New Naira notes crisis: protests break out across Nigeria

We publish the RSM statement on the recent crisis in Nigeria

REVOLUTIONARY SOCIALIST MOVEMENT

PRESS STATEMENT

21 February, 2023.

Time for mass action to end perennial fuel shortage and scarcity of new Naira notes!

Workers and youth must fight back to end the anti-people policies!

Nationalise the banking system and the energy sector to implement pro-poor policies! 

The decision by the Buhari-led government to withdraw from circulation the old  Naira  200, 500, and 1000 notes has created chaos and has put ordinary Nigerians under huge pressure and new hardships. 

Initially, the Buhari regime decided to change the three highest denominations of the Naira with effect  December 15th, 2023 announced deadline for  old notes to be  January 31, 2023. When that proved unrealistic, a new date was fixed at February 10, 2023 and later people were asked to bring old notes to the Central Bank in person. While people returned the old bank notes to the banks, the new notes did not flow in sufficient quantity. This led to chaotic scenes, with people having to line up for 3-5 hours just to make a cash withdrawal, and a significant number of violent incidents inside or outside banks.

The government has cited a number of reasons as the driving force behind this change, the most important one being the need to discourage cash hoarding and money laundering, as well as kidnapping and vote buying. But the widespread corruption is not based on the old Naira notes, it is based on the character of Nigerian capitalism. The only thing that this new change has achieved is to put additional obstacles to people to access the small amounts of money they have, with the additional result of inflicting a blow to the economy, which is likely to contract according to some reports. 

The address by the President on the morning of Thursday, February 16, extending the legal tender status of old notes to only N200 notes is a sham, and is leading to national chaos. It is at the same time disregarding the Supreme Court ruling of February 8th, which demands that the legal tender of the old notes is extended. 

***

People are outraged by these developments. Series of protests are going on across the country and many have resulted to violence and wanton destruction of properties. Many ATMs has been destroyed and many banks have been burnt. Although RSM supports the protest that have been breaking out all over the country, it stands against blind violence. It also condemns police violence against protesters which have resulted in many injuries and a few deaths.  

The Buhari-led administration is to be blame for this new precarious situation the masses are going through. In a country largely based on cash, where electronic payments are not working properly, people cannot access their cash reserves and are condemned to waste their time in ques, not being able to cover their daily needs, ect. 

***

This new hardship is imposed on top of the fuel scarcity crisis.

Nigeria is ranking 11th in oil reserves worldwide and 14th in oil production. But still, its people have to face fuel scarcity and spend significant amount of their incomes to buy petrol.

This current fuel shortage crisis has meant that millions of people have been sleeping in filling stations just to get fuel at black market price of N300 per liter to do their usual businesses. This is despite huge amounts of money that the present and past governments have poured into the energy sector. No doubt most of this money went for jumbo payments to political office holders, reckless spending and hand-outs to crony capitalists. 

***

The new Naira notes crisis has brought to the fore the underlying problems of the financial and banking sectors of Nigeria. 

Even the Point on Sale (POS) operators do not work properly, adding to the problem. Another issue is that enterprises are not accepting the old Naira notes, even if they are still valid, out of fear that there will be problems with their exchange process. The Central Bank of Nigeria claims that it has issued enough money to the commercial banks, but the banks have denied this– total irresponsibility!

This current situation has established the fact that the ruling elite in Nigeria is so backward that they cannot carry out even the most basic tasks of a proper functioning of their system. In fact, oil and currency shortages could easily be addressed if the government was working to the benefit of the people and not a minority of profiteers. 

***

There’s a possibility that mass protests will continue across Nigeria. The problem is that this outburst of anger lacks organisation and a political platform, thus it takes the form of violent clashes.

The Trade Union Congress of Nigeria and the Nigeria Labour Congress have both not announced actions. The Association of Senior Staff of Banks, Insurance and Financial Institutions did declare a strike to protect its members from violent incidents, but it retracted, presumably due to pressures from above. The newly elected president of Nigeria Labour Congress said they won’t declare strikes because elections are around the corner and they don’t want anything that will affect the outcome. 

RSM believes that the situation requires mass mobilisations and protests to demand an end to fuel scarcity and the immediate release of new Naira notes to circulation. The rot in the Nigeria financial sector didn’t start today. All sections of the ruling class are responsible for the crisis of inflation, the naira devaluation and all the polices that enforce hardships to the poor. The capitalists and bureaucrats of the energy sector are equally to blame for the fuel shortages. 

The super rich will not suffer, as they have their ways around these problems. Some people have access to so much wealth that they are immune to these kinds of problems. At the same time, millions of Nigerians are suffering to get new notes and some fuel.

The only way out of these double crises (fuel and notes) is to take the banking system and the energy sector away from the corrupt hands of capitalists and put them in the hands of society. That means to nationalise the banking and energy sectors, without compensation to their super-rich owners, and establish workers and social management and control to avoid corruption, mismanagement and profiteering.  

We call on the NLC, the TUC and all their affiliates, who’s workers are directly suffering from this policies, to provide organisation and leadership to this struggle which is now breaking out. The trade union movement needs to fight for the interest of the working people. There is a need to link protests against the current crisis and the anti-poor policies in general to the need for a mass working people political party with a socialist programme that can both organise immediate struggles and argue for a fundamental change in society.

Salako Kayode

Publicity Secretary 

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