Nigeria: flap over Arabic numerals on banknotes

Harold Schiffman hfsclpp at
Wed Aug 29 13:05:57 UTC 2007


*Soludo's Hara-Kiri*

Daily Trust (Abuja)

28 August 2007
Posted to the web 28 August 2007

By Muhammad Al-Ghazali

*"The price of liberty is eternal vigilance"- Thomas Jefferson*

To be honest, I wanted to write on the fast developing scandal in the
Federal House of Representatives this week until the CBN governor - if he is
still in office today, that is - Chukwuma Soludo, not for the first time
forced himself into national reckoning last Friday. The Speaker of the
House, Patricia Olubunmi Etteh, it would be recalled, was the professional
beautician who forayed into politics and quickly warmed herself into
reckoning where it mattered most in the hearts of the juggernauts of the old
order. Her subsequent triumph at the polls to elect the Speaker like that of
her senior counterpart in the Senate was not an accident of history but part
of a premeditated move by the former discredited President Olusegun Obasanjo
to reward his foot-soldiers who fought in vain for his third term in office.

For now, let us return to our main course for the day. By most accounts,
Chukwuma Soludo up till the moment of writing this the governor of the
Central Bank is an intelligent person and a sound economist because you
don't get to hold a PhD on the subject if you are anything less. But that is
not the same as saying that the man shies away from unnecessary
controversies or that he is perfect and above committing his fair share of
errors. The man is human, after all.

A few months ago when he tried to justify the removal of what he erroneously
thought were Arabic inscriptions from the new naira notes, it was just one
example of his limitations as a human being. Without calling for a
nationwide debate or consultations over the matter, Soludo concluded that
the Roman numerals and the English language where the epicentres of our
cultural heritage in the manner he insisted that Ajami or Hausa transcribed
with Arabic letters was alien to our culture! I duly pointed out in my
reaction to the changes at the time that Soludo could not have known better
than even the British who colonised us for several centuries and thought the
Ajami was an efficient and more pragmatic mode of communication among the
diverse people of West Africa.

Readers will also recall that I alluded to Africa's triple cultural heritage
which embodies the forces of Christianity and Westernisation, Islam and
finally our age-old indigenous beliefs. I concluded that it was the same
triple heritage which enabled Soludo to effect the recent change in his
first name from Charles to Chukwuma in all his official records with
effortless ease. I remember quite vividly that for my trouble, I received a
few irritating emails from Nigerians from a particular part of the country
who have refused to purge themselves of nauseating ethnic sentiments nearly
fifty years after our independence.

Yet, my position - which has not changed by the way - is that the national
currency of any nation, least of all Nigeria, is the collective heritage of
the people and not the private toy of any Alan Greenspan wannabe to do as he
pleased with. Even so, if Soludo had read Stephen Lendman's thesis titled
definitely have had a rethink. More on that subject later.

In the meantime, I was also emphatic in the view that Soludo is the least
qualified person to define or even interpret our cultural heritage in the
manner he did without any attempt at constructive national debate or
consensus building. Unfortunately for the man, last week confirmed the
age-old saying that 'you can fool the people for sometime but not all the
time'. Not content with playing the role of our Culture Minister, the same
arrogance and unilateral action he exhibited in the case of the new naira
notes was repeated in his publicised attempt to re-denominate our currency
through his so-called "Strategic Agenda for the Naira." Let me make it clear
at this point that I am not an economist, but I don't even need to be one to
appreciate that a few things just did not seem right with the idea.

First, let us even assume that the formal sectors of the economy accept the
changes with ease; what about the informal sector? Second, how would the
local lady selling akara and kunu accept payment for her delicacies for a
fraction of their previous values without much dogon turanci? What about
local transport fares as opposed to airlines who will no doubt comply?
Fourth, why have some countries such as Japan become uncomfortable whenever
the yen appreciates significantly against the dollar?

