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| Sanusi Lamido |
The governor of the Central Bank of Nigeria (CBN), Sanusi
Lamido on Tuesday reacted to a statement credited to a former President,
Olusegun Obasanjo, who said that the planned introduction of the N5000 note
will increase inflation in the country.
Mr Obasanjo had on Thursday said the introduction of the
N5000 note would kill production and affect small businesses negatively.
The former president, who disclosed this at a roundtable
advocacy forum organised by the Institute of Directors, in Lagos, said the way,
Mr Sanusi, was fighting inflation by removing money from circulation was
improper.
However, speaking at the sixth annual conference of the
Chartered Institute of Bankers of Nigeria, Mr Sanusi said Mr Obasanjo had
introduced more high denomination in Nigeria than any other Head of State.
“General Obasanjo did N20; he did N100, N200, N500 and
N1000. He has introduced more higher denomination than any Head of States,” Mr
Sanusi said.
The CBN governor said that during the period Mr Obasanjo was
introducing high denomination inflation in Nigeria was actually low.
“General Obasanjo did N100 in 1999; then he did N200 in
2000; he did N500 I think two years later; and did N1000. In that period,
inflation was coming down because it was accompanied by very tight monetary and
fiscal policies during his reforms.
“For somebody who have gone through that to come and stand
up and say ‘introducing a higher denomination causes inflation’ I don’t know if
somebody wrote his speech. I’m trying to see him or if he was misquoted.
“If he actually said that then he must be the single most
important determinant of inflation in our history given the number of notes
that he introduced,” he said
Mr Sanusi said printing higher denomination without
increasing the money supply in the economy will not increase inflation. “This
is simple economics,” he said.
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