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Godwin Emefiele

27.05.2022 Featured Naira Fall, Food Scarcity … CBN Governor Godwin Emefiele’s Scorecard

Published 27th May, 2022

By Tola Owoyele

In early May, Godwin Emefiele, Governor of the Central Bank of Nigeria (CBN), became a topic of discussion when he signified interest in running for the office of the president in 2023.

Before his declaration, Emefiele had been rumoured on several platforms to be in the race for the All Progressives Congress (APC) ticket to succeed President Muhammadu Buhari. His eventual decision to run generated a lot of opinions, with many calling for his resignation from an office they believed should be held by a non-partisan professional.

Responding, Mike Ozeknome, Emefiele’s lawyer, argued that the governor would only resign from office on moral grounds and not on points of law.

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Ozekhome went on to file a suit against the Independent National Electoral Commission (INEC) and the Attorney-General of the Federation to prevent them from stopping Emefiele and his presidential ambition. However, news emerged on May 25 that the CBN Governor had withdrawn his suit based on an agreement with Buhari that he would continue his job and forget the presidency.

On Wednesday, it was rumoured that the president had eventually sacked him, but this was quickly debunked by the CBN. Since his controversial ambition made headlines, Emefiele has become a darling of the media, and many Nigerians may want to know a little more him. Here’s his scorecard as CBN Governor.

NAIRA TO DOLLAR

When Emefiele took office in March 2014, a US dollar exchanged for NI64, but the official exchange rate is a dollar to N419 today. This means the naira has become 62 percent weaker.

In the parallel market, the situation is worse, as the naira has weakened from N180 to a dollar to N605 to a dollar. This is a 70.5 percent depreciation of the naira in eight years.

This depreciation occurred, despite the attempts made by the apex bank to boost dollar inflow and save the currency in recent times.

Some of the measures the CBN took were the introduction of the “Naira 4 Dollar Scheme” intended to boost the inflow of diaspora remittances into the country, and the adoption of the Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate as the benchmark rate.

Other measures were the discontinuation of foreign exchange (forex) sales to Bureaux De Change (BDC) operators and introduction of the eNaira, the continent’s first digital currency, in October 2021.

Despite all these measures, the naira retains its unprecedented weakness.

ANCHOR BORROWERS PROGRAMME AND FOOD INFLATION

In November 2015, the federal government, through the CBN, launched the Anchor Borrowers Programme (ABP).

The initiative was designed to inject funds into the country’s agricultural sector by assisting smallholder farmers with loans that would encourage an increase in productivity.

However, farmers from the southwest, south-south and southeast said they were not feeling the impact of the scheme. They also alleged favouritism in the selection of beneficiaries.

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In December 2021, food inflation rose to 17.37 percent from 17.21 percent in November. The inflation occurred despite the unveiling of the rice paddy pyramids in Abuja the same year.

In January, Emefiele was quick to dismiss the development, saying it was temporary. He attributed the issue to the destruction of perishables while being transported to the market. He also blamed the activities of hoarders.

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GROUPS PROTEST AGAINST EMEFIELE IN 2021

In December 2021, civil society organisations like Sustainable Development Advocates, Nigeria Acceptability Project, Niger Delta Forum for Good Governance and Women for Good Governance protested and called for the removal of Emefiele over his ”poor administration of fiscal and monetary policies”.

The group claimed that the governor’s policies had further worsened the economic situation of Nigerians. The groups stated that some of the economic programmes devised to alleviate poverty in Nigeria had been ”messed up” by Emefiele.

“Mr President, of fundamental reference is the gross abuse, mismanagement and incompetence of the management of the Central Bank of Nigeria (CBN) under the headship of Mr Godwin Emefiele. We have seen mismanaged fiscal and monetary policies that have increased the inflation rate and weakened naira that has affected our foreign exchange earnings,”a letter addressed to the president and signed by the organisations’ executives read.

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“It is on record, that despite the massive commitment and investment of your administration in programs that seek to alleviate poverty and empower Nigerians, ahead of moments, such as the impending removal of fuel subsidy, the CBN has squandered the opportunities provided by such, as the bank under Mr Emefiele became an institution run like a private enterprise, mainly for the benefit of friends, cronies and families of Mr Godwin Emefiele. 

“We are worried that the CBN is unbending despite calls by stakeholders and Nigerians to adjust its dangerous policies which have badly impacted negatively on our economy, making our economy to further nose dive with weakened naira.”

The group ended the letter by calling for Emefiele’s immediate sack.

Published 27th May, 2022

By Tola Owoyele

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