28 August 2012

Nigerians Speak On New N5000, Coins

Photo: Vanguard
Nigeria N5000 note.

Since the Central Bank of Nigeria (CBN) announced its intention Thursday to introduce N5000 note and converting the N5, N10 and N20 notes into coins, Nigerians have been reacting differently.

The CBN said the new policy takes effect early next year. Our reporters sampled the opinions of ordinary people on the street of Abuja, yesterday and below are the responses of those they spoke with.

Ismail, 25, a nail cutter, said the introduction of the N5000 note is useless to him because it will only benefit the rich. On the coins, he said he prefers the paper currency.

Abiodun, 26, a businessman, said the introduction of the N5000 note will give rise to inflation and corruption in the country because "this is not the right time for such and the introduction of coins will devalue our currency."

Rafael, 40, vulcanizer, said the introduction of N5000 note will be of a greater disadvantage to the poor masses, because prices will go higher and the introduction of the coins is a very bad idea and "will be a regrettable action in Nigeria."

Lawan, 26, labourer, said the introduction of the N5000 will be of benefit to the rich and a disadvantage to the poor masses in the country.

Yakubu Umar, 20, labourer, said the introduction of coins will benefit the poor masses, but will be useless to the rich.

Ibrahim Ahmed, 30, cement supplier, said the introduction of N5000 note will create a downfall in the country. He said, "It is for their own selfish interest. For the poor masses, it will be very difficult to get the money because they have to work very hard while the introduction of coins is a bad idea."

Mansur Haladu, 47, Keke NAPEP driver, said the introduction of the N5000 is for the benefit of the rich people, "it has little advantage on the poor masses while the introduction of the coins is not necessary."

Mallam Mohammed Awwal, 17, cart pusher, said the introduction of the N5000 note will bring improvement.

Ummi, 11, food hawker, thinks this is not the right time to bring such policy, but she however said the introduction of coins will bring relieve to the people.

Mohammed, 21, yoghurt seller, thinks the introduction will be of benefit of the rich people not the poor masses, it will increase corruption in the country while the introduction of the coins will be of great benefit to the poor masses.

Moses Maina, 28, bus driver, thinks the introduction of the N5000 note will affect the poor people and the currency will be valueless while the introduction of coins will benefit the poor masses.

The News Agency of Nigeria reports that some Nigerians have advised the CBN to reconsider its decision to introduce new N5000 note and coin some naira denominations.

Those that spoke with NAN all agreed that the introduction of the new note and coins would portend grave implications for the economy.

Mr. Nnamemeka Obiaraeri, the Managing Director, Taurus Capital Advisory Service Ltd., said that the apex bank should revisit its "redenomination policy" rather than introduce the new note.

Obiaraeri said the redenomination policy, which was proposed by Professor Charles Soludo, a former Governor of CBN in 2007, would strengthen the nation's currency.

He said that the introduction of new note and coins would be counter-productive as it would increase inflation rate in an economy that is already fragile.

"Our economy is not robust; there is high rate of unemployment and the rate of inflation will increase with the N5000 note and those new coins in the system," he said.

Mr. Bade Oludahun, a currency analyst at Forex Time Trading West Africa said the proposed new naira note would "weaken" the middle class.

He said that the proposal would lead to devaluation of the naira, stressing that it would be better to encourage the use of existing coins.

Mr. Boniface Okezie, President, Progressive Shareholders Association of Nigeria said that the policy would contradict the cashless policy.

He said: "The CBN should work more on strengthening the naira, instead of introducing a big denomination like N5000. Again, you wonder why the CBN wants to introduce coins and a high naira denomination now that it is talking about a cashless monetary system. I think this proposed policy will defeat the latest policies of the CBN."

Okezie said that it would be difficult for Nigerians to begin to carry coins and large amounts of cash about.

Mr. Gbenga Okeowo, a businessman, urged the CBN to consult widely before implementing its new currency policy.

He said: "The introduction of those coins and the N5000 note is inappropriate and is inconsistent with the cashless policy being promoted by the apex bank. I propose that a national conference must be convened by the CBN Governor, Malam Sanusi Lamido Sanusi, to deliberate on the policy."

Okeowo said that a national debate was necessary to give the proposal "wide spread legitimacy."

Miss. Linda Aken, a GSM recharge card vendor said that their business would be affected by the introduction of N5000 notes.

She said the proposed policy would compound the problem of giving customers their balances after transactions.

She said: "We, recharge card sellers, are still battling with giving customers that use N1000 to buy N100 recharge cards their balances. Most of the time, we don't make much sales when customers come with N1000 notes to buy small amount of airtime.

"I know that our sales margins will definitely drop if N5000 notes are introduced into the market," she said.

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