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Tag: emefiele

  • Cryptocurrency: CBN acted in Nigerians’ best interest

    Cryptocurrency: CBN acted in Nigerians’ best interest

    The Governor of Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, has said that the CBN acted in the nation’s best interest by ordering banks, non-banking and other financial institutions not to facilitate trading and dealings in cryptocurrencies.

    Emefiele, while briefing a joint Senate Committee on Banking, Insurance and Other Financial Institutions, ICT and Cybercrimes, and Capital Market, on its directive banning cryptocurrency trading, described the operations of cryptocurrencies as dangerous and opaque.

    “Cryptocurrency has no place in our monetary system at this time and cryptocurrency transactions should not be carried out through the Nigerian banking system,” he said.

    The Independent Corrupt Practices and Other Related Offences Commission (ICPC) and the Nigerian Financial Intelligent Unit (NFIU), which also addressed the joint committee, said cryptocurrency was being used as a channel for funding violence and terrorism in Nigeria.

    Emefiele said the use of cryptocurrency contravened the law, adding that the fact that cryptocurrencies are issued by unregulated and unlicensed entities, made it contrary to the mandate of the CBN, as enshrined in the CBN Act (2007) that empowers it as the issuer of legal tender in Nigeria.

    Emefiele, who also differentiated between digital currencies, which apex banks can issue, and cryptocurrencies issued by unknown and unregulated entities, stated that the anonymity, obscurity, and concealment of cryptocurrencies made them suitable for those who indulge in illegal activities such as money laundering, terrorism financing, purchase of small arms and light weapons and tax evasion.

    Citing instances of investigated criminal activities that had been linked to cryptocurrencies, he stated that the legitimacy of money and the safety of Nigeria’s financial system were central to the mandate of the CBN.

    “Cryptocurrency is not legitimate money because it is not created or backed by any central bank.

    “Cryptocurrency has no place in our monetary system at this time and cryptocurrency transactions should not be carried out through the Nigerian banking system,” he said.

    Emefiele faulted arguments that the CBN’s actions were inimical to the development of FinTech or a technology-driven payment system.

    On the contrary, he noted that the Nigerian payment system, boosted by reforms driven by the CBN has evolved over the past decade, surpassing those of many of its counterparts in emerging frontier and advanced economies.

    While urging that the issue of cryptocurrency be treated with caution, the CBN governor assured the committee that the bank would continue its surveillance and deeper understanding of the digital space.

    He stated that the ultimate goal of the CBN was to do all within its regulatory powers to educate Nigerians on emerging financial risks and protect the financial system from the activities of currency speculators, money launderers, and international fraudsters.

    In his presentation, the Director-General of the Securities and Exchange Commission (SEC), Mr. Lamido Yuguda, said there was no policy contradiction between the CBN directive and the pronouncements by the SEC on cryptocurrencies dealings in Nigeria.

    He said the SEC made its pronouncement at the time to provide regulatory certainty within the digital asset space due to the growing volume of reported flaws.

    Prior to the CBN directive, he said the SEC, in 2017, had cautioned the public on the risks involved in investing in digital and cryptocurrency.

    He added that the CBN, Nigeria Deposit Insurance Corporation (NDIC) and the SEC between 2018 and 2020 had also warned on the lack of protection in investments in cryptocurrency.

    Yuguda said following the CBN directive, the SEC had suspended the admittance of all persons affected by CBN circular into its proposed regulatory incubatory framework in order to ensure that only operators in full compliance with extant laws and regulations were admitted into the framework for regulating digital assets.

    Similarly, the Chairman of the Independent Corrupt Practices and Other Related Offences Commission (ICPC), Prof. Bolaji Owasanoye (SAN), highlighted the risks inherent in investing in virtual assets and cryptocurrencies in Nigeria.

    He explained that cryptocurrencies posed serious legal and law enforcement risks for Nigeria due to its opaque nature and illicit financial flows.

  • National Arts Theatre, Lagos, to be transformed into a World Class Convention Centre

    National Arts Theatre, Lagos, to be transformed into a World Class Convention Centre

    The National Arts Theatre, Iganmu, Lagos, is to be transformed into a World class Convention Centre and the contract for the transformation will be sealed in the next two weeks, the Central Bank Governor, Mr Godwin Emefiele, has said.

    Emefiele disclosed this good news yesterday while answering questions on the outcome of the Monetary Policy Committee meeting, which held in Abuja, yesterday.

    According to him, all approvals are in place to renovate the structure of the National Arts Theatre and transform it into a world class Conventional Centre.

