History of Nigerian Currency

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Nigeria's National Currency (1914 – 2014): One Money, Many Transitions, Multiple Reforms

Our special correspondent, NUHU YAR'WA, in this historical treatise reveals that Nigeria may not have attained the dreams of its founding fathers as the most developed nation in Africa – politically, economically and technologically even though she has attained 50 years of nationhood; not because she has had no political transitions and economic adjustment programmes with monumental relics such as paper monies, coins, bonds and covenants and edits from 1914, and a dozen constitutional frame work from 1922.

It is because various political leaderships systematically dwarfed the national currency, NAIRA, in assigning converting rate to it vis – a – vis international currencies. For example, is Naira the strongest currency in Africa? Excerpts: In 50 years (1960 – 2010), Nigeria has had a total of six currency regimes powered by political transitions between various civilian and military dictatorships, including constitutional formats and half – a – dozen legal currency tenders.

This is a journey, in the first instance, from 1914 to 1959 and which further transmuted to giant indigenous markings from 1973 to 2004 under the watchful Central Bank of Nigeria (CBN), hitherto the National Bank of British Nigeria.
Interestingly, under the British West Africa (1890 – 1960s), were in existence; the National Bank of (British) Ghana and similarly, the Sierra-Leone, etc. There was at the edge of Middle – East, British India - before the emergence there-from Pakistan out of four Indian Provinces of Punjab, Kashmir, Islamabad and Bulachistan.

Various coins and paper denominations entered Nigeria's money market between 1973, 1977, 1982, 1984 and 1997. There was also the millennium package from year 2000 A.D when polymer – in leather format, contrary to treated industrially secured paper forms-were introduced as legal tenders in smaller fractions of N5, N10, N20 and N50. These are relics; they are equally a burden on the nation.

The Central Bank of Nigeria (CBN) has remained the regulatory body of the agency minting all legal tenders by way of cheque leaf, booklet, bond papers, coins and currency.

Security Firm, Secured Economy

This remains the primary function of the Nigeria Security Printing and Minting Company (NSPMC). In short, the mint, through whose functions the CBN principally regulates Nigeria's capital market and the international money flow via the various commercial, industrial and trade banks as well as practices at stock exchange chambers and security exchange fora remains a security firm in itself with national focus and international link. CBN remains the gateway to international marketing/commerce through sales and purchase, import and export duties/taxes.

The Declassification of British Pound:

Indeed, Nigeria adopted the Naira and Kobo as her currency in 1973 while the Naira replaced the colonial – imposed British Pound, Kobo took the place of British Coin Shilling. The British Pence – as the lowest denomination was declassified by Nigeria's military government then led in the early 70s by Gen. Yakubu Gowon. The Pence automatically lacked conversion rate and so lacked an equivalent home – print relic.

Searching for the Mess

Perhaps, the genesis of Nigeria's steady economic recession or meltdown was first noticed in the early 80s during the civilian administration of Alhaji Shehu Shagari. He introduced "austerity measures". The reason became crystal from 1987 to 1992 – within a decade gap of insulating the many setbacks in the economy by the military regimes led by General Buhari in 1983 – 1985 and Babangida between 1986 – 1993 respectively.

Evidently, the period 1975 to 1990 – a painful long match of fifteen years characterized by four sudden national political leadership changes – may adequately explain where Nigeria lost focus in its bid at economic prosperity and with it, technological build –up.

This may be convincing especially that in the 80s and 90s, Nigeria was a vast agrarian economy with unlimited industrial potentials of the 60s and 70s which the colonial epoch 1900 – 1960 envied but which was crippled by instable domestic political regimes which avoided the broad tracks at industrial growth.

The Broad Track

The broad track include the painful abandonment of the neatly packaged "Five Years Development Plan" initiated on political independence by Prime Minister, Sir Abubakar Tafawa Balewa's civilian administration.

The plan in series, forecloses slippery paths; provides stimulants and jam – packs interest at national goal/aspiration within a fairly short period of four to five years.

Politics not based on national values and aspirations, so to say, instead of allowing this periodically masterful political broad way at ensuring a consistent economic growth by index to strengthen industrial set up sadly regressed Nigeria as it jacked–up all issues into yearly January-marked long budgetary speeches full of ceremonial expenditure-by Presidents, Governors and Ministers-lacking financial discipline in spending public monies. Because of low or lack of moral power to account to the people through treasury which enhances the recreation of economic growth or boom, and with it general wellbeing for all.

Naira as an International Index

How or whether Naira will become an international tender like U.S. dollar, British Pound, Chinese Yuan, Saudi Riyadh and German Marks will perhaps await another or more monetary reforms and political transitions in time and space.

