Godwin Emefiele: Softly, softly

By Sheriffdeen Tella

The second basic function of the CBN according to the Act that established it is that it should maintain external reserves to safeguard the international value of the legal tender currency. The official exchange rate of naira to a dollar in 2014 just after Emefiele took over the CBN was N165.15; while the black market rate was N190. If there is a government official that should remain humble, it is the Governor of the Central Bank of Nigeria. If we are to divide the economy into two namely the real and the monetary sectors, the governor carries half. It is a favour from God and a responsibility that must be carried out with utmost dexterity and humility. The CBN Governor, Godwin Emefiele, recognises the magnitude and the authority attached to the assignment but has yet to demonstrate the required humility for such position.

He feels the assignment has given him power over the country he is expected to serve. He is above the Nigerian institutions, constitution, and even the people. The National Assembly called him many times but he ignored it with flimsy excuses. The Nigerian citizens asked him to reconsider his stand on the deadline for currency swapping in view of the inadequacies surrounding the availability of the new currencies, he ignored them and instead was offering ATM cards for withdrawal of local currencies and foreign exchange. Does the public have accounts with the CBN?

Let us assess his execution of the monetary management of the Nigerian economy. The starting point is to present the traditional functions of the central bank and examine how he has performed. The traditional or basic functions are expected to be performed by any central bank in the world. The central bank is the only bank that can issue domestic currencies. It serves as an adviser and banker to the government just as it is the lender of last resort to other banks. The bank is the custodian of cash reserves and foreign currency or foreign exchange. It acts as the clearing house for interbank transactions among banks and the issuer of monetary policy.

It is within this general context that the four-core mandate of the CBN was formulated. In the Act establishing the bank, it is expected to issue legal tender currency in Nigeria; maintain external reserves to safeguard the international value of the legal tender currency; promote a sound financial system in Nigeria; and, act as banker and provide economic and financial advice to the Federal Government.

The first primary and major goal of the CBN is to produce Nigeria’s money and distribute the same fairly across the country. It is not to produce Nigerian ATM cards. The distribution of the new currency is unfair. Most banks have been collecting old notes with no new currencies to replace them. I went to a bank’s ATM to withdraw money at the end of last week and also with the intention to snap the old currencies the bank has been dishing out before taking it from the ATM. Unfortunately, the machine has no money to dispense. And, that is common everywhere. A cashless economy does not mean no cash. The so-called cashless economies in advanced countries have millions of ATMs installed outside banks, in shopping malls, train stations, bus stations et cetera. What are the ATMs supposed to be dispensing and why were they installed if they are 100 per cent cashless? In those economies, ATMs work 24 hours a day and seven days a week. No internet problems and no electricity problems either. Forcing people to go cashless is a cover-up for inadequacy and inefficiency. To the extent that currencies are not easily available, the governor of the CBN has failed in the first function.

The second basic function of the CBN according to the Act that established it is that it should maintain external reserves to safeguard the international value of the legal tender currency. The official exchange rate of naira to a dollar in 2014 just after Emefiele took over the CBN was N165.15; while the black market rate was N190. What is the exchange rate today? The official rate is N440 and the black market rate hovers around N750. It can neither encourage foreign investment nor the repatriation of proceeds of exports.

It was under the leadership of the CBN Governor that, through a whistle-blower, large amounts of new foreign currencies were found in a flat in Ikoyi, Lagos. Who is legally responsible for the custody of foreign currencies? So, who should be queried for the Ikoyi foreign currency warehouse? During the intervention programmes of 2015, Emefiele was reported (never denied) to have distributed foreign currencies to some commercial banks for intervention in distressed businesses. There was no record of how the money was distributed or if it was returned. After some writeups by Late Henry Boyo and yours truly,

Buhari, you do not have 7 days!

By Victor Ikhatalor

President Buhari, you must take the conn! There is a raging tempest and you do not have the luxury of 7 days to chart a new course. Stir away from the storm now and let Nigerians have access to their money! It is the very least you can do.

I saw a video this morning (February 5th 2023), that jolted me. It was a moving video of a man, a naked man in a banking office in Nigeria. I have seen numerous videos of Nigerians distressed in these times, I could add mine too, but this man’s distress, compelled by forces outside of his power to strip himself of all human dignity was riveting and startling for I have seen it before.

It is of historical genre. It is the inadvertent, reactive act of an ordinary citizen’s resistance against oppression. It is of the kind, in it’s poignant, wretched appeal, that ignites a spark and moves other ordinary citizens. Empires, and yes government’s have been engulfed by such acts and across mother Nigeria by the minute, such acts are being replicated.

