actually thats the motive behind the redenomination
-to improve our economy.

The American mile is longer than the standard kilometer which is used in Nigeria. Perhaps we should define a new Nigerian kilometer that is equal to 10 kilometers so we can beat America and 'improve transportation'?

I think it'll beneficial in the overall sense. It will have an indirect effect on our economy. They wouldn't be able to say that "a lot of Nigerians live on less than $2 a day."-for long.

People, we should now start to do more to help the economy, like opening up manufacturing companies in Nigeria instead of service oriented businesses. Most people that I know that are going back want to open up some type of commercial business to generate personal wealth. We should start making more of the stuff we need for survival at quality on par with developed nations. Why can't we make cars in Nigeria? I'm sure those guys in Ojuelegba and all those thugs wouldn't mind working in a plant if they're treated well. They wouldn't even mind moving to a little town to work if the job is stable.

My point is, anything to help is a step in the right direction. We can manufacture stuff for those other countries in Africa that are at war - thus helping our economy, instead we import it from China - Nigeria, then from Nigeria - Wherever.

I think it'll beneficial in the overall sense. It will have an indirect effect on our economy. They wouldn't be able to say that "a lot of Nigerians live on less than $2 a day."-for long.

Instead, they'll be saying "a lot of Nigerians live on 2 naira 50 kobo a day". Does that sound like an improvement?

[color=#990000]In agreement with "Knowall", who would force the informal and/or black market economy to accept the re-denominated Naira. To be fair to Soludo, he has tried his best so far, but the re-denomination thingy is about to blow up every good deed. Re-denomination is predominant in countries with hyper inflation.

I'm not an economist, but a floating exchange rate with minimal intervention from the CBN and a little dollarisation would be ideal for now to boost the economy. From trusted sources, as at Monday 13 August when the news about liberalization of the foreign exchange market and payment to state accounts in dollars, a dollar dropped to a naira before peaking up.

Advantages of partial dollarisation include reduction of country risk, thereby providing a stable and secure economic and investment climate, possible devaluation of the local exchange rate, credible economic climate, increased investment from local and foreign investors and therefore a reduction in interest rates on foreign burrowing.

As for a floating exchange rate, the demand and supply of foreign currency by the private market would determine what the exchange rate would be at any point in time. As such, if demand for a currency is low, its value will decrease, which will in turn make imported goods more expensive and thus stimulate demand for local goods and services thereby, generating more jobs.
In a floating regime, the central bank may also intervene when it's necessary to ensure stability and to avoid inflation; however, it is less often that the central bank of a floating regime will interfere.
Although, the floating exchange rate regime is not without flaws, it has been proven as amore efficient way of determining the long term value of a currency and creating equilibrium in the international market.

My Naija people, I just talk from the very little knowledge of economics wey I know. I pray, Soludo reconsiders the effects both positive and negative of re-denomination on Nigeria in particular before next year. At least he has a year.

The possible gain on re-denomination of the Naira on the long run that I can see is a term called "Seigniorage". This is the profit gained from issuing coinage (the minting of monies costs less than the actual value of the coinage).

I'm not saying precisely that it would not work, but not in Nigeria for NOW.

the truth is that the value of the naira will not be enchanced or reduced by the redenomination ( not revaluation) of our currency, eventhough i think on the long run it will be good for the economy but all of us are missing some salient points here, from august next year  our present N20,N10,N5 notes will become 20K,10k,5k respectively and they will
no longer be notes but COINS and considering the reception that the other coins introduced months ago got from
nigerians, i am afraid that infaltion could set in, if people reject the proposed new coins,but i think the CBN will do a
lot of sensitization before the new currency regime dawn on us, afterall Ghana just redenominate their currency and
they now pay coins to enter transport, even in cameroon they pay coins to fly okada and to board taxi. i rest my case.

D whole thing is confusing

HELLO ALL,

Please amidst all this economics terms, pls can someone explain in layman's language the advantages of this re-denomination.

For instance when u say it reduces inflation, how does that affect the ordinary nigerian. Does reduction in inflation mean reduction in price of goods?

Please i really need to understand this terms as an ordinary man on d street.


pLEASE REPLY FOR THE BENEFITS OF THOSE OF US THAT HAVE NO KNOWLEDGE OF THIS ECONOMIC TERMS.

tHANK YOU.

