ijebuman's diary

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Wednesday, August 15, 2007

The All 'New' Naira 

And the main news today, out of naija is about the all New "revalued" Naira coming your way. From August 1st 2008 , two zeroes will be knocked off N100 (N1), N200 (N2),N500 (N5) (i'm sure you get the idea)

When Soludo (the CBN governor) was asked what will happen to some body, for example, who has kept N1000 and wants to exchange it. He explained, “If you have $1000, it’s the same thing, you get the value for the $1000. There is no devaluation, there is no loss of value, it is just like instead of N100, you carry N1. That N1 in comparison with the dollar, it’s the same value. Before, you pay N126 for a dollar, now you have N1.26 for one dollar. So it’s fantastic.”

To the man on the street, who has N1000 in his account, he said, “if you have N100, 000, it would become N1000, but the key thing about valuation is that it is in relation to other currencies. If you relate to the dollar, N125, 000 in your account before would give you $1000 but now N125, 000 in your account, would now become N1, 250. If you want to buy dollars, it would give you the same $1000.
As a Nigerian, psychologically it is good for us; that our Naira is N1.25 to a dollar, unlike N125 to a dollar. It’s a feel good factor.
The Naira Big bang

I don't know, it all sounds like some strange IMF experiment to test someone's thesis on the chaos theory.
I'm not knocking naija here but this is the same country where we had "slight" problems organising a simple election.
In a country where 70% of the population is barely literate, how are people expected to understand that N1000 will now be N10. How will iya sikira understand that the 'ogi' she sold for N200 the day before is now N2 or how will baba Morufu, the meat seller understand that the 'bokoto' he is selling for N2000 is now N20?

On a funnier note whats going to happen to the naija version of who wants to be a millionaire c
onsidering 10 million naira will soon become 100,000 naira...

posted by ijebuman  # 5:13 pm
Good point. But, if there is one thing Nigeria is good for, it is making catchy radio jingles. I can hear it right now "Make una come see oh. Naira dey change oh! 10,000 na 1000 now oh...."

Blah, blah, blah.

They will find a way to inform the masses. I read that it will be a good thing for Nigeria especially as other schemes ued by the CBN will be stopped and that the value of the currency will increase. I'm hoping for the best and well, expecting the worst. We shall see.
I'm not an economist either, what I sense this Naira re-engineering, manipulating, re-nominating, devaluing, or whatever term ones comes to mind is NOT will make life easier for the man on the street. It is just another economics experiment Soludo is crazy about.

Besides, wasn't he the one that introduced the 1000 naira bill and the redesigned the naira, and scooped off the smaller notes from circulation? Now he's wants to reintroduce them under disguise?

Up till now, it's not clear how the bank consolidation he orchestrated has positively impacted the common man and small businesses in Nigeria. Yes, on paper it's the best thing that ever happened to the banking sector - on paper!

These Ammani-suit cladded bankers should take some lessons for Mohammad Yanus, the Nobel laureate economics professor, who woke to discover that all the economic theories he's been feeding his students for yeas were irrelevant and went ahead and created a system (Gremeen Bank) that caters to the poor.

These Nigerian economic wizards need to stop the gimmicks and their good-for-paper-only theories. Enough!
lol @ Solomon

Am I the only one excited over the Naira being almost equivalent to the Dollar in value or is it that I don't quite grasp the concept of devaluation?

Anyway I prefer to adopt a 'wait and see' approach to this sort of thing. The fact that it's being mentioned a year in advance makes it all the more vulnarable to sabotaj however noble the intentions are.

By the way interesting blog you got here. I was attracted to the title. Coincidentally my husband is an also Ijebu man in the UK :)
Oops! I meant the concept of revaluation... not devaluation.

who knows maybe i'm your husband blogging anonymously lol
70% of the population may not be literate...but believe me they know how do their maths when it comes to money...These are Nigerians we're talking about for god's sake!
Lol @ Solo's jingle! So true!

There should be some sort of better system to have ppl get used to the changes. Honestly, I was taken aback by it, too and I'm trying to learn how-stuff-works, going forward...
How does this affect Naijas who r trying to runs their visa? When asked to present their bank statements showing a huge amount of money in their accounts, they just show it and it tallies with the US equivalent? This is gonna be fun!
Soludo should go chew his new naira policy...lawl!

I didn't say that; Yar'dua just did by putting a "screech" on the new naira policy. Go-Slow Yardua has now become a Anywhere-The-Wind-Blow Go-Slow president. Yardua can't make up his mind on what direction Nigeria should be heading; he backed out of the idea of having the AG exercise his oversight function over EFCC within 24hrs and now retraced his footsteps on the naira policy in less than 2 weeks. It is either Yardua lacks vision to lead or he doesn't have the balls to make hard decision or maybe he is just being controlled by some unforseen political forces...but definitely not the interest of Nigerians. Sicko he is!
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