Editorial: Public policies are typically the product of tradition, because the quiet familiarity of tradition makes for some semblance of stability, predictability or perhaps safety. But sometimes, tradition can prove to be an inadvertent anchor of error, or it may outlive its usefulness. This seems to be the case with the appointment and tenure of the governors of the Central Bank of Nigeria, CBN.
Since the return of democracy in 1999, all the CBN governors have served only one term – and there have been three of them. Mr. Joseph Sanusi declined a second term for personal reasons, particularly his age. Both Prof. Chukwuma Soludo and Mallam Lamido Sanusi were younger and ambitious enough to desire second terms. But for political considerations, they were denied.
Our society grandiloquently allows politics interfere with government action especially on issues of critical national importance. This has had deleterious consequences for our development, leading to wrong decisions taken at the right time or right decisions taken at the wrong time; both resulting In the same outcome, the robbing of Nigerians of unique moments to dig themselves out of the pit of poverty and despair. It now appears that the decision to appoint a CBN governor has again become victim of a treacherous and cynical tradition. This Newspaper believes the time has come to reexamine this practice of instinctively refusing CBN Governors a second term in office regardless of their performance on the job; putting an end to the self-defeating act of subjecting the sensitive position of CBN governor to the merciless caprices of the Nigerian game of political roulette.
All over the world the office of the central bank governor or chairman is revered and highly institutionalized because it is the face and embodiment of economic stability. A major function of the central bank is the determination and control of the price system, which include inflation rate, interest rate and exchange rate; these are the determinants of every economy. A major adverse change in any of them will spell doom.
So the head of every central bank is carefully chosen and rarely relieved until they have served their full term, as any perceived instability in the office could be injurious to the entire economy. This was the case in South Africa not quite long ago where a sudden change in the governor led the economy into a tailspin.
We admit that every government reserves the right to choose those it will work with, including the CBN governor; however, we also believe that because government has the power does not necessarily mean it should use it without circumspection and caution. Certain things are lawful but not expedient. Every change comes with a period of learning and such periods have serious effects and impact on policy and performance of the person and the institution involved. In the case of the CBN, the consequences could be severely damaging.
From every indication, Mr. Godwin Emefiele has learned the ropes on the job and has proved his competence, cool-headedness and policy clarity in the course of the last five years. It has been a tortuous and turbulent journey that could have broken most faint hearted persons. On the balance, Emefiele has distinguished himself and operated as a team player and servant- leader. He has kept the economy from harm’s way having navigated it out of an avoidable recession. He was appointed at a time of national economic distress and acquitted himself admirably.
By June 2019 he would be due for reappointment or, as has been the case in the recent past, relieved of his appointment. Beyond politics and sub-national sentiments, This Newspaer believe the one-time Zenith Bank CEO, should be reappointed essentially because he has done well, if doing well is a metrics for determining appointments. Emefiele has stabilised the price system that a change now may prove disruptive.
His achievements are glaring even if at times subtle. Not to reappoint him will say more negative things about us than any purpose such may serve. Perhaps the only thing against him would be his ethnicity and that he was not appointed by the Muhammadu Buhari administration. But these are not sufficient reasons to ignore his contributions to the economy.
The ban on 43 items from forex at the height of the currency crisis was a master stroke that saved the economy from collapse. There has been a boost in local production of the 43 items banned which has created domestic demand for the items concerned, employment generation, substantial forex owing to the reduction in the import bills of the country and improved domestic capacity. The CBN intervention in the area of agriculture, manufacturing, Micro, Small and Medium Enterprises (MSMEs) and infrastructure has yielded multiplier effect on the economy.
The foreign reserve of Nigeria has risen to $45 billion and the CBN in its quest to ensure greater accessibility to forex, established the Investors’ and Exporters (I& E) Window in April 2017 as well as the forex window for Small and Medium Enterprises, SME.”
At the Bureau De Change segment, there has been a significant appreciation of the Naira from over N525 per dollar in February 2017 to about N360 per dollar today. Rates at the I & E Window also appreciated from nearly N382 per dollar in May 2017 to just over N360 per dollar. In addition, exchange rate pressures normally witnessed during the general election cycles was absent in 2019 polls.
The Anchor Borrowers’ Programme scheme stands out as one of the major achievements of the Bank in its intervention effort. The goal of the programme is to collaborate with anchor companies involved in the production and processing of key agricultural commodities. As at December 2018, a total sum of N174.48 billion had been disbursed through 19 participating Financial Institutions (FPIs) to finance 902,518 farmers, working with 194 anchor companies. During the period, 2,807,775 and 8,423,325 direct and indirect jobs respectively had been created under ABP. This is unprecedented.
The only thing that can be said at this point is that the present CBN governor deserves an opportunity to consolidate the good job he has done so far. This will be to the advantage of government and the Nigerian people.
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