Unless my memory failed me, I thought one of the fundamental reasons why
some countries at times contrive to lower the value of their national
currencies was to boost local production. What about the Italian lira which
is counted in billions compared to the dollar? Does that mean that the
Italian economy is also a basket case? Fifth, having only recently
introduced the N1,000 note with great fanfare, Soludo needs to convince
Nigerians that his new agenda is not a mere reactionary move to counter
Ghanaians, who overburdened by the cedi counted in billions, decided to
re-denominate their currency to minimise the high costs of printing the
notes among other well-thought-out reasons.

Yet, there are other cogent reasons to believe that Soludo has been more a
loose cannon recently. Last month, for instance, it was reported that the
apex bank awarded contract valued at over thirty-two [yes 32!] billion naira
for the renovation of its Lagos office. It was never indicated whether the
contract received the blessing of the Federal Executive Council. Previously,
he had also informed Nigerians that the CBN's new head office in Abuja was
to be leased to the proposed African Central Bank. If he could do that with
impunity, the next thing obviously will be for Nigerians to brace themselves
for relocation of the CBN head office away from the Federal Capital
Territory (Abuja) in the near future.

However, all these posers are now academic since it has already transpired
that Soludo never even had the powers he claimed to possess for his
unilateral actions. A lot has already been written about the events of last
Friday in which for the first time in living memory, an incumbent governor
of the Central Bank was soundly humiliated, and well, literally shown the
way out of the door by the president. I have also read some nonsense from
some predictable quarters on why Soludo must not resign his position, but
for my money, his position has now simply become untenable as shall become
obvious presently. As things stand now, I simply refuse to believe that an
intelligent fellow like Soludo could have committed the monumental folly of
embarking on such a far-reaching venture without taking the president into

But if at all he did, then there are a few options left for him over the
matter. If the man has any self-respect, it beats my imagination how he can
continue to occupy his office after comments like, "In the present
circumstances, the president is not convinced of the merits of the naira
re-denomination plan put forward by the CBN without appropriate regard for
the present administration's insistence on due process and the rule of law,"
which was how the Special Adviser to the president presented his boss's
reaction to Soludo's much-trumpeted agenda to re-denominate the naira.

In case Soludo has problems with the English language, which I doubt, what
the president thinks in simple terms is that the governor's action is in
mortal breach of the law. What the public reaction also suggests is that the
president has lost complete faith in the governor and it remains to be seen
how he can reclaim the same trust and confidence in future. That,
ordinarily, should have earned the man the sack with immediate effect, but
for the simple fact that in the dying days of the Obasanjo
maladministration, he was able to push through some amendments to the CBN
Act, which prohibits the removal of the governor by the president except
supported by two-thirds of the National Assembly. But even that should be
sufficient grounds for Nigerians to celebrate this morning.

If the president had wanted to spare Soludo's skin, he could easily have
summoned him in the presence of the Attorney-General and subjected the man
to a tongue-lashing or better still a subtle rap on the wrist. But he did
neither, which makes his intention almost beyond question. Except if Soludo
is also a moron, which I doubt, he cannot feign ignorance of the compulsive
message. By allowing the Attorney-General and his Special Adviser to pummel
and disrobe the governor in the manner they did, the president effectively
crossed the Rubicon in his relationship with Soludo from which there is a
point of no return. One of them will definitely blink in the end and I doubt
very much if that person will be the president given what is at stake. We
shall see.

For now though, there is every indication that resignation is the last thing
on Soludo's mind. He is Nigerian lest we forget, after all. Honourable
resignation from office to protect whatever remains of one's honour and
integrity are forever a rarity on these shores. From what I gathered, his
job comes with unbelievable perks and privileges that will make even the
president shake his head in disbelief! He is highly unlikely to give all
that up without a serious fight. Already, there are indications that the man
has started to fight back through the media. Part of his strategy no doubt
will be to politicise his disagreement with the president. Yesterday, for
instance, the Nigerian Tribune citing unnamed sources reported that the CBN
believes that the enemies of Nigeria were behind the move to scuttle the
'Strategic Agenda for the Naira.'

