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Wednesday, 29 December, 1999, 15:21 GMT
Big banknote too much for Nigeria

100-naira note The 100-naira note has not been welcomed by all


By Lagos correspondent Barnaby Phillips

Nigeria has introduced a new 100-naira note, worth about one US dollar, but it is proving surprisingly unpopular.

Like many African countries, Nigeria has seen the value of its national currency decline steeply in recent years.

In the 1970s, the Nigerian naira was on a par with the pound sterling. Now there are 160 naira to the pound.

But whereas most governments responded to the decline in their currencies' value by printing bigger and bigger banknotes, Nigeria resisted the trend, believing it would accelerate inflation.

But with the the introduction this month of the new note the situation has changed.

Warnings

The 100-naira note was controversial long before any Nigerians got their hands on it.


old banknotes Well-used small denomination notes are the norm
The newspapers have been full of letters warning that its introduction would give unscrupulous bus drivers and food sellers an excuse to increase their prices.

So many people are living in desperate poverty, that a measure that makes perfect sense to the elite has aroused fear and suspicion among ordinary people.

Nigerians, well accustomed to the absence of high-value bank notes, prefer to deal with very big piles of almost worthless notes.

In an economy where few choose to keep their money in banks, it is perfectly normal to carry large sacks of money to the shops or marketplace.

Glaring error

But if the 100-naira note was bound to receive a hostile reception, the situation has been compounded by a glaring error in its design.

It depicts the famous Zuma rock, a massive outcrop by the main north-south highway in central Nigeria.

The caption below the rock says that it is in the federal capital territory, Abuja, whereas in fact it is in the neighbouring Niger state.

The outraged state goverment in Niger has threatened to sue the Central Bank, which has hurriedly sent a delegation to apologise.

The note will now be reissued with corrections.

But it is an inauspicious start for an unpopular banknote.

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