he redenomination of Nigerian currency, Naira, has generated more heat within a very short time of the announcement by Professor Chukwuma Soludo, the Governor of Central Bank, Nigeria. It has also generated some heavy jabs at the Federal Executive Council meeting held Wednesday, August 15, 2007, which was believed to have lasted for about 5 hours mainly on new Naira Regime as presented by Professor Soludo. He was only invited to brief the FEC on his Tuesday, August 14, 2007 announcement on the new Naira Regime. Unfortunately there are very few economists in the FEC. Nigerians both at home and abroad were not left out on the debate from the wave of discussion of the redenomination of the Naira notes.

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Professor Soludo announced on Tuesday, August 14, 2007, that as part of a major policy shift on Nigeria's currency, from August 1, 2008 the naira would be redenominated to knock off two zeros to the left, while the exchange rate could be N1.25 Kobo to $1, while N20 would be the highest denomination. He further announced that part of Federation allocations would be shared in dollars. In other words, under the new Naira Regime the new currency structure will phase out all denominations above N20, that is, the current 50 naira, 100, 200, 500 and 1000 notes would be faced out.

In addition Nigerian Central Bank would re-introduce coins in the denominations of 1Kobo, 2kobo, 5kobo, 10kobo, and 20kobo while the notes would be from 50kobo, N1, N5, N10, and N20. According to Soludo, no one looses any value of their money. In other words, the new notes and coins would have the same purchasing power as the old ones.

Reading closely, the new Naira Regime has caused some tails waggling as the CBN Governor announced that by 2008, Naira could be equal to $1.25 US dollars. I am not an economist, but a policy analyst. My college days, Economic class was one of my 'best' subjects to say the least. I only managed to make a "C" in the class as part of my general education areas for my undergraduate degree. My readers should not prosecute me on my approach to this subject.

My first reaction was that it was good for Nigeria and its economy. Twenty Naira note, being the highest denomination, for now, would be good for the country. It could go to N50 and N100 down the road.

Remembering in the early 1980s in the "Gold Rush" to the United States of America, Nigerian Naira equaled to US two dollars. Unfortunately as of today, August 2007, it has been $1.00 to N120.00. When you change your money from Dollar to Naira, you found it worthless. By the time you buy ABC items, the money is gone. Each time you get to the Nigerian market, Nigerian market men and women priced their goods in Dollars whereas Nigeria currency is Naira. The new naira Regime would change peoples' psyche the way Nigerians react to pricing of goods. As it is in Nigeria, inflation could be driven by peoples psychosomatic.

The New Naira Regime could cut down on inflation; the money value could be better appreciated; investors would go for it; it won't have negative effect on investment; more money would go to the bank, instead being keeping it in the homes; it would cut down on high level armed robbery; it may induce mostly economic immigrants, who were forced to flee Nigeria due to the harsh economic climate, to hurry back to Nigeria; their positive efforts abroad, if put into positive use in Nigeria could earn them more dividends than where they are matching on a spot in a vicious circle. In other words those looking for greener pastures would remain in Nigeria; and there could be lesser brain drain, among others. I would say that from my greenhorn point, Naira abuse would be minimized.

What Soludo is proposing has been done from time to time by other countries. For instance, Argentina, China, Israel, and recently, Ghana in July 2007, have done it. As of (August 2007), Ghana's currency is stronger than Dollar. The New Naira Regime is a way of recalculating the relationship between Naira and Dollar.

The coins are coming back. In an economy where coins are not used or people REFUSED to accept coins, with currencies in circulation all the time, that economy would have some serious challenge surviving.

Unfortunately most Nigerians have a different outlook on the new Naira Regime as announced by Professor Soludo. The New Naira Regime could be viewed as a gamble by some people. Life itself is a gamble. If we know what life has in stock for us, we would not be jumping all over the world, like a frog, for what we want in life.

My first reaction would be to reject "Sharing Part of the Federation Account in US Dollars to deepen the Forex Market and for Liquidity Management". Either part or whole, paying in Dollars in Nigeria should be rejected out rightly. Nigeria medium of purchase is in Naira. It is absolutely imperative for the payments in Nigeria to be in Naira, unless the Central Bank is planning to change the Nigerian currency to Dollars, if that is the target.

As expected, some Manufacturers would applaud payment of federal and state governments from the Federation's Accounts in dollars. They might argue that it would be in line with the whole idea of "maintaining economic equilibrium", which could invariably stop them from going to the banks for foreign exchange and pay commission or interest. Some school might argue that foreign investors would found it easier to calculate the currency and conduct their businesses better.

We could further argue that the move would have a great impact on the psyche of the people. We could also look at some reasons for a capital flight to be associated with the fear of depreciation of Naira. By bringing Naira to its true value, it could help to reduce capital flight. Foreign investors as of now were only interested in quickly repatriating their monies abroad, which the new Naira Regime could correct.

Arguing further, the New Naira Regime, could strengthened the naira, which would put more confidence on the currency, especially in the face of the ongoing proposal towards making the naira the major currency in the West African sub regional zone. In addition it would be easier, from the regional calculation of their currencies to the common currency for West Africa. Regardless how we all look at it, Nigeria economy needs to be strengthened through its currency and by attaining the goal Nigeria wants to reach in 2020 and being in control of the West African Currency.

