September 17, (THEWILL) – President Bola Tinubu on Friday, September 15, 2023, nominated Dr Olayemi Michael Cardoso, as the new Governor of the Central Bank of Nigeria (CBN) subject to approval by the Senate.
When (not, if) approved by the Red Chamber of the National Assembly, as the rule demands, Cardoso will occupy his exalted seat as the 11th indigenous central bank governor since the apex bank was created in 1958.
But he is coming at a turbulent time. The CBN has been in the eye of the storm while playing its role as the monetary policy authority. This has made the apex bank chief a household name within and outside Nigeria. The reason is simple.
There is an organic relationship between the central bank and the economy of a nation; the bank’s policies have far-reaching implications on the people’s wealth-creating abilities and standard of living. Navigating the troubled roads to achieve economic stability has been a tough job for the central bank chief in the last eight years.
In many cases, the apex bank had to push to close ranks with the fiscal authorities to keep the economy going. Such policies helped the CBN to navigate the economy through the recession and COVID-19 challenges.
By extension, interest rate issues, external reserves, foreign exchange rates, price stability, financial inclusion, gap in the agricultural and manufacturing value chains as well as sound financial system, dominated public discourse over policy actions of the central bank.
Overlooking the scathing criticism from some analysts who argued that the CBN had acquired renewed energy to push beyond its monetary policy mandate, the apex bank activated its Development Finance mandates through which it created several intervention programmes.
Currently, the CBN has 37 intervention funds targeted at stimulating the economy and addressing the issue of unemployment. While proof has been established that these programmes impacted positively on the economy, critics question their purpose and results.
The reason is that the economy has not fared better despite the interventions; but the CBN cannot alter its mandate to assume additional responsibility in the fiscal authority space. This is where the economy is today: in doldrums.
Cardoso is going to head a Central Bank battling with monetary policies to address myriad challenges: Rampaging inflation, mounting debt stock, rising unemployment and deepening poverty.
There is volatile forex market, dollar shortage, dwindling reserves, export promotion challenges, low domestic capacity, insecurity, receding investment inflow, backlog of unsettled forex commitments, oil theft, challenge of illegal refineries while legal refineries are dormant.
Coming on board three months after the abolition of multiple foreign exchange windows which led to the depreciation of the Naira by over 60 percent, Cordoso was welcomed Friday with the announcement of August 2023 inflation rate hitting 25.80 percent, and Naira slumping to N756,91/$ at the I&E window and turnover thinning down to $45.88 million. Meanwhile, the parallel market rate continues to soar – hitting N950/$ as of Friday, September 16, 2023.
The Debt Management Office (DMO) announced the same day that Nigeria’s debt stock stood at N87.38 trillion ($113.42 billion). Three ago, FTSE Russell announced that it had downgraded Nigeria from frontier to unclassified market status due to the challenge of investors repatriating their assets from dollar-strapped Nigeria.
The CBN policies that aim to stimulate local production and boost export have been hampered by a severely challenging environment which is not of the apex bank’s making.
Yet, Nigerians look towards the man occupying the Central Bank Governor’s seat for solutions.
A statement by President Tinubu’s media aide, Ajuri Ngelale, said the President also approved the nomination of four new Deputy Governors of the CBN, for a term of five years at the first instance, pending their confirmation by the Nigerian Senate.
They include:
Mrs. Emem Nnana Usoro
Mr. Muhammad Sani Abdullahi Dattijo
Mr. Philip Ikeazor
Dr. Bala M. Bello
***Cordoso, the Harvard-trained Economist and his team have their job cut out for them, clearly and specifically. The deliverables are not subject to guesswork.*