For now, Naira commands some measure of respect within some west African countries such as Nigeria's immediate neighbours: Chad, Niger and Cameroon. Saudi Arabia, to her credit, remains the only large economy in the world which as Nigeria's traditional partner, tolerates the Naira: Nigeria's economic power. Commercial activities involving Naira are handled in great sums at Al – Arabia's commercial, diplomatic and industrial city of Jeddah.

One Currency, Many Faces & Phases

Naira remains one money with many reforms, multiple faces and phases built in transitions. Alhaji Shehu Shagari introduced the then highest denomination of N20 notes without the coin equivalent in the early 80s. General Buhari, apparently fighting high corruption and private stock piling of Naira notes at home and in farms by unpatriotic Nigerians, changed the entire colour-separations, symbols and security markings of the various denominations in 1984 on his assumption of power after sacking the civilian leadership in 1983.

General Ibrahim Babangida from 1986 when he assumed power to 1993 when he left, did not introduce any new denomination. He was careful in strengthening the "economic adjustment programme" of the Shagari era which was a national policy.

A Pendulum that Hurts Up...

This shifted IBB into a pendulum, swinging the nation between FEM (Forex Exchange Market) and the second one (SFEM) with tangible results.

Late General Sani Abacha who assumed power in November 1993 and died in 1998 while on the throne introduced the then highest N50 denomination. It was called locally as wa – zo – bia because of its art work which depicted major Nigerian tribes: the wa represents Yoruba's call for "come". The Hausa corresponding term is zo and the Ibo equivalent, bia.

General Obasanjo while serving Nigeria as civilian president between 1999 and 2007 first introduced the N100 note and simultaneously N200 and N500 as larger national tenders. He also gave Nigeria its current largest note – N1000, which lacks the equivalent in coin fabrication.

Planless Economy

A country whose monetary index and indices only recognizes Kobo as fractional unit in statute books and calculations in organized markets such as in banking transactions, budgetary analyses and cross-border invoicing by way of import taxes and export duties while locally refusing to package every item in kobo-weight or value except in Naira round sum, from all frequently consumables such as sugar and canned tomatoes, soft drinks etc across both rural markets and urban trade centres, is a sad often-repeated phenomenon inconsistent with national pride via economic growth that allows multiple choices at satisfaction with less stress: The ability to encourage little savings on all supplies is nil.

Even services such as transport fares, hospital billing, school fees and court fines are imposed within the highest round figures of tens, hundreds and thousands.

Perhaps, when the culture of insistence on invoicing and/or receipts on all goods and services - be it fuel intake or barbing saloon attendance is nationally encouraged with drastic punitive measure while coins are also made available, the citizens will fast learn that some little savings from little purchases grants the financial power/right for higher purchases and purposes. The manufacturers too will also appreciate that little discounts in fixing prices per unit of articles or products is both charity to the buyer as it is a high consideration to the manufacturer and the whole seller. The revenue enforcing officers will then make this prosperity a national umbrella if it bills individuals and organizations sums with fractions atop which CBN must have made available.

The Historical Challenge

Pupils in primary schools and students in higher colleges may have forgotten that a legal tender called kobo exists. They may have lost the image of the "beast" called kobo and its fascinating or 'awesome' security features; its metallic substance as copper or silver or bronze.

Sadly, how many Nigerians, including the noisy civil servants, lawyers and lecturers realize that the smallest items in retail shops such as a packet of matches, biscuit, salt, water sachet or kolanut which we buy say N5 approximate to 500kobo, 100k being symbolically equivalent to N1?

Switching back, electrically, to pounds or "Nigeria Pound" with well home-determined value at convertible rate to foreign currencies such as Euro, dollar, Riyadh, Yuan and Sterling is speedily both necessary and desirable.

Pseudo – Nationalism

For fear of political noise-makers who may accuse us of being "neo-colonial apologists" or pseudo-nationalists, Nigeria can, if not comfortable with the title "Nigeria Pound" with inscription NP, make do with a home created acronym – NAUYI.

Nauyi in Hausa vocabulary means "weight". And Nauyi as my coinage further takes note of Nigeria's wa-zo-bia large ethnic groupings of Yoruba, Hausa and Ibo internally linguistic beautiful expression of embrace, unity, call or attention: Nau being "Niger Area Unity" whereas "Yih" that supports "Nau" give out "Y" to Yoruba; "I" stands for Ibo and "h" encapsulates Hausa hegemony.

Perhaps, Nauyi's best alternative home-grown coinage may be "Nibec" where "Ni" stands for Niger river, hence Niger Area while "be" is Benue river with "c" serving as "currency", Nibec. Nigeria's affairs from 1900 is paddled on rivers Niger and Benue.

For now, is Naira which is derived from the territorial image – Nigeria, the most strongest of currencies in Africa?

Nuhu Yar'wa is with the Editorial department of the Leadership.
GSM: 0803 – 599 – 3023.

Source: Leadership
It is our choices...that show what we truly are, far more than our abilities. -J. K. Rowling.