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  • BREAKING: CBN lifts Forex restrictions on importation of 43 items

    BREAKING: CBN lifts Forex restrictions on importation of 43 items

    The Central Bank of Nigeria (CBN) has finally lifted the foreign exchange restrictions it placed importers of 43 items eight years ago. 

    The CBN in a statement signed by Dr. Isa AbdulMumin, the director of corporate communications of the bank, said a significant change has been made in the foreign exchange market policy. 

    Importers who were previously restricted from purchasing foreign exchange for 43 specific items, as outlined in the 2015 Circular referenced as TED/FEFPC/GEN/O1/010 and its addendums, are now allowed to participate in the Nigerian Foreign Exchange Market to buy foreign currency for their transactions.

    As of October 2021, the Central Bank of Nigeria (CBN) had restricted access to Forex from FX market for the following 43 items: Rice, cement, Margarine, Palm kernel, palm oil products and vegetable oils, Meat and processed meat products and Vegetables and processed vegetable products.

    Others are: Poultry and processed poultry products, Tinned fish in sauce (Geisha)/sardines, Cold rolled steel sheets, Galvanized steel sheets, Roofing sheets, Wheelbarrows, Head pans, Metal boxes and containers, Enamelware, Steel drums, Steel pipes, Wire rods (deformed and not deformed), Iron rods and reinforcing bars.

    Read Also: CBN to shelve development financing, says Yemi Cardoso

    Also included on the list were: Wire mesh, Steel nails, Security and razor fencing and poles, Wood particle boards and panels, Wood fiberboards and panels, Plywood boards and panels, Wooden doors, Toothpicks, Glass and glassware, Kitchen utensils, Tableware, Tiles-vitrified and ceramic.

    Textiles, Woven fabrics, Clothes, Plastic and rubber products, polypropylene granules, cellophane wrappers and bags, Soap and cosmetics, Tomatoes/tomato pastes, Eurobond/foreign currency bond/ share purchases, Piston crowns, Ball bearings, High voltage cables, Transformers/switch gears and Gas cylinders were also on list.

    AbdulMumin said the CBN is actively working to address the existing backlog of foreign exchange transactions, and the CBN is currently engaged in ongoing discussions with various stakeholders to find solutions and facilitate the clearance of this backlog.

    A long-term goal of the CBN he added is to establish a unified foreign exchange market, by simplifying and streamlining the FX market in Nigeria. 

    The CBN he stated is in consultation with various market participants to work towards the achievement of this goal, which would lead to a more cohesive and efficient foreign exchange market in the country.

    In trying to maintain price stability within the country, AbdulMumin said the CBN periodically injects funds into the Nigerian Foreign Exchange Market to enhance liquidity. 

    As market conditions improve and become more stable, the frequency and scale of these interventions by the CBN he said will decrease over time.

    The statement reads: the Central Bank of Nigeria (CBN) will continue to promote orderliness and professional conduct by all participants in the Nigerian Foreign Exchange Market to ensure market forces determine exchange rates on a Willing Buyer – Willing Seller principle.

    He said: “The CBN reiterates that the prevailing Foreign Exchange (FX) rates should be referenced from platforms such as the CBN website, FMDQ, and other recognised or appointed trading systems to promote price discovery, transparency, and credibility in the FX rates.

    As part of its responsibility to ensure price stability, the CBN will boost liquidity in the Nigerian Foreign Exchange Market by interventions from time to time. As market liquidity improves, these CBN interventions will gradually decrease.

    He added: “Importers of all the 43 items previously restricted by the 2015 Circular referenced TED/FEFPC/GEN/O1/010 and its addendums are now allowed to purchase foreign exchange in the Nigerian Foreign Exchange Market.

    “The CBN is committed to accelerating efforts to clear the FX backlog with existing participants and will continue dialogue with stakeholders to address the issue.”

    The CBN has set as one of its goals the attainment of a single FX market. Consultation is ongoing with market participants to achieve this goal. Participants and the general public are to be guided by the above.

  • CBN: ‘What is the exchange rate of the Nigerian???’

    CBN: ‘What is the exchange rate of the Nigerian???’

    Perhaps the security forces would prefer not to announce operations ahead of time as it affords the enemy the opportunity to escape or ambush our gallant forces. Secrecy and silence were paramount in security. Maybe the announcement is a cunning military strategy?         

