Mr President, look to the CBN

Since last year, the Central Bank of Nigeria (CBN) has been in the news for mostly the wrong reasons. The employment by the bank of what has been described as children of highly placed Nigerians in a manner that allegedly contravened the rules did not endear them to President Muhammadu Buhari, much less the CBN’s […]

Since last year, the Central Bank of Nigeria (CBN) has been in the news for mostly the wrong reasons. The employment by the bank of what has been described as children of highly placed Nigerians in a manner that allegedly contravened the rules did not endear them to President Muhammadu Buhari, much less the CBN’s leadership. Vigorous efforts by the civil society to get the Presidency to order the cancellation of the recruitment did not yield fruits. Arising from the hard economic times in which the country has found itself, some Nigerians think that the apex bank is to blame. The bank has become a pawn in the hands of partisan groups that have rivalled one another calling for the stay or departure of its governor. Notwithstanding the valiant efforts the leadership of the bank has been making to avert a financial catastrophe, it has been savaged as inconsistent in its policies, thereby taking blame for the countries’ economic woes.

From the time it withheld the allocation of foreign exchange on concessionary terms for the importation of 41 banned items, the CBN leadership has come under serious attack from idle minds. But should we continue to fritter hard cash on such inconsequential things like toothpick? How can we be importing palm oil products at a time when our foreign reserves have shrunken? 

The current leadership of the CBN has been strong and purposeful on interventions particularly in agriculture and the small and medium enterprises (SMEs). Billions of Naira have been channelled through the Bank of Agriculture (BOA) and Bank of Industry (BOI) to stimulate local production of goods and services. The anchor borrowers programme launched by the President himself in Birnin Kebbi in November 2015 has recorded tremendous progress. With increased production in Kebbi, Kaduna, Kano, Jigawa, Ebonyi and Nassarawa, Nigeria is well on its way to self-sufficiency in rice, possibly by 2019. The commitment and results achieved in this regard by the CBN governor as well as Governor Atiku Bagudu of Kebbi have attracted national recognition for them. Both Vanguard and Leadership newspapers have awarded Bagudu their Governor of the Year 2016. 

Nevertheless, it is time for Mr President to strengthen the CBN by naming a board it. It is inconceivable that at a time we are looking for economic redemption, the bank still doesn’t have the full complement of leadership in place. The President will help the CBN to work better if he appoints a board for it. It’s important for the President to fill such important vacancies not just with loyalists but knowledgeable persons who will bring their expertise to bear on the onerous search for economic recovery.

At the moment, the CBN is torn in between controlling inflation and facilitating growth. Economic recession has resulted into massive unemployment, low purchasing power, high prices of goods and services and generally worsened poverty.  Unfortunately, monetary policy alone cannot re-order the economy’; the federal government must bear responsibility for pulling Nigeria out  of this biting recession massively injecting capital into job creating ventures such as the construction of roads and railways. If adequately complimented with regular supply of power, this could jumpstart the economy. The meeting between monetary and fiscal authorities which was held during a two-day retreat last week has raised hopes that at last a pathway has been found for concerted actions that may lead to the recovery of the economy.

Former Governor Sanusi Lamido Sanusi had argued before now about the need to nominate a CBN Governor or Deputy Governor at least three months ahead of time. In more advanced climes such as the United States of America, personalities are nominated for such important jobs well ahead of time. Janet Yellen, for example was touted as Ben Bernanke’s successor several months before she was so designated by President Barack Obama. The advantage here is that the person so designated has enough time to prepare himself to seamlessly move into the job.

In a matter of days, Dr Sarah Alade will step aside having served two terms as Deputy Governor, making a total of 10 years. As I write, there is no indication that the President has nominated anyone to replace her. Dr Alade actually started as a member of staff of the CBN and was appointed as an Assistant Director in the Research Department in 1993. She became Director, Banking Operations Department in 2004 and was elevated to Deputy Governor, Economic Policy, on 26th March, 2007.

Dr Alade, BSc Economics, Obafemi Awolowo University, Ile-Ife, (1976) PhD Management Science (Operations Research), University of Ilorin, (1991) has had a brilliant run in the CBN. Her good understanding of the Nigerian economy ensured that she retained the Economic Policy Directorate for a long time and was the most senior DG at the time  President Goodluck Jonathan controversially removed Governor Sanusi Lamido. The onus therefore fell on her to act as the governor and she did this from February till June, 2014 when she handed over to the new Governor, Mr Godwin Emefiele. 

Another of the old guard from the Soludo and Sanusi epochs, Alhaji Suleiman Barau, is also stepping down. Alhaji Barau arrived the CBN in 2005 as a Special Adviser to former Governor, Professor Charles Soludo and was appointed to the Board and Deputy Governor on 13th December, 2007. By the end of this year, he will also have served the maximum two terms permitted by the CBN Act. Barau obtained BSc Economics from Ahmadu Bello University, Zaria, and MSc (Money & Finance) from the University of Jos. He has also served the bank well. 

The President should look to the CBN, strengthen the institution by swiftly filling all management vacancies, align fiscal policies to monetary strategies and get us out of these economic doldrums.