Emefiele: Re-enforced Incompetence
On January 27,2016, the Naira lost 25% of its value against the dollar and then on February 2,a week later, the NNPC, the nation’s oil company ,announced an operational loss of $150 million. At the time, the administration was about 7 months old and yet to know why it came to power. The losses ( value of currency and oil revenues) will continue as it turned out. When it got worse, Mr Emefiele began to speak in echo chambers as was his colleague at the NNPC, Ibe Kachukwu. Here is one of his many verbose but essentially meaningless statements.
“I want to assure Nigerians that we are seeking ways to improve the foreign exchange supply into the market. And as we eventually achieve this objective, this will be unfolded, so as to ensure that we fund the forex market appropriately.
“I am sure in the course of time you will begin to see some of the efforts that we are putting in place so that you begin to see how we will provide some sort of flexibility in the market. And also deepen the market so that businesses can continue the way they are supposed to be.”
“With time you will see how we will provide the needed framework for a flexible forex regime”.
Mr Emefiele made those statements at a Monetary Policy Meeting in Abuja on Tuesday, February 4, 2016.At the time , we didn’t think he was right and how prophetic that turned out as the currency would fall further, bank shares plunged, factories shut down ,unemployment ,layoffs became a quotidian and a recession followed.
As these went on, Mr Emefiele had no answers or even if he did, his masters would not listen to him. Those who wouldn’t listen to him would be the leadership of the NNPC.
JP Morgan Bond Index:
When JP Morgan advised the new government to let the market determine the value of the currency and allow monetary matters to be decided by business people, the government told Nigerians to ignored it. It did exactly the opposite of what the bank advised. Soon, the bank will exit Nigeria from its very influential bond index.
On October 1,2015,Vice President Yemi Osibanjo told Nigeria on Chanels TV that it should ignore JP Morgan. “They are only about portfolio investment “, he said. As if you didn’t need those.
We expected Mr Emefiele to advise the government to the contrary: CBN being independent and its governor being a competent person. But no, Instead, Mr Emefiele continued to defend the economic missteps of the government time after time until the whole enterprise collapsed.
News came in Thursday that Nigeria’s president, Mohammadu Buhari, has re-appointed Godwin Emefiele( whose term ends in June)for another term. Those who benefit from Mr Emefiele would rejoice but the economy will get so be beyond redemption.
It was a surprise that Mr Buhari kept Mr Emefiele in 2015 as he sort to crumble anything that had a whiff of his predecessor, Goodluck Jonathan. It will soon be obvious that the CBN governor kept his job because of the worst reason: Incompetence ! He was soon to be found wanting, a qualification that the then new administration seems to enjoy in a warped way. By that we mean that Mr Emefiele was retained because he was a lame duck lackey who won’t be able to give orders let alone ask pesky questions .Less than one year into Mr Buhari’s administration, the nation entered a recession that has since morphed into something worse even though the government announced that it was out of it. The collapse of the economy and the current depression have everything to do with Mr Emefiele. If only because he ought to know better.
In 2016, we wrote severally that the governor should be shown the door if only to give the impression that the government was doing something.
We were right then. And we are right in saying today that re-apointing Mr Emefiele is like making and economic paralysis a chronic condition.
Mr Emefiele doesn’t know his job description and he tends to think that he is the financial spokesman of the government. He takes orders instead of giving them.
Remember that loss of value in the first paragraph? Well, it has worsened to 100% at $1-N360. And the second, the NNPC bleeding? Well, the cagey government has announced that it has lost $500 million in 4 years.
Who would have imagined that Nigeria had a combined GDP of $500bilion between 2011 and 2015?
Keeping Mr Emefiele was wrong. Re-appointing him is a fatality.