    “All approvals are in place; we are hoping in the next couple of weeks, a contract will be awarded and the National Arts Theatre, by the grace of God, will wear a new look,” Emefiele said.

    He recalled the structure in 1977 was commissioned and used for the Festival of Arts and Culture, FESTAC, but was saddened by the fact that it was allowed to decay.

    “National Arts Theatre was commissioned and used for the FESTAC, 1977. We have visited that magnificent structure, yes, it’s totally dilapidated but the structure can compete with any conventional Centre that you will find in any part of the world.

    “So it is painful that we allowed that infrastructure to decay to the level that it is,” he said.

    Emefiele also said that no conventional centres in the world was a match to the national Art theatre adding that he had not seen any in all the IMF and World Bank’s meetings that he had so far attended.

    He said that the Bankers Committee would fund the renovation of the structure, given the approval of President Muhammadu Buhari.

    The CBN governor said that four structures would also be built to support the creative arts activities of the Nigerian youths.

    Besides, he believed that a new and improved national arts theatre would be launched by the president, before 2023.

    Recall that the Federal Government, in July 2020, officially handed over the National Theatre in Lagos to the Central Bank of Nigeria (CBN) and the the Bankers’ Committee for renovation.

    Emefiele had said at the handover that Nigeria had the potential to earn over $20bn annually from the creative industry and that the creative industry centre was expected to create over 1 million jobs in five years.

    “Our goal for the National Theatre is to create an environment where startups and existing businesses are rewarded for their creativity,” Emefiele had said.

  • Just in: CBN retains lending rate at 11.5%

    Just in: CBN retains lending rate at 11.5%

    The Monetary Policy Committee of the Central Bank of Nigeria has retained the Monetary Policy Rate at 11.5 per cent.

    The CBN Governor, Godwin Emefiele, disclosed this after the committee’s two-day meeting in Abuja on Tuesday.

    It also retained the Cash Reserve Ratio and Liquidity Ratio at 27.5 per cent and 30 per cent respectively.

    At the last MPC meeting in September, the committee reduced the MPR from 12.5 per cent to 11.5 per cent.

  • CBN Gov Emefiele accused of massive corruption, Nigerians in USA drag him before American congress [Documents attached]

    Nigeria Central Bank Governor, Godwin Emefiele is enmeshed in an allegation of massive corruption estimated in billions of Naira. Between 2015 and 2016, CBN’s Emefiele reportedly conspired with Nigerian National Petroleum Corporation to illegally divert $24,263,008.56 meant to be shared to 37 states and 774 local councils.

    A group, Nigerian Young Professionals Forum (NYPF), United States of America/Caribbean chapter, has submitted a petition to the United States Congress, demanding an investigation and sanction of Emefiele who was also accused of running a black-market forex cartel worth $800m with Isa Funtua (owner of Bulet Construction Company) and other top members of President Muhammadu Buhari’s cabal since 2015.

    NYPF in a letter to Nancy Pelosi, Speaker of the House of Representatives; Addison Mitchell McConnell, Senator from Kentucky; Charles Ellis Schumer, Senator from New York and Kevin Owen of the House of Representatives, called for a special congressional hearing to what it described as “wanton looting, brazen stealing and corruption” by Emefiele and members of the inner circle of President Muhammadu Buhari’s government.

    The letter dated June 2, 2020 and signed by Jackson Ude, Coordinator of the group, said the activities of CBN governor had in no small measure weakened the country’s economy, which largely depends on oil exports and foreign grants.

    The letter partly reads, “You may wish to recall that President Buhari came to power in 2015 with a pledge to tackle corruption. But no success prosecutions have happened, and he appears to condone and shied his friends and family members tainted by serious allegations of financial fraud. The activities of CBN governor Emefiele have, in no small measure, contributed and continue to contribute to Nigeria’s dubious fight against corruption and further weakened the country’s economy — which largely depends on oil exports and foreign grants.

    “Between 2015 and 2016, under Emefiele’s watch, CBN conspired with Nigerian National Petroleum Corporation to illegally divert $24,263,008.56 meant to shared to 37 states and 774 local councils. In a leaked tape obtain by saharareporters.com, one if Nigeria’s leading investigative news website, Emefiele and some officials of CBN were caught discussing how to cover up the loss of N500bn (an equivalent of $1.2 billion) stolen from the CBN in a private investment that failed. Till date, no one including Emefiele has been held accountable.

