*By Abba Adakole*<\/p>\n
Public offices are held in trust for the people. Therefore occupiers of
\npublic offices are the golden fish that have no hiding place.\u00a0 It is thus
\ninstructive that they should justify their appointments by demonstrating
\ncompetence, accountability, discipline and leadership. These virtues
\napproximate the essence of every successful public office holder.<\/p>\n
It is in the context of the parameters supra that economic analysts and
\npublic affairs commentators have, in recent times, been giving appraisals
\nof the person of the Governor of Central Bank of Nigeria (CBN), Mr. Godwin
\nEmefiele and his era at the head of the apex bank\u2019s command-room since
\nstepping in the saddle on June 3, 2014.<\/p>\n
One such analysis that was agreeable to me and reflected my views was
\npublished on the back page of Leadership newspaper of Thursday, February
\n21, 2019 titled: \u201cDeconstructing Emefiele, CBN\u2019s Command-Room Guru\u201d wherein
\nthe writer noted how the American media raised the profile of astute
\neconomist and former chair of the US Federal Reserve Board from 1987 to
\n2006, Alan Greenspan, to a point that several observers likened him to a
\n\u201crock star\u201d whereas he was ordinarily subdued in his public appearances.<\/p>\n
The interesting contrast with Emefiele is that the media in Nigeria had not
\nextended a similar favour to CBN\u2019s Emefiele. But, that seems to have
\nchanged in the last two months. Emefiele has understandably been enjoying a
\nrave review of his first tenure as CBN governor in the media. Such reviews
\nof his era and achievements could either recommend him for tenure renewal
\nor for posterity\u2019s positive judgment.<\/p>\n
Emefiele has unarguably brought over three decades of both theoretical and
\npractical experience from top-flight academic and hands-on banking arenas
\nto the complex, fluid turf of central banking. In Buhari\u2019s change
\nadministration, Emefiele has been able to call on these governance skills
\nto successfully drive CBN\u2019s command room. He can, in the next level, keep
\nfidelity to the major regulatory objectives of the CBN, to wit: maintaining
\nthe external reserves, promoting monetary stability and a sound financial
\nenvironment, and acting as a banker of last resort.<\/p>\n
At a bankers\u2019s dinner in Lagos, last year, he reportedly alluded to a
\nnumber of recent developments that had markedly impacted emerging market
\neconomies, including Nigeria. One such development was the rising global
\ninterest rate due to sustained monetary policy tightening stance in the
\nUnited States and other advanced economies.<\/p>\n
According to him, \u201cThis has consequently heightened fragilities, imbalances
\nand vulnerabilities in emerging markets. The Fed fund rate was raised
\nsteadily to 2.25 percent in September 2018 with a forward guidance for one
\nmore hike before the end of 2018 and three more in 2019. Similarly, the
\nBank of England raised its policy rate in August 2018 for the first time
\nsince 2008. Some emerging market economies, including India, Indonesia,
\nMexico and Turkey have also raised interest rates in response to that shock.<\/p>\n
\u201cConsequently, Nigeria witnessed significant outflows of capital from
\nemerging markets, which led to immense pressures on exchange rates, FX
\nreserves, and sharp losses in the capital markets. Even Argentina, Brazil,
\nSouth Africa, Turkey and Russia have depreciated their currencies
\nsignificantly due to this shock. There have also been uneven fluctuations
\nin the international prices of commodities including crude oil, gold,
\ncocoa, etc.<\/p>\n
\u201cIn fact, a critical dimension shaping this tumult is that the global
\neconomy has experienced profound geopolitical and trade tensions. These
\ninclude strains between US and China, US and Iran, Russia and Western
\nPowers and more. These have unquestionably impacted the dynamics of global
\ntrade. Also, these were exacerbated by rising tendencies and incidences of
\nprotectionism, nationalism and anti-globalization – especially in the
\nwestern hemisphere.\u201d<\/p>\n
Consequently, Nigeria\u2019s macro-economy experienced significant impulses over
\nthe last few years, which triggered the country\u2019s GDP collapse into a
\nrecession with inflation spiraling to nearly 19 percent. The Naira-Dollar
\nexchange rate hit peaks never seen before. Both unemployment and poverty
\nalso deteriorated. These adverse outcomes also revealed the country\u2019s most
\nworrying structural fault lines, to wit: the persisting sole dependence on
\noil and the inordinate size of the nation\u2019s imports.<\/p>\n
