By Dele Sobowale
“Be thou as chaste as ice, as pure as snow, thou shalt not escape calumny.” William Shakespeare, 1564-1616. VANGUARD BOOK OF QUOTATIONS, VBQ, p 25.
There must be occasions when the Governor of the Central Bank of Nigeria, CBN, Mr Godwin Emefiele, must feel like the late Italian dictator, Benito Mussolini, 1883-1945, who declared that “Governing Italians is not impossible; it is merely useless”. Governing the Nigerian monetary policy sector and its financial systems, rationally, is also not impossible. It is increasingly clear that is might be the closest thing to exercise in futility.
The various stakeholders don’t want a CBN which will run its affairs in a logical manner. They want a bank which will favour their own particular interests. And when that does not happen, the campaign of calumny against the CBN Governor becomes relentless. Two examples will illustrate the point about calumny.
It is no longer news that some new staff members were recently recruited by the CBN without undergoing the “normal” process. Without bothering to verify the facts behind the actions taken, the usual “social critics”, who must comment on everything, even if in ignorance, were on the internet. The recruitment exercise was likened to the Nigerian Customs fiasco which took place under President Jonathan.
Soon, there were demands for the CBN to resign or be sacked. Little did they know that the “owners” of Nigeria, the All Progressives Congress, APC, was behind the matter. That they were ignored by the President should have been all the warning they needed that our new rulers are busy sharing the booty gained from a brutal campaign. “Nobody stands all day in the rain for nothing” according to the late Chief M.K.O. Abiola. Those who literally “stood in the rain” for APC have very right to enjoy the fruits of their labour.
Recently, the CBN was again carpeted for allowing Muslim pilgrims to source dollars at official exchange rate. As a Christian and avid opponent of governments getting involved in religious matters, especially pilgrimages, which have been conduit pipes for official corruption, it is easy to join the noise. But, mob action is never helpful. Until an explanation was given there was nothing to comment about.
Now we have the explanation and this one also is government’s issue to address. Even if there was a previous agreement, the Federal Government, if it chose, could have stopped it. That the deal went through can only mean that the Federal Government approved of it. That is the end of the story.
That said, it appears that most of the criticisms of the operations of the CBN invariably stem from self-interest masquerading as public interest. That is why when one assembles them, the contradictions are very clear. Even the recent pronouncement of the Governor of Kaduna State, El-Rufai falls into that category.
His statement, or was it declaration, that “unless the Central Bank and the banking system make a conscious decision to bring interest rates, one day it would be legislated” –whatever that means – falls into that category. El-Rufai’s demonstration of economic ignorance is an example of the sort of criticism directed at the CBN by self-seeking individuals attempting to bend monetary policy to serve their own interest.
To start with, there is absolutely nothing the CBN is doing now that was not done during the eight years El-Rufai was in government. There was no threat then to force the CBN and the banks to commit financial suicide just to please anybody. Rufai cited the example of the UK which recently lowered interest rates to buttress his point. Well, somebody once said “a little knowledge is a dangerous thing”. This is a classic example of someone in high office, with little knowledge attempting to foist ignorance on the monetary policy managers.
Comparing the United Kingdom, an advanced economy, well-diversified with a mono-product backward nation like Nigeria is not only inappropriate but dangerous. Since, the bane of our current problem is insufficient supply of foreign exchange, the differences between Britain and Nigeria should be clear to anyone not wedded to self-induced self-deception. Two facts will be sufficient to make the point clear even to market traders.
First, no single manufacturer, and certainly not its entire manufacturing sector, in England, depends on foreign exchange allocation from the Bank of England to survive. Neither does its banks and Bureau De Changes, BDCs. By contrast, Nigerian manufacturers heavily rely on the CBN and are experiencing difficulties because the Nigerian Central Bank cannot supply what they need.
UK manufacturers export – including to Nigeria. Nigeria manufacturers largely import while consuming the dollars earned from crude oil export. Anybody interested can go and read the Annual Reports and Accounts of our largest businesses and seldom would there be an entry for revenue from exports.
It is because the UK’s economy had been diversified for ages that its exchange rate cannot change from N200/US$1 to N400/US$1 in one month. El-Rufai was in a government for eight years. Yet the government he served did nothing to diversify the economy. His comments sound like “blaming the victim” for their omissions.
Secondly, government spending constitutes a far lower percentage of the Gross Domestic Productivity, GDP, of the UK than Nigeria’s, such that whole units of government cannot consider shutting down for two or three days as some states in Nigeria are proposing. Here in Nigeria, most states will shut down if revenue allocation from Abuja stops.
Thank God for Godwin Emefiele. Had he listened to “know-nothings” Nigeria would have been ruined long ago.