    “In a most bizarre manner, the CBN allegedly awarded a contract for the expansion of its parking lot to Bulet International Limited, a company owned by Ismaila Isa Funtua, an ally and confident of President Mohammadu Buhari at a whopping N30bn (the equivalent of $77.5 million) in 2019. No parking lot extension contract cost that much in the United States. The contract, which violated Nigeria’s procurement laws, was secretly awarded to Bulet International. No investigation and prosecution have been despite numerous media reports.

    “Emefiele has been running the CBN with top members of the Buhari cabal led by Isa Funtua the owner of Bulet Construction Company and the recently deceased Chief of Staff to President Buhari, Abba Kyari, Attorney General and Minister for Justice, Abubakar Malami, Mamman Daura, Lawan Daura, Babagna Kingibe, Nasir Danu and few others who are all from the Northern Nigeria. What is even more shocking is that Isa Funtua and the cabal have been running a black-market forex cartel worth $800m every week since the beginning of the Buhari administration in 2015. This continued until late 2017 when the Vice President Yemi Osinbajo scaled it down it to $500m when the President was away for medicals.”

    It then called on the US Congress to invoke the Global Magnistky Act and place visa restrictions on Emefiele, Malami and the others linked with the corruption in CBN.

    See original petition:

  • CBN orders instant refund of dispense errors at banks’ ATM

    The Central Bank of Nigeria (CBN) has ordered quick refund of failed transactions and dispense errors at banks’ Automated Teller Machine (ARM).

    In a circular by its spokesman, Isaac Okorafor, titled: “CBN Revises Timelines for Dispense Errors, Refund Complaints”, on Sunday, the apex bank listed how the banks should quickly resolve the problems and resolve the customer complaints.

    The circular reads: “The Central Bank of Nigeria (CBN), in its determination to further enhance service quality, particularly quick refunds when customers experience failed transactions, dispense errors or disputes, has revised timelines for reversals and/or resolution of refund complaints on electronic channels, with effect from June 8, 2020, as follows: Failed “On-Us” ATM transactions (when customers use their cards on their bank’s ATMs) shall be instantly reversed from the current timeline of three (3) days. Where instant reversal fails due to any technical issue or system glitch, the timeline for manual reversal shall not exceed 24 hours.

    Refunds for failed “Not-on-Us” ATM transactions (where customers use their cards on other banks’ ATMs) shall not exceed 48 hours from the current 3-5 days.

    Resolution of disputed/failed PoS or Web transactions shall be concluded within 72 hours from the current five (5) days.

    All banks are directed to resolve backlog of all ATM, POS and Web customer refunds within two weeks starting June 8, 2020”

    Meanwhile, key service providers in the Nigerian payments system have also committed to establishing an integrated dispute resolution platform for the industry and enhance their payment system infrastructure and processes to reduce incidences of transaction failure.

    Members of the public are therefore requested to refer to the updated Guidelines for the Operation of Electronic Payment Channels on the Bank’s website (www.cbn.gov.ng) for further details.

  • Emefiele’s Post Covid-19 Marshall Plan For Nigeria : Trick Or Treat? Magnus Onyibe

    Emefiele’s Post Covid-19 Marshall Plan For Nigeria : Trick Or Treat? Magnus Onyibe

    By Magnus onyibe.

