Naira redesign: Halt economic chaos, NECA urges government
The Nigeria Employers’ Consultative Association (NECA) has urged the Federal Government to look beyond the politics of the Naira redesign and focus on the damaging effects on businesses and the economy at large.
This is just as the body said the value chain in the formal and informal sectors with over N10 billion cash transactions daily is almost destroyed with consequences for employment, business sustainability and national development.
Director-General, NECA, Adewale-Smatt Oyerinde, said it was unfortunate that too much attention has been placed on the politics of the Naira redesign with the government and the Central Bank of Nigeria (CBN), shifting attention away from the damaging effect of the cash squeeze on businesses and the already fragile economy.
Oyerinde, who spoke in Lagos, said no matter how well-intentioned, a good policy with a poor implementation plan will ultimately fail, eroding the little gains the economy would have made.
He lamented that the policy is also flawed by improper and shortsightedness in implementation.
According to him, it does not seem that the CBN understands the challenges nor has 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.
He said in the last few weeks, with the cash squeeze and the purchasing ability of Nigerians greatly impaired by the alleged shameless implementation of the policy, the economy had witnessed a significant bashing with a report stating that the real sector witnessed about a 40 per cent drop in productive activities.
He lamented that as the cash crunch continues, thousands of productive hours are lost daily in queues by employees and many cannot even get to work.
While making recommendations for a quick resolution of the challenges, the NECA boss urged that while the CBN’s desire for a cashless economy was commendable, it should not in the process exclude those it intended to include.
He urged that critical and immediate effort should be made to improve alternative routes to cash, thereby ensuring seamless transactions before going digital.
“It is callous to deprive citizens of the new Naira notes after cajoling them to deposit the old ones in the banks. We urge the CBN to sanction the commercial banks that are 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.
“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, who witnessed various degrees of successes and failures when they implanted their currency redesign, but will also do a thorough analysis and simulation of likely social and economic challenges that might arise and definitive response to those challenges,” he said.