Report: Nigerian Central Bank Spent Over $1.8 Billion Managing Local Currency

During her quality earlier Nigerian lawmakers, Aisha Ahmad, the lawman politician of the Central Bank of Nigeria (CBN), told lawmakers that retired of the astir $1.8 cardinal utilized to negociate the section currency, implicit 90% of this full was reportedly utilized to money expenses associated with the accumulation of banknotes.

The Growing Cost of Maintaining the Naira

According to Aisha Ahmad, the lawman politician of the Central Bank of Nigeria (CBN), betwixt the years 2017 and 2021, the apex slope spent an equivalent of astir $1.8 billion, oregon 800 cardinal naira, managing the section currency. The accumulation of caller banknotes unsocial accounted for much than 90% of this figure.

As per remarks published by the Punch, Ahmad, successful her caller quality earlier Nigerian lawmakers, besides claimed that the outgo of maintaining the section currency has been expanding by implicit $22 cardinal annually. Before Ahmad’s disclosure, Kingsley Moghalu, a erstwhile CBN lawman governor, had besides told lawmakers that the cardinal slope uses astir $336 cardinal to negociate the currency.

In summation to incurring precocious costs associated with managing the naira currency, the CBN has to contend with the accrued hazard of counterfeiting, the study said.

Meanwhile, successful her testimony, Ahmad partially blamed the spiraling costs connected what she characterized arsenic wholesale hoarding of the naira by the Nigerian public.

“An reflection supported by statistic shows that currency extracurricular banks consists of implicit 80 per cent of the currency successful circulation; worsening [the] shortage of acceptable banknotes successful circulation. This portends [a] antagonistic nationalist cognition of the slope and increases [the] menace to fiscal strategy stability,” Ahmad is quoted arsenic saying.

To assistance the cardinal slope flooded immoderate of the challenges identified by Ahmad, the CBN introduced into circulation recently designed naira banknotes connected Dec. 15. At the aforesaid time, the slope said Nigerian residents successful possession of the aged banknotes should instrumentality these earlier oregon by Jan. 1, 2023.

CBN Not Targeting Politicians

The cardinal slope has besides restricted the magnitude of currency that individuals and firm organizations tin withdraw. However, immoderate Nigerian commentators person accused the CBN of utilizing the alleged naira redesign argumentation to people politicians. Responding to these allegations, Ahmad reportedly told lawmakers that the bank’s determination to bounds currency withdrawals was based connected research.

“I person to marque it precise wide that the CBN is an autarkic instauration and our decisions are taken based connected probe — it is the enactment of galore teams moving unneurotic crossed the antithetic directories,” Ahmad reportedly said.

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