mentioned earlier, . As a ‘Freakonomist’ again, I have had cause in times past to analyse Nigeria’s corruption, and often concluded that the real problem is that people steal money from their own people and use such monies to better other economies. Oftentimes, such monies stolen are lost to other countries eg the case of Ibori. Is the CBN being more pragmatic than our best intellectuals?

It is on record, the amount of corruption that gentlemen like JD Rockefeller perpetrated, or even JP Morgan II in his time. Many more. But they kept their money in the US Dollar, and used it to create jobs for their own people. Rockefeller’s Standard Oil is now the global Mobil. His steel companies are still there. But Nigeria’s corrupt people have no initiatives and nothing on ground to show for their corruption. That is why I say that they are not corrupt but simply insane! The current problems faced in the global economy, especially in the USA and Europe, stemming from the tricks played in the financial sector, is largely because this time around, the financial mavericks refused to keep their gains within their country. Most of the monies lost in the financial markets are sitting pretty in tax havens – a rare occasion where the thieves in advanced countries copies their dumb cousins in Africa (Nigeria especially)

As it pertains to the strength of currencies, it is a fact that currencies that chase after others will ultimately lose strength and be weaker. Nigerians like to talk about the time when the Naira was strong. But it was for a short while, and the Naira could not withstand its own baselessness ie (no strong manufacturing to support its value but only raw commodities), and the pressure by the ‘international community’ (that rampaging gang of deceivers who have now escalated to the level of destroying countries through internal wars), to keep it in its rightful place. Nigeria, like every other country in sub-Saharan Africa, was made to devalue its currency, while still being heavily import-dependent, a scenario that ensures that money only flows out of the country, and not into it.

This new currency seems to serve a strategic value to 1. Deemphasise the reliance on the US Dollar, 2. Ensure that more Naira is kept within the country and 3. Prepare the currency for ultimate convertibility. Currency convertibility is a scenario where the currency is recognized globally and thus accepted. This is what creates a demand for the currency and makes the currency strong like we would want it to be. For example, if the currency was fully convertible, we would not have to look for US Dollar to purchase with Naira (Naira pursuing/chasing Dollar), before we travel to the USA or UAE. We would just travel with our Naira. “That would be the day”, I can hear you say. But remaining where we are, we can never get to that point, and if we don’t get to that point, we can never reposition the economy. In my years as a banker, I never saw any Import Form (Form M), denominated in Naira. Not even the Export Form (NXP Form), meaning that even Nigerian exporters do not desire the Naira in payment for their goods. All the while, the Naira chases the Dollar, and gets weaker. With this new currency, perhaps we may, just may, develop some respect for the Naira!

6. MONOPOLIES OF NAIRA PRINTING
A top official of the CBN hinted that on some of our currencies, Nigeria does not still have the full rights or monopoly. That was cause for concern for me. He hinted also that the introduction of the N5,000 note was a way of wresting back some of the controls on our currencies from where the control now resides. There are many secrets in government today, some of which are affecting the ordinary people. Only those at the driver’s seat will know what they are. I believe the Nigerian elite should try and find out the real issue here and make sure they err on the side of patriotism, rather than stand far and criticize every policy, at the risk of Nigeria continuing to be a slave country to the powerful ones. Granted that this cannot be achieved by force, but by compromise for powerful countries are actually… powerful!

7. THE NEED FOR CBN TO DO ITS JOB
Ultimately, there is a need to allow CBN do its job. If indeed it is a policy for Central Banks to review their currency policies every 5 years, our Central Bank should not be an exception, just because we have a track record of inefficiency in government – and even in the private sector. But of course it should not be a one-track-minded approach. Still, the Currency Operations and Monetary Policy groups in the CBN must be allowed to run professionally and to proffer policies for the country, in line with their analysis of the economy. With the number of PHDs in those departments of the CBN, there must have been some rigour that went into this and other policies, which those of us outside cannot muster from the comfort of our sitting rooms. We outside do not also have access to the data at their disposal. We must ensure that we don’t hasten to shoot down policies, but first do proper homework before constructive suggestions. Agreed, the people are often the last hope in society. We laymen may be the ones who will save the government from its own policies. But this time, the response was rather hurried, and the barking, apparently up the wrong tree…

