Naira To Be Re-Denominated

http://www.rmrdc.gov.ng/NEWS/8thtechnoexpo2006.htm


that site above is for those thinking that we will fail and for those that wants us to fail

if the naira is redenominated that means myweekly pocket money will be in coins is that good for a g like me?. soludo why now?

i must commend soludo et al's efforts to improve the economy, but i wonder if they have really looked into this. i understand the cbn has a target of making the naira the ecowas currency by 2020, and i know this redenomination has a lot to do with it, as it will make the naira mathematically easy to convert into dollars.

But is it such a good idea to redenominate the psyche of nigerians who are used to spending hundreds and thousands daily? imagine your usual bus fare is 100naira right now, by august next year, it becomes 1 naira. say this bus fare increases to 1naira 10 kobo, pro'bly due to the rains (as in naija, everything is an excuse to increase prices, even christmas where yankee dey go on sales, naija dey double prices), would the conductor rather hold 1 naira notes and jiggle 5 and 10 kobo coins, than jus ask for 1naira, 50kobo notes? afterall a reason bus fares jump from 120 naira now to 150naira is the issue of 'change'. 

coins will become excess baggage and more difficult to carrry around or spend. it means aboki's shop will be filled wiith coins, iya basira will be carrying sacks. i thot the main reason 10kobo - 1naira coins vanished was bcuz they were "heavy" to spend. the truth is that we place more value in notes than coins.

i say except the cbn is willing to make the new naira in more notes and less coins, i don't see how the value of things will not go up.

someone please correct me if u dont see my point.

really? and i guess cards will be used in the market, on the roads, in buses and taxis. THINK guy, the fact that cards will exist someday does not stop an increase in prices in the next few years. its not about "rep" or "big boy" ^{since thats what u call it}, my posts ask that u think of the implications this will have in the long run, not just in a few years.

guess it happened this way too when the consolidation of banks began, most were scared that jobs were going to be lost. well it happens that banks are one of the highest employers of young grads, and they get to pay relatively(even if not at par with the work).
though most times i don't agree with his policies well i hold brief for him on this one, one needs to cross ones fingers wait and see the results before judging. i don't think its right casting aspersions on his integrity as an economist, check out the naija economy pre2003 and post 2006, things have changed.

All this noise about coins and no coins. I remember in the 70s to mid 80s, People used to spray only 10 kobos and 50kobo notes in "Owambe" parties and nobody was ashamed then. Today, even in the UK, people can't afford to spray £1 coins in "Owambe" parties, they could only afford $1 notes. People should stop all the sentimental talk and face the real thing. I still maintain my stand for this policy and time will tell if it's a right step or not.

man alot of people do not even know how a fiat money system works. This is really sad. People think reprinting a piece of paper to read a different number is going to change anything in our economy? I see a huge scam where the elites cash in their millions for an equivalent number of new naira while the rest of the populace does real conversion. The rich become richer and the poor stagnate. That will be the result of this government sanctioned 419 scam.

After being one of the STRONG opposers of the success of the banking reforms, I've been made to eat my words - being that the idea of 25 billion was not possible (at least not in Nigeria). Again Chief Economist Soludo is at it again. However this time around, I've decided to tread gently.

Truth be told: Nothing really changes with the redomination except of course our large egos would be deflated. i.e. Billionaires become Millionaires; Millionaires become thousandnaires and of course there would be lots of hundrednaires in town. Our brothers & sisters in the diaspora would be unable to "oppress" us with their dollars & pounds (courtesy of the exchange rate).

All that said, the success of this policy is dependent on other factors including the ability of our manufacturing firms to produce (quality) exportable goods; the issue of epiletic power becomes once upon a time,  etc. While I believe that Soludo's intentions are genuine & sincere, we as a country have had the issue of policy implementation and a minus. But his success with the banking reforms speaks loud.

I pray for his success,  we should tread with caution,  But we MUST TREAD. Afterall, so many of us have prayed for a miracle,  Is this it? Or should we wait for another? We should continue to pray, hope for the best and support men (and women) with good intentions.

God Bless Nigeria.!!

if it is going to change things for better,i support it.let them go ahead.Thank God for the new administration.

