THISDAY has learnt that the planned redenomination of the Naira may take effect from January 1, 2008, eight months earlier than planned by the Central Bank of Nigeria (CBN).

However, CBN sources said shifting the date backward could present logistic challenges for the minting and Distribution of New notes and coins, as well as the timeline for Public enlightenment.

The CBN is said to favour an implementation date of January 1, 2009, since the reason for the suggestion of a shift in date is to align the New currency policy with the budget year.

According to CBN sources, if the New currency is introduced on August 1, 2008, there will be a transition period of five months during which the New and the old Naira will be used side-by-side.

This means if a product is priced N1000 under the New regime, a buyer can choose to pay N100,000 in old currency or N1000 with the New Naira .

The CBN Governor , Profe-ssor Charles Soludo, had Tuesday last week, announced the redenomination of the National currency to knock off two zeros to the left, while N20 would be the highest denomination with effect from August 1, 2008.

The proposal to shift the implementation date, THISDAY was told, may form part of the proposal to be forwarded to the Federal Executive council (FEC) by the Economic Management Team which has been mandated by FEC to “fine-tune” the monetary policy.

It is also being suggested that instead of phasing Out the current N1000, N500, N200, N100 and N50 notes, the redenomination could still accommodate them but they should be withdrawn from circulation gradually.

Under this proposal, there will be no need to mint New currencies, and this is expected to save the nation billions of Naira that will otherwise be expended on Printing New currencies.

The Minister of Finance , Dr. Shamsudeen Usman, had informed the Press last week that the economic team would look into some “technical areas” of the CBN policy and advise FEC appropriately.

Implementing the policy midyear may present some “mathematical challenges” for the fiscal activities of the Government , the source said.

The decision to “fine-tune” the policy had been interpreted in some quarters to mean an intention on the part of the Federal Government to reverse it.

The Minister of Information and Communications, Chief John Odey, had, while briefing the media after FEC’s meeting on Wednesday, implied that the policy needed FEC approval, saying “the Ministry of Finance is a member of the Board of the CBN… There Are Benefits in terms of redenomination of Naira and micro economic stability. All these we will get Professional advice from the Economic Team. The CBN plan for the redenomination is not something that will come up today. They will come up with a position for council to approval. They will brief the National Assembly and other stakeholders”.

But a minister told THISDAY yesterday that President Umaru Musa Yar’Adua is fully in support of the policy.

“Most of the questioning that Soludo faced at the FEC meeting was from politicians who were very curious to understand what the New policy meant in concrete terms,” he said. “Since it is a Technical matter, the president said the Economic Management Team should go and iron Out the Technical details and present its own advice to council .”

Usman had also clarified Odey’s statement, saying “the action of the CBN is within the purview of the Act of the CBN since it is dealing with policy monetary issues. It is their prerogative to take decisions on these issues. The autonomy of the CBN is not in question and it is acting absolutely within the Law.”

Last week, Soludo explained to THISDAY that under the New policy, nothing would change in “nominal terms”.

“Everything remains basically unchanged. We haven’t lost any Value . Nobody loses any Value but over time, because we will pin down inflation expectation, everybody gains so the guy who is earning 50,000 today will start going home with 500.

“The Bus fare that used to be 15 Naira will now be 15 kobo. He will still enter the same Bus , instead of the 15 Naira when he was earning 50,000 now he pays 15 kobo Out of his 500 Naira salary. It will be the same two decimal points to the left; everything, All prices will be affected.

“On that particular date (August 1, 2008), All the monies we have in the Bank will go two decimals backwards. The old money you Are going to drop, if you give them 50,000 Naira , they Are going to give you back 500 Naira . Because it will be a totally New currency everybody will go through it. So what it means is that the Value in nominal terms everything will just come down that way because everybody will go to the Bank to Exchange the old notes. Your old 50 Naira , 100, 200, 500 and 1000 Are Out,” he had explained.

Ghana, Nigeria ’s neighbour, was the First West African country to re-denominate its currency. With effect from July 1, 2007, the country knocked four zeros off the cedi, thereby making the renamed Ghana cedi Exchange at par with the dollar. The old currency will be in circulation along with the New one until December 31, 2007. The old currency will cease to exist from January 1, 2008—exactly six months after the introduction of New currencies.