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Labour, Opposition Condemn Sanusi’s N5,000 Note Project

By on August 27, 2012

CBN Governor, Lamido Sanusi

Knocks for Sanusi’s intent to introduce the N5,000 note have come from several different corners including the National Labour Congress, Trade Union Congress and Action Congress of Nigeria amongst other parties.

In a statement released by the Trade Union Congress over the policy, the Labour body called it a policy that will lead to the devaluation of the Naira, trigger request for salary increases and should be discussed by the entire country instead of being unilaterally adopted by CBN.

The TUC statement reads, “We are surprised that the CBN could at this time decide to embark on the mission to make changes to the nation’s currency and to also create a N5, 000 denomination. The intention at coining the N5, N10 and N20 denominations does a psychological damage to the value of the Naira. We are surprised that despite CBN’s acquiescence to this, it still intends pushing forward with this objective.

“If the objective is truly the pursuit of a cashless economy, why would the CBN consider it too expedient at this time to also pursue concurrently the printing of more currencies especially the jumbo N5, 000 note?

“It should be remembered that the CBN has changed the face of the Naira severally in the past years mouthing the same arguments which have all proven in the long run to be baseless. We see this rather as a sign of a monetary system management gone awry and the deeper malaise of the continued wrong – headed management of the nation’s foreign exchange receipts.

“We therefore call on the CBN to immediately suspend this pursuit, allow it to be discussed nationally as our experience has shown that the outcome of this will affect majority of Nigerians adversely before any further action is taken.  We would also want the CBN to tell Nigerians what it will cost the tax payers to move to this new currency regime.”

NLC Vice-President, Comrade Issa Aremu said, “We oppose the proposed introduction of higher banknote of N5000  next year as announced by the Central Bank of Nigeria. Lower banknote denominations of N5, N10, and N20 will be also coined according to the Central Bank of Nigeria. The current highest banknote of N1000 was introduced in 2005.  We had currency review in 2007 and 2009. It should not be customary for every CBN governor to change the nation’s banknotes.  Incessant turning out of higher banknotes is an attempt to legitimize the devaluation of the Nigerian currency.  There is a direct relationship between higher banknotes and devaluation of the currency.”

He added, “The CBN should concentrate on stabilizing the value of the Naira rather than legitimizing the devaluation of the currency.”

ACN National Publicity Secretary Alhaji Lai Mohammed also voiced the party’s grievances with the CBN over the policy.

He said, “First, there is a strong historical evidence that the introduction of higher and higher face value currency notes in an economy often signifies a regime of increased and sustained fiscal deficit financing. Secondly the issuance of such high value currency notes is likely to be perceived as an indication of government’s failure to effectively control inflation

“Thirdly the issuance of the N5,000 currency note runs counter to the recent policy of the Central Bank of Nigeria to promote a “cashless” economy by encouraging the increased use of non-cash transaction instruments. The introduction of a high face value currency note actually does the opposite because by reducing the unit cost of printing and transportation, it actually would promote the use of cash.

“Fourthly, the issuance of the new N5,000 currency note also runs counter to the government’s often repeated commitment to fight corruption. It is widely recognised that large scale corruption tends to be facilitated by the ease with which unrecorded and large cash transactions can be made.”