Charles Soludo is simply brilliant and i believe

he will give embezzlers,corrupt pollitical ''eaters''(leaders) and money launderers

a run of their loot

Ribadu please watchout for the thieves!

and we should expect the return of nigerians in diaspora.

there goes our millionaires !

Please amidst all this economics terms, please can someone explain in layman's language the advantages of this re-denomination.

The advantages of the naira re-denomination include:
(1) widespread confusion making corruption easier. (2) exorbitant costs of compliance. (4) CBN in the news again!!

While I appreciate all our apprehension about this re-denomination,  one thing everybody seems to forget is that MONEY IS JUST A MEANS OF EXCHANGE. The paper itself isn't exactly a reflection of once wealth but THE VALUE(goods & services) it can get.

There should not be any problem with this exercise,there's adequate notice, and I will asume equally sufficient publication & awareness,

What we should all be concerned with is WILL THE GOVT SUPPORT THE CURRENCY WITH PROPER FISCAL POLICIES??

Once you have all the factors of production to back up your currency ,you don't have a problem,afterall somebody unilaterally devalued the currency(although this should'nt e mixed up with re-denomination).

Another thing we must realise is that money is a political tool,worldwide. Thats why the British refused to join the Euro & the US has been fighting China to float its currency.

Lets support our Naira /Country please,

Lets support our Naira /Country please,

Why should we be required to put up with an inconvenient policy when that policy also happens to be pointless?
The government is made to serve us and not the other way round. The government shouldn't inconvenience us!

a country of 150milion people generating only 3000MW!!

where is the power to sustain this re-denomination?

We would not deny Nigeria/Naira any support if we see changes that can sustain it. There is no increase or mention of an increas in production to back up the currency. Why not work on the production/more obvious problems first? There are many things we can use the money for that will produce immediate or short term improvements and this is not one of them.

Simple and short, it is not needed. Deal with the needs before the wants.

babasin:

a country of 150milion people generating only 3000MW!!

where is the power to sustain this re-denomination?

I am not surprised you said this, if Nigeria can cut 50% of supplies to neighbouring countries all of you will cut your trash quit.


I pray they put this into consideration.

Well, even if the governemnt didn't "waste" this money on this exercise it still would not have reached the places everyone else would have liked, atleast not at first. It would have gone into there pockets so either way if you were never going to see the benefits of your taxes why does it matter? Atleast they are showing the world they can follow the economic policies and if this attracts foreign money then it will mean in time the economy of Nigeria may improve. This is not a stand alone policy though but to me its a step in the right direction. Yes, perhaps too soon but I think that may be because the government is racing to show the African Central Bank (and thus the world too) that they are the flagship of Nigeria.

Instead of thinking of how this will go wrong, perhaps we should think of what the best way Nigerians can place themselves to benefit from it. because whether you are for it or against it will come to pass anyway and you will be the ones left to deal with this. Start to think of what you can offer a foreign investor, either as a person or as a business and what they can offer you, don't let yourself be used, but at the same time represent Nigeria in a good light so that investment will be plentiful. If it were up to me this would come a little later perhaps and the investors would mainly be Nigerians who want to return or atleast 'give back'. At the very least the so-called cheap labour will bring outsourcing opportunities to Nigeria like India saw. Well thats my stand on it!

i don't think is a good measure. to my own opinion, the value of money will still be the same

If you think it is a wrong, it is not too late we can still make it right?

There are some strategies that can be used in preventing it from affecting the people. Though I am not an economist but in my line you can always find a solution.


It is up to the people of the country to improvise a way that will favour them.

@ALL

wotever u proclaimed u worth,never 4get to divide it by 100 oh.if u are billionaire,u are now demoted to millionaire oh Dangote& Jimoh Ibrahim ,etc are now Millionaires ,if u are Millionaire,ur new financial status is now change to thousand naira worth while d thousandnaires can only wine & dine wit Hundrednaires,hundrednaires wil bcome kobonaires,while my brothers and sisters dat are kobonaires wil bcome kobolessnaires .

9ja na wa oh.We don't know where to run go again oh.Dis wil definitely result into GROSS CONFUSION,COMMOTION & CHAOS because landlords no go gree,marketwomen,etc go fight u,if u pay them present cost of there wares now DIVIDED BY 100

If wot i said is nt true,just wait and see wot wil happen come Aug.2008 and beyond.

