According to a recent analysis by the economic think tank Centre for the Promotion of Private Business, the Federal Government’s over 70% mop-up of cash through the Central Bank of Nigeria has caused the Nigerian economy to stagnate and lose over N20 trillion.
It said that in addition to crippling economic activity nationwide, the prolonged severe cash shortage now posed a serious threat to the livelihoods of the majority of Nigerians.
“Millions of citizens have slipped into penury and destitution as a result of the disruptions and tribulations perpetrated by the currency redesign policy, especially the mopping up of over 70 per cent of cash in the economy,” the Director, CPPE, Dr. Muda Yusuf, stated, while reacting to the currency redesign policy.
Calling for an urgent intervention by the President, Major General Muhammadu Buhari (retd.), he stressed that “Nigerians have not been this traumatised in recent history.”
Yusuf added, “The economy is gradually grinding to a halt because of the collapse of payment systems across all platforms. Digital platforms are performing sub-optimally because of congestion; physical cash is unavailable because the CBN has sucked away over 70 per cent of cash in the economy; and the expected relief from the Supreme Court judgement has not materialised.
“The citizens are consequently left in a quandary. The banks claimed that the CBN has not officially communicated the Supreme Court judgment to them for any actions.
“The President has maintained a worrying muteness on the judgment; the market women and men are waiting to hear from President Buhari or the CBN governor on the legal tender status of old currency notes.”
The CPPE boss noted that curiously, there was an apparent reluctance or unwillingness by the Federal Government and the CBN to comply with the Supreme Court judgment, describing this as very disturbing and inexplicable.
“Meanwhile, Nigerians continue to groan in the adversity inflicted by the acute cash shortage amid rejection of old currency notes by market operators, refusal by banks to accept the old notes, silence by the Presidency on the Supreme Court judgement; and absence of official pronouncement by the CBN on the issue,” Yusuf stated.
He pointed out retail transactions across sectors had become nerve-wracking and distressing as payment system challenges persisted.
“Since the onset of the cash crisis, the Nigerian economy has lost an estimated N20tn. These losses arose from the deceleration of economic activities, crippling of trading activities, stifling of the informal economy, contraction in the agricultural sector and the paralysis of the rural economy. There are also corresponding job losses in the hundreds of thousands.”