    When under the auspices of the federal Govt of Nigeria, the CBN Governor, Godwin Emefiele influenced the banning of 45 items/products that he reckoned could be produced locally in Nigeria from being imported and pilling needless pressure on the foreign exchange reserve , he became the butt of the jokes of prominent Western media organizations, particularly the Economist magazine of London , Time magazine of New York and Wall Street Journal, WSJ which stopped short of labeling Nigeria’s CBN Governor, a demagogue for banning items , as ridiculous in their estimation, as tooth pick from receiving foreign exchange allocation from the CBN for its importation.
    But following the current lockdown of an estimated 90% of planet earth as a cautionary measure against the threat of the coronavirus pandemic that has already infected over 2 million people and sent to their early graves, lives in excess of 130, 000 worldwide and still counting, Emefiele , the unsung hero of the sickly Nigerian economy , seems to be having the last laugh, as the entire world is currently adopting his much derided policy of restricting the import of goods that can be locally produced.
    With this sudden turn of events whereby it is now the best-in-class strategy to restrict import/export, who can we say has been tricking Nigerians into importing everything on earth, thereby creating the existential threat capable of depleting our hard earned foreign exchange income ; and who has been treating us to a new and improved way of conserving our forex income sourced mainly from hydrocarbon, so that Nigeria can have enough to invest in infrastructure such as hospitals and schools ?
    You be the judge!
    It is such a paradox that the phenomenon of global trade which launched China into the global market arena and subsequently earned the Asian country the enviable status of being the most prolific and biggest factory of the world, is about to become the acheel’s heel of the same China, because that’s where the deadly Covid -19 pandemic now shutting down planet earth is believed to have emanated.
    Obviously , the simple principle of what goes up must come down is at play in its starkest reality.
    So what an irony that, China that has been the greatest beneficiary of global trade would end up being the biggest loser of global trade , if the global wave of import/export restrictions become the new normal according to the prognostications of Nigeria’s CBN Governor and other economists around the world.
    It is not as if nobody anticipated that global trade as we currently know it would not have eventually come to an end. But no one in their wildest imagination reckoned that the end could be so dramatic and would be caused by an invisible enemy such as a deadly virus as opposed to the several protests staged by anti global trade activists against global leaders during their annual World Economic Forum, WEF talk shops in Davos , Switzerland.
    Worst still, no one dreamed that a seemingly ordinary virus would so dramatically end trade, which not even the world war l and ll was able stop and which has waxed stronger since the founding of WTO in 1995 , in replacement of the General Agreement on Trade and Tariff, GATT, established in 1948.
    But the events of the last four or so months when the coronavirus was believed to have sprung from an animal to man in an innocuous live animal market in Wuhan, Kobe province of China has stunned the best of scientists in the entire world who did not see it coming.
    Not even Bill Gates, Microsoft founder and the world’s second richest man whose business ventures had some five years ago made a prognosis of a virus warfare and started preparing against the threat , has been able to halt the spread.
    Obviously, Mr Gates anticipatory investment in the firm Global Good , Intellectual Venture with the aim of embedding chips in humans, have proven not to be a match for the highly stealthy coronavirus pandemic now invading and ravaging mankind.
    Until the opening up of China by one of it’s leaders considered to be the father of modern day China, deng Xiaoping whose policies culminated into China’s entry into the World Trade Organization, WTO in 2001; an initiative which opened up the market of the estimated 164 member countries of the organization to Chinese products/services; and transformed the previously autarkic Chinese communism driven economy into an open factory for the world, global trade wasn’t such an attractive proposition.
    Since founding the WTO , ‘export or die’ became a major global trade mantra.
    And the establishment of the private sector driven World Economic Forum , WEF in 1971 gave verve to the inevitability of global trade, as the most powerful in Govt and the wealthiest businessmen/women all over the world started taking time yearly to bask in the splendor of the alpines of the snow capped resorts/villas in Davos, Switzerland, while holding aloft the flag of global trade and promoting its values as immutable , to the consternation of the powerless and poor who detest the phenomenon and therefore hold equally striking protects against it. Fortuitously, the anti global trade activists who entertain the fears that globalization enables the rich to crowd out the poor, seem to be wining the contest as Covid-19 has upended the concept of trade by compelling practically all the leaders of the free world to start coming up with trade policies that make them appear more like North Korean leader Kim Jong-Un , the world’s most reclusive leader and the poster child of economic autarky.
    According to Emefiele’s position in the report under review, “As of 10 April 2020, an updated count of total export restrictions by Global Trade Alert Team at the university of St. Gallen, Switzerland suggests a total of 102 restrictions by 75 countries”.
    Really? So the concept of export restrictions for which Emefiele received hard knocks has become the new ‘sexy’?
    Continuing, the CBN Governor avers that “Vietnam the world’s third largest exporter of rice , suspended granting rice export certificates until the country ‘reviews domestic inventories”
    Imagine that the CBN under Emefiele’s leadership did not have the foresight of advising president Muhammadu Buhari to ban rice importation into our country and encourage Nigerians to eat locally grown and milled rice of which the authorities now claim our country is self sufficient ? Nigerians would not only be scrambling around the world for Covid-19 test kits and Personal Protection Equipment, PPEs, being horde by the hitherto high minded advanced economies that now prefer to satisfy their local markets first , our country would also be desperately searching for the favorite staple food- rice in countries like Vietnam and India to feed our people .
