“You can have a certain arrogance, and I think that’s fine, but what you should never lose is respect for others.” —Steffi Graf
By Omoniyi Salaudeen
The governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, bears a semblance of the proverbial cat with nine lives. Cunning and crafty, he has always shown a prodigious capacity for controversy and walking out of it. His guile, gut, and craftiness make him arguably the most controversial head the apex bank of Nigeria has ever had. So far, no one else has demonstrated enough courage to venture into power politics while presiding over the highest financial regulatory authority in the county.
To be sure, the extant provision of the Constitution of the Federal Republic of Nigeria in respect of the statutory functions of the CBN has not been amended to allow for such an infraction. Yet, he did so recently in the buildup to the presidential primary of the ruling All Progressives Congress (APC) with passion, energy, and zest until he found himself at a critical juncture where he had to make a hard choice between the devil and the deep blue sea.
Stalled at a crossroads, he had no option but to beat a sharp retreat back to his cocoon. Even then, he got more than he bargained for, as the members of the public, who felt nauseated by his flagrant disregard for the standard rules of engagement, came hard on him.
Yet, he got away with his misadventure. He walked out of the looming crisis unscathed because President Muhammadu Buhari, whose practice is to delegate responsibilities without supervision, looked the other way while the intrigue lasted.
Just as the dust settled, Emefiele raised another public suspicion with the treachery with which he initiated naira redesigning. In seeking the approval of the president to give the notes a facelift, he circumvented the supervising ministry, the Ministry of Finance, Budget, and National Planning, and unilaterally rolled out the plan.
According to the 1997 amendments, the CBN is directly responsible to the Minister of Finance in matters concerning the supervision and control of the bank and other financial institutions. But in his characteristic show of arrogance and seeming obstinacy, Emefiele again flouted the rule of the procedure without caring a hoot about the consequences of his willful violation of the law.
The Minister of Finance, Zanaib Ahmed, therefore, had good ground to distance herself from the initiative when she was confronted with the question during her appearance before the Senate.
Senator Opeyemi Bamidele, representing Ekiti Central Senatorial District, had raised the poser during the 2023 budget defence session before the Senate Committee on Finance.
But the Minister feigned ignorance of the planned policy in a cynical tone, warning that the new notes could have dire consequences on the value of the naira.
“To me, the policy may be a well-conceived one, but the timing going by realities on the ground is very wrong as the naira may fall to as low as N1,000 to a US Dollar before January 31, 2023, fixed for the implementation of the policy,” she said.
President Buhari, having performed the unveiling ceremony on Wednesday, it can be safely said that the policy is very much on course.
Nigerians will know in due course which of the two actors is right. Currently, the policy is undergoing the test of time. At the weekly FEC meeting, Emefiele was ecstatic about the success of the redesigning when the President unveiled the new notes to the excitement of the council members.
He gave a boost to the ego of the CBN boss, declaring that he approved the policy.
Fielding questions from journalists after the event, Emefiele said the redesigned notes would give the apex bank ample control over the amount of money in circulation.
“In the past, attempts to redesign and reissue currencies had been resisted. Only a President of Muhammadu Buhari’s character could have made this happen,” he said.
The CBN governor listed the benefits of the redesigned naira notes to include enhanced security, greater durability, attractiveness, and promotion of rich cultural heritage.
Going by the timeline set by the CBN, by January 31, 2023, the N200, N500, and N1000 currency notes currently in circulation in Nigeria will go into extinction.
They will cease to be legal tender. Instead, the newly redesigned denominations will become legitimate means of exchange for goods and services.
Already, the emerging signal from the Forex market has shown that Emefiele is winning. In the last couple of days, there has been some appreciable improvement in the exchange rate of the Naira against the Dollar. Whether or not it is going to be sustainable, time will judge. If it’s sustainable, Nigeria will be better for it and the CBN boss will take all the credit for the initiative. If not, he takes the blame.
For now, there is no permanent answer to the unstable macroeconomic policies that determine the stability of the economy. In broad terms, the goal of macroeconomic policy is to provide a stable economic environment that is conducive to fostering strong and sustainable economic growth on which the creation of jobs, wealth, and improved living standards depend. The key pillars of macroeconomic policy are fiscal policy, monetary policy, and exchange rate. And, of course, the sure way to promote stable and sustainable growth is by promoting effective synergy among the relevant departments of government.
It is an onerous task that demands a multi-sectorial approach without unnecessary muscle-flexing, undue fussiness, or duplication of duty. It has more to do with the team spirit rather than the I-can-do-it alone attitude of the CBN governor.
Several times in the recent past, Emefiele had been accused of usurping or undermining the functions and responsibilities of some Ministries, Departments, and Agencies (MDAs) that are not directly under CBN purview under the guise of one form of financial intervention or the other.
One intervention that has attracted severe criticism from concerned stakeholders is the Anchor Borrowers Programme of the Federal Government through which the CBN has disbursed a huge quantum of money to the farmers to boost agricultural production. President Buhari launched the ABP programme in November 2015 to provide low-interest rate loans to smallholder farmers cultivating cereals (rice, maize, and wheat), cotton, roots and tubers, sugarcane, tree crops, legumes, tomatoes, and livestock.
It was under the programme that the CBN governor early last year organized an exhibition of stacked paddy rice pyramids produced by rice farmers across the country in Abuja. Even though the production of rice is said to have increased to over 7.5 million metric tons annually, this improvement has been numbed by the high price of the commodity.
Many Nigerians have questioned the transparency of the disbursement of the loans by the CBN and the rationale behind the hijack of the programme. The original plan of the programme was for Deposit Money Banks (DMBs), Development Financial Institutions (DFIs), and Microfinance Banks (MFBs) to disburse the loans to the beneficiaries, who in turn will repay the loans by taking their harvests equivalent to the value of facilities taken to the “anchors”.
Today, one of the major setbacks of that laudable scheme is the failure of most farmers to repay the loans, which is already threatening the continuity of the initiative.
Reports say many of the farmers refused to pay back the loans due to the misconception that since the CBN is the lender, the loan is a national cake and therefore they do not need to pay back what they consider to be their share as citizens.
As of December 2021, when the programme was suspended, over 4.8 million farmers were said to have benefited from over N1 trillion disbursed across the country. Out of this colossal amount, CBN has been able to recover only N400 billion, leaving an outstanding debt overhang of N600 billion.
This sad narrative has been largely blamed on the inherent abuses in the disbursement process.
Moving forward, therefore, Emefiele must shelve the toga of arrogance that has no basis other than the deadly sin of superiority. In all fields of human endeavour, the ability to manage people and inspire team spirit is the hallmark of an effective leader.
Before his appointment as the governor of the Central Bank of Nigeria CBN in 2014, Godwin Emefiele had gained over 18 years of banking experience which climaxed in his position as the Chief Executive Officer and Group Managing Director of Zenith Bank Plc.
Apart from naira redesigning, he would be remembered for other interventionist programmes his regime introduced to stabilize the economy during and immediate post-COVID-19 pandemic.