    The CBN team must put a notice in CBN offices asking ‘WHAT IS THE EXCHANGE RATE OF THE NIGERIAN, NOT JUST THE NAIRA? ’. We cannot divorce the naira from the lives of Nigerians. It is a financial fatal mistake for CBN and financial institutions to ignore the Nigerian holding the naira. In medicine and education, we know that naira value determines the quality and quantity of care and education. By now, the CBN leadership would have had a rude awakening from the congratulatory media spotlight having successfully scaled the sometimes-odoriferous political screening procedure. The dream of high office is over, the nightmare of office-holding has begun, or perhaps ‘daymare’ or sleepless ‘night-and-day-mare’? One can only imagine the ‘true talk’ revelations the CBN team face daily especially with the corruption by inactivity and unconstitutional over-activity revealed by the federal government’s forensic investigator, as frightening financial facts are dug up. The team has become fully conversant with funds or the lack of funds and the ever-deepening account of the void in the vault[s] of the deeply wounded or actually raped apex bank.

    The team must know the answer to the first question for the new CBN leadership: ‘Does Nigeria have $3.4billion or $34billion in Foreign Reserves?’ What is the foreign reserve figure? The CBN needs to answer ‘Who or what is the black market in Nigeria?’ The CBN should have a black-market imitator presenting the mind, method and machinations of the black market to predict the cabal’s actions to the CBN’s Daily Emergency Strategic Meeting’.

    The foreign exchange black market is a major cancer in Nigeria and a very expensive debilitating disease, difficult to eradicate and very deadly to the citizenry. Everyone finally realises that everything for transporting life’s daily needs like kerosene, petrol, diesel or gas and food require foreign exchange. Manipulated or not, foreign exchange rate is very relevant to everyone, from baby on powdered milk to grandparent on imported diapers. The stupid saying that ‘good foreign exchange rates and fuel prices only favour the rich and cheat the poor’ is now exposed as the ludicrous lie we have been trying to expose for years.

    Nigeria has managed to create many jobs non-existent elsewhere and refusing to create jobs that exist elsewhere – the ones which make countries great nations. We have an army of aboki forex mules, a cabal to make the dollar crazily more expensive than it should be and ‘fresh naira note sellers’ on the creation side. There is a complete lack of dedicated maintenance staff on the other hand.

    Read Also: eNaira no threat to financial stability, says CBN

    Nigeria demands that the ‘Nigerian Forex Cabal’, a key culprit in our financial wows today, must, like any illegitimate organisation,  voluntarily wind-up operations by being starved of CBN funds needed by legitimate corporate and private individual needs. The cabal must be neutralised, prosecuted and imprisoned for financial terrorism against Nigeria. The CBN collaborators deserve no mercy. The cabal only thrives because someone, somewhere, created an artificial scarcity atmosphere.

    CBN high officials cannot claim ignorance of the source. CBN in collaboration with other relevant agencies especially ICPC, EFCC, etc. must conduct a high-powered investigation to neutralise the kingpins and end this third force assault on Nigerian naira. Can the CBN wrestle the demon of the black-market cabal to the ground or will its corrupt shadow forever dwarf the CBN? Will more dollars fall out of the CBN net, under the radar allowing the cabal to create naira even less valuable than it is now with to crashing through the N1000:$1 ruining pension, salary and manufacturing plans? 

    No doubt the increase in oil price to $92 per barrel should increase our foreign exchange earnings handsomely especially as we majorly reduce oil theft and approach the limit of legal barrels per day to recover from our 44% shortfall. Sadly, even with this anticipated increase in earnings, we have been told that the immediate past government secretly forward-sold our oil and perhaps [mis]spent the foreign exchange in advance and for an undisclosed period. If true, those who did this should be tried for financial mismanagement and abuse of office. The side effect of what should have been a celebratory high oil price $92 bringing much needed massive foreign exchange into Nigeria and the rubbish naira value concocted by the greed-driven foreign exchange cabal is the high market price of oil products.

    Will government have to reintroduce subsidies or give more palliatives to reduce the escalating fuel and transport costs ruining Nigerian families?

    Of course, if CBN could pay off Nigeria’s legitimate corporate and individual immediate accumulated dollar debts as it claims, create the miracle of providing enough dollars for daily legitimate markets with adequate dollars which requires better dollar inflows from oil etc., starve the leakage to the black-market cabal, eliminate the black market and deliberately strengthen the naira, then poverty figures would drop. We need made-in-Nigeria fuel, better power supply, destruction of oil smugglers, elimination of the forex cabal, and immediate ease-of-doing-business promotion of dollar earning enterprises which earn rather than burn foreign exchange. These will demonstrate that the government and CBN at last value the ‘THE EXCHANGE RATE OF NIGERIANS’.