    After successfully intervening with massive funds infusion into the agricultural sector , as reflected by the drastic reduction in rice import and its current intervention in cotton production as well as in other food value chain which are also looking good, the CBN might have convinced itself that it now has a proof-of-concept that money works when used to intervene in some critical sectors of the economy wisely.
    Presumably, that’s what has emboldened Emefiele to offer to plough another N3.5 trillion into critical growth areas that would facilitate a more self reliant Nigerian economy.
    But are all or most Nigerians aligned on this quest for food security / sufficiency, the CBN style ?
    That’s yet to be seen.
    And given the anger and hunger on the streets of Nigeria, stemming from the Covid -19 pandemic compelled shelter-at-home order that has left most Nigerians stranded, since quite a lot of us usually eke out our living based on the odd jobs that we can do to earn about N2,000 to N5,000 on a daily basis to feed ourselves , Emefiele needs to go beyond the bold declaration in his deeply thought through and inspiring proposition “Turning The Covid-19 Pandemic Tragedy Into An Opportunity For A New Nigeria”.
    Besides the CBN, the other critical agencies of Govt responsible for mobilizing Nigerians into action and galvanizing their belief in the common good and survivability of our country seems to be missing in action .
    In this period of high level of despondency, owing to the compulsory social distancing policy which seems to be the only proven panacea to Covid-19 in the industrialized and advanced society, how do we make more Nigerians share the CBN vision when they are practically starving and unhappy in light of the fact that majority of those who earn their living solely in unstructured system of daily income of a couple of thousands of naira are now without income ? Why are we in Nigeria adopting Western solution to the Covid-19 pandemic hook-line and -sinker ? Would what works in the industrialized economies , work for us in the developing world, given the different local dynamics at play?
    In an April 2, 2020 report by the pair of Zachary Barnett-Howell and Ahmed Mushfiq Mobarak of Yale School of Management, USA , titled “Should Low-Income Countries lmpose The Same Social Distancing Guidelines As Europe & North America To Halt Spread of Covid-19 “?, it was revealed that the benefits of social distancing between rich and poor countries differ.
    Below are some of the eye opening conclusions from the Executive Summary of the report:
    “Social distancing has become the primary policy prescription for combating the COVID-19 pandemic, and has been widely adopted in Europe and North America. We combine country-specific economic estimates of the benefits of disease avoidance with an epidemiological model that projects the spread of COVID-19 to analyze whether the benefits of social distancing and suppression varies across rich and poor countries. This modeling exercise yields the following key insights:
    1. Populations in rich countries tend to skew older, and COVID-19 mortality effects are therefore predicted to be much larger there than in poor countries, even after accounting for differences in health system capacity.
    2. Social distancing measures are predicted to save a large number
    of lives in high-income countries, to the extent that practically any economic cost of distancing is worth bearing. The economic value generated by equally effective social distancing policies is estimated to be 240 times larger for the United States, or 70 times larger for Germany, compared to the value created in Pakistan or Nigeria. The value of benefits estimated for each country translates to a savings of 59% of US GDP, 85% of German GDP, but only 14% of Bangladesh’s GDP or 19% of India’s (read Nigeria )
    3. The much lower estimated benefits of social distancing and social suppression in low-income countries are driven by three critical factors:
    (a) Developing countries have smaller proportions of elderly people to save via social distancing compared to low-fertility rich nations.(Nigeria’s youth population is estimated to be in excess of 60%.
    (b) Social distancing saves lives in rich countries by flattening the curve of infections, to reduce pressure on health systems. Delaying infections is not as useful in countries where the limited number of hospital beds and ventilators are already overwhelmed and not accessible to most.(typical situation of Nigeria)
    (c) Social distancing lowers disease risk by limiting people’s economic opportunities. Poorer people are naturally less willing to make those economic sacrifices. They place relatively greater value on their livelihood concerns compared to concerns about contracting coronavirus.
    Not only are the epidemiological and economic benefits of social distancing much smaller in poorer countries, (like Nigeria) such policies may also exact a heavy toll on the poorest and most vulnerable” (obviously the case in Nigeria now)
    Given the expert analysis above, is the 28 days lock down of Lagos state, Ogun state and the Federal Capital Territory, FCT , the economic power houses of Nigeria, the most optimal strategy for our country to deal with the coronavirus pandemic or a mere copy and paste by our lazy technocrats?
    Did the members of the presidential advisory team make any input into the decision to lock down major economic centers and states in Nigeria for a whopping 28 days at a period that crude oil price is selling for less than $20 per barrel in the international market and when budget 2020 was predicated on $57 per barrel ?
    In light of the decision to shut down our economy which obviously was not put through the crucible of very rigorous test as it should , are our civil/public servants truly enthusiastic to help President Buhari lift our country out of economic doldrums; or would they be constituting a drag by creating bureaucratic bottle necks on the path of those who choose to respond to the CBN’s clarion call? Why is the star studded presidential economic advisory team absent in this critical period, that l would imagine that such a formidable team is most needed? Questions! questions!! questions!!!
    For the avoidance of doubt, l’m not by any means discountenancing the benefits of social distancing in combating a pandemic , but l’m making a case that our technocrats could have tweaked with the industrialized world’s template and come up with what’s most suitable for our peculiar circumstances, since the socioeconomic environment in Nigeria differs significantly with what obtains in Europe, North America or Asia.
    Some would argue that such granular details would be the focus of the implementers of what for lack of a better phrase, l would like to refer to as Emefiele’s Post Covid-19 Marshal Plan For Nigeria.
    So, l rest my case.
    Magnus onyibe, a development strategist,alumnus of the fletcher school of law and diplomacy, tufts University, Massachusetts, USA , and a former cabinet member of delta state Govt , sent this piece from lagos.