The real issue behind this soludo thing is not about Nigeria but it is an Ecowas agenda planed by the world bank for nigeria. Check out this opinion in today's guardian newspaper as this explains all you need to know. And also the reason why soludo had to retrace his steps after issuing higher denomination notes:


Soludo's American wonder

By Peter Alexander Egom


THE Nigerian Debt Management Office, DMO, held an international conference on debt sustainability in June 2001. It was in Abuja. And I was there as an observer. That event was the last official outing of Izoma Phillip C. Asiodu as Economic Adviser to President O. Obasanjo. It was also the first official outing for Dr. Magnus Kpakol, the neither here nor there economist, as Economic Adviser to President O. Obasanjo. But, the main stars of that conference were the quartet of Mrs. Oby Ezekwesili, Dr. Ngozi Okonjo-Iweala, Professor Charles C. Soludo and Dr. Mansor Muktar. The World Bank had used that occasion to announce them as its anointed quartet, come July 2003, with the scorched-earth mandate to finally drag the Nigerian economy, the heartbeat of the black race, back to colonial monetary manacle and bondage.

And, in this assignment the quartet has been very successful as the Naira under their watch has become ever so outward-looking and foreign-friendly, ever so work-shy and rural-shy in Nigeria, and ever so ready for the colonial monetary manacle of the fixed-rate currency board relationship with the imperial but terminally sick US Dollar. This is Mr. Soludo's latest plan for the Naira come August 1, 2008. Indeed, the main assignment of the quartet has been to midwife, latest by July 2009, a new West African Currency Board with the US Dollar as its guarantor and currency of reference.

However, what intrigued me much at the Abuja conference of June 2001 was not the Nigerian gang of four that the World Bank had chosen to corral Nigeria and the black race as whole back to colonial monetary manacle and bondage. Rather what caught and fixed my attention was this very stooping and very old man of an American by the name of Dr. Reginald Green. Ha! Ha!, was this not the same Dr. Green who had held the Tanzanian Treasury and President Nyerere's Ujamaa economic policy hostage with mumbling misadvice in 1974-75 when I was at the Bank of Tanzania at work with my flow of funds study of the Tanzanian economy? It surely was.

And there and then I knew that the economy of Nigeria under President O. Obasanjo would not bring any economic good cheer to Nigeria and to most Nigerians. And so it has truly turned out to be in spite of Nigeria's unprecedented run of economic good fortune in foreign exchange earnings from oil and gas export in the period 1999-2007.

But, we Nigerians owe Mr. Soludo a deep debt of gratitude. For flush, as he always is, with immodest and loquacious self-praise, he has gone on to give us the first ever clear statement about the Big Bang, or shall we say the Big Whimper, of the monetary theory and practice which lies behind the World Bank's colonial economic roadmap for Nigeria. For every economic policy package anywhere must be held together and driven by a concise theory and practice of money. The job of any public statement on the relevant theory and practice of money behind any economic policy package is to, among other things, educate and inform the public on whether the money being used to manage the economic life of a nation is debt-based or commodity-based, is urban-friendly or rural friendly, is public-sector financing or private sector financing, has outward-looking convertibility or inward-looking convertibility.

For once these key attributes of the money in use in a nation have been decided upon, then the economist is put in the vantage position to anticipate where the nation's economy is headed with respect to providing its nationals with job, food and social security. Thus, quite contrary to popular belief, economics is a cut and dried subject which says that debt money is always an impoverishing bad master where commodity money is always an enriching good servant.

Thus, until Mr. Soludo happened a week ago with his impoverishing bad master of the debt Naira and the colonial dollarisation plan for the Naira, the hitherto World Bank approved economic managers of Nigeria had been all too vague about the theory and practice of money that drives their American wonder works or shall we say their American Good Works in Nigeria! But this is no more the case.

For Mr. Soludo has now made it crystal clear that the World Bank's economic policy for Nigeria has the impoverishing bad master of the outward-working and non-convertible Naira at its base and centre but that the Naira is be to given, come August 1, 2008, a deceitful patina of outward-looking convertibility by being manacled, in restricted colonial convertibility, to the terminally-ill US Dollar at the fixed rate of N1.25 to one US Dollar. In other words, come August 1, 2008, Nigeria will be returned to the colonial thraldom of the pre-October 1, 1960 fixed rate currency board debt standard where the fixed-rate colonial convertibility of the Naira will be guaranteed by the US Federal Reserve System. Simply brilliant! But, treasonous and, treacherous all the same. And all of this ties up with the see-saw history of the ECOWAS common currency project as follows:

In April 2001, the ECOWAS member countries decided on a two-pronged attack on their elusive quest for a common currency. The CFA Franc economies of the ECOWAS were grouped under the umbrella of the First Monetary Zone with the CFA Franc as their common colonial currency which has restricted convertibility into the Euro of the Eurozone. The Anglo-phone economies of the ECOWAS were grouped under the Second Monetary Zone with the ECO to emerge as their colonial common currency which would have restricted convertibility into the US Dollar. However, the launching of the ECO has proved to be very troublesome after the target dates for this in July 2003 and in July 2005 came and went without the ECO coming into virtual or real circulation.

