The Central Bank of Nigeria (CBN) says it expended N125.275 billion on printing, minting, currency notes and coins in the past three years.
A statistics pasted on the bank’s website yesterday showed that N47.141 billion was spent in 2009, N45.507 billion and N32.627 billion was spent in 2010 and 2011 respectively.
The apex bank denied that it would not spend N40 billion on the proposed currency restructuring exercise, insisting that currency restructuring would not lead to inflation.
“It will not cause inflation in any form whatsoever as it will not increase money supply. Instead, currency restructuring will make payments easier and indeed check unnecessary rise in prices that come through the practice of rounding up,” it said.
It also said the experience in Nigeria and other jurisdictions suggests that currency restructuring may actually help in tackling inflation.
“For instance, when CBN introduced the N500 banknote in 2002, inflation dropped from 16.5 per cent to 12.1 per cent in 2003. Similarly, when the N1,000 banknote was introduced in 2005, the inflation rate actually dropped from 11.6 per cent to 8.6 per cent (single digit) in 2006 and dropped further to 6.6 per cent in 2007,” it said.