It is a statement of fact that besides the constitutional responsibilities of the Central Bank of Nigeria (CBN), which include but not limited to ensuring monetary and price stability; issuance of legal tender currency in Nigeria; maintenance of external reserves to safeguard the international value of the legal tender currency which is the naira; promotion of sound financial system and acting as banker of last resort and provide economic and financial advice to the Federal Government, the apex bank under its current management has worked assiduously to ensure that the nation’s economy does not collapse under the weight of serial inconsistencies on the part of our political leadership.
Those criticizing the CBN for indulging in everything and in all things, appear to have limited information on the consequences of the apex bank standing aloof in the face of the apparent display of the lack of proper understanding of the dynamics of the economy by those who ought to be in charge of the nation’s fiscal policy directions.
We believe that never in the history of this nation has any CBN governor than Mr. Godwin Emefiele saddled the bank in several engagements cutting across the monetary and fiscal policy issues in a deliberate effort to defend the currency, the naira and maintain a manageable level of inflation amid the citizen’s appetite for consumption of foreign goods and services against the backdrop of dwindling exports.
Although we are not proponents of a monetary policy authority which derives joy on embarking on ego trip as in becoming the contracting agent of the government, we appreciate the courage of the current leadership of the CBN in wanting to act as catalyst in safeguarding the obviously troubled economy of the nation.
We salute the courage of the CBN in transiting from part of its primary responsibilities of administering the Banks and Other Financial Institutions (BOFI) Act (1991) as amended, with the sole aim of ensuring high standards of banking practice and financial stability through its surveillance activities, as well as the promotion of an efficient payment system to being able to perform, and creditably too, such other major developmental functions focused on all the key sectors of the Nigerian economy covering financial, agricultural and industrial sectors as carried out through its various departments and partnering agencies.
The 37 intervention programmes made so far by the CBN under Emefiele to boost the economy may not have witnessed resounding successes like every other human endeavour, but it must be emphasized that many of those schemes like the Anchor Borrowers’ Programme, the Real Sector Support Facility, Export Stimulation Scheme and the Commercial Agricultural Credit Scheme are target driven to the extent that anyone can gauge their impacts considering that such interventions are borne out of critical issues within our economic space.
With over N700 billion earmarked for the programmers, about three million farmers have queued into the Anchor Borrowers’ Scheme either directly or indirectly with the multiplier effects of helping to stabilize the prices of such critical food items as rice and corn with the CBN acting as major off taker since the apex bank now collects their produce at a predetermined price in form of loan repayment scheme instead of demanding for cash repayment.
The recent discovery that the Small and Medium scale Enterprises (SMEs) in the country contributed a staggering 40 per cent to the nation’s GDP justifies Emefiele’s decision to allocate N318 billion to the sector as intervention fund.
The power and airline intervention fund is another stand-alone fund from the CBN which, in the height of times will help bridge the metering gap in the electricity supply chain courtesy of the design to assemble electricity meters in the country on the heels of creating over 5,000 jobs in the same way that the aviation intervention funds can be said to be responsible for airline operators in Nigeria to still remain in business till now.
The recent presidential directive for the revamping of the commodity exchange is part of the challenges which Emefiele has taken up as the 11th governor of CBN with N50 billion already set aside for the project. Analysts are projecting stability in commodity pricing and export promotion incentives on the ultimate success of CBN’s proposed intervention in this area.
The CBN has insisted, with the support of expert opinions, that its interventions in the real sector of the economy were targetted at boosting Nigeria’s participation in the African Continental Free Trade Area’s (AfCFTA) agreement.
Agreed that the apex bank cannot be jack of all trades, it will amount to standing argument on its head for anyone to want to interrogate Emefiele and his team for not folding their hands as is the case with many agencies and department of the government and allow the nation’s economy to stagnate or plunged into another recession.
We strongly believe that the N7.436 billion recently accessed from CBN by four States in the South-South regions to open up more land for cultivation, create access roads to agricultural lands and provide infrastructure among other support services in the region is a classical example of what an agent of development should be as the measures are helping to induce greater activity in the agricultural sector and enabling the movement of goods from farm to factories and to the markets.
This may not be the best of time to applaud the CBN and its managers for wanting to be everything to every sector of the economy including the apex bank’s alleged disposition of a Father Christmas considering that all the gamut efforts targeted at defending the naira against major foreign currencies have not been successful.
The apex bank should be commended for its capacity to providing answers to the low hanging fruits in anticipation of a more predictable environment as well as mustering the political will to engage the monster in the room which is the predictability of the exchange rates of naira to other currencies. It is not cheering news that over N3 trillion out of the N4.2 trillion intervention funds disbursed by the Central Bank of Nigeria are outstanding as of December 31, 2020.
Good as the efforts of the apex bank are in managing both the monetary and fiscal policies of government and by extension, caring for the needs of the ordinary Nigerian, the overall yardstick for measuring the success of the bank under Emefiele lies on how well the CBN conducts its statutory obligation especially in the thorny areas of inflation and exchange rates; two critical indicators which have profound influence over other economic variables. The exchange rate of naira to dollar is still unacceptably high as it stands today; the same way that the inflation rate is still standing at two digits. There must be solution in the interest of the economy and all Nigerians.