The Central Bank of Nigeria (CBN) released figures indicating that in October 2023, the total quantity of cash in circulation in Nigeria was N2.99 trillion. This is the highest since the CBN’s currency swap and naira redesign program started in May 2022.
The removal of subsidies has resulted in an increase in revenue inflow of over N1 trillion for the Federation Account, as disclosed by Mr. Wale Edun, the Minister of Finance.
The increase in currency in circulation is likely due to a number of factors, including the festive season, the increase in economic activity, and the ongoing cash shortage in the country. The CBN has said that it is monitoring the situation and will take action if necessary to ensure that there is enough cash in circulation.
The government has been able to enhance its investments in social services and infrastructure because to the increased revenue. Additionally, it has assisted in lowering the government’s fiscal deficit.
The administration has defended the controversial policy of eliminating fuel subsidies, claiming that doing so is important to save money and make investments in other sectors of the economy. In order to lessen the impact of the elimination of subsidies on low-income Nigerians, the government has also put in place a number of initiatives, such as a cash transfer program.
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The management of the money in circulation falls under the purview of the CBN. The CBN accomplishes this by producing fresh coins and banknotes, disposing of old ones, and keeping an eye on the movement of money throughout the economy. In addition, the CBN strives to guarantee that the economy has access to enough cash in circulation to meet its demands.
Edun disclosed that the Federal Government had long since realized that the fuel subsidy was unsustainable through the representation of Mr. Okokon Udo, Permanent Secretary, Finance, Special Duties.
He claimed that the subsidy system reduced resources that could have been used for spending essential to the general public’s well-being.
The minister affirmed that the administration of President Bola Tinubu would persist in enacting policies that prioritize the interests and wellbeing of Nigerians.
The increase in currency in circulation is likely due to a number of factors, including the festive season, the increase in economic activity, and the ongoing cash shortage in the country. The CBN has said that it is monitoring the situation and will take action if necessary to ensure that there is enough cash in circulation.