Godwin Emefiele, Governor, CBN.

 

Financial experts have disagreed in strong terms with The Economist’s suggestion that the Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele should be relieved of his job. They believe that doing so will be grossly unjust to the man who inherited an already the collapse in oil price.

Former Managing Director of defunct ACB International Bank, Chief Emma Nwosu, told Hallmark that the CBN governor should not be blamed for the country’s present economic strain, saying that the fundamentals were just playing out.

“What is happening now has little or nothing to do with the Governor of the Central Bank of Nigeria. If you look at it, APC has just democratically taken over government. There have not been structures for the government to run. During this period of waiting, many things are on a standstill,” he explained.

The former ACB boss claimed that the inactivity of the government has created room for foreign exchange flight, hold-up of foreign Direct Investment (FDI), which has made the value of country’s currency to decline.

He argued that the government should receive more of the blame for the present economic woes bedeviling the country, because there is very little the CBN could do to salvage the situation.

There is a limit to playing with figures, MPC rate, devaluation can do in stabilizing the economy,” he added.

Mr. Nwosu, however, stated that the Nigerian economy may have been better managed if the government had appointed a proactive economist to man the Central bank.

The President, Bank Customers Association of Nigeria (BCAN) and former registrar, Chartered Institute of Bankers of Nigeria (CIBN), Dr. Uju Ogbunka, opined that it was wrong for anybody to call for the replacement of Mr. Emefiele as the CBN Governor.

According him, the Nigerian economy is not worse than it was before the CBN Governor got the rein of leadership of the apex bank. 

“People should be allowed to do their work. The people in CBN are trying their best to ensure that the economy works. Don’t forget that economic management is not the function of the CBN alone. It is just one side of the divide, which has to do with the monetary aspect,” he explained.

 The economic team and Ministry of Finance, he said, are supposed to complement the efforts of the CBN in the management of the country’s economy.

 The Economist had in its July 4, 2015 edition titled: “Toothpick alert” criticized CBN’s recent forex policy, which restricted importers of 41 items from accessing forex from the interbank market, bureau de change and export proceeds, with the magazine concluding that “Some wonder which would be worse for Nigeria: allowing him (Emefiele) to serve the remaining four years of his term or undermining the independence of the central bank by sacking him.”

The CBN had since responded, arguing that the article did not take into cognizance that the exchange rate is simply a price that is essentially determined by the forces of supply and demand.

“Contrary to the article’s argument, adjustments to a sharp decline in supply of US Dollars cannot all be borne by an indeterminate depreciation, without considering the full impact on the Nigerian economy.

The demand side also has to be considered, not just in response to the pressure on the Naira but as an opportunity to change the economy’s structure, resuscitate local manufacturing, and expand job creation for our citizens,” the apex bank stated in its response.

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