Nigerians have criticized the “redesign” of the country’s local currency proposed by its central bank to curb counterfeiting and hoarding of large sums abroad the banking system.
President Muhammadu Buhari on Wednesday unveiled the redesigned 200, 500 and 1,000 naira notes, saying “the new Naira notes have been fortified with security features that make them difficult to counterfeit”.
The new banknotes look very similar to those currently in circulation. The design of the highest denomination 1,000-naira note, which includes the national coat of arms and the headquarters of the Central Bank of Nigeria, is largely unchanged. The only significant difference is the color – from a mostly brown to blue signature.
The Central Bank of Nigeria (CBN) says the redesigned notes will replace the notes currently in circulation by January 2023.
But many locals are unimpressed, describing the supposedly redesigned notes as a simple color change, given their similarities to the old notes.
“Snapchat filter, waste of time and resources, so an entire CBN cannot hire experts to redesign Naira notes. This is a renovation, not a redesign,” a Nigerian posted on Twitter.
“What a waste of time and resources… what’s the difference?” another asked.
CNN has sought comment from CBN.
Chief economist Bismarck Rewane tells CNN that changing the appearance of a coin adds nothing to its value and is irrelevant in curbing counterfeiting.
The government says new security features were added to the new notes, but Rewane says the changes to the currency are not significant enough to curb counterfeiting.
The value of the Nigerian naira has been on the decline in recent years, falling to a record low on the black market where it was trading at nearly 800 to the US dollar as of Friday.
“It doesn’t change anything,” Rewane says of the naira redesign. “It doesn’t increase the value,” he says, adding: “There was no redesign.” The color of the coin changed that’s all. The change is not significant enough to stop counterfeiting.”
Nigeria’s 1,000 and 500 naira notes are the most counterfeited, according to the CBN’s annual report last year.
News of the naira redesign – first announced last month – created mixed feelings among Nigerians, some of whom questioned the cost of printing the new notes at a time when the country is facing a dwindling oil revenues, the main source of income.
Central Bank Governor Godwin Emefiele expects the introduction of the new notes to help control inflation, which recently rose to a 17-year high, and also fight corruption.
These goals, says Rewane, may not be achieved.
“It’s just a change in color. I can’t see the connection between the color of the coin and the desired goals. If the goal is to reduce inflation, it will not achieve it. [Changing the look of the currency] it has no macroeconomic impact,” he told CNN.
At the unveiling of the new notes on Wednesday, President Buhari said he had been almost 20 years since the country made a major redesign of its banknotes.
The Nigerian leader added that replacing the current currency with the redesigned banknotes will help fight hoarding of funds outside the banking system.
“It is on this basis that I gave my approval for the redesign of the 200, 500 and 1000 notes,” he said..
The old naira notes will be completely phased out by the end of January next year, the CBN says, as locals scramble to deposit their old notes in commercial banks.