Director of the Centre for Economic Policy Analysis and Research of the University of Lagos, Professor Ndubisi Nwokoma, has stated both his concerns and expectations for the president’s recently nominated candidate for the position of the Governor of the Central bank of Nigeria.
Bola Ahmed Tinubu, the President of Nigeria nominated banking expert, Olayemi Cardoso to take up the position of Governor of the Central Bank of Nigeria. According to a Presidential statement delivered by the Presidential Spokesman, Ajuri Ngelale on Friday, the governor will now serve a 5-years tenor whereas his confirmation is as he is under screening by the Senate. Cardoso is to take over from Folashodun Shonubi who is acting CBN governor. Cardoso is a former commissioner of Nigeria’s first stand-alone ministry of economic planning and budget in Lagos state.
In an ARISE NEWS interview on Monday, Prof. Nwokoma raised the question of if there is truly a vacancy since the previous governor Godwin Emefiele was only suspended and not exactly removed. He also questioned Cardoso’s capacity to handle monetary policy and macroeconomy in bringing balance leading to enhanced economic growth. His concerns were bordered around the notice that there was no history of it in the portfolio of the candidate who is a “banker, not an academic.”
He stated that since the nomination has been made, the incoming governor should focus on creating price stability in a nation that has suffered heavily from inflation and also look into political interference in the use of foreign exchange to ensure stability.
“Monetary policy is very critical. It’s the core function of the central bank of any country.”
According to him, “In many other jurisdictions, you must have a core knowledge of micro economic policy. Bankers have their strengths and strong points but a banker needs to have a broader view and not micro manage because there is this tendency for a banker to micro manage a number of times. But we don’t have to micro-manage to look at the big picture and you need the big picture to be a successful CBN governor.
“It’s too late now and he’s been nominated. He has banking experience but however maybe he needs to acquire some more knowledge. He’s been more involved in the fiscal side but I didn’t see much of monetary policy in his portfolio.
“If he doesn’t get monetary policy right, he will have inflation jumping around.”
Nwokoma advised that the deputy governor assigned to him should be vast in that aspect of monetary policy to create balance. He, however, also stated that Cardoso has the upper hand from winning the confidence of the president but hopes that his nomination is in the interest of the economy.
The professor pointed out that foreign exchange has been a cause of concern over the years and blames it on bad management of the supply of demand stating that the economy has to be made attractive.
“For people to be able to bring foreign currency into your economy they must find it attractive. Over the past few years we have had the level of capital importation going down the drain. Under Emefiele, though one would not blame the CBN governor for that, the level of instability in the system and unfavourable operating environment, won’t allow foreigners bring in foreign money, that affects the supply of foreign exchange.”
He added that the need to buy foreign goods should be addressed and try to promote local industries stating that the exchange rate is not something we can support.
In conclusion he stated that the incoming CBN governor should work hand in hand with the Minister of Finance, Wale Edun, to create job opportunities through local production.
“Monetary policy is the core function of the CBN while Fiscal policy is the function of the minister of Finance. They will need to work together. Good enough they are from the same political group. There is a need for them to harmonize.”