“Nigeria’s GDP Numbers To Drop” Rewane Speaks on Cash Scarcity As Governors Wait for Supreme Court Judgment
- Bismark Rewane, a well-known economist, has expressed his thoughts on the CBN's naira redesign
- The CBN's deadline for exchanging old naira notes for new ones was set for February 10, 2023
- The Supreme Court is expected to rule on the naira swap deadline in a case brought by governors
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Bismarck Rewane, who is the CEO of Financial Derivatives Company Limited has projected that the Nigerian economy will suffer from the naira swap policy of the Central Bank of Nigeria (CBN).
Speaking on Channels TV, Rewane predicted that there will be a three-to-five-percent drop in the gross domestic product (GDP) of Q1 2023 as a direct result of the naira swap.
Rewane's opinion comes at a time when at least five Governors have filed lawsuits in the supreme court contesting the federal government's deadline for the naira exchange.
Source: UGC
The supreme court is expected to make a decision on Wednesday, February 15, 2023.
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What is Rewane saying
According to Rewane, there used to be three to four ATM users in Downtown Lagos (Ikoyi, Victoria Island, and Lekki). The average number of ATM users in midtown (Ebute Meta) was eight, while one uptown (Alimosho) had 15.
He added that getting money from an ATM used to take five minutes in Ikoyi, seven minutes in Ebute Meta, and ten minutes in Alimosho.
His words:
“The impact at the end of the day is that it will affect GDP this quarter, conservatively, by three percent, and aggressively it could reduce GDP in this quarter by five percent, if nothing is done in a hurry."
“Fast-forward to now. The average number of people in front of an ATM in Ikoyi and Victoria Island is now 40. In midtown, Ebute Meta, it’s about 100 people. And in Alimosho, it’s about 600 people.
“The consequences are that flour sales in Lagos are down 30 percent. The rams in Kano are down 70 percent. And cement in Kogi is down 40 percent of sales."
CBN decides to print new naira abroad
In another report, the CBN has decided to print the new naira notes abroad has scarcity persists.
Punch reports that the CBN will bow to mounting pressure and contract the printing of the redesigned N1,000, N500, and N200 notes to foreign contractors in the coming days in order to boost the circulation of the currency.
Naira continue to improve against US dollar
Meanwhile, the scarcity of the Naira seems to be helping its value against the US dollar across official and unofficial forex exchange markets
Naira recorded two straight days of appreciation in the official market as dollar demands dropped
The Central Bank of Nigeria is expected to withdraw the use of old naira notes on Friday, February 10, 2023
Source: Legit.ng