Nigerian kleptocratic misleaders, a subsisting plague on mother Nigeria, have left footprints of suffering in their wake, but none, no matter how rudderless, have ever bumbled into the uncharted waters of threatening the uniquely delicate balance of their self-preservative existential relationship with Nigerians.

Uniquely, the Nigerian, high or low, has over time, ignoring the fundamental societal social contract, validating the very existence of government, taken upon himself/herself the mantle of government. It is suo motu for the Nigerian to be largely or wholly responsible for the personal and dependant provision of healthcare, education, electricity, water, shelter, local roads etc. the House of Representatives set up a committee to look into the matter. Maybe a report will come out almost five years after.

No class of ruling elite, constituting government, has at anytime in Nigeria’s chequered history, ever done anything to lift this unique mantle of the Nigerian’s shoulder. Indeed, they have thrived in decadent conspicuous consumption and glory in the unassuming nature of the Nigerian in this warped relationship.

So, unless this incumbent government has in “Houdini” fashion, overnight assumed government’s rightful roles in social contracts, and lifted over 133 million Nigerians out of multidimensional poverty, unless, wait! When trouble sleep. Yanga go wake am. Weting him dey find…(apologies to Fela Anikulapo Kuti). You get it!

We can suffer fuel scarcity without threatening government like in other places. We seem divinely gifted among nation’s in being able to suffer perennial ineptitude and thieving of our misleaders. The threshold of the Nigerian’s ability to suffer and smile is almost miraculously elastic. But, even in our darkest days, and we have had our fair share in this nation – we have never, ever faced the prospect of being unable to access and use our own money!

Shortage of the naira is exacerbating all other dire existential realities, fuel unavailability inclusive.

The CBN governor turned himself into a commercial bank manager by going out to give money to farmers as intervention funds when the funds could have been channeled through the Bank of Agriculture that is equipped to perform such a function. He later complained that the farmers were not repaying the funds given to them. Yet, according to him, the farmers so liked him that they paid N100m for his botched presidential form! Have they not repaid the loans?

There was a display of massive branded campaign vehicles for the CBN Governor’s campaign when he was to contest the primary of the All Progressives Congress. Those vehicles were not produced in Nigeria and must have, therefore, been imported with hard-earned foreign exchange. The bank was more interested in funding foreign travels by government officials, and importing exotic drinks and food as well as encouraging round-tripping activities within the foreign exchange market than providing money for the importation of raw materials and spare parts for industries. Yet the governor would put the massive depreciation of the naira on one Aboki Bureau de Change or students going abroad to study. Given the exchange rate depreciation under his watch, it is clear that the governor has again failed in the second basic function of the central bank.

Has the CBN promoted a sound financial system? Instead of strengthening the financial system by encouraging them to be more innovative, the bank has been competing with commercial banks. As already alluded to, the CBN has been engaging in retail banking in the name of promoting CBN interventions. The introduction of ATM cards by the CBN for whatever transactions is an aberration; not innovation. Individuals do not bank directly with the CBN, so what do they need the CBN card for? Until recently, I have used my bank’s master card to collect foreign currencies whenever I travelled to other countries in Africa, Europe or elsewhere. So, why do I have to get a CBN card to do the same? I will have to transfer money to the card at a cost and withdraw at another cost. What a financial loss!

Sheriffdeen Tella is a Public Policy Analyst.

Nigerians are beginning to protest and it’s spreading everyday. Nigerians are besieging banks with naked displays of frustration assuming worrying dimensions. Lives and property are being lost!

There are looming dark clouds, portending stormy waters ahead and Nigeria must be steered away from any calamitous collision. For so long, absent a capable captain to chart the course, ship mates in ranking positions on the Nigerian ship have been left to run amok. In spite of their best efforts, the Nigerian ship, beleaguered, has somehow still been able to keep afloat. These ship mates, implacable and seemingly irredeemable continually seeking ways and means to inflict suffering on the people will see the Nigerian ship capsize come what may!

Banks and Automated Teller Machines (ATMs) all over the country are empty no matter what the jejune economist running the Central Bank of Nigeria says. Godwin Emefiele, the man under whose watch Nigeria continues to reach new milestones in economic woes is a ship mate running amok.

President Buhari, you must take the conn! There is a raging tempest and you do not have the luxury of 7 days to chart a new course. Stir away from the storm now and let Nigerians have access to their money! It is the very least you can do.

Victor Ikhatalor is a Human Rights Defender and Good Governance Advocate and can be reached at kingjvic7@gmail.com