  • Never again

    Never again

    • CBN governors have no business playing politics

    Efforts by the National Assembly to forbid the Governor of Central Bank of Nigeria (CBN) from participating directly or indirectly in partisan politics is a welcome development. Last year’s moves by the former governor of the apex bank, Mr. Godwin Emefiele, to swim in the murky waters of Nigerian politics was an eye opener. It was frightening enough to goad the lawmakers into saying, “never again”.

    Not only did Mr. Emefiele obtain the form to contest in the presidential primary election of the All Progressives Congress (APC), whether in person or through friends, he approached the high court to validate his action. It was unprecedented, brazen and unimaginable.

    It is paradoxical that the head of a bank that has always argued for its autonomy was willing to dabble into partisan politics, explaining that there is nothing in the 1999 Constitution or the CBN Act of 2007 preventing him from exercising his fundamental right to vote or be voted for.

    If we were to go by the logic of Mr. Emefiele, perhaps the Service Chiefs, Chief Justice of Nigeria, and Head of Service of the Federation would be permitted to dive into partisan politics while still holding office, on the excuse that they will be exercising their rights as Nigerian citizens. Absurd.

    Nigerians should realise that morals, values and ethics play major roles in sustaining any society. They form the plank on which laws rest. It is impossible to have all things enshrined in the statute books.

    The British nation is run on the basis of conventions, judicial precedence and a sprinkling of laws. Everybody appreciates the bar and no one attempts to sneak under it. It is our politicians who are always accused of failing to keep to rules, thus necessitating the call for infusion of more technocrats to the governance structure; but the Emefiele experience has shown that there may be no difference.

    This is not the first time that the National Assembly would foresee the danger in such lacuna. Last year, the House of Representatives similarly initiated a law that would forbid the move. However, nothing came out of it until the end of the 9th Assembly. Now that the bill has scaled the first reading, we hope both chambers would be fully committed to seeing it through.

    Read Also: eNaira no threat to financial stability, says CBN

    Besides, there are many such laws that have lacunae being exploited by public officers to trample on national values and interests. Our lawmakers should be diligent and proactive enough to locate them and introduce necessary amendments. We hope the legislators would not fail to spell out penalty for flouting the law as is the case with many existing laws.

    In line with recommendations made by the Minister of Power, Mr. Adebayo, Adelabu, when he appeared before the Red Chamber for ministerial screening, this is an opportunity to whittle down the powers of the CBN governor. The previous governor disregarded every other authority, dealing only with the President, thus making it impossible to harmonise fiscal and monetary policies to the discomfiture of citizens. Mr. Adelabu is in a good position to posit on the subject, having previously worked as a deputy governor of the institution. There is the need to tweak the law to ensure that henceforth, the CBN governor is a team leader. Nigeria has found itself in a deep hole because of the manner former CBN managements handled financial transactions. The ways and means mechanism was frequently abused and the officials got away with it as no sanctions are specified and none applied.

    We do not envy the monetary and fiscal authorities at this point in time. They have come into office at a time that inflation is refusing to be reined in, interest rate has made it impossible for manufacturers and producers to meet their goals, exchange rate soared as soon as the Naira was floated, and petroleum products slipped out of control.

    All, including the President who is Chief Executive of the country, have to roll up their sleeves, set aside textbook prescriptions, and come up with policies peculiar to the Nigerian situation.

    The executive, legislature and general public must work together to get the economic vehicle that has broken down in the middle of nowhere moving again.

  • eNaira no threat to financial stability, says CBN

    eNaira no threat to financial stability, says CBN

    The eNaira is being refined and adjusted in order to enhance the experience of users across various platforms or systems. 

     The Central Bank of Nigeria (CBN) in a statement yesterday, said the goal is to make it easier and more convenient for people to use the eNaira.

     The statement signed by the bank’s spokesman, Dr. Isa AbdulMumin, emphasised the importance of Nigerians adopting this technology. 

     The eNaira is seen as a tool for achieving greater financial inclusion in the country. Financial inclusion means providing access to affordable and convenient financial services to all individuals and businesses, including those who are unbanked or have limited access to traditional financial services. 

