The Value News

CBN: How Emefiele Won Buhari’s Heart

By Stephen Ubanna

More facts have emerged why Godwin Emefiele, a University of  Nigeria, Nsukka, graduate of Banking and Finance and governor of Central Bank of Nigeria, CBN,  won the heart of President Muhammadu Buhari to be  nominated   as the governor of the apex Bank for another five years.

This is to avoid the distortion of the country’s monetary and fiscal policies  which include the Anchor Borrower’s Programme, ABP, which had brought the Buhari Administration into limelight  in the area of increased food  production and conserving the nation’s foreign exchange reserves.  This is in addition to the ban on 41  items  from accessing the  official foreign exchange market  . In taking the decision,  the CBN, under the close watch of Emefiele  had described them as being responsible for the depleting the nation’s foreign reserves in the past years.  

The CBN,  had increased the banned   items, which could  no longer access the forex market  to 43 with the inclusion of the fertilizer and textiles, when Emefiele and his management became convinced that there was no basis to still be importing such items into the country when  it could be produced locally.The Delta state born CBN, governor may  have proved that he knows what he was doing to stabilise the value of the naira despite pressures from both official and unofficial quarters  to devalue the naira  that  he had presided over the Bank introduction of multiple foreign exchange or the country. The introduction of the multiple exchange rate system, according to sources had led  to the creation of  the Inter-Bank/ wholesale, Invisible,  small and medium scale Enterprises, SMEs and the Investors and exporter’s windows.

Godwin Emefiele: Re-appointed CBN Governor

He may have finally  given the Kastina state born Nigerian President course to trust him when in 2018, he dragged the government to enter into  a bilateral Currency agreement  with the Asian country of China worth about $2.5 billion United States dollars. The CBN, under  Emefiefele  may have come out with the economic idea which was quickly bought by him when he was told about the economic benefits  to  aid the transactions between Nigeria and their Chinese Suppliers. Note that 70 percent of the imports into Nigeria, including Pharmaceutical products are from China and India and about 20 percent from  US, Europe and other Asian countries.

Prior  to the submission  of his name to the Bukola Saraki led Senate,  the CBN , governor had  already told those that cares to listen  including the participants at the Association of Assets Custodians Conference  of Nigeria,  AACN, last Thursday in the United Kingdom that he would be reappointed by the President  for  another five years to Head the CBN.  As a prelude to the submission of his name to the Senate for Confirmation  last two weeks, it was learnt that the announcement had already been made within the Bank  which was seen as a welcome development  for continuity  in the implementation of the country’s monetary and fiscal policies.

Bank sources told The Value News that officials of the  World Bank and the International Monetary Fund, IMF, including the African Development Bank , ADB,  headed by Akinwumi Adesina, the country’s  former minister of Agriculture and Rural Development in Nigeria, also put in a word to the President  to retain the services of the  current CBN , governor, if he is interested in turning the nation’s economy  around in the next four years. The President recent private visit to UK, on April 25, 2019, may have also given opportunity  to reach out to   experts  and finally became convinced  that he has no option by to retain Emefiele as the CBN governor . It was therefore  not very surprising that barely one week after his return from the  UK trip , he submitted his  letter of tenure elongation  to Saraki, the President, which was read on the floor of the red Chamber.

 Going by the Act  establishing  the Apex Bank,  the Senate must confirm  the nomination  before the   appointment can take effect. Economic experts and members of the Bankers Committee have  hailed the President  for re-appointing   CBN governor  for take the country out of the wood between 2016 and 2018, during the period of the economic recession. They noted that it is only a President with a listening ear that could listen to advise to allow the structure of the apex Bank to remain as it is for continuity.

The good news was that the Capital Market  responded positively  to the CBN governor’s renewed appointment by the President. On Thursday, May 9, 2019, in London,  an elated and fulfilled Emefiele  had addressed investors as well as the foreign Exchange , windows, as  there was a naira gain after the Presidential announcement  elongating his tenure for another five years, an indication that if he had been dropped, the naira would have crashed  in the forex market. According to a CBN , source, the foreign Exchange window started trading at N362.00 to a dollar but ended at N360.00 to a US,  dollar, thus bringing  the Investors and Foreign Exchange window in parity with the parallel market.

There is no gain saying the fact that this is the first time  since  the return of  democracy in the country  in 199, that a serving  governor of the CBN, who has completed his five years in office  would be  nominated  for  another five years  by a President  that hat had  no hand in his appointment in the first instance. Recall that Emfiele , who was the Managing Director of Zenith Bank plc, was appointed by former President  Goodluck Jonathan of then ruling People’s Democratic,  PDP, in 2014.

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1 comment

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