NWOKO: Use Naira As Only Legal Tender In Nigeria
THE senator representing Delta North in the National Assembly, Ned Munir Nwoko, has suggested the use of naira as the only legal tender in Nigeria for the transaction of businesses.
Speaking during plenary, the lawmaker, in reaction to the devaluation of the naira against the US dollar, appealed to his colleagues to ban the use of dollars in the country in order to help strengthen the local currency.
He said: “I have lamented about the fundamental problem we have in Nigeria, and that is the use of dual currency in Nigeria. There is no other economy that can survive with that.
“We must understand that we have relegated the naira to the background. Everybody is talking about dollars and the dollar is what is causing the problem.
”It might be a difficult thing to contemplate, but what has to be done is that we have to stop the use of dollars in Nigeria. Once we do that, everything begins to take shape.”
Nwoko, a solicitor of the Supreme Court of England and Wales, said the glaring income inequality between foreign workers and their Nigerian counterparts in companies operating in Nigeria is a deeply concerning practice that perpetuates historical injustices rooted in the colonial legacy.
This practice, he stated, exacerbates existing economic disparities and reinforces the master-servant dynamic that has plagued the country for centuries.
Looking at colonial legacy and economic exploitation in Nigeria and Africa as a whole, the former House of Representatives member noted: “Historically, income inequality in Africa, including Nigeria, has been entrenched since the colonial era.
“European settlers exploited the vast resources of the continent, while systematically marginalising and impoverishing indigenous populations. This exploitation was not only economic, but also deeply ingrained in social and political structures, leading to a stark income gap between Africans and their colonial overlords.
“During colonial rule, Africans were often relegated to low-paying labour roles, while Europeans enjoyed privileged positions with significantly higher incomes.
“Of course, this disparity was not based on merit or skill, but rather on race and colonial power dynamics.”
He lamented unequal treatment in the present day, even after gaining independence, adding that the remnants of this unequal system persist, manifesting in the unequal treatment of foreign workers and local employees in the country.
“The payment of foreign workers in dollars, while Nigerian colleagues receive wages far below the conversion rate is a blatant example of this ongoing injustice.”
The consequences of this practice, he noted, extended beyond mere discrimination, as they have profound implications for Nigeria’s economy, as could be seen today.
The senator insisted that the alarming depreciation of the naira against the United States (US) dollar is exacerbated by the demand for foreign currency to pay professional services in dollars, thereby not only eroding confidence in the domestic currency, but also widening socio-economic disparities within the country.
Regarding the legal ambiguity and regulatory reform, the Idumuje-Ugboko-born politician bemoaned that the absence of explicit prohibition on paying salaries in foreign currency in relevant legislation, such as the Central Bank of Nigeria (CBN) Act and the Foreign Exchange Act heightens regulatory ambiguity and allows such exploitative practices to persist unchecked.
He, therefore, called for an urgent amendments to these laws to address this issue effectively and ensure equitable treatment of all workers in Nigeria.
The significant capital flight resulting from these unequal salary payments, he stressed, far surpasses most factors contributing to naira depreciation, including school fees and medical treatments abroad.
For this reason, he reckoned that ending the practice of paying foreign workers in dollars is not only a matter of economic justice, but also a crucial step towards dismantling neo-colonial structures and building a more equitable and prosperous Nigeria for all its citizens.
Nwoko, while urging a reconsideration of the policy of foreign reserves in foreign lands, said such notion is not only repulsive, but also counter-intuitive to Nigeria’s economic sovereignty, adding that contrary to the practices of other nations, such as the US, Britain, France and Japan, who keep their reserves within their own borders, Nigeria’s adherence to this practice raises questions about its colonial legacy.
“If our early indigenous leaders adopted this approach due to colonial mentality, why should we perpetuate it? he asked rhetorically.
He punctured the need to balance trade primary argument to defend the existence of foreign reserves, saying it lacks merit and falls short when adequately scutinised, when considering the limited number of traders involved in importing goods into Nigeria, which constitutes a negligible fraction of the population.
As a result, Nwoko said it is time to prioritise the domestication of Nigeria’s reserves, anchoring its economic stability firmly within its borders.
He insisted that if we don’t get our currency to be needed, valued, known and quoted, no one is coming to do it for us, noting that continued acceptance of the dollar as legal tender undermines Nigeria’s economic sovereignty and must be halted.
“We must stop giving people the confidence to conduct business in Nigeria using foreign currencies. This practice not only undermines our economy, but also perpetuates dependency on foreign currencies.
“As a nation that sells crude oil and a few other items on the global market, it’s crucial that we make it compulsory for every sale of these items to be conducted in naira. This will prompt buyers to seek out naira, leading to its appreciation due to increased demand and scarcity.
“While we may not have a large volume of exports on the global market, we attract a significant number of visitors. When these visitors understand that the dollar will not be accepted as legal tender in Nigeria, they begin sourcing naira from their commercial banks and Bureau de Change (BDCs) even before arriving in the country.
“This increased demand prompts banks abroad to source and stock up naira, making it readily available for exchange.”
He added: “Upon arrival, visitors can also obtain naira from our BDCs. Imagine millions of visitors and prospective visitors from all over the world sourcing naira; our local currency becomes increasingly relevant. This scenario creates a simple supply-and-demand dynamic, where the demand for naira increases, making it more relevant globally.
“If we fail to create a need for naira in other nations, their BDCs won’t even recognise it, let alone accept it for exchange. We must create an atmosphere that encourages the demand for naira. This involves adopting policies that mandate the use of naira for business transactions. Additionally, all domiciliary accounts must be converted into naira.”
Nwoko also called for urgent redefining the role of BDC, saying their prevalence in Nigeria must align with currency policies aimed at shunning unfairly fall of the naira. BDCs, he said, should serve as facilitators of currency exchange for foreigners, promoting the use of the naira in domestic transactions.
“By enforcing regulations that prohibit the acceptance of foreign currencies for local transactions, we redirect the focus of BDCs towards selling naira and retaining foreign currencies for outbound travelers. Ambiguous practices, such as students paying school fees abroad, must also be addressed by BDCs in commercial banks.”
He acknowledged that opposition to these reforms may arise, particularly from oil companies and other corporations with agreements that could hinder the implementation of the proposed measures and hinder progress.
He, however, stated that agreements do not equate to immutable judgments and any existing agreements would be thoroughly reviewed and any unjust or unfair ones would be amended or terminated in favour of the collective economic growth of the country.
The lawmaker opined that if Nigerians truly desire economic freedom, then reassessing the country’s approach to reserves and currency policy is imperative to pave the way for economic resilience and self-reliance.
On the dwindling economy, Nwoko said: “In an economy of this nature, we must think of consumers, the interest rate in Nigeria is currently unacceptable. We must think of an interest rate that is not more than five per cent, so that people can begin to borrow. If people cannot borrow, they can not survive, we must be able to borrow at an acceptable interest rate.
“As we grapple with the free fall of the naira and the near-collapse of the economy, there is only one short-term, medium-term and long-term solution, which is captured in my motion and Bill before the senate, titled, ‘Urgent Call for Immediate Prohibition of the Use of Foreign Currencies in Nigeria’ and ‘Bill for an Act to Alter the Central Bank of Nigeria Act, 2007, to Provide for the Prohibition of Foreign Currency Payment for Remuneration and for Matters Connected Therewith.’