Never worry God dey

Cheers,see u on aug.2008 & beyond

sometimes when i said i hate this country - nigeria - it is not that the country itself is bad but because the country is too much of devil-ordained-negative-folks.
whatever anyone thinks regarding Soludo's plans, is the persons opinion. which i think is subject to be respected. but i advice any pessimistic fellow to go throw himself to the lagoon and rest in peace.

we need men that are sailing to a new Nigeria to be alive to see the fruit of the patience all this while. not men of vain principle.

for God sake what have we not said and yet we are still in a 3rd world country? i am of the opinion that instead of doing nothing to move nowhere, let Soludo do his foolishness perhaps it will take us somewhere.

i am sorry if i am a bit hard on any school of thought, but i think it is time for us to employed all our believes, faiths and optimism and stand by him both in prayers and in great expectation for a new nigeria.

i am certain that Nigeria has arrived at her final bus stop of rough decision making and policy implementation. we are going to the top. i wish to meet us there. but not the pissimists.

KUDOS Soludo! you have my support.

@ bajon - I couldn't agree with u more. There are just too many negative folks in Nigeria and that's what is keeping us down. Every proposal, in fact anything & every thing is criticized, even by peeps that know next to nothing about modern economics. Every body is already prophesying failure instead of them to be optimistic. The fact of the matter is that most intelligent people on the know do in fact support this policy even though some do have reservations. I find it very disingenuous when people like Kalu I. Kalu who partook in the destruction of the Naira are coming out to criticize the policy.

The fact of the matter is that Solodu has done a wonderful job since he took office, inflation has been tamed, the banks are doing fine, uncontrolled spending has been checked as well as a healthy current account balance. He has definitely done well and I trust him on this one.

I think its a welcome idea, we just gotta wait see if this will work out in the nigerian monetary economy.

God dey!

shuo! interesting, naijas no go dey run to america like before, wetin u dey look for sokoto go dey ur sokoto, u feeel?

shuo! interesting, naijas no go dey run to america like before, wetin u dey look for sokoto go dey ur sokoto, u feeel?.but wait , i dont support the idea of removing zero's from the back of peoples money, what abt those wey keep money for house?, abeg!

quotes from topsido : "Even a fool knows it is goin to improve our economy"

That's expected from someone whose name sounds like soludo. . .  . And how did you arrive at your conclusion?.

The redenomination will not in itself attract more or less money. Its the removal of the restriction on capital movement that will encourage people to bring in more money.

WAEC is a fraud, cos from what I can see on this thread, most should have gotten  F. You shoyuld all look at the value of the Yuan, Yen, and Zimbabwe Dollar. One is worth less than a tissue paper because it has no economy, and another is undervalued becasue the products it sells fetch more in the international market.

Imagine if the Japs make Honda Accord for 2,000 man hours($10/hr) and sell it in Naija for 3,000 man hours, but in Naija its worth 30,000 because naija workers earn $1/hr. Now the take that money to buy Raw oil, steel add their valuable labour and technology to it and resell back to Naija for 10x its local manhour cost.It takes Honda abt 23 hour to  make an Accord you pay N3m for. Now imagine your currency at 1:1. Uoy either have a product you can sell to the Japs/ or compete with them in a "free" market with a product that has same or better quality, for less man hour cost. Because we have nothing but oil, we'll be back to square one, China has equal quality(tech) but less manhour cost, which is why threr products are showing up on Nigerian street and cheap unrefined oil is flowing into China(no value added). Why do you think refineries never seem to work? As llong as there is no energy to add value to raw products you'll always import from those who get the energy for cheap.

It not illegal, if you can't develop your technology then you pay for those who did through funding of R& and the will not wait for you. Survival of the fittest.

A NEW DAWN FOR THE GOOD PEOPLE OF NIGERIAN, I CAN'T WAIT FOR IT TO START.

GOD BLESS THE ECONOMIC TEAM
GOD BLESS NIGERIA

A NEW DAWN FOR THE GOOD PEOPLE OF NIGERIAN, I CAN'T WAIT FOR IT TO START.

GOD BLESS THE ECONOMIC TEAM
GOD BLESS NIGERIA

Dats gud news. millionaires wil become thousanaires or even hundrednaires by next yr.
But can someboby plz xplain to me why Soludo did'nt implement this ryt b4 now?

on a lighter note,
who wants to be a millionaire, and all those reality shows / company promos will have to change  their slogans come 08/2008!

who wants to win 10,000 naira?
bank PHB 10,000 naira jackpot!!