The Nigerian economy has lost a staggering N20 trillion due to the removal of cash from circulation, according to a report by the Centre for Public Policy and Economic Analysis (CPPE). The report states that over 70% of cash has been sucked away from the economy, leading to a significant decline in economic activity.
The CPPE report highlights that the removal of cash from circulation is due to various factors, including increased digital transactions and hoarding of cash by individuals and businesses.
The report also notes that the government’s efforts to reduce corruption and money laundering have contributed to the decline in cash circulation.
The impact of this loss on the Nigerian economy cannot be overstated. With less cash in circulation, businesses are struggling to stay afloat, leading to job losses and reduced economic growth. The CPPE warns that if this trend continues, it could lead to a full-blown recession.
In a press release by CPPE’s chief executive, Dr. Muda Yusuf, the Center said the economy is gradually grinding to a halt because of the collapse of payment systems across all platforms.
“Digital platforms are performing sub-optimally because of congestion; physical cash is unavailable because the CBN has sucked away over 70% of cash in the economy; and the expected relief from the Supreme Court judgment has not materialised. The citizens are consequently left in a quandary.”
“Since the onset of the cash crisis, the Nigerian economy has lost an estimated N20 trillion. These losses arose from the deceleration of economic activities, the crippling of trading activities, the stifling of the informal economy, the contraction in the agricultural sector, and the paralysis of the rural economy. There are also corresponding job losses in hundreds of thousands.”
He further explained that the commercial banks claim that the CBN has not officially communicated the Supreme Court’s judgment to them for any actions; the President has maintained a worrying muteness on the judgment; the market women and men are waiting to hear from President Buhari or the CBN governor on the legal tender status of old currency notes.
“Curiously, there is an apparent reluctance or unwillingness by the federal government and the CBN to comply with the Supreme Court’s judgment. This is very disturbing and inexplicable,” he noted.
“Evidently, President Buhari did not seem to appreciate the gravity and enormity of the suffering and pain that Nigerians have been experiencing since the onset of the currency redesign policy. We again plead with the President to immediately intervene to put an end to the devastating and traumatic outcomes of a repressive, poorly conceptualised, and badly implemented currency redesign policy. We request the following immediate actions”
“The CBN should be directed to immediately inform the Nigerian public that the old currency notes alongside the new notes remain legal tender until the 31st of December 2023, in line with the Supreme Court judgment.”
“The CBN should be directed to officially communicate the outcome of the Supreme Court’s judgment to the banks and affirm compliance with the judgment.”
“The president should publicly empathise with Nigerians on the unwarranted and inexcusable pain and suffering that the currency redesign policy has wreaked on them.”