Imagine walking into a place called Chinatown and needing a thick bifocal to see any person of Chinese descent. Except that town were Lilliputian in dimensions, while you were Brobdingnagian, it would be extremely weird, and you would be forgiven for thinking that being all righteous, the Chinese had been raptured. This seemingly implausible situation is currently playing out in Nigeria, where the Naira, the national currency, now competes with petrol in the Scarcity Championships.
Barely a week to the 31 January 2023 deadline that had been designated as the last date for legal use of the three largest naira denominations, many traders across Nigeria had ceased collecting the old notes. Their clear preference for the new notes was hinged on fear of suffering losses if the deadline were to elapse while the old notes remained in their possession. Even traders who hitherto had no bank accounts desperately found means to move their old monies to banks. After enjoying decades outside the financial system, the threat of financial ruin brought many unbanked Nigerians to the banks.
But a problem was clearly apparent as only few Nigerians had actually seen and touched the fresh ink on the new naira notes. However, as a country with unending hope, Nigerians bought the official narrative that the new notes would be readily available and that the currency change was necessary to among other things, strike a mortal blow to corrupt politicians who had amassed massive naira war chests to buy voters’ consciences during the impending general elections. As usual in Nigeria, sprinkling a bit of anti-corruption rhetoric and “us-versus-them” segregation was seen as a sure bet to get mass support.
When the new naira notes were announced by the Central Bank Governor and unveiled by President Buhari, I had wondered about the merits and the reliability of electronic banking which was being championed as the way forward in a country that needed Elon Musk’s Starlink, priced at more than ten times the monthly minimum wage, to move from less than 50% broadband penetration to 100%. Alas, even I neglected any arduous logical reasoning, being easily seduced by the appeal of making Nigeria’s infamous crooks lose billions of stolen and archived naira notes.
We are now five days past the apocalyptic deadline. In line with the national tradition, the deadline was extended by ten days. However, the situation across the country is one filled with sad tales of intense suffering, desperation, unrestrained greed, corporate collusion, officialised half-truths, political wranglings, and a bit of violence. We have seen Nigerians sleeping in front of ATMs, fighting to get ahead in queues, attacking some ATMs and even banks, stripping naked in bank halls, and even resorting to using CFA Francs for trade, all in frustration at their inability to get cold cash—whether old or new naira notes— in a country with ≈70% informal transactions where cash is the sovereign.
A hopeful Nigerian would say that at least we have not gotten to the Lebanese level where bankers are taken hostage in return for access to a customer’s own funds. But I wonder if all these sufferings were unavoidable. In 2016, the Indian Government tried something similar, howbeit more drastic, and the disastrous results are available for other policymakers. I would have thought that Nigeria’s officials would have reviewed the Indian version and prepared for all possibilities. There is nothing happening today that we could not have foreseen—electronic banking failures, refusal to load ATMs with cash, selling cash, diversion to highly connected persons—all these are not new problems. Just as several others have repeatedly pointed out, Nigeria is a case of numerous self-inflicted wounds.
Planning and execution shortcomings aside, the current cash scarcity has again publicised our national proclivity for cheating others. Nigerians may score high on happiness levels as we have an unmatched ability to turn anything into comedy, including marinating in back-to-back skits released by a presidential candidate turned entertainer. But our intrinsic happiness sits alongside intense selfishness that now shows in the skyrocketing “naira-to-naira” exchange rate. However, while we attempt to blame POS Operators for charging up to 40% premium for cash withdrawals, we forget the times when we have done the same through our white collar jobs and businesses.
As we countdown to the 2023 General Elections, we hope that the naira scarcity would abate, so we can go back to worrying about dollar scarcity. But if after all the suffering, widespread vote buying still occurs, then Uncle Meffy may be due for a televised flogging. Hopefully nothing of that sort occurs, and maybe we might see some method in this madness and somehow expedite the long-sought transition to a cashless economy. I also hope that the current mess would not strike a mortal blow to consumer confidence to trigger massive un-banking of the banked. Anyways, time will tell. For now, we let our senior uncles continue the game of Russian Roulette.
Cover Image Credit: Central Bank of Nigeria
Jilomes 