Eminent human rights lawyer Femi Falana has raised concerns over the legality of the recent decision by the Central Bank of Nigeria (CBN) under President Bola Tinubu to float the naira against the dollar and other international currencies. Falana asserts that the decision is illegal and is currently the subject of a court challenge.
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On June 14, when the naira was trading between 730 and 755 to the dollar at the Investors and Exporters (I&E) window, the CBN reportedly instructed Deposit Money Banks to allow the naira to freely float against foreign currencies. The exchange rate as per the CBN website stands between N744 and N746 as of the latest update.
Falana, speaking as a guest on Channels Television’s Sunrise Daily, emphasized that the CBN Act mandates the apex bank to fix the exchange rate, contradicting the notion of a floating naira. He highlighted the absence of legal provisions supporting the concept of determining the naira’s value through market forces.
Citing Section 16 of the Central Bank Act, Falana revealed that he has filed a lawsuit against the CBN at the Federal High Court. This section obliges the Central Bank to establish and regulate the naira’s exchange rate in relation to other currencies. Moreover, he pointed to Section 20(1) of the Act, which designates the currency notes issued by the Central Bank as the sole legal tender in Nigeria—specifically, “only the naira.”
Explaining further, Falana outlined Section 20(5) of the Act, which classifies the use of any currency other than the naira in Nigeria without the central bank’s approval as an offense subject to prosecution, with a penalty of six months’ imprisonment.
The senior advocate also commented on the recent decision by the Federal Government to allocate N5 billion to each state and the Federal Capital Territory (FCT) for procuring food items intended for distribution to impoverished citizens. While the National Economic Council (NEC) presented this as a measure to alleviate poverty, Falana criticized these actions as temporary and diversionary. He emphasized that addressing the core issue—dollarization of the economy—requires stronger actions by government officials.
Falana concluded that until concrete steps are taken to strengthen the naira and eliminate dollarization, temporary palliatives will remain insufficient in addressing the root causes of the economic crisis.
As Falana’s legal challenge unfolds, questions about the legality of the naira float decision by the CBN continue to be at the forefront of national discourse, stirring debates among legal experts and policymakers alike.
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