The Nigeria Governors' Forum (NGF) has asked its members to support the Supreme Court's decision on the Central Bank of Nigeria's (CBN) naira redesign policy against the Federal Government, which is scheduled for Wednesday.
The NGF asked Attorneys General of the 36 states to review the complaint before the Supreme Court in order to consolidate the legal reliefs sought by states in a communiqué published yesterday, following its meeting on Saturday in Abuja.
The complaint was initiated by the governments of Kaduna, Kogi, and Zamfara states before Kano, Niger, Ondo, and Ekiti states joined last week.
Following the meeting, the governors stated that the country is at risk of recession as a result of the CBN's naira exchange strategy.
The governors, across party lines, blasted CBN over the handling of the policy in a communiqué issued by NGF chairwoman and governor of Sokoto State, Aminu Tambuwal, saying that the consequent currency scarcity is causing hardship for Nigerians.
They accused the central bank of carrying out a "currency confiscation" scheme that is generating hardship for Nigerians. The governors also demanded a halt to the CBN's effort to phase out the usage of old currency notes after two deadlines failed to address naira scarcity across the country.
"The CBN's justification for what it calls a "astronomical growth in money in circulation" as the rationale for this strategy is not substantiated by its own data.
"According to the CBN, the currency in circulation has risen from N1.4 trillion in 2015 to N3.23 trillion in October 2022. CBN appears to have ignored the country's nominal GDP increasing throughout this period, the doubling of consumer prices, rising population, and the impact of CBN's massive Ways & Means advances to the Federal Government over this period.
"In the circumstances, it is safe to draw either of two conclusions - the CBN statistics may be incomplete or in fact, Nigerians may have done extraordinarily well in the transition to a cashless economy.
"In addition, considering the huge informal sector in the nation, the number of banknotes generated in exchange so far by the CBN shows it greatly overestimated the economy's actual cash needs.
"The inability to use the new notes has had far-reaching economic effects, leading to the emergence of the naira black market, severe food inflation, variable commodities prices based on the method of exchange, and long queues as well as crowds around Automated Teller Machines (ATMs) and banking halls across the country. The country is vulnerable to a CBN-induced recession.
"It is our considered conclusion that what CBN is at present pursuing is a money confiscation scheme, not the currency exchange policy intended under S20(3) of the CBN Act, 2007. Currency confiscation in the sense that the liquidity available to the general population is woefully inadequate due to restrictions on the amount that can be withdrawn regardless of the amount deposited."
The governors' stance comes despite the suffering of Nigerians who have struggled to acquire cash for regular transactions. The scarcity of currency is the result of the Central Bank of Nigeria's decision to redesign the notes of the three largest naira denominations: N200, N500, and N1,000.
As a result, the governors "urged the Federal Government and the Central Bank of Nigeria to respect the rule of law and listen to the voice of reason expressed by Nigerians and other stakeholders, including the Council of State, before the damage to our economy becomes too great to repair by the next administration."
As the debate over the redesign of the naira continues, the Ekiti State government asked to be joined as a co-plaintiff in the litigation against the Federal Government over the CBN deadline for exchanging old notes for new ones.
According to the governor's Chief Press Secretary, Yinka Oyebode, the Ekiti State Attorney General and Commissioner for Justice, Mr. Dayo Apata, submitted the Application for Joinder on Friday at the Supreme Court.
Plaintiffs in the case are the Attorneys General of Kaduna, Kogi, and Zamfara states, while the defendant is the Attorney-General of the Federation, Abubakar Malami (SAN).
Also over the weekend, the Niger State administration filed a lawsuit against the Federal Government over the CBN policy's execution. According to a statement issued by the Attorney General and Commissioner for Justice, Nasara Danmallam, the suit with the case number SC/CV/210/2023 was filed on Friday.
According to the statement, the complaint seeks, among other things, an extension of the period set by the CBN for the currency swap and withdrawal from circulation of the old notes.
Danmallam went on to say that the Niger State government stated in the affidavit in support of the originating summons that the non-availability of the freshly redesigned notes has imposed untold pain and suffering on inhabitants of the state, particularly those residing in remote communities.
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