The new Naira Regime won't affect naira value, according to Soludo. Oppositions could be professional, but mostly personal. Unfortunately, and politically AC has placed itself on the opposition side, just to oppose EVERTHING without necessarily getting the facts to its side of thinking. Nigerian Engineers with their mathematical calculations, the economists with their theories, the people whose life depends on trading in currency, Nigerians Abroad would be the advocate to kill the new Naira Regime.

The opposition would come strongly from Nigerians Abroad, for some selfish reasons, as they would no longer have the advantage over the 'almighty' foreign currency that they usually have. Other oppositions would be from those whose Banks were forced to fold up; those who were not given the opportunity to establish their own mushroom banks; those Banks that would like to bring their failed banks alive again through the backdoor, would definitely oppose the new Naira Regime. If we really want Nigeria to be among the comity of nations by 2020, something reasonable has to be done to revive Nigerian monetary system.

Take for instance when you go to Nigeria with about $1,000.00, it gives you a very deep pocket due to the exchange rate. When you start spending the money, you quickly realize that your deep pocket is virtually at the surface level within a short time. Unfortunately, the money is gone before you know it.

We would found out that Naira became valueless in the Nigerian market in comparison to US Dollars. You exchange Dollar for about N120.00, and by the time you spend $100.00, you found out that you have bought 'nothing' with that money. When you get to the market the seller would be telling you stories of the exchange rate. When you give money to your relatives, they look at it and tell you the dollar equivalent of what you have given them. Some would say, 'na me u dey give five dollars'. It ridicules the currency we call Naira.

When we look at it closely, you would find out that some goods sold for N1, 000.00 in Nigeria could be costlier when you compare it to the same goods purchased in the United States of America for S10.00. During my last trip to Abuja early August 2007, for my lunch outside the Hotel, I did not pay less than N1, 200.00 for lunch. Let us assume that is about $10.00 US Dollars. If I go to down town, Atlanta, to spend $10.00 for my lunch only, by the time I get back to my office, I would be snoring because I ate too much with the $10.00. With just $5.00, I would be satisfied with a normal lunch meal.

Soludo has not announced the new Naira Regime when I put out a paper for Nigerians Abroad returning to Nigeria. Definitely all of them could not, would not, and may not return to Nigeria, regardless the strength of Nigerian economy.

At a gathering this past weekend, August 18, 2007, I looked around and saw a cross sections of Nigerians Abroad at the gathering. There and then I realized that some of them would NEVER return to Nigeria on a permanent basis. They have strongly established their businesses. They have made remarkable in-road into the corporate America in their businesses. It would be impossible for them to return to Nigeria. They could have properties in Nigeria just for the sake of it. Some have attained the highest level in their academic and professional careers. Some of them might have vowed never to return to their motherland. There is no problem with that. That is life. Life is not inertia What Nigeria needs from people in this group are some encouragement for them giving back to the community where they started. Don't get me wrong some or few Nigerians in this group could still make it back to the country if and when they decide to, while keeping their homes in their respective places of abode.

Another Nigerians in this group that I observed were those that are not completely established in their careers and professions, but could go either way. Those are just either in the ways. They could go either way of their choice. Some would think twice before they make it back to Nigeria. They could be easily persuaded to return to Nigeria.

There are those that are not sure what the future hold for them with their skills and expertise that Nigeria needs. Most Nigerians in this group would return, regardless the home situation. Those are already on their way to Nigeria any way. This group is definitely looking for an opportunity to make it back to the country

The last group is where the challenge holds for every Nigerians at home and especially abroad; the children born in foreign lands, Asia, America, Europe, and Africa. They are at some serious cultural cross roads. They have the skills, the energy, and what it takes to be the pride of their communities. This group has to be lured to Nigeria through more official economic, social and political incentives. Nigerians must work very hard to get this crop of future Nigerian generations to contribute to the growth of Nigeria.

The new Naira Regime, the redenomination of Naira would be the first time in the history of Nigeria that this has ever been done. In effect Central Bank of Nigeria would need very extensive massive and effective campaign, education and enlightenment of the Nigerian populace on the new Naira Regime as announced by Professor Soludo.

We should be aware of the autonomy of Central bank of Nigeria for embarking on any economic policy for the country. However, it needs the support of the Nigerian President members of the FEC, and Nigerians at large, to turn Nigerian economy around for good, especially in the Nigerian Banking sector. Nigeria should start doing away with the deadly western ideas that do not work for the country. Patterning Nigeria issues along its cultural background could liberate Nigeria from its spider web of western ideas.

At this stage of global economic reforms and development, with the 2020 Vision for Nigeria to be among the comity of Nations, Nigerian President, Umar Musa Yar'Adua has to throw his weight behind the New Naira Regime, with some amendments, to make Nigeria economy strong enough to withstand any 'economic tsunami'. It would go with the President's vision on the economic recovery for Nigeria.

Nigeria ripe for changes in its economic approaches since the country's debts has been at the manageable level. The country should aggressively develop other areas of its economy, especially the agricultural, and possibly its potential mineral resources, for better economy growth. To actualize the economic growth, Nigerian infrastructure, especially the energy and roads, would have to be aggressively pursued by Yar'Adua's administration to make sure that the 2020 vision and the valuation of Naira is attained.