     By embracing the eNaira, more Nigerians can gain access to a range of financial services, which can help improve their economic well-being and participation in the formal economy.

    Read Also: World economy incomplete without  prosperous Africa

     According to Isa AbdulMumin, “the eNaira structure continues to evolve and undergo modifications targeted at improving the user experience across all interfaces. We encourage Nigerians to embrace the technology for, amongst other things, greater financial inclusion.”

     The CBN released the statement in response to news reports suggesting that the Central Bank Digital Currency (CBDC), the eNaira, poses a threat to the country’s financial stability. 

     After reviewing the reports, the CBN determined that there was a lack of understanding regarding certain aspects of the bank’s recently released book, “Economics of Digital Currencies: A Book of Readings”. 

     The CBN clarified that the book highlights issues and challenges in the implementation and adoption of CBDCs, emphasizing the potential threat they pose to financial stability as speculative investments. 

     The media reports that raised concerns about the eNaira’s potential risks to financial stability were deemed “unconvincing” and the CBN urged Nigerians to embrace the technology for greater financial inclusion. 

     The eNaira structure, AbdulMumin said, is evolving and undergoing modifications to improve the user experience.

  • Fintechs gain more grounds as CBN tightens regulation

    Fintechs gain more grounds as CBN tightens regulation

    The determination to serve the under-served majority in the Nigerian financial sector has brought more financial technology firms into limelight. But the operators have come to face new challenges of compliance with Central Bank of Nigeria’s (CBN) operational guidelines for banks and other financial institutions, writes COLLINS NWEZE 

    Banking in Nigeria remains an attractive sector, with over N3.7 trillion  in value addition to customers. 

    McKinsey & Company, a global management firm, report says  despite high levels of competition, the majority of consumers remain underserved. 

    Lack of access to services, especially in rural areas, inaffordability, and poor user experience  contribute to the frustration consumers experience across the customer spectrum.

    This has created an opening that fintechs have been quick to take advantage of, with many stepping up to develop enhanced propositions across the value chain to address pain points in affordable payments, quick loans, and flexible savings and investments, among others.

    At the same time, a youthful population, increasing smartphone penetration, and a focused regulatory drive to increase financial inclusion and cashless payments, are combining to create the perfect recipe for a thriving fintech sector. 

    Read Also: Nigeria Customs Service probes $40m Arik Air aircraft deal

    Nigeria is home to over 200 fintech standalone companies, plus many fintech solutions offered by banks and mobile network operators as part of their product portfolio. 

    Between 2014 and 2019, Nigeria’s bustling fintech scene raised more than $600 million in funding, attracting 25 per cent ($122 million) of the $491.6 million raised by African tech startups in 2019 alone—second only to Kenya, which attracted $149 million.

    The Central Bank of Nigeria (CBN) has, on the need to boost financial sector security, put the Fintechs under regulatory scrutiny. 

    In many cases, apex bank had, through court order, froze the accounts of some fintechs allegedly involved in fraudulent financial activities. The move were part of the tightened regulatory surveillance to put the operators under check.

  • As Cardoso takes charge at CBN

    As Cardoso takes charge at CBN

    By Haruna Lawal

    With the appointment and confirmation of Michael Olayemi Cardoso as helmsman at the Central Bank of Nigeria (CBN), the much-anticipated stability in the management structure is expected to begin to take shape. With this development, many an analyst, have devoted time and energy to unveiling the new central banker in relation to the task ahead as the economy continues to struggle to cope with multiple pressures that are impacting harshly on the citizens.

    The new CBN helmsman faces spiking inflation, higher interest rates, a falling bank adequacy ratio, volatile exchange rate among others which will test his preparedness for the job. There is no contesting the fact that Cardoso’s appointment is well deserved having proven his mettle elsewhere.

    In confronting these and other challenges, he will be expected to commence the recapitalization of the banking sector. This is imperative as the value of the naira continues to drop in the market. Similarly, he will also strive to restore confidence to the foreign exchange market, deepen and ensure efficiency of the financial system, capital requirements for banks, addressing ways and means financing of fiscal deficit as well as completely jettisoning the controversial naira redesign policy. Others are the tenure and cost of funds in the banking system, reducing concentration of risks in banking sector, initiation of stakeholders’ engagement and corporate governance.

