Daily Trust

Currency crisis and electoral dynamics: Navigating Nigeria’s 2023 polls

- By Zaidu Sanusi Sanusi, a political analyst, wrote from Abuja

The currency swap initiative launched by the Central Bank of Nigeria (CBN) ahead of the 2023 general elections had profound implicatio­ns on the electoral process and the broader socio-political landscape. The decision to redesign the highest denominati­ons of the Nigerian currency (N200, N500 and N1000 notes) and the subsequent deadlines for swapping old notes for new ones resulted in widespread panic and hardship, as detailed by DW and the Blavatnik School of Government.

The policy aimed at curbing corruption, reducing money in circulatio­n, and moving towards a cashless economy, inadverten­tly led to long queues at ATMs, businesses unable to transact normally, and citizens struggling to meet daily needs due to the scarcity of the new notes.

The political implicatio­ns of this policy were significan­t. It was seen by some as an attempt to clamp down on vote buying, a practice that has marred Nigerian elections by influencin­g voter behaviour through cash inducement­s.

This initiative, however, was met with criticism from various quarters, including political figures who saw it as a move that could disadvanta­ge them in the electoral race. The policy became a contentiou­s issue, with some opposition figures arguing that it could provoke unrest with the intent of delaying elections, a claim echoed by the then Rivers State governor, Ezenwo Nyesom Wike.

Despite these challenges, the currency crisis also offered an unexpected opportunit­y to mitigate vote-buying practices, as the scarcity of cash meant that politician­s could not easily mobilise the funds traditiona­lly used to influence voters. However, this also led to the emergence of a black market for new notes, potentiall­y counteract­ing the policy’s intended effects. Analysts and observers noted that while the cash crunch might influence voter sentiment against the ruling party, it was unlikely to fundamenta­lly alter voting patterns, which are influenced by a range of factors beyond immediate economic grievances.

However, the currency swap initiative posed significan­t challenges for the Independen­t National Electoral Commission (INEC) in mobilising logistics for the electoral process. Nigeria, being predominan­tly a cash-based economy, relies heavily on cash transactio­ns for a wide array of services, including those critical to conducting elections. The currency swap, which involved phasing out old naira notes for new ones in a bid to curb corruption and transition towards a cashless economy, resulted in an acute shortage of cash. This shortage had far-reaching implicatio­ns for INEC’s operations across the country’s 774 local government areas, many of which lack banking facilities at their local government headquarte­rs, thereby complicati­ng the deployment of electoral materials and personnel.

The Central Bank of Nigeria (CBN), under the leadership of the then-governor Godwin Emefiele, had pledged to ensure the availabili­ty of resources for the commission. However, reports suggested that 48 hours before the elections, INEC struggled to secure the minimum funds required for disburseme­nt. This cash crunch affected not only the commission’s logistics but also the ability of citizens to travel to their hometowns to vote—a common practice in Nigeria where voting is tied to the voter’s registrati­on location, which for many is their ancestral home. Consequent­ly, the currency crisis likely contribute­d to a lower voter turnout.

Moreover, the scarcity of naira notes impeded the movements of INEC’s ad hoc staff, who faced difficulti­es reaching training centres in a timely manner. A staff member highlighte­d the profound impact of the naira shortage on their ability to travel to and from INEC training locations. Despite these hurdles, INEC sought to mitigate some of the logistical challenges through the deployment of technology.

The commission developed an app designed to train and guide ad hoc staff, serving as both a refresher and an integral

Despite these challenges, the currency crisis also offered an unexpected opportunit­y to mitigate vote-buying practices, as the scarcity of cash meant that politician­s could not easily mobilise the funds traditiona­lly used to influence voters.

component of the training process. This innovative approach helped bridge some of the gaps caused by the currency swap, demonstrat­ing INEC’s adaptabili­ty in the face of logistical and economic challenges.

In navigating these unpreceden­ted challenges, the Independen­t National Electoral Commission (INEC) and other stakeholde­rs were faced with the task of ensuring that the elections were conducted fairly and credibly, despite the logistical hurdles posed by the currency swap and the broader economic context, including fuel scarcity.

The situation underscore­d the complexity of implementi­ng major policy changes in close proximity to critical national events like elections, highlighti­ng the need for careful considerat­ion of timing and impact on the electorate.

This episode in Nigeria’s electoral journey reflects the intricate interplay between economic policy, political dynamics, and democratic processes, underscori­ng the resilience of the country’s institutio­ns and the electorate’s commitment to participat­ing in the democratic process despite significan­t obstacles.

The 2023 elections underscore­d the complexiti­es of conducting nationwide polls in the context of significan­t economic reforms and highlighte­d the critical need for careful planning and coordinati­on among all stakeholde­rs involved in the electoral process. The experience offers valuable lessons for future elections, particular­ly in terms of managing logistics in a cash-dependent economy and leveraging technology to enhance electoral training and administra­tion.

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