My timeline has since been inundated with cries of “we
don’t want!” the new N5000 note. I even joined at intervals away from my
#SaveDebbie crowd-sourcing efforts. I then read the document below. So,
let us keep the emotional arguments away for a while and argue against
his own reasons behind the the “CURE” project of the Central Bank…that
is, rationally argue bereft of weak cliches we have come to be used to.
See the text below and you can also download:
PRESS BRIEFING BY THE GOVERNOR, CENTRAL BANK OF NIGERIA, MALLAM SANUSI
LAMIDO SANUSI, CON, ON THE PROPOSED CURRENCY RESTRUCTURING EXERCISE,
“PROJECT CURE”
PROTOCOL
Gentlemen of the Press, I welcome you to the briefing on the currency restructuring
exercise being implemented by the Central Bank of Nigeria (CBN).
Before I proceed, I would like to use this opportunity to express our gratitude to you all
for the support you have given to the Bank thus far, by helping in disseminating
information about our policies, programmes and activities. I urge you to continue
along this path of fruitful collaboration and support in the interest of our economy.
I am delighted to brief you today on the CBN’s proposed currency restructuring
exercise, which we have code-named “PROJECT CURE”. As you all know, one of the
core mandates of the CBN, like monetary authorities across the world, is the issuance
and management of the legal tender currency. This implies that the CBN is responsible
for the entire process of currency production and it includes the following elements:
design, production, storage, distribution and the disposal of unfit banknotes. An
important component of our responsibility is ensuring an optimal currency structure in
terms of efficiency, cost effectiveness and balanced mix of various denominations. It
entails the CBN being responsive to the changing needs of the economy and keeping
pace with evolving trends in contemporary currency technology-world.
In addition, in line with international best practices, monetary authorities are required to
review their nations’ currencies at intervals of between five (5) and eight (8) years. This
is done in order to address, among other factors, inevitable weaknesses and challenges 2
identified in the circulating banknotes and coins. These factors usually arise from
innovations in technology, aesthetics, security considerations and so on.
In the case of Nigeria’s currency, the following table clearly shows the period some
denominations have been circulating without any major review:
S/N Denomination Date Restructured No. of years
1. N100 December 1999 13
2. N200 November 2000 12
3. N500 April 2001 11
4. N1,000 October 2005 7
In Nigeria, the last comprehensive review of the currency was carried out in 2005. It
resulted in the introduction of the N20 polymer banknote followed by the varnishing of
the N5, N10 and N50 paper banknotes in 2007. These lower denomination notes were
eventually converted into polymer banknotes in 2009.
As a first step towards this routine exercise, the CBN carried out a review of the existing
currency series in 2010. The exercise threw up several revelations and challenges such
as the following:
? Public apathy towards the usage of the 50K, N1 and N2 coins, introduced in
February, 2007.
? The varnished lower denomination banknotes failed to adequately meet
expected longevity.
? Significant difficulties associated with the processing and destruction
(briquetting) of the polymer banknotes. It is important to add that this situation
has largely constrained the realisation of the benefits expected from polymer
banknotes over paper notes.
? The tactile feature for the visually impaired on the polymer notes has not been as
effective as desired.
In the light of the observed challenges, the CBN conducted several stakeholders’ fora
in 2011 on currency restructuring to gauge public and independent perspectives on the 3
existing banknotes and coin series. The issues raised and the subsequent findings and
decisions were summarised as follows:
? Due to inflationary pressures, the CBN should coin lower denominations of
currency up to N100. The relevant denominations in this category are N5, N10,
N20, N50 and N100;
? Need to encourage the usage of coins; and
? Enhancement of the quality of banknotes.
? The CBN should introduce higher denomination banknotes to discourage
dollarization, reduce the volume of banknotes as well as the overall cost of
currency management.
Gentlemen of the Press, we are now about to embark on another comprehensive
review of our national currency structure. The impending review exercise is aimed at
achieving the following objectives:
(i) Upgrading the design of the entire existing range of currency
denominations in order to enhance the quality and integrity of the
banknotes;
(ii) Incorporating a more effective feature for the visually challenged;
(iii) Introducing new security features on the redesigned banknotes. The
intention here is to enable us take ownership and control of the new
features on the series and eliminate payment of royalties on patented
security features;
(iv) Achieving an optimal currency structure that will ensure cost effectiveness
and balanced mix and utilization of all the currency denominations;
(v) Introducing new series of coins that would be generally acceptable for
purposes of transaction; and
(vi) Reducing the cost of production, distribution and disposal of banknotes
by introducing a higher bill that would reduce the volume and cost of
notes in circulation. The savings would be channeled to provide
incentives for the usage and acceptance of coins. 4
As a means of realising the above objectives, several entities have collaborated to
redesign the new currency series. These include the Currency Operations Department,
Nigerian Security Printing and Minting Company (NSPM) Plc, along with competent
international consultants.
On the 28
th of November, 2011, the CBN Board considered and approved the new
currency series. It subsequently sought and on the 19
th of December, 2011 obtained
the approval of His Excellency, the President, Dr. Goodluck Ebele Jonathan, GCFR.
Under the new structure, the existing denominations of N50, N100, N200, N500 and
N1,000 will be redesigned with added new security features. It is our pleasure to inform
you that a new high currency denomination will also be introduced. It is the N5,000
note. In the same vein, the lower banknote denominations of N5, N10 and N20 will be
coined. Consequently, the Naira currency structure will now be twelve (12); these are
six (6) coins and six (6) banknote denominations. The details are as follows:
Coins Banknotes
50K N50
N1 N100
N2 N200
N5 N500
N10 N1,000
N20 N5,000
Presently, efforts are being put in place to ensure that the redesigned N50 and the new
N5,000 banknotes should be launched early in 2013.
It has been argued that the introduction of a higher denomination banknote could
exert inflationary pressures in the economy. Ladies and gentlemen, inflation in Nigeria is
a monetary phenomenon. Secondly, in some countries such as Singapore, Germany
and Japan the highest denominations are 10,000 SGD, €500 and Yen10,000
respectively. These denominations have relatively high dollar equivalent. The levels of
inflation are, however, low at 2.8, 1.1, and -0.7 as at 2010.
Furthermore, we believe that the introduction of a higher bill would complement the
Bank’s cash less policy as it would substantially reduce the volume of currency-incirculation particularly in the long term. 5
To encourage the usage of coins the CBN would liaise with relevant MDAs, DMBs, road
transport workers, market operators, small businesses, supermarkets, vendors, etc to
create avenues for the usage of the coins. We would ensure that coin collection is
convenient and the infrastructure readily assessable.
Please note that the introduction of the new currency series will be a gradual process,
as the banknotes will circulate simultaneously with the old series until they are fully
withdrawn from circulation. Therefore, there would be no urgent need for exchange of
the old for the new banknotes by the general public for as long as the old banknotes
are in circulation, they will remain legal tender.
Gentlemen of the Press, this is an overview of our currency restructuring exercise, known
as “PROJECT CURE”. I request that you join us in our effort to provide our country with a
befitting currency structure that will be an effective facilitator of economic activities.
Thank you for your kind attention.
Sanusi Lamido Sanusi, CON
Governor, CBN
23rd August, 2012
