…Falana Sues CBN Over Dollarisation Mama Sunday was almost through with the rice she was cooking when she tasted it again and noticed she was yet to add salt. She quickly dashed inside to take the salt container. It was like a movie when she came back and discovered someone or a group of persons
…Falana Sues CBN Over Dollarisation
Mama Sunday was almost through with the rice she was cooking when she tasted it again and noticed she was yet to add salt. She quickly dashed inside to take the salt container. It was like a movie when she came back and discovered someone or a group of persons have turned the rice from the aluminum pot and covered the empty pot on the fire.
Her case was similar to Madam Esther’s incident. She had twisted and turned the yam flower on fire in front of their apartment, a one – room – and parlour, when she went inside to bring plates to dish the Amala. When she returned, the pot of Amala was gone! Madam Esther searched the neighbourhood for some minutes and was almost giving up hope when she discovered a family having a feast at the back of her house. She moved closer, discovered the family was using only palm oil to eat her pot of Amala. She left for her house without saying a word.
The hardship in the land is so palpable that one could cut it with bare hands. The suffering cuts across ethnic, religious, political and social lines. But there is a limit to human endurance. In Minna,the Niger State capital, on Monday, 5 February , 2024, thousands of residents took to the streets in protest against what they described as severe hunger and escalating cost of living in the country.
The protesters, who were out as early as 7 am, blocked the Minna-Bida Road at the popular Kpakungu roundabout to express their grievances over the rising cost of food items when police men granted to the scene fired teargas cannisters to disperse the protesters.
Security agencies that included the police, Civil defence and Department of State Services (DSS)merely followed the protesters to prevent them from vandalising both public and private business concerns.
This was after the initial efforts by the police to control the crowd almost resulted in violence as protesters asked the police to take their leave and let them be.
The protesters formed impenetrable barricades that disrupted both vehicular and human traffic on some of the major roads within the metropolis, the protesters, including women, and youths, chanted different songs against the administration of President Bola Ahmed Tinubu.
Some of the protesters were shouting at the top of their voices saying that the rising cost of food items and poor government efforts towards arresting the unfortunate development forced them to come out of their houses to block major roads to draw the attention of government to their worsening conditions
They also complained that while the people were experiencing excruciating pains as a result of government policies that were not well thought out, public office holders were living in luxury at the expense of the people.
Addressing the protesters, the Niger State Deputy Governor, Alhaji Yakubu Garba, said that the government was conscious and quite aware of their plight, pains and hardship being faced by families.
The deputy governor assured the protesters that government at all levels was working hard towards mitigating the high cost of living arising from the removal of the petrol subsidy.
Falana Sues CBN for Dollarisation of the Economy
As the protest rocked Minna, Niger state capital, another form of protest was happening in the court as a Senior Advocate of Nigeria, Mr. Femi Falana, sued the Central Bank of Nigeria (CBN) for the “dollarisation of the Nigerian economy.”
Mr. Falana, in the suit marked FHC/L/CS/476/23, filed at the Federal High Court in Lagos, is asking the court to determine among others :“whether by virtue of Section 16 of the Central Bank Act, the exchange rate of the naira shall be determined, from time to time, by a suitable mechanism devised by the Bank for that purpose?”
He claimed that :“the seeming non-performance of the defendant’s statutory obligations culminated in dollarisation of the country’s economy which has, in turn, affected the country’s economy negatively, contrary to the objectives of the defendant as enshrined in Section 2 of CBN Act.”
In a 10-paragraph affidavit in support of the Originating Summons deposed to by one Mr. Ayodele Aribisala, the learned silk argued that the CBN had allowed many landlords in Lagos, Abuja, Port Harcourt and other cities in Nigeria for which the apex bank was established to serve to collect rents in dollars.
“The Defendant has refused to stop the collection of school fees and rents in dollars in Nigeria,” he said.
Mr. Falana argued that the dollarisation of the Nigerian economy and the failure to address the multiple exchange rates further pushed the naira to its current fluctuating state.
He recalled that in 2015, one dollar was exchanged for N178, but in 2022, it was exchanged for N750.
The Senior Advocate further argued that the multiple exchange rates regime led to the emergence of different exchange rates in the three major segments of the foreign exchange market namely: the official market, the Investors and Exporters window (also known as NAFEX) and the parallel market.
His words:“that the failure of the defendant to perform its statutory duties has resulted in the constant devaluation, depreciation and unending plunge of the naira.
“That the resultant effect of the abdication of defendant’s statutory duties has also affected the country’s economy and many businesses adversely.”
In the written address in support of the suit filed on his behalf by Mrs. Funmi Falana, SAN , the plaintiff submitted that by allowing the unabated use of dollars in Nigeria to the detriment of the naira, the defendant had failed in its statutory duties to ensure that naira remained the only recognised means of legal tender in Nigeria.
He noted that the Minister of Finance, Dr. Wale Edun, on August 17, 2021, publicly admitted that the multiple exchange rates system had compounded the problem in the Nigeria capital market and further stated that the defendant’s latest policy was directed towards a unified exchange rate.
Mr. Falana argued :“The defendant, having realised that its policies on dual exchange rate system have caused more harm than good, declared the parallel market illegal and a bad determinant for the naira.
“The defendant further intimated its plan to eliminate the multiple exchange rate regime and unify the exchange rates and manage the rate in a sustainable manner over a period of 12 months but has failed to do so.
“The apparent remiss of the defendant which has impoverished and pauperised many Nigerians must not be further condoned and same ought to be expeditiously addressed in order to save the jittery value of our currency that was once ranked as one of the strongest currencies in the world.
“To this end, we humbly submit that by employing unsuitable mechanisms and creating multiple exchange rates in contravention of section 16 of the CBN Act, the defendant has categorically failed to carry out its principal objects which inter alia, are to ensure monetary and price stability…, and promote a sound financial system in Nigeria and we urge your lordship to so hold.
“Consequently, we urge your lordship to compel the defendant to put an end to the use of dollar as legal tender by enforcing policies and sanctions that will stop the illegal use of dollars as legal tender in Nigeria.”
The plaintiff, among other reliefs, sought “A declaration that by virtue of section 16 of the Central Bank Act the legal tender in Nigeria is naira and kobo.
“A declaration that by the combined effect of sections 15 and 20 (1) of the Central Bank Act, the currency notes issued by the defendant shall be the legal tender in Nigeria.
“A declaration that by virtue of section 16 of the Central Bank Act the exchange rate of the Naira shall be determined, from time to time, by a suitable mechanism devised by the defendant for that purpose.
“A declaration that by virtue of section 16 of the Central Bank Act the defendant is not competent to allow multiple exchange rates of the naira vis-a-vis the dollars and other foreign currencies.
“A declaration that by virtue of section 20 (5) of the Central Bank Act the defendant is under a legal obligation to prosecute any person who refuses to accept the naira as a means of payment in Nigeria.”
Mr. Falana pleaded with the court to allow the suit to be served out of Lagos State and in the Federal Capital Territory, Abuja.