The governor of the Central Bank of Nigeria (CBN), Sanusi Lamido on Tuesday reacted to a statement credited to a former President, Olusegun Obasanjo, who said that the planned introduction of the N5000 note will increase inflation in the country.

Mr Obasanjo had on Thursday said the introduction of the N5000 note would kill production and affect small businesses negatively.

The former president, who disclosed this at a roundtable advocacy forum organised by the Institute of Directors, in Lagos, said the way, Mr Sanusi, was fighting inflation by removing money from circulation was improper.

However, speaking at the sixth annual conference of the Chartered Institute of Bankers of Nigeria, Mr Sanusi said Mr Obasanjo had introduced more high denomination in Nigeria than any other Head of State.

“General Obasanjo did N20; he did N100, N200, N500 and N1000. He has introduced more higher denomination than any Head of States,” Mr Sanusi said.

The CBN governor said that during the period Mr Obasanjo was introducing high denomination inflation in Nigeria was actually low.

“General Obasanjo did N100 in 1999; then he did N200 in 2000; he did N500 I think two years later; and did N1000. In that period, inflation was coming down because it was accompanied by very tight monetary and fiscal policies during his reforms.

“For somebody who have gone through that to come and stand up and say ‘introducing a higher denomination causes inflation’ I don’t know if somebody wrote his speech. I’m trying to see him or if he was misquoted.

“If he actually said that then he must be the single most important determinant of inflation in our history given the number of notes that he introduced,” he said

Mr Sanusi said printing higher denomination without increasing the money supply in the economy will not increase inflation. “This is simple economics,” he said.

He said that the cost of printing and minting all denomination of currency in 2009 was N47 billion and that by 2011 the CBN brought this cost down to N32 billion.

He said that by 2014 the cost would further be reduced to N25 billion thereby saving about 50 percent of the total cost of printing and minting all denomination of currency.

Mr Sanusi said the N5000 note would not cost more than N3 billion to print.

ballabriggs: The truth is OBJ did not say introducing new notes will kill production. OBJ said cutting inflation will kill production. They are two different things. So when Baba go begin slap Journo for interview, make nobody complain.

But you have dolts in the Nigerian media who went to print with something different.

While we might want to allow for inflation, the truth is, there is also the reserves to protect. This is very important for an import dependent economy with a limited absorptive capacity for investments.

I said the same thing Sanusi said in one of my earlier posts, OBJ implemented loads of contractionary fiscal and monetary policies. He raised taxes on petroleum products more than any other leader in Nigeria. He introduced the new VAT rate before Late Umaru Yar'adua reverted it to the old rate.

lucenzo: Sanusi may be right but attacking obj is sumtin I wouldn‘t do even if I am the president. At times silence is the best answer.

2mch: Sanusi is a bad economist, but a good turban wearer. . OBJ did not make any wrong assertions. If it doesn't make sense to Sanusi. Then his coconut brain needs to go on exile.

Genius100: The truth here is that most Nigerians are i-diots. When the story broke about what OBJ said, there was an accompanying video. In the video, OBJ clearly said if the sole focus of the CBN governor is fighting inflation, then production will suffer. HE NEVER SAID INTRODUCTION OF N5000 WILL KILL PRODUCTION. But guess what, a newscater that actually showed the video claimed OBJ vehemently disagreed with the introduction of N5000 becuase it will kill production. Most Nigerians are simply incompetent...

Genius100: The truth here is that most Nigerians are i-diots. When the story broke about what OBJ said, there was an accompanying video. In the video, OBJ clearly said if the sole focus of the CBN governor is fighting inflation, then production will suffer. HE NEVER SAID INTRODUCTION OF N5000 WILL KILL PRODUCTION. But guess what, a newscater that actually showed the video claimed OBJ vehemently disagreed with the introduction of N5000 becuase it will kill production. Most Nigerians are simply incompetent...

anitank: Wether OBJ said it or not, we all know that N5000 naira note will be a great disaster to this country. I mean wasn't that what Ghana left that we r going into

misreal: u r just writing bulky nonsense i wish i was ur father i for don kill u

ACM10: Why does Sanusi wield so much power? Where are those powers when Soludo was at the helm? Is Sanusi really answerable to the president or himself?