Following the launch of the much anticipated digital currency, e-Naira, which is the first of its kind in Africa, as social justice expert has raised concerns.
President Muhammadu Buhari had launched the e-Naira on Monday at the Presidential Villa, Abuja.
The Central Bank Digital Currency (CBDC) and its underlying technology, called blockchain, has the ability to improve Nigeria’s Gross Domestic Product, GDP, by $29 billion over the next 10 years, President Muhammadu Buhari had said.
E-Naira, according to Buhari would enable the government send direct payments to citizens eligible for specific welfare programmes as well as foster cross border trade.
The digital currency has the capacity to ensure economic growth through better economic activities, increase remittances, improve financial inclusion and make monetary policy more effective.
But speaking on the issue, the Lead Director of Centre for Social Justice, CSJ, Eze Onyekpere, faulted the launch of e-Naira.
Onyekpere lamented that the newly launched e-Naira adds “no spectacular value” to the economy.
Describing the latest action of the government as “cosmetic,” the CSJ Lead Director wondered what value the digital currency would add to the economy.
He said: “I think the important thing right now is what adds value to the economy in terms of job creation, stabilizing our currency, economic growth, and reducing the run on the Naira.
“So all these, be it e-money or x-money, is not adding any spectacular value; it’s just a different format of the money available.
“For me, it’s not about having the capacity or not, of course we have it; but it’s a little bit cosmetic; what value is it adding to the economy?
“I’m yet to see any major value, is it going to create jobs for the teeming youths? Is it going to return the value of the Naira? Is it going to reduce inflation? Or it’s just one of those formal things that doesn’t hold the substance of the challenge of the Nigerian economy?”
One of the major threats to the digital currency is fraud, and the Nigerian government launched the e-Naira at a time when the country is witnessing an escalation in advanced fee fraud popularly called Yahoo Yahoo.
Some Nigerian youths have taken to Yahoo Yahoo as a shorter route to economic empowerment, which is a direct result of the government’s inadequacies to provide jobs and ensure improvement in the quality of lives.
Recall that a Nigerian Instagram celebrity, Ramon Abbas aka Hushpuppi and his cronies had used financial platforms like Bitcoin to hide some of the loots they acquired from Yahoo Yahoo.
However, Onyekpere urged the Central Bank of Nigeria, CBN, and security agents to be proactive in protecting the digital currency from fraudsters.
He said: “Everything that has an advantage must have a disadvantage. E-money does not necessarily means fraud, and as some people are planning it; there should be security measures to put in place by CBN, security agencies, and financial intelligent unit, who should work towards curtailing such, that is why we pay them.
“That people can commit fraud should not be a reason why we should not operate e-money. I think we should work towards curtailing any negative tendencies.”
Eze Onyekpere is a lawyer with specialization in development law including electricity reforms, fiscal governance, human rights and constitutional reforms. He has worked on electric power sector reforms, privatization, gender and trade policy and liberalization of education.