    Cardoso is assuming the leadership of the CBN at a very crucial time in the nation’s economic history. There is no gainsaying it that a serious confidence crisis in the foreign exchange market is fuelling an unprecedented speculative onslaught on the naira. Similarly, the economy is grappling with severe adverse effects of depreciating exchange rate, soaring energy costs, ravaging inflationary pressures, huge backlog of foreign exchange obligations that needs to be cleared and debt service obligations that need to be redeemed.

    Read Also; FG to give N25,000 grant to vulnerable pensioners

    The economic management orthodoxy of market forces has been called to question in the country following the social outcomes of the recent market-oriented reforms. But on the part of the CBN, it is pertinent to enjoin Cardoso and his team to ensure strategic and transparent intervention in the foreign exchange market in order to minimise volatility.

    Similarly, the CBN under this new management may have to look at the import and export (I&E) window and possibly create an autonomous window in the banking system where the currency can trade freely without any encumbrances. This is necessary to avert the diversion of remittances to other jurisdictions or the black market.

    Perhaps, drawing from the experience of foreign airlines some of which are looking elsewhere for business opportunities as a result of the government’s inability to satisfy their foreign exchange earnings, it is imperative that the government accords high priority to this area so as to restore the confidence of domestic and foreign investors.

    Before his appointment,Cardoso, had served in Lagos State under Governor Tinubu as Commissioner for Economic Planning and Budget. In this regard, he is considered an expert in fiscal policy as against the perceived mandate of the Central Bank, as an agency of government that superintends over monetary policy and microeconomic issues. Many also argue that this may not matter much considering the fact that one of his predecessors in office, Adamu Ciroma, a history graduate, who was appointed by General Murtala Mohammed as CBN governor, was assessed to have performed well in that office. That he later served as Minister of Finance, attests to this assessment.

    Regardless, he is coming into office at a time of heightened expectation- runaway inflation, fledgling value of the nation’s legal tender, the Naira, vis-à-vis other international currencies, exchange rate challenges, price instability among many other issues that are plaguing the economy.

    It is from this point of view that one is persuaded to posit that Cardoso has his job cut out for him.

    Nigerians expect him to hit the ground running and put in place policies that will bring the economy under control by fashioning out implementable monetary policies that will, hopefully, energise the micro economic issues the president will act on in his determination to give the economy, generally, the desired kiss of life.

    Beyond these general assumptions about his duties as the CBN governor, it is important to put him on notice that there is an urgent need to stabilize the price mechanism that has been impacting negatively on the economy, heating up the system and generating inflationary trends that are unhealthy and unacceptable. He is expected to bring down inflation, currently at double digit levels. He must not wait to be told that the society is finding it difficult to cope with the enormous challenges presented by an economy in distress. As a key economic adviser to the president, he will be expected to think on his feet and outside the box to initiate policies that are people- friendly.

    Another aspect of the economy that is responsible for the seeming crisis in the economy, regarded as exceedingly import- dependent, is the alleged political interference in the foreign exchange management. If this is the true position, it becomes hasty to envy him his appointment because the demands are not likely to ease anytime soon. However, Nigerians expect him to step on toes, including sensitive ones, in the management of the nation’s dwindling foreign exchange.

    It will, also, not be out of place, to expect the CBN governor to insist on the independence of the apex bank so as to avoid the abuse experienced lately in its application of the ways and means policy that almost turned it into the piggy bank of the executive branch.

    It is heartening to note that he has pledged to accord priority to clearing the backlog of unsettled foreign exchange obligations, enhance transparency, fix corporate governance and ensure confidence in the autonomy and integrity of the bank. Judging by his vast experience, the CBN governor has what it takes to give the apex bank a new lease of life and ultimately ensure the building of a virile economy.

    • Lawal, an economist, wrote from Lagos.

  • CBN, Interswitch partner on financial inclusion

    CBN, Interswitch partner on financial inclusion

    Interswitch, one of Africa’s leading integrated payments and digital commerce companies, proudly announces its Platinum Sponsorship of the second edition of the International Financial Inclusion Conference (IFIC). 

    This prestigious event, organized by the Central Bank of Nigeria (CBN), is scheduled to take place on October 5th and 6th at the Landmark Event Centre in Lagos.

    The IFIC, a significant gathering of thought leaders, financial services providers, regulators, development partners, and other financial inclusion stakeholders, aims to deliberate on contemporary developments, address challenges, and propose solutions to foster a more inclusive financial system. 

    Themed ‘Financial Inclusion for All: Global Insights for Local Impact’, the conference underscores the CBN’s dedication to extending financial services and opportunities to underserved or excluded individuals within the formal financial system.