SOME MORE CRITICISMS
Since drafting this response, I put it out on my facebook page and received further critique from far and wide. Some of the issues are dealt with below;

IS IT AN ELITIST POLICY?
The question has been asked if this is the best use we can put the over N40billion that CBN intends to spend for this project. On the surface, it seems not to be worth it. But another way of looking at it is that if we truly get the benefits enumerated above, then this would have been a great move. If Nigeria spends N40billion to get a lifetime advantage, saving the country untold Trillions of Naira as a result of respect returning to the Naira and the conservation of our money in our own country, then that is good investment

CBN AND INDUSTRIAL DEVT
The argument has been made why CBN cannot spend the same amount revamping industries. Globally, it is on record that in times of economic stress, when nations are going through dire straits, Central Banks have always been pitched against lawmakers for ‘going outside their remits’. This is because Central Banks often ‘intervene’ in different industries to ‘provide stimulus’, or to outrightly rescue those industries for the greater good. But it must not be forgotten that Central Banks are not Ministries of Agric, Industry or Commerce. What we should encourage the Central Bank to do, are what they are set up to do – monetary policies and currency management.

In this instance, the CBN’s policy will help in rejuvenating our moribund industries through the process I mentioned above. It will be indirect in nature. If the CBN’s management of monetary policy encourages people to keep more money in Nigeria, and in the national currency, then ultimately such monies will make their ways into the industrial sector. Whereas the CBN has set up different funds for different industries today – Agric Fund, Aviation Fund etc – such funds should be but temporary as the Central Bank should refocus on its core mandate after any crisis period.

DEVALUATION
One great concern I must add, regarding this subject, and an argument I haven’t heard from any quarters, is that an unexpected and massive devaluation of the Naira, will make mincemeat of this policy, because if the N5,000 note debuts at somewhere close to $35 in value, all the gains of store of value and de-dollarisation will erode if the value of that note drops to say $15. The only strategy to curtail this risk may be to ensure that the core reasons for having that note is quickly ingrained into the subconscious of Nigerians before devaluation comes. It seems most likely that the Naira may devalue against the Dollar in the future, especially if for any reason, the price of our main commodities drop.

CAVEATS

1. I have never met Sanusi one on one, but seen him from a distance. Apparently one does not have to meet ‘a whole governor’ of the Central Bank to run training in finance, statistics and related subjects.
2. My training firm has done business with the Central Bank since the Soludo era. Why not? I am an ex-banker, an Economist, a Chartered Accountant, and I hold a Masters Degree in Financial Markets and Derivatives. I also have executive training at London Business School and Harvard, plus we are about 50 faculty members at the firm I manage – 3 full Professors on board.
3. I cannot comment on whether there is fraudulent intention beneath the plans for the new currency. I cannot see people’s minds.
4. I cannot comment on the adequacy or otherwise of the budget for the currency as I do not have the details and that will require extensive research. I believe though that most costs can be reviewed downwards and/or phased over a period of time to reduce the impact
5. My comments are strictly based on the economic relevance of the policy, and the socio-cultural issues that I think matter, have been embedded in my analysis
6. I cannot tell for certain that this initiative will be successful at the end of the day. Many factors intervene in determining the success or otherwise of any policy.
7. I must emphasise that I am not a spokesman for the CBN and I have only spoken as a private citizen, expressing my views like anyone else. I have only brought my little knowledge of economics to bear on this writeup. I have also not spoken with anyone at the CBN officially about this policy, but I have read a brief response by the CBN Governor, to questions raised about the matter, as well as listened to TV programmes where CBN agents defended the policy.
8. As someone who emphasizes the value of history, I would want a rethink of the strategy of dropping great sages like Tafawa Balewa, Alvan Ikoku and Murtala Mohammed off our currencies. Perhaps the CBN should reconsider the design of the notes if it eventually carries through the policy