  • CBN Gov, Emefiele details how Nigeria can turn COVID-19 pandemic into windows of national development

    Disturbed by the harsh economic downturn of the novel coronavirus [COVID-19] pandemic on the globe, the Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, has proposed a post-COVID-19 economic recovery path for Nigeria.

    Emefiele insisted that despite the harsh realities of the pandemic on the world, however, there are hidden opportunities for Nigeria to harness. The CBN governor said the proposed economic recovery strategy spanning three years will be biased towards mass employment and wealth creation in the country focusing on four main areas, namely, light manufacturing, affordable housing, renewable energy, and cutting-edge research.

    The CBN Governor made the proposition in an article titled “How Nigeria can turn the COVID-19 tragedy into an opportunity.”

    Read full article below:

    As many people are now aware, the outbreak of the Novel Coronavirus Disease (COVID-19) in China rapidly permeated and profoundly changed the world. While this crisis is first and foremost a public health issue, which has claimed the lives of over 123,600 people worldwide, and counting, the economic damages are unprecedented on several fronts: Crude oil prices declined dramatically to as low as US$17 per barrel by the end of March, even before applying the discounts many oil exporters are offering; Stock valuations for the NSE-ASI, Nikkei, Dow Jones and FTSE-100 declined by an average of 23.8 percent between January and March 2020; Global airlines have lost about US$252 billion in revenues and across the broad range of industries from hospitality to services, the pain is growing. These outcomes have expectedly thrown the global economy into a recession, the depth and duration of which is currently difficult to fathom. In fact, the International Monetary Fund (IMF) predicts that the global economy would decline by 3 percent this year.

    Around the world, countries have moved away from multilateralism and responded by fighting for themselves with several measures to protect their own people and economies, regardless of the spillover effects on the rest of the world. According to the World Customs Organization, a total of 32 countries and territories, adopted stringent and immediate export restrictions on critical medical supplies and drugs that were specifically meant to respond to COVID-19. As of 10 April 2020, an updated count of total export restrictions by the Global Trade Alert Team at the University of St. Gallen, Switzerland suggest a total of 102 restrictions by 75 countries.

    On 4 March 2020, Germany announced an export ban that applied to all sorts of medical protection gear including breathing masks, medical gloves and protective suits. Around the same time, President Macron announced that France will requisition all face masks produced in the country, a de facto export ban. Between 8 February 2020 and 6 April 2020, India released eight (8) different export notifications banning several drugs and medical supplies including hydroxychloroquine, ventilators, personal protections masks, oxygen therapy apparatus, and breathing devices. On 3 April 2020, the Trump Administration invoked the war-era US Defense Production Act to stop major US mask manufacturer, 3M, from exporting N95 respirator masks to Canada and Latin America.

    Fears of a long global recession have also led to worries about unprecedented global food insecurity, with concerns that agricultural production may be dislocated by containment measures that constrain workers from planting, managing and harvesting critical crops. Rather than seek cooperative and global solutions, several countries have resorted to export restrictions of critical agricultural produce. According to the International Food Policy Research Institute (IFPRI), about 37 countries have enacted various forms of food export restrictions in response to COVID-19, even in countries where average production exceeds domestic consumption.

    For example, Viet Nam, the world’s third largest exporter of rice, suspended granting rice export certificates until the country “reviews domestic inventories”. Russia, the world’s largest wheat exporter, announced a ten-day ban on the export of buckwheat and rice due to concerns over panic buying in local supermarkets.

    What if these restrictions become the new normal? What if the COVID-19 pandemic continues in a second wave or another pandemic occurs in which all borders are shut and food imports are significantly restricted? What if we cannot seek medical care outside Nigeria and must rely on local hospitals and medical professionals? For how long shall we continue to rely on the world for anything and everything at every time?