CBN had to deploy seven carefully planned measures to manage the negative
\ntensions of being an evolving player in the global village square,
\nincluding, among others, fine-tuning the extant monetary policy, rejigging
\nthe external reserve management, stabilising the exchange rate management,
\nintroducing the Naira-Renminbi Currency swap, given the growing importance
\nof the Chinese currency in global markets, and interventions in the
\ndevelopment financing sector.<\/p>\n
Without a doubt, CBN\u2019s policies and initiatives are yielding positive
\nresults toward full correction of the underlying imbalances within the
\nNigerian economy. The Ease-of-Doing-Business profile of the country is
\nimproving, courtesy of the CBN interventions. The establishment of the
\nCredit Bureau and the National Collateral Registry, which improved access
\nto credit in the domestic economy, had made significant contributions.<\/p>\n
Besides, the introduction of the transparent I&E FX Window, which increased
\ninvestor\u2019s confidence and eased market sentiments, also boosted Nigeria\u2019s
\nEase of Doing Business indicator.\u00a0 Emefiele\u2019s CBN has also effectively
\nmanaged the external reserves. Over the last few years, it has established
\nand maintained the decisive withdrawal of subsidy for the importation of 41
\nnon-essential commodities.<\/p>\n
Following the strict implementation of the policy, imports (fob) fell
\nsteadily from US$15.7b in December 2014 to US$11.1b in June 2016 and US$7.2
\nb in June 2018.\u00a0 As it is, many entrepreneurs are taking advantage of this
\npolicy to venture into the domestic production of the restricted items with
\nremarkable successes and great impact on employment even though The
\nGuardian in its editorial of March 26, 2019 held a different view that the
\nCBN had put Nigeria out of work by stopping fifth instant importers from
\naccessing forex for textile products. But it did not elucidate further the
\nramifications of its argument.<\/p>\n
Over all, the CBN on Emefiele\u2019s watch has given traction to key
\nmacroeconomic indicators and this has brought about the cyclical recovery
\nof the economy since the 2016 recession, and short-term prospects. For
\ninstance, after five quarters of uninterrupted GDP contraction -beginning
\nfrom 2016Q1- the economy exited recession during the second quarter of
\n2017. This recovery has been sustained for five consecutive quarters.\u00a0 While
\nthe pace of GDP growth slowed from 1.95 percent in the first quarter of
\n2018 to 1.50 percent the second quarter, short-term outlook remained good.<\/p>\n
According to reports, the Nigerian economy likewise witnessed 18 straight
\nmonths of disinflation to 11.1 percent in July 2018, following a period of
\nrising inflationary pressure that peaked at 18.7 percent in January 2017.
\nMinor upticks, due to rising food prices, however, raised it to 11.3
\npercent in September 2018. The exchange rate has remained largely stable at
\nthe FX markets with evident convergence continuing across all segments. At
\nthe BDC segment, there was significant appreciation of the Naira from over
\nNGN525\/US$ in February 2017, to about NGN359\/US$ currently.<\/p>\n
Another significant achievement by the CBN, according to consensus by
\nanalysts, is the Anchor Borrowers\u2019 Programme (ABP), aimed at stimulating
\nproductive activities and development in the agricultural sector through
\nthe provision of farm input both in cash and kind to small holder farmers
\nin order to improve farm yields; and, designed to stabilise supply of input
\nto agro-processors with a view to addressing the nation\u2019s balance of
\npayments on food import and export.<\/p>\n
The CBN claims a total number of 862, 239 hectares across 16 different
\ncommodities had so far benefitted from the ABP, which had generated about
\n2.5 million jobs across the country. Subsequent to the success of the
\nprogramme with regard to cultivation of rice and maize, the Monetary Policy
\nCommittee recommended that the programme be applied to other areas such as
\npalm oil, tomatoes, and fisheries, among others.<\/p>\n
–<\/p>\n
*Adakole, public affairs analyst, contributed this piece from Kaduna.*<\/p>\n","protected":false},"excerpt":{"rendered":"
*By Abba Adakole* Public offices are held in trust for the people. Therefore occupiers of public offices are the golden fish that have no hiding place.\u00a0 It is thus instructive…<\/p>\n","protected":false},"author":1,"featured_media":56737,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","footnotes":""},"categories":[7],"tags":[],"class_list":["post-65931","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles-opinions"],"yoast_head":"\n