    Interswitch’s sponsorship of the conference reflects its unwavering commitment to promoting financial inclusion and sustainable economic development. Mitchell Elegbe, Founder and Group Managing Director of Interswitch expressed the company’s mission to make digital payments and financial services accessible to all. 

    Read Also: What the new CBN leadership should focus on

    He stated, “At Interswitch, we are driven by a mission to make digital payments and financial services accessible to everyone. The CBN’s International Financial Inclusion Conference aligns perfectly with our vision, and we are delighted to be a part of this global conversation. As a pioneering supporter and enabler of the National Financial Inclusion Strategy, we are indeed pleased to sponsor the International Financial Inclusion Conference and look forward to engaging with other stakeholders and exploring innovative solutions that will move us closer to achieving universal financial inclusion.”

    The event promises a diverse range of activities, including networking sessions, exhibitions showcasing groundbreaking financial inclusion solutions, the prestigious Financial Inclusion Awards, and stimulating panel discussions featuring industry experts such as Titilola Shogaolu, Managing Director of Interswitch Financial Inclusion Services (IFIS) who will be on one of the panels to discuss ‘Fintech -Enabled Financial Inclusion: Last Mile Solutions’.

    Interswitch remains steadfast in its commitment to enhancing financial services and advancing financial inclusion through groundbreaking digital solutions and products and continued collaboration with esteemed industry leaders such as the Central Bank of Nigeria (CBN).

  • What the new CBN leadership should focus on

    What the new CBN leadership should focus on

    • By Ola Oladele

    Sir: With inflation at an all-time high, exchange rate hovering around N1000 to the dollar, and unexplained unemployment rates, forgive me for being cautiously optimistic about the announcement of the new leadership team at the Central Bank of Nigeria.

    The CBN is key to sustaining and growing our economy to the point where every economic challenge is somehow tied to their action or inaction.  As Bruce Lee the Hong Kong-American martial artist and actor said, a successful warrior is the average man with laser-like focus.  Therefore, in all that needs to be fixed in our dear nation, this new team needs to focus on a few things for maximum (and widespread) impact. 

    Price stability: the current widespread worry/ fear, despair in our society is a direct result of uncertainty.  Where are we going? Will I be able to pay January school fees at this rate? Are we going to two thousand naira to the dollar? Individuals and businesses need clarity to plan and subsequently stop buying dollars ‘just in case’. 

    For most people, the fact that they don’t know the planned direction of the currency is worse than the fact that it is hovering around a thousand naira right now.  Why? No one would want to buy at the current rate for a December obligation only to find the exchange rate at N750, for example.  Neither would you want to refuse to buy at the current rate and then find it at N1300, for example, in November.  We need three months, six months and even up to 18-month target exchange rates along with the strategy to achieve stability. 

    There is a weak vote of confidence in the Naira; once the CBN achieves these time-bound goals, everyone will begin to calm down.  However, guidance and strategy must come together.

    Nigerians witnessed an onslaught of direct financial interventions by the CBN in the tenure of their former leadership.  While the intention was well-meaning to fund specific sectors and spur growth, the result was increased money supply leading to inflation and low economic impact due to inadequate monitoring of the recipients.  Going forward, let the CBN return to being the lender of last resort and even then, only to banks and financial institutions as we were taught in Economics 101. 

    Read Also: How to prevent Military rule in Africa, by Ganduje

    If the CBN wants banks to lend at single digits, it should reflect in Cash Reserve Ratio, standing deposit rates, liquidity ratio and in the deployment of liquidity management tools in the interbank market.  The CBN as big brother should engage the executive to resolve the infrastructural bottlenecks that result in higher rates.  This way, our banks and financial institutions will be financial system pillars and not CBN representative offices. The system is stronger when every part is supported, required and monitored to play their own roles effectively.  It won’t happen overnight, but let’s start the journey.

    Financial Inclusion: The more Nigerians we have actively participating in the financial system, the more effective CBN’s policies will be.  The World Bank’s global financial inclusion database 2022 states that 64.8% of Nigerians have access to at least one financial service.  While this is a massive improvement from 36.8% in 2011, about 30% of the total money supply (over N13 trillion) is in paper cash.  This means that the impact/ efficiency of CBN policies to steer the Nigerian economic ship is capped at less than 70% at any point in time, and most likely even less.  Licencing and support for financial technology solutions to deepen penetration is an urgent need to support trade and economic growth.

