Nigeria’s President Buhari Extends Deadline To Swap Old Banknotes To April Amidst Escalating Crisis
Nigeria’s President Muhammadu Buhari said on Thursday that he had given approval to the central bank to extend the deadline to turn in old banknotes by 60 days until April 10.
Nigeria’s central bank decided last year to start circulating newly designed 200, 500 and 1,000 naira notes. The deadline to turn in old notes was already extended once to Feb. 10, after which they would no longer be legal tender.
However, Nigeria’s Supreme Court last week suspended the deadline after the International Monetary Fund flagged disruptions to trade and payments.
Nigerians were due to turn in old 1,000, 500 and 200 naira banknotes in exchange for newly designed notes by Friday as part of a central bank initiative to curb cash in circulation and control double-digit inflation.
The plan has caused huge controversy, with people saying there are not yet enough new notes available, leading to chaotic scenes at banks and acute cash shortages.
Some politicians have criticised the timing ahead of Feb. 25 elections for a new president and lawmakers, as campaigns are funded by mostly hard-to-trace cash.
Last week, the International Monetary Fund(IMF) resident representative in Nigeria urged the Central Bank of Nigeria (CBN) to consider extending the deadline for notes to be swapped given the disruption caused by the shortage of new notes.
The central bank says the plan also aims to reduce fraud as the security features on the new notes will make them harder to counterfeit and that it will foster a move towards a cashless economy.
About 1.3 trillion nairas ($2.8 billion) in old notes have been deposited into the bank since the announcement in October, according to the bank.
Some ruling party officials have publicly accused the CBN of a plot to turn voters against its candidate in the presidential election, Bola Tinubu.
President Muhammadu Buhari is not running he will complete his constitutionally allowed two terms in May.
Inflation and a flagging economy are likely to be major issues for voters at the elections, with many saying life is harder than when Buhari took office in 2015.
