‘Printing of more notes, alternative cash routes’ — NECA proffers solutions to naira scarcity

The Nigeria Employers’ Consultative Association (NECA) has advised the federal government to look beyond the politics of the naira redesign policy and focus on its damaging effects on businesses and the economy.

In a statement on Sunday, Adewale-Smatt Oyerinde, NECA director-general, said the ongoing cash crunch has had a devastating impact on the formal and informal economy.

‘’In the last few weeks, with the cash squeeze and the purchasing ability of Nigerians greatly impaired by the poor implementation of the policy, the economy has witnessed a significant bashing,” the statement reads.

‘’This is so, with a report stating that the real sector witnessed about 40 percent drop in productive activities.

‘’As the cash crush continues, thousands of productive hours are lost daily on queues by employees and many cannot even get to work.

‘’The value chain in the formal and informal sector with over N10 billion cash transactions daily is almost destroyed with consequences for employment, business sustainability and national development.”

The NECA DG called for critical and immediate efforts to be made to improve or upgrade alternative routes to cash.

He said the measure would ensure seamless transactions in the country before the transition to digital channels.

Oyerinde described the series of actions being taken by the Central Bank of Nigeria (CBN), such as the cash swap programme, as an “afterthought” after the reality of resistance by Nigerians.

‘’It is callous to deprive citizens of the new naira notes after cajoling them to deposit the old ones in the banks,” the statement reads.

‘’We urge the CBN to sanction the commercial banks that have been found to be complicit in the whole show of shame, even as the CBN cannot extricate itself from being complicit.

‘’As an immediate action, we align with the position of the Council of State that the CBN should release more new naira notes into the economy or allow the use of the old ones, pending a time when it will demonstrate competence by not always putting the cart before the horse in the implementation of monetary policies.”

The NECA boss said the naira redesign policy with its objectives as listed by the CBN was laudable.

He, however, said that like many of the CBN’s initiatives, it was flawed by shortsightedness in implementation.

‘’For a definitive monetary policy as the naira design, it is expected that the CBN will not only take lessons from other countries like India, Myanmar, Australia, Venezuela, Zimbabwe and the European Union, which witnessed various degrees of successes and failures when they implemented their currency redesign,” the statement adds.

‘’However, CBN will also do a thorough analysis and simulation of likely social and economic challenges that might arise and a definitive response to those challenges.

‘’Thus far, it does not seem that the CBN understands the challenges, nor have solutions to the economic issues, thereby allowing speculators and economic saboteurs to have a field day at the expense of legitimate businesses and the economy.”