    Although these developments are troubling, they present a clear opportunity to re-echo a persistent message the Central Bank of Nigeria (CBN) has been sending for a long time, and at this time even more urgently so: We must look inwards as a nation and guarantee food security, high quality and affordable healthcare, and cutting-edge education for our people. For a country of over 200 million people, and projected to be about 450 million in a few decades, we can no longer ignore repeated warnings about the dangers that lie ahead if we do not begin to depend largely on what we produce locally. The security and well-being of our nation is contingent on building a well-diversified and inclusive productive economy.

    When I became Governor of the Central Bank in June 2014, imports of rice, fish, wheat and sugar alone consumed about N1.3 trillion worth of foreign exchange from the Bank. My immediate question was: can we not produce these ourselves? After all, only a few decades ago, Nigeria was one of the world’s largest producers and exporters of many agricultural products like palm oil, cocoa and groundnuts. Today, we import nearly 600,000 metric tonnes of palm oil, whilst Indonesia and Malaysia, two countries that were far behind us in this crop, now combine to export over 90 percent of global demand. In 2017, Indonesia earned US$12.6 billion from its oil and gas sector but US$18.4 billion in from palm oil. I believe that this pandemic and the immediate response of many of our trading partners suggest it is now more critical than ever that we take back control; not just control over our economy, but also of our destiny and our future.

    In line with the vision of President Muhammadu Buhari, the CBN has indeed created several lending programmes and provided hundreds of billions to smallholder farmers and industrial processors in several key agricultural produce. These policies are aimed at positioning Nigeria to become a self-sufficient food producer, creating millions of jobs, supplying key markets across the country and dampening the effects of exchange rate movements on local prices.

    This philosophy has been a consistent theme of the CBN’s policies over the last few years. At the 2016 Annual Bankers’ Dinner, I challenged the bankers that we needed to take decisive actions to fundamentally transform the structure of our economy. Throughout that speech, I talked about the damaging effects of Nigeria’s unsustainable propensity to import, and opined that it was high time we looked inwards and stopped using hard-earned foreign exchange (FX) to import items that we should produce locally. This determination, therefore, formed the bedrock of the Bank’s policy, which restricts access to FX for importers of many items. These sentiments were re-echoed at the 2017 edition of the same Bankers’ Dinner with specific examples of several companies that have benefited significantly from this policy of self-sufficiency. With President Buhari’s full support, we have continued to refine this policy to ensure that the best interest of Nigeria is served.

    Many times, the Bank has been accused of promoting protectionist policies. My answer has always been that leaders are first and foremost accountable to their own citizens. If the vagaries of international trade threaten their wellbeing, leaders have to react by compelling some change in patterns of trade to the greater good of their citizens.

    That is why in response to COVID-19, we are strengthening the Nigerian economy by providing a combined stimulus package of about N3.5 trillion in targeted measures to households, businesses, manufacturers and healthcare providers. These measures are deliberately designed to both support the Federal Government’s immediate fight against COVID-19, but also to build a more resilient, more self-reliant Nigerian economy.

    We do not know what the world will look like after this pandemic. Countries may continue to look inwards and globalization as we know it today may be dead for a generation.

    Therefore, as a nation, we cannot afford to continueTherefore, as a nation, we cannot afford to continue relying on the world for our food, education and healthcare. The time has come to fully transform Nigeria into a modern, sophisticated and inclusive economy that is self-sufficient, rewards the hardworking, protects the poor and vulnerable, and can compete internationally across a range of strategic sectors.

    In order to achieve this goal, we must begin immediately to support the Federal Government to:

    1) Build a base of high quality infrastructure, including reliable power that can engender industrial activity;

    2) Support both smallholder and large scale agriculture production in select staple and cash crops;

    3) Create an ecosystem of factories, storages, and logistics companies that move raw materials for value-added production, and finished goods to markets;

    4) Use our fiscal priorities to create a robust educational system that enables critical thinking and creativity, which would better prepare our children for the world of tomorrow;

    5) Develop a healthcare system that is trusted to keep all Nigerians healthy, irrespective of social class;

    6) Facilitate access to cheap and long-term credit for Small and Medium-Scale Enterprises (SMEs) and large corporates;

    7) Develop and strengthen pro-poor policies that bring financial services and security to the poor and the vulnerable; and

    8) Expedite the development of venture capitalists for nurturing new ideas and engendering Nigerian businesses to compete globally.

    India is in a position to ban exports because it is producing critical drugs and medical supplies that the rest of the world needs. It also has companies that are global champions, and even merging with or acquiring peers in advanced nations. Why should this be out of our reach? We have the companies and the manpower. Some of the best brains in the world from the Americas to Europe and from Asia to Africa are Nigerians; driving global innovations in all fields. Nigerians are successful everywhere, and are already one of the most sought after immigrant groups in the United States. Now is the time to seize this opportunity and create an environment that empowers our people to thrive within our own shores.

