All is still not well for the embattled governor of the Central Bank of Nigeria, Godwin Emefiele as the head honcho of the apex bank is fighting another battle this time over $53 million judgment debt arising from the Paris Club refund. IBRAHIM APEKHADE YUSUF in this report examines the issues.
One public officer who has been in the eye of the storm lately is Mr. Godwin Emefiele, the governor of the Central Bank of Nigeria (CBN).
Although the literary interpretation of the name ‘Emefiele’ in Igbo language simply means ‘don’t err’, however, in the eyes of people in some quarters, the helmsman of the nation’s apex bank may have erred in some way as he continues to get into trouble every now and then.
Lamentably, under his stewardship, the nation’s financial ecosystem has witnessed an unprecedented turn of events; the outcome of which led to some far reaching decisions and also left bitter taste on the lips of many.
Since his emergence as the CBN top echelon there have not been synergies between fiscal and monetary authorities, just as other serious macroeconomic issues, most of which miscarried, have shown him as someone out of focus and direction.
Signs that things were no longer the same with the Delta State-born technocrat became apparent after his failed presidential bid, a development, which further brought him to public opprobrium.
Fast-forward to almost three months after the failed bid, the CBN governor began to reel out different policies chief among which was the new naira redesign with a deadline set for January.
This is just as informed sources say certain members of the cabal in the corridors of power apparently unhappy with Emefiele’s antics tried everything within their powers to contain what they saw as his power-mongering tendencies.
At the National Assembly, for instance, some members raised red flags over the whereabouts of the controversial N89.1 trillion stamp duty receipts.
At issue is that a member of the House of Representatives from Jigawa, Gudaji Kazaure, in a viral video, had allegedly accused the CBN governor of attempts to cover-up facts surrounding the collection of the controversial amount.
He also alleged that he was deliberately being denied access to present a preliminary report of a committee set up by President Muhammadu Buhari to look into the alleged stamp duty funds being withheld by the CBN.
Also in the viral video, Kazaure urged the president to either allow him to present his report to him or immediately order a thorough investigation of the alleged stamp duty funds.
But the Malam Garba Shehu, the president’s Senior Special Assistant on media and publicity, described the Kazaure’s Committee as illegal, saying the committee was dissolved on the directive of Buhari.
In the statement which reads in part, Shehu said,”In the first instance, the committee on the alleged loss of stamp duty funds he is talking about is an illegal committee; it was dissolved on the directive of the president.
”Anyone familiar with our constitution will find it curious that a member of the Parliament is the Secretary of an Executive Committee.
”It suffices to say that the entire net worth of the nation’s financial sector, the assets of the banking sector put together are not worth N50 trillion, not to talk of the kind of money he is talking about.
”CBN assures that there is absolutely no problem, whatsoever, with money from Stamp Duties.
”There is a committee duly set up by the president in June 2020 chaired by the Attorney-General and Minister of Justice and the Secretary is the Chairman of the Federal Internal Revenue Service, FIRS that is currently reconciling the stamp duty accounts.”
The presidential aide further revealed that earlier investigations carried out by government departments and anti-corruption agencies on the stamp duty accounts indicated that nothing sensational had been discovered by them.
However, the last straw that may have broken the camel’s back was the allegations made against him by the Department of State Service, who have laid a manhunt for him over terrorism financing in Nigeria.
Specifically, the DSS sought a court injunction to arrest and detain him for at least 60 days for alleged terrorism financing.
However, Justice Maryam Hassan of the Federal Capital Territory High Court in December last year rejected the DSS application after describing the allegations as vindictive and lame.
To stave off the DSS, the CBN governor reportedly flew out of the country for his annual leave and only returned a few days ago to attend the MPC Meeting in Abuja.
While Emefiele may have succeeded once again in avoiding physical scrutiny and coming under the radar of the NASS, it is however not clear how long he will continue to evade visitation to meet with lawmakers at the upper and lower legislative chambers including the DSS.
The fire this time
Another thorny issue Emefiele is facing presently is the crisis arising from the unpaid $53million Paris Fund.
Justice Inyang Ekwo of the Federal High Court, Abuja, had last Tuesday summoned the CBN governor over a $53 million judgment debt arising from the Paris Club refund.
The judge gave the order in a suit filed by a Senior Advocate of Nigeria, Mr. Joe Agi, against Linas International Limited, the Minister of Finance, and the CBN.
The lawyer representing the judgement creditor, J. O. Njikonye, had earlier filed an application asking the court to issue a warrant for Emefiele’s arrest and transportation to court.
From available information, the dispute stemmed from an alleged $70 million judgment against Linas International Ltd for the lawyer’s (Joe Agi) assistance with the Paris Club refund.
Emefiele was said to have only released $17 million, leaving an unpaid balance of $53 million.
It may be recalled that a federal high court had on January 23, 2020, ruled that the CBN governor must appear “to be examined on oath touching the means you have or have had, since the date of the said garnishee order absolute, to pay the balance of $53 million now due and payable under the said garnishee order absolute and also show cause why you should not be committed to prison for default in payment of the said sum.”
