Why naira swap won’t tame terrorism, by Nextier report

• SERAP sues Buhari over ‘unlawful’ ban of old N500, N1,000 notes

President Muhammadu Buhari’s decision to redesign the naira, as part of efforts to tame terrorism in Nigeria, is unlikely to yield desired results, says an investigative report released by public policy research group, Nextier.

The report advised that more pertinent is government’s political will to prosecute already identified terrorism sponsors, including those unmasked by foreign partners, like the United Arab Emirates (UAE) and United States of America (U.S.).

On November 23, 2022, Buhari and the Central Bank of Nigeria (CBN) unveiled redesigned N200, N500 and N1,000 notes, explaining that individuals and corporate organisations would be restricted to a weekly N100,000 and N500,000 cash withdrawal limit over the counter, respectively.

In response to fears that the swap aims to inflict further hardship on innocent Nigerians, Buhari explained that the measure targets corrupt persons and terror financiers who hoard ill-gotten cash to bankroll criminal activities and violence. He added that the action would make the old notes unusable by criminals who have stockpiled them.

But Nextier’s report, released over the weekend, says: “The ill-timed and quick-fix policy is a wild goose chase.”

It says “to mitigate terrorism financing, the government has to take some bold steps, including timely arrest and prosecution of persons indicted for terrorism financing, strengthening collaboration with other countries, such as UAE and U.S., and sanctioning complicit banks which are used to siphon money to terror groups.”

It adds, moreover, “Nigeria should stop politicising or treating indicted sponsors of terror with kid gloves. The UAE, the U.S. and some other countries have demonstrated a willingness to support Nigeria in the war against terrorism financing by availing the country with the names of indicted sponsors.

“Thus, the onus is on Nigeria to follow up on such external intelligence. The CBN and other banking regulatory agencies and institutions should be more diligent in their watchdog roles.
“They should expose and sanction banks, which collude with terrorist groups or their financiers appropriately, in line with extant rules.”

Meanwhile, Socio-Economic Rights and Accountability Project (SERAP) has sued Buhari and two others at the Federal High Court, Abuja, over alleged unlawful ban of the old N500 and N1,000 banknotes, contrary to interim injunction by the Supreme Court.

Joined in the suit, as defendants, are the Attorney General of the Federation and Minister of Justice, Abubakar Malami, and the CBN.

The Supreme Court, in a case initially brought by 10 states, recently, held that the old banknotes remain legal tender, pending the determination of a motion on notice fixed for February 22. The deadline for the swap of the old notes expired on February 10.

However, Buhari in a national broadcast, last Thursday, directed CBN to recirculate only the old N200 notes, thereby overruling the Supreme Court and banning the use of old N500 and N1,000 notes in the country.

In the suit, number FHC/ABJ/CS/233/2023, filed last Friday, SERAP is asking the court to determine whether Buhari’s directive is not inconsistent and incompatible with constitutional duties to obey decisions of the Supreme Court and oath of office.

SERAP is asking the court to declare that Buhari’s directive is a fundamental breach of Section 287(1) of the Nigerian Constitution 1999 (as amended) and his constitutional oath of office, and therefore unconstitutional, unlawful, null and void.

No date has been fixed for hearing of the suit.