It was then realised that the ECO common currency had to have an anchor and a locomotive currency from among the members of the WAMZ and the choice for this fell on the Naira of Nigeria, in the same manner as the DMark was the anchor and locomotive currency of the Euro. So, all of the recent avalanche of talk by Mr. Soludo about the Naira being the currency of reference in West Africa, and Nigeria becoming the financial hub of West Africa, if not for the whole of Africa, is all tied up with the planed emergence of the colonial ECO common currency in July 2009. And after July 2009, it is the plan that a new colonial ECOWAS common currency will be forged out of the colonial CFA and the colonial ECO.

And, it was, indeed, my realisation of the full colonial implications of the post -2003 economic policies of the World Bank's gang of four in Nigeria that prompted me to write as follows on page 95 of my 2006 book "Compass for Economic Reform:

Already, "by July 2004, it was clear to any keen observer of the Nigerian economic scene that the ECO common currency project of the WAMZ would not fly by July 2005 as scheduled. What was missing and is still missing in this three-decade old colonial common currency project is a Nigerian anchor currency which has the colonial convertibility of the CFA Franc or of the Hong Kong dollar. Accordingly the ECO common currency project has been rescheduled to fly by July 2009 so that, in the interim, Nigeria would have to hurry and put in place such internal and external payments arrangements that would inexorably lead the Naira, before July 2009, to the gallows of colonial convertibility. This is the sum-total of the colonial sense in the on-going economic reform programme of Nigeria".

So, Soludo's newly announced Naira revaluation and convertibility plan gives credence to what I saw of the colonial drift of Nigeria's economic policy as far back as July 2004 when Mr. Soludo became the Governor of the CBN. Indeed, the new Lagos-based US dollar trading African Finance Corporation, AFC, with the wholly paid up share capital of one billion US Dollars, is the precursor of the West African Central Bank and, naturally, the unending beefing up of the capital bases of Nigeria's commercial banks to at least one billion US dollars per bank is all in aid of Nigeria becoming by July 2009 the sub-imperial hub of dealings in foreign exchange in West Africa, a money centre in the footsteps of Dubai. And likewise the FS2020 is aimed at turning all of Nigeria into a country-wide and colonial bureau de change!


To be continued

Egom is with Nigerian Institute of International Affairs (NIIA), Lagos


All i'd say is tighten your seat belts and shine your eyes well well because nobody really knows how it will affect the common man in the long run.
My advice is to invest your naira in real commodities, sellable new items or landed props that can be sold for good profit if the going gets tough.

good suggestion _{*nice joke*}

The redomination does not make the naira equal the dollar pronto becos what one dollar would buy on the 31st of July would remain the same. If anything it is the complementary measures like the convertibility of the naira and the sharing of Oil revenue to states govt in dollars that would result in the naira gaining against the dollar as the CBN would lose its full control over the naira.

One of the reasons the re denomination is being done now, is because the Purchasing Power Parity (PPP) of the Naira had increased significantly in recent years, due to an increasingly strong economy that is being driven by deregulation in most of the mainstay of the economy.

The PPP of the Naira against the dollar can be measured by how much N127 can buy compared to US$1. That is why many Nigerians who visit home prefer to buy certain electronics and hi-tech products when in Nigeria.

@seun, there's no need for too much grammar so if anyone doesn't like it they can commit suicide if they wish. Which kin tin be dis, everyone is complaining that we are in bad shape, then the government came up with a plan to get everyone involved and also feel proud about our nation but yet all the oppressors still have something to say which is nothing. Is it when is $1 to 1000naira that they need to implement this genuis plan or what? Nigeria is a big player in Africa especially west Africa and needs to have experts from all over the world mostly Nigerians doing business and knowing that it is profitable without harming the people.
 The next major change after that would be manufacturers, inventors, investors, laborers, and local miners will begin to see it profitable to do business here and that in turn would make prices fall with a vibrant and intelligent competition and would also make naijas  be the ones who utilizes her resources cuz we can now buy experts with a reasonable currency. And lets face it, is more advantageous for the economy and the people than its disadvantages.
 Naija will be a place of hope, opportunity, and all this can be done without leaving somewhere else and just visiting naija.

Amen

I think to reduce madness for pple trying to be billonaires.