Nigeria’s Currency Crisis Worsens as Residents Struggle to Access New Banknotes
Nigeria is facing a deepening currency crisis as residents struggle to access new naira banknotes that were introduced by the Central Bank of Nigeria (CBN) last December. The move was intended to help address the liquidity crisis outside the banking system, which is estimated to be over 3 trillion nairas or $6.5 billion at the current exchange rate. However, the new banknotes are in short supply, triggering protests and leading some residents to resort to bartering as an alternative means of transaction.
The CBN had announced the withdrawal of the 200, 500 and 1000 naira notes from circulation, with a deadline for residents to exchange them at banks by April 10. However, banks have reportedly been unable to provide enough new notes to meet demand. As a result, long queues have formed outside banks, and some local media reports suggest that some people are being left without any means of payment.
The scarcity of cash has forced some local merchants to resort to bartering to sell their goods. Protests have broken out in response to the failure of the currency transition, with some residents even resorting to burning down banks in frustration.
Residents are now seeking alternative means of payment, including foreign currencies and cryptocurrencies. This has driven up the local price of Bitcoin, which reportedly reached as high as $37,000, compared to a global average of $23,000.
The situation highlights the need for stability in a country’s banking system and economic policies, as well as the importance of access to payment systems that are not controlled by political entities. Nigeria, the largest country in Africa, is still facing significant challenges in achieving financial stability. The current crisis is a reminder of the importance of effective governance and economic policies in promoting sustainable development.
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