It further claimed in what must surely count as an insult to the president
that some 'big men' likely to be harmed by the new policy confused him
leading to the volte-face. But the report completely gave the game away when
it claimed that the new policy would also have made the currency black
market extinct if it saw the light of the day! After all, who in this
country does not know that the currency black market business is almost a
complete monopoly of the 'Mallams?' But blackmail, I also hasten to add, is
nothing new to Nigerian politics and has over time become a common tool for
those who cannot convince anyone through the force of their arguments or
even the logic of their convictions.

Even so, sentiments and silly thinking aside, there is today a very urgent
need to dissect the factors that have led a fine intellectual like Chukwuma
Soludo to commit a virtual hara-kiri - or self-disembowelment for those who
don't understand a word of Japanese - in the manner he arrogated to himself
powers that he never possessed in the first place. The more I attempted to
decipher his motives, the more I was tempted to believe that Soludo stands
accused for allowing the autonomy guaranteed the apex bank courtesy of the
recent amendments to the CBN Act to get into his head. Central Banks after
all have never been an end to themselves.

The US Federal Reserve, Bank of England, Bank of Japan and the European
Central Bank (for the 12 European countries that adopted the single euro
currency in 1999) are institutions with enormous power far beyond what most
people everywhere can imagine. These most dominant of all central banks, as
well as most others, have a powerful influence on the financial conditions
in virtually all countries including their own, of course, in an
increasingly borderless financial world where a significant economic event
in one nation can affect most others for better or worse. But such powers
have never gone undisputed for reasons that shall become apparent presently.

I hinted earlier that Soludo carries on as if he is Alan Greenspan, one of
the most powerful chairmen of the American Federal Reserve Board who
recently retired from office. But even in America, there are question marks
over the legality of the Federal Reserve Board itself. As Stephen Lendman
pointed out, 'The Federal Reserve Act that began it all must surely rank as
one of the most disastrous and outrageous pieces of legislation to the
public welfare ever to come out of any legislative body. It may have also
been and still is illegal according to Article 1, Section 8 of the
Constitution which happens to be the inviolable law of the land. The article
states that Congress shall have the power to coin (create) money and
regulate the value thereof. In 1935, the US Supreme Court ruled the Congress
cannot constitutionally delegate its power to another group or body.'

He further stated, 'The Congress thus acted in violation of the Constitution
it swore to uphold and in so doing created the Federal Reserve System that,
as will be explained below, is a private for-profit corporation operating at
the expense of the public welfare. By its action, our lawmakers committed
fraud against the people of the country and so far have gotten away with it
without the public even knowing about the harm done.'

Lendman concluded that, 'The shameful result is that what should have
arrived stillborn is now the most dominant institution on earth, and all
because of what began on a privately owned island with a scary name. But had
the Congress acted responsibly, the act of Federal creation might never have
happened. The legislation establishing it was so harmful to the public
interest, it likely never would have passed if it hadn't been shepherded
through a carefully-prepared Congressional Conference Committee meeting
scheduled for between 1:30 and 4:30 AM (when most members of Congress were
asleep) on December 22, 1913. The Act was then voted on the next day and
passed although many members of the body had left for the Christmas holidays
and most others who stayed behind hadn't had time to read it or know its

So there it is. Even the so-called powers of the Federal Reserve Board are
predicated on patent illegitimacy. But does something sound familiar here?
Certainly! According to information divulged on behalf of the president by
Olusegun Adeniyi last week, "In his last week in office, President Olusegun
Obasanjo signed into law several bills targeted at institutional reforms.
One of them, the Central Bank of Nigeria Act 2007 was gazetted on June 1;
three days after President Umaru Musa Yar'Adua assumed office.' The next
logical questions to ask of course are: how much rigorous debate was the
amendment of the CBN Act subjected to and how informed were the public about
its basic provisions of the amendment? Why was the singing of the CBN Act,
like the approvals for the sales of our refineries one of the last actions
of Obasanjo in office?

The posers are many but the lesson for Soludo's present predicament is that
the price for reckless behaviour is high, painful and inevitable. It's true
for countries as well as individuals, but too often, neither one sees it
until it's too late, and in the case of Chukwuma Soludo, it is certainly far
too late! But there could be several others with the same mindset and
swollen heads who need to be watched carefully in the corridors of power.
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