    Our economy and people have taken a bashing in recent times and the CBN has in the past, promised us things they had no power to unilaterally deliver on.  Using commercial banks as a metaphor, the CBN is like the FINCON (financial control) unit – very key to the bank but not a revenue generating team.  They are to manage the reserves and not create the reserves.  Their role in job creation is to create the economic environment to support businesses that will grow and then hire.  If the environment is right, banks will give loans – and at affordable rates too. 

    Seeing that short term interventions haven’t worked, let’s try long term transformational and self-sustaining initiatives. As the great man Steve Jobs said, focus is about saying no.

    •Ola Oladele, CFA,

    <oler@themoneywitclub.com>

  • Shake-up likely in CBN board

    Shake-up likely in CBN board

    A major restructuring of the board of the Central Bank of Nigeria (CBN) is underway as part of plans to fully align the institutional perspective of the apex bank with the ongoing reforms.

    The board of the CBN is made up of five executives and seven non-executive members. The five executive members are the Governor and four deputy governors.

    President Bola Tinubu had appointed new CBN executive management on September 15, 2023. The Senate last week confirmed the appointment of Dr Olayemi Cardoso as the 12th substantive Governor of CBN alongside four deputy governors- Mrs. Emem Usoro, Mr. Muhammad Dattijo, Mr. Philip Ikeazor, and Dr. Bala Bello.

    Multiple sources in the know of the undercurrents yesterday said the composition of the board of the apex bank may soon change in order to give the apex bank a clean start and realign it with the reform mandate of the new CBN management.

    “Fresh thinking and ideas is sorely needed in the management of our finances at this time,” a source said.

    According to the source, the board of the apex bank could not be divested from its activities, thus the extension of the sweeping change of the executive management to the board.

    A source pointed out that given the rationales for the appointment of the new executive management, the government would want people with the same philosophical views to compliment the new executives.

    “With reconstitution of the board of governors, it’s only a matter of time for the main board which incidentally is headed by the CBN Governor, to be reconstituted,” another source said.

    The organogram of the apex bank places the board of directors as the highest organ, followed by the office of the Governor and then, the four deputy governors.

    The current non-executive board members and directors of the apex bank included Prof. Justitia Nnabuko, Adeola Adetunji, Prof. Mike Obadan and Prof. Ummu Jalingo, who were all appointed on July 07, 2018.

    Read Also: PDP will not exceed four years in Osun, says APC council chair

    Others board members and directors included Dr. Abdu Abubakar, who was appointed on April 04, 2019 and Mr. Aliyu Ahmed, who was appointed on September 25, 2020. The Accountant General of the Federation, Mrs Oluwatoyin Madein, became a board member on May 18, 2023, in line with extant rules.

    Ahmed, who became a director and board member by virtue of his appointment as the Permanent Secretary of the Federal Ministry of Finance on September 24, 2020; recently retired. In line with the provision of the Central Bank of Nigeria (CBN) Act, Ahmed will be replaced with the new Permanent Secretary of the Ministry of Finance.

    Nnabuko, a Professor of Marketing, is an academician with a wealth of experience and has served in various capacities at the University of Nigeria (UNN).

    Adetunji, an Economist, has a long distinguished career in the private sector, including as Managing Director of Coca-Cola Nigeria Limited and Coca-Cola Sabco North & East Africa.

    Obadan, a Professor of Economics, has served in several positions locally and internationally, including as Director-General, National Centre for Economic Management and Administration (NACEMA), Dean of the Faculty of Social Sciences, University of Ibadan and Chairman, Economics Policy Analysis and Management Network (EPANET), Harare, Zimbabwe.

    Jalingo bagged her Phd. in Economics from the Usman Danfodio University (UDU), Sokoto with specialisation in Aviation Economics. She was the Head of the Economics Department, Bayero University (BUK), Kano and currently, Director of the Centre for Social and Economic Research (CSER) at the Federal University, Dutse.

    Abubakar, an expert in Construction Economics and Management, has over 30 years academic and working experience. He has held various positions in both the private and public sectors including as Executive Director, Banking Operation and Services at First Bank Plc, Special Assistant to the Minister of State for Education and Special Adviser to the Governor of the Central Bank of Nigeria on Private Sector and Parastatals.

