The Finance Minister also warned the CBN that the naira redesign policy will come with some consequences.
The Minister of Finance, Budget and National Planning , Zainab Ahmed, has said the Central Bank of Nigeria (CBN) didn’t consult her ministry before going public with the new monetary policy.
According to reports the CBN Governor, Godwin Emefiele, announced on Wednesday, October 26, 2022, that the apex bank will introduce redesigned N200, N500 and N1000 naira notes with effect from Dec 15, 2022.
Emefiele said the action was taken in order to mop up excessive naira notes currently in circulation as well as curbing crimes including kidnapping and money laundering.
But, the Finance Minister has dissociated herself from the new monetary policy claiming that the CBN acted unilaterally.
Ahmed said this during the 2023 budget defence session she had with the Senate Committee on Finance, chaired by Senator Solomon Olamilekan Adeola, on Friday, October 28, 2022.
While responding to questions from the senators, the Minister warned the CBN of consequences that may arise from the policy.
Senator Bamidele Opeyemi (APC-Ekiti) had decried the spontaneous increase in price of dollar to naira at the parallel market since the policy was announced by the CBN.
He expressed concern on the likely consequences of the policy on the nation’s economy, given the astronomical increase of forex.
Collaborating, Senator Adeola said the announcement of the policy had already caused the value of the Naira to a US dollar to rise from N740 to N788 due to rush in exchange of stashed Naira Notes for foreign currencies, particularly the dollar.
He said, even though the policy may be a well-conceived one, the consequences of the policy were that price of dollar to the naira was rising, adding that it might rise to N1,000 before December, when the policy would take off.
In her response, Ahmed said she received information on the new policy just as other Nigerians, saying that her ministry, as a fiscal authority, was not part of the process leading to formulation and announcement of the policy.
“We were not consulted, it was an announcement that we heard, it was said that part of the reason advocated was that it was one of the ways to mope up liquidity to manage inflation.
“But there are consequences that we are also looking at, what will the consequences be, there will be some benefits, but there will be some challenges.
“And I don’t know whether the monetary authorities have actually looked very closely as to where the consequences are and how they can be mitigated.
“So I still advise that you have that discussion with the monetary authorities.”
