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PeeCeeJay By Jideofor Adibe
Emefiele: Clueless or Just a Fall Guy?
This reflection was inspired by the ‘crisis of confidence’ that currently surrounds the Central Bank Governor, Godwin Emefiele, over his continued stewardship of the apex bank following what we now call ‘Dasukigate’ and the massive depreciation in the value of the Naira at the Black or parallel market. For instance the Serving Overseer of the Latter Rain Assembly, Pastor Tunde Bakare, who was also Buhari’s running mate in the 2011 presidential election argued that it would be unfair to prosecute Sambo Dasuki, the immediate past National Security Adviser for allegedly misappropriating the money meant for arms purchase while the CBN governor, who released the money to Dasuki, was allowed to remain in office. In a similar note, Professor Chukwuma Soludo, former Governor of the Central Bank alleged that former President Jonathan ran the Central Bank of Nigeria (under Emefiele’s watch) like the Ugandan maximum leader Idi Amin who, in a movie had to order the country’s equivalent of our CBN Governor to print more money whenever he was told his country was going broke.
Questions have also been raised about Emefiele’s competence, with suggestions that he is underperforming. Joseph Sanusi, who was appointed CBN Governor by Obasanjo shortly after being sworn as President in 1999 for instance argued that it was wrong for the government to foist commercial bankers who were previously regulated by CBN Deputy governors on the latter as their bosses when such commercial bankers have not imbibed the institutional culture of central banking. Joseph Sanusi was already Deputy Governor of the CBN when he was elevated to head the apex bank. Emefiele who was appointed as CBN Governor on June 3 2014 was until his appointment the Chief Executive officer and Group Managing Director of Zenith Bank. He had been Deputy Managing Director of the bank since 2001 before he was appointed to take over from Jim Ovia as the Bank’s MD in 2010.
I do not know Emefiele from Adam and my aim here is not to defend his tenure as CBN governor. Rather my objective is to interrogate some of the allegations against him – moral impropriety over the Dasukigate, not standing up to former President Jonathan who allegedly turned the CBN into an ATM and for allegedly not providing convincing leadership in the current economic crisis as epitomized by the huge depreciation in the value of the Naira at the parallel markets and the criticism that dogged the CBN’s ban on the importation of 41 items, including tooth picks. It is hoped that by interrogating these events the proper lessons that should be learnt from them will not be lost in our simplistic desire to find a culprit.
Dasukigate
For me the key lesson from ‘Dasukigate’ goes beyond the alleged sharing of mouth-watering sums of money meant for arms purchase to the issue of how security votes for President and Governors are used. I learnt that the National Security Adviser manages the security vote of the President and that traditionally there is an ‘elongated’ definition of ‘security’ – for both the President and State Governors. In other words, while ordinary Nigerians may conceptualize security strictly in physical terms – the physical protection of the Governors and the President - it would seem that the designers of the idea of ‘security vote’ borrowed from the United Nations Development Programme’s (1994) notion of ‘human security’, where anything that is capable of threatening the happiness of an individual - including the inability of a man to find a wife or vice versa could be securitized (i.e. become a security issue). In other words, what constitutes security appears to be left at the discretion of those who enjoy such a privilege – creating a huge room for abuse. In this sense ‘Dasikugate’, more than anything raises question about the meaning of ‘security’, the management of security votes and the sources of campaign finances for political parties – not just for the PDP.
Turning the CBN into an ATM of the President
That the CBN Governor allowed the carting away of huge sums of money from the apex bank’s vaults on the say-so of former President Jonathan without apparently raising objections may be less Emefiele’s fault than it result of the ‘banana republic’ character of the state. In banana republics the word of the maximum leader is law. And Nigeria till this day still exhibits the symptoms of a banana republic – including at the state levels where the Governors are the equivalent of sea monsters. In banana Republics, which agency head, whether CBN Governor or not can really stand in the way of the instructions or even the body language of the maximum leader? Therefore an important takeaway from this is that our institutions, not any individual, are just too weak to resist any irrational demand of the maximum leader.
Import bans and the collapse in the value of the Naira
Banning the importation of certain items such as tooth picks and Indian incenses as a way of conserving foreign currencies may play well with national pride but they are also bound to attract criticisms from critical global media and financial analysts which are quickly reproduced at the national level to reinforce other existing disaffections. This is not to deny that some of the Bank’s policies are rather bizarre - such as preventing people who sourced foreign currencies from the ‘black market’ or elsewhere from paying such money into their local domiciliary accounts (the policy has now been reversed).
On the collapse in the value of the Naira at the parallel market, one does not need to be an economist to know that the slump in crude prices from the highs of over $100 per barrel to less than $30 per barrel will have adverse effects on the supply of foreign currencies. The economy is not only highly dependent on oil for its foreign exchange earnings; the country is also import dependent addicted. For instance while the CBN’s monthly foreign earnings have fallen from a monthly average of $3.2 billion to about $1 billion, import bills have ballooned in the last ten years – from N148.3bn in 2005 to N917.6bn in 2015, an increase of 519 per cent. About 40% of official foreign exchange demand in the country is for the importation of refined petroleum products.
It is possible that CBN’s mode of handling the current economic crisis may not be optimal. But a key question is whether there is enough room for the policy makers to choose alternative policy options without being constrained by the President’s famed body language and preferred policy options. As we know the president’s brand of economics appears to be cynical of ‘market determinism’ and favours command and control.
Who do we need as CBN Governor?
More than anything else, the moral and competence questions surrounding Emefiele’s continued leadership of the apex bank raises an even more fundamental question of the sort of personality we need as CBN Governor. Joseph Sanusi, who became CBN Governor from the rank of Deputy Governor of the Bank argued that future CBN Governors should be appointed only from among the Deputy Governors of the Bank. The truth however is that whether the head of an organisation or firm should be appointed from within or outside the organisation has always been controversial. Suffice it to add that two of the most distinguished (in my opinion) of the country’s CBN Governors - Professor Chukwuma Soludo and Sanusi Lamido Sanusi - (now Emir of Kano) did not come from within the Central Bank. While Soludo had a background in the academia, Lamido Sanusi, like Emefiele, had a background in commercial banking. Remarkably while Soludo was a full time academic, both Lamido Sanusi and Emefiele had stints in academia before joining commercial banking. Lamido Sanusi briefly taught economics at Ahmadu Bello University Zaria (1983-1985), while Emefiele taught Finance and Insurance at the University of Nigeria Nsukka and the University of Port Harcourt before joining Zenith bank.
The three are different personality types. While Soludo was a flamboyant academic – he turned an otherwise innocuous position of CBN Governor into a celebrity position – he was very much an establishment person who wanted to be both seen and heard. Sanusi on the other hand was not only a flamboyant man who a wanted to be both seen and heard, he was basically an anti-establishment person who did not mind expressing his views on any political issue. I once described him as a “radical in a conservative job”. Emefiele on the other hand appears to be a throw-back to CBN Governors in the pre-Soludo and Sanusi era. He is neither flamboyant nor does he give the impression that he is eager to be seen and heard – like his last two predecessors.
A crucial question here is whether the apparent dissatisfaction with the way Emefiele does his job is, at least partly, merely a misplaced nostalgia for Soludo and Lamido Sanusi? |