Subsequently, in October 2022, Agi, through his counsel Isaac Ekpa and Chinonso Obasi, filed another application against Linas International, minister of finance, and the CBN, seeking “an order directing the inspector-general of police to arrest Emefiele and bring him to court alongside his lawyers: Damian Dodo, Audu Anuga, all Senior Advocates of Nigeria, and Ginika Ezeoke, Jessica Iyoke, Abdullahi Afolayan, and Olayemi Afolayan.”
The court granted the application and ordered Emefiele to appear in court on Wednesday, January 18.
However, at the court session on Wednesday, the case was adjourned to March 20.
Following the adjournment, the CBN governor, in his appeal dated January 12 but filed on January 13, 2023; contended that the trial judge erred in law and occasioned a miscarriage of justice when it made an order compelling his attendance in court.
Emefiele through his counsel, Damien Dodo, informed the court that there are two pending appeals marked CA/A/476/2018, and CA/A/23/2020, which are appeals against the judgment sought to be enforced by the judgment creditor.
Consequently, he argued that the proceedings to compel his appearance after appeals have been entered strips the trial court of the jurisdiction to preside over the same subject matter.
Emefiele equally submitted that the trial judge erred when he ordered him to personally appear in court without determining one way or the other, his application challenging the jurisdiction of the court.
The appellant further said the lower court erred when it made an order compelling his appearance in court on January 18, 2023, when he is not a party to the suit before it.
He, therefore, prayed to the appellate court to allow his appeal and set aside the orders made by the federal high court.
Genesis of the Paris Fund deal
At the early days of the President Muhammadu Buhari most state government enduring acute state of insolvency as many were heavily indebted to the commercial banks to the extent that “average growth rate of states’ debt between 2012 and 2016 remained elevated at 22.16 per cent, while average growth rate of internally generated revenue is 9.04 per cent.
To address this lacuna, Prof. Uche Uwaleke, Nigeria’s first Professor of Capital Market, assessment of the Paris Club Fund became inevitable.
With respect to borrowing, Uwaleke advised at the time that state Houses of Assembly should ensure that state governments comply with Section 42 of the Fiscal Responsibility Act 2007 which provides for borrowing limits and that loans are linked to viable projects.
By so doing, the don said the last tranche of what has become known as the Paris Club Refund was highly sought after by the 36 state governors some five years ago.
The varsity don who explained this in a statement made available to The Nation recalled that the sub-national governments were ordinarily entitled to these refunds as they arose from over-deductions from statutory allocations to the 36 states in respect of debt service obligations between 1995 and 2005, the approval represents yet another intervention by the federal government to rescue many states currently experiencing severe financial crisis.
It will be recalled that in the early days of the present administration, state governors, under the aegis of the Nigerian Governors’ Forum, made a request for a bailout from the Federal Government to enable them clear arrears of several months’ salaries to their workers.
Consequently, the Federal Government rolled out a relief package involving a special intervention fund packaged by the Central Bank of Nigeria that offered soft loans to the states, ranging from N250bn to N300bn as well as a debt relief programme designed by the Debt Management Office to enable state governments restructure their commercial loans put at over N660bn as of that time.
The whole idea was to extend the duration of such loans, reduce their debt-servicing obligations and put states in a stronger position to at least pay salaries.
The impact of this relief package was negligible or so it seemed. Following sustained pressure by the state governors, the Federal Government in December 2016 released to the states the first tranche of Paris Club refund to the tune of N516.38bn on the understanding that a minimum of 50 per cent would be applied to offset outstanding salaries and pensions.
Sadly, this also yielded very little results not least because many state governors had other priorities.
In May 2017, the Federal Government once again offered another relief package to the state governments to the effect that it would defer deductions from states’ Federation Account Allocations on their restructured loans.
This “deferral”, which was a bailout by another name, amounted to a total of N10.9bn. Barely two months after this package was announced and seven months after the first tranche of the Paris Club refund was released to the states by the Federal Government, the former demanded and got in July 2017 the second tranche amounting to N243.795bn.
Just like the previous rescue packages, the Federal Government had intended that the refund would enable the states to meet their obligations to workers and so had advised state governments to use between 50 per cent and 75 per cent of their share of the refund to clear the arrears of salaries and pensions considering the fact that the non-payment of salaries had contributed to the economic recession.
In search of Buhari’s intervention
Apparently worried by the legion of challenges besetting him, informed sources revealed that Emefiele had on Thursday visited President Muhammadu Buhari at the State House, Abuja, to brief the latter about his travails.
Sources said this is the second meeting with the President since the CBN governor “secretly” returned to the country on January 12, 2022.
Emefiele had earlier on Thursday joined the delegation of the Arab Bank for Economic Development led by its Director General, Dr Sidi Ould Tah.
As at press time it was not clear whether the CBN helmsman got any assurances from Buhari on what could possibly be the aftermath of the relentless battles confronting him on all fronts.
Emefiele, however, filed an appeal against the FHC ruling saying that Justice Ekwo erred in law and occasioned a miscarriage of justice when he made an order compelling his attendance in court for the $53 million debt.
The court had to adjourn the case till March 20, 2023.
