FOLLOWING his nomination by President Bola Tinubu for Nigeria’s top banking job on September 15, the Senate, penultimate week, confirmed the appointment of Mr. Olayemi Cardoso as Governor of the Central Bank of Nigeria (CBN). It also confirmed the appointments of Emem Usoro, Muhammed Abdullahi-Dattijo, Philip Ikeazor and Bala Bello as deputy governors of the bank. The screening, which lasted almost three hours, afforded the new CBN Governor the opportunity of sharing his vision for the apex bank. While noting that his major goal was to refocus the CBN through short, medium and long-term measures, Cardoso stated that the bank under his watch would operate transparent monetary policies with respect to data, refrain from the errors committed by past administrations of the bank, comply with all constitutional duties, and ensure the compliance of Nigeria’s financial policies with international standards. Promising to restore confidence in the autonomy and integrity of the bank, Cardoso said he would maintain price stability, revert to evidence-based monetary policies, and discontinue his predecessor’s unorthodox monetary policies to bolster the naira.
To be sure, these are terrible times for the economy. The new CBN Governor spoke just as the naira neared 1,000/$ at the parallel market and settled at at N755.08/$1 at the official market. With soaring inflation, massive unemployment and lay-offs, Nigerians can be forgiven for attaching little importance to the new change of leadership at the apex bank. Given the criticality of the CBN to the functioning and health of the economy, the Senate is expected to thoroughly review the qualifications of nominees, and their conduct in office, if confirmed, in order to have an effective and efficient CBN. This means ensuring that there are consequences for misuse of the powers of the CBN by those in its leadership positions. Unfortunately, the Red Chamber has often failed to perform this role creditably, leaving those holding the reins at the CBN to play games with the health of the economy,with Nigerians bearing the brunt of their insidious behaviour. It is hoped that things will be remarkably different this time around.
Indeed, Cardoso’s profile does inspire hope, particularly with his impressive performance during his confirmation and his avowed promise to ensure that the CBN sticks to its constitutional mandate, which would mean having the latitude to pursue its policies and programmes unencumbered by the political leadership. A distinguished stock broker and former chairman of Citibank with over 30 years’ experience in the private, public and not-for-profit organisations, Cardoso has, at various times, served on the boards of Nigerian subsidiaries of Texaco and Chevron and chaired the board of EFInA, a financial sector development organisation. As Commissioner for Economic Planning and Budget for Lagos State, he was credited with financial reform processes that led to the state developing independent tax revenues. Besides, as a consultant and policy expert, Cardoso has advised and collaborated with major international development organisations, including the World Bank, Ford Foundation, UN Habitat, World Health Organisation and the Swedish Development Foundation. He was a member of the Cities Alliance’s Africa Think Tank Group, a group created to solve urban development challenges, and has also served as a board member of MRS Oil and the advisory board of Lagos Business School, in addition to being the chairman of the board of EFinA and of the board of African Venture Philanthropy Alliance.
Apparently, Cardoso must focus on returning the CBN to its core mandate. He must roll out appropriate monetary policies to salvage the economy considering its present dwindling fortunes and the negative effects. This is the way to give real meaning to his leadership at the CBN. To say that the new CBN Governor has his work cut out for him would be an understatement. His immediate duty, as the Centre for the Promotion of Private Enterprise (CPPE) has identified, rightly in our own view, is the restoration of confidence in Nigeria’s foreign exchange market and the recapitalisation of the banking industry. Cardoso would be doing the financial system a lot of good by paying heed to the CPPE’s charge with regard to restoring confidence to the foreign exchange market, deepening the financial system, ensuring efficiency of the financial system and capital requirements for banks; addressing ways and means financing of fiscal deficit and addressing the tenure and cost of funds in the banking system. It is incumbent on him to reduce the concentration of risks in the banking sector and initiate stakeholders’ engagement and corporate governance.
In the past, the country witnessed the ugly spectacle of CBN Governors making intemperate utterances, participating in politics and engaging in misusing public funds, thus undermining the bank’s mandate. It is hoped that the new CBN leadership will steer clear of these afflictions and discontinue the ugly practice of deliberately working at cross purposes with the finance ministry. If anything, the current fate of the naira in the international market calls for a radical change of approach at the apex bank. In the end, Nigerians will hold Cardoso to his promise to pull back from aggressive development finance, enthrone a culture of transparency and ensure zero tolerance for breaches of the CBN Act.
Cardoso, as we wish you a successful tenure of office, it is incumbent on you to write your name in gold by the end of your tour of duty.
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