Updated by Faith Barbara Namagembe at 2138 EAT on Sunday 5th March 3023.
Nigeria’s Supreme court has declared the government’s rollout of newly-designed currency to be unconstitutional and ordered that old notes remain in circulation until the end of the year.
The Supreme court ruling on Friday followed a lawsuit filed in February by 16 Nigerian state governors asking that the old 200-, 500- and 1,000-naira notes be allowed to circulate for a longer period.
The Central Bank of Nigeria redesigned the bills last year and initially gave Nigerians only six weeks to exchange old bills for new ones. The deadline was later extended by 10 days but the bank retired the old 500- and 1,000-naira notes last month.
Authorities said the redesign was to rein in excess cash, fight crime and kidnapping, and address inflation and counterfeiting. However, Justice Emmanuel Agim ruled the policy backed by President Muhammadu Buhari was an unconstitutional use of executive power and breached the fundamental rights of Nigerian citizens.
The court said the policy caused hardships for millions of people, noting that some cash-strapped citizens had to engage in barter to survive. Three people were killed in protests against the policy that turned violent. Nextier economist Ndu Nwokolo said he’s not hopeful the Central Bank of Nigeria and Buhari will comply with the court’s ruling soon.
“The executive can say, ‘OK, we’ve heard the Supreme court, we’re going to do that.’ But however long it takes them to do that [obey], who’s going take them to court to say, ‘You’ve been asked to implement this and you’ve not started implementing it?'” Nwokolo said.
Buhari refused to obey a February 8 order by the Supreme court to suspend the planned February 10 deadline for turning in the old bills. The Supreme court said that was a sign of dictatorship.
But Nwokolo said Buhari’s move could have been a deliberate act by the president to discourage vote buying during the election season. Nigeria went to the polls last weekend to elect a new president and lawmakers. Next week, various states will hold gubernatorial elections.
Nigeria is also facing intensifying fuel shortages due to a disruption in the product distribution chain caused by activities of cross-border smugglers. Many are hoping the new president will address these problems once and for all