  • As the CBN gets a new boss

    As the CBN gets a new boss

    It is a new dawn at the Central Bank of Nigeria as the Senate, the upper chamber of the National Assembly, screened and approved the nominees of President Bola Tinubu to pilot the affairs of the monetary institution. The President appointed the new Governor, Dr. Olayemi Cardoso, and four Deputy Governors to assist him to run the affairs of the Bank. They are Mr. Philip Ikeazor, Mr. Mohammad Sani Datti, Mrs. Nnana Usoro, and Dr. Bala M. Bello. Their appointment came on the heels of the suspension and subsequent resignation of the former Governor, Mr. Godwin Emefiele.

    The former Acting Governor, Mr. Folashodun Shonubi, Mr. Edward Adamu, Mrs. Aishah Ahmad and Dr. Kingsley Obiora also resigned their appointments after the announcement of the new managers to pave way for their screening, and eventual assumption of office.

    The CBN in recent times has been in the eye of the storm following the former governor’s tenure in office. His foray into politics was contentious. If it could be recalled, the former governor was alleged to have procured a nomination form during the last political exercise of 2023 to contest for the presidency of the country. The move attracted the wrath of politicians and critical financial stakeholders who considered the move an aberration by a sitting governor of the Bank. Public outcry subsequently made him to jettison the ambition. Ever since the Bank knew no peace. All its subsequent pronouncements and actions were tagged political.

    Mr. Emefiele’s Naira redesign policy, a good initiative though, poorly implemented, revulsed Nigerians who felt humiliated, frustrated, lost businesses, and considered their monies confiscated.  They were miffed, the anguish was visible and unbearable. That singular action turned people against the CBN. At the same time, the political class who felt the policy was targeted at them saw it as a vendetta for their opposition to his ill-fated political ambition. They never forgave him, and Nigerians equally called for his head.

    As the Bank gets a new driver, it is hoped that the Naira, which is currently badly battered will start to regain its breath. It is also expected of the political class to allow the currency a fresh breath of air. The politicians have strangulated the Naira, and it needs strength. They are classically its problem and can still rescue it. They have lost faith in the Naira, our national identity, preferring to hold the dollar and other currencies as stores of value.

    It is no gainsaying that the task ahead has been cut out for the new CBN governor, and Nigerians will be leveraging his pedigree as a financial technocrat to prove his mettle and rescue the domestic currency from its current travails. However, the job is not for Mr. Cardoso and his team alone, the fiscal authority must help the Naira to live. The government must come forward with policies to energize the economy.

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    The problem of the Naira is Nigeria’s overdependence on proceeds from oil. The opaquely riddled sector has been a curse rather than a blessing to the nation.  Crude oil theft has remained unabated, oil subsidy a scam, and poor, yet unprivileged Nigerians, bore the brunt.  Nigeria was also not producing to feed or export, but heavily reliant on importation of what it can produce and eat. The desire to diversify the economy has not been matched with action. The intractable insecurity challenge has consumed the food producing belt of the country due to the repressive activities of bandits, and other ancillary issues that has eroded the potency and viability of the economy.

    The new CBN Governor no doubt has a daunting task ahead of him. It is not a good time to be appointed for such an onerous job. The economy is challenged, and Nigerians are on the edge, frustrated, and forlorn, thus, the touted synergy and alignment of purpose by the fiscal and monetary authorities is more desirable now than before. Working at cross purposes to outdo each other will further hurt the economy.

    Urgently desirable also is the solution to banditry. It has wreaked havoc on the economy and must be addressed now. It has taken too long. Foreign investors have taken flight, even local counterparts have either shutdown or relocated, forcing the economy to its knee. Equally desirable is adequate, and not epileptic power supply. Most manufacturing firms have been operating under excruciating conditions, and cost of alternative energy to remain in production is adding more pains, not to talk of scarcity of forex to procure materials and machineries.

    The situation is overwhelming; thus, it is not a time to plays politics, but for every hand to be on the deck to rescue Nigeria. No foreign investor will bring his/her hard-earned money to an unsafe economy. It is also imperative, and expedient, for the government to have respect for the independence of the CBN. The overbearing attitude of past administrations on the Bank was visibly nauseating that made stakeholders to ask where the independence of the Central Bank is. As the government financial advisor, and banker, mandated to ensure and maintain price and financial stability, it should be left to perform its duties as it is best practiced globally. Political interference would not give us a desirable central bank. Nigerians have lost confidence in the Bank considering happenings in and around the Bank lately, and it will assuage their feelings if this conundrum is rested by these fresh appointments.

    • Ademola Oyetunji writes from Ibadan.