    To this end, the Central Bank has developed a Policy Response Timeline to guide our crises management and the orderly reboot of the Nigerian economy.

    Immediate-Term Policies (0-3 Months)

    In light of the fact that this crisis is an exogenous one thrust upon us without much warning, this phase reflects the government’s efforts at containment and mitigation. Although global cases are heading towards two million with over 123, 600 deaths as of 14 April 2020, we now have 343 cases, of which there have been 91 recoveries and sadly 10 deaths. With President Buhari’s continuing strong leadership, Nigeria can now test 1,500 persons per day in twelve (12) Molecular Test Laboratories. We believe that his strong leadership to impose early travel restrictions, lockdown, social distancing, and other measures have been greatly effective in curbing the spread of the disease. More so, the Presidential Task Force on COVID-19 and the Nigeria Centre for Disease Control (NCDC) have helped the country stay ahead of the curve with increased testing capacity, provision of better-equipped isolation centres, and effective contact tracing. Within this milieu, the CBN has responded in several ways, first by supporting hospitals and pharmaceutical industry with low interest loans to immediately deal with the public health crises; then by working with the private sector Coalition Against COVID (CACOVID) to support the Presidential Task Force on COVID-19 across its response, while mobilizing palliatives for the poor and vulnerable. Under this Immediate-Term Response, we have activated the following: 1) Ensure financial system stability by granting regulatory forbearance to banks to restructure terms of facilities in affected sectors; 2) Trigger banks and other financial institutions to roll-out business continuity processes to ensure that banking services are delivered in a sasafe social-distance regime for all customers and bankers; 3) Grant additional moratorium of 1 year on CBN intervention facilities; 4) Reduce interest rates on intervention facilities from 9 percent to 5 percent; 5) Create N50 billion targeted credit facility for affected households and SMEs; 6) Strengthen the Loan-Deposit Ratio (LDR) policy, which is encouraging significant extra lending from banks; 7) Improve FX supply to the CBN by directing all oil companies (international and domestic) and all related companies (oil service) to sell FX to CBN and no longer to the NNPC; 8) Provide additional N100b intervention in healthcare loans to pharmaceutical companies, healthcare practitioners intending to expand/build capacity; 9) Provide N1 trillion in loans to boost local manufacturing and production across critical sectors; and 10) Engender financial inclusion by ensuring the poor and vulnerable are able, by all means necessary, through banks, microfinance, community and non-bank financial institutions, to access financial services to meet their basic needs.

    Short-Term Policy Priorities (0 – 12 months)

    As soon as President Muhammadu Buhari and the Health authorities determine our Coronavirus Transmission Curve is flattening and many of the ongoing restrictions are eased, this will be the phase for repositioning the Nigerian economic space. As part of the lessons from the current pandemic, we must ensure that that our value-added sector, the manufacturing industry is strengthened. Accordingly, the CBN will pursue the following policies in this phase: 1) Reinvigorate our financial support for the manufacturing sector by expanding the intervention all through its value-chain. In most cases, we will ensure that primary products sourced locally provide essential raw material for the manufacturing sector except where they are only available overseas; 2) With the support of the Federal Government, the CBN will embark on a project to get banks and private equity firms to finance homegrown and sustainable healthcare services that will help to reverse medical tourism out of Nigeria. By offering long-term financing for the entire healthcare value-chain (including medicine, pharmaceuticals, and critical care), banks will work with healthcare providers to consolidate on the current efforts to rebuild our medical facilities in order to ensure Nigeria has world class affordable hospitals for the people of Nigeria and those wishing to visit Nigeria for treatment; 3) The CBN will promote the establishment of InfraCo PLC, a world class infrastructure development vehicle, wholly focused on Nigeria, with combined debt and equity take-off capital of N15 trillion, and managed by an independent infrastructure fund manager. This fund will be utilized to support the Federal Government in building the transport infrastructure required to move agriculture products to processors, raw materials to factories, and finished goods to markets, as envisaged at the CBN Going for Growth Roundtable in March 2020; and 4) Continue to prioritize the provision of FX for the importation of machinery and critical raw materials needed to drive a self-sufficient Nigerian economy.

    Medium-Term Policy Priorities (0 -3 Years):

    Once the world returns to some new normal having tamed COVID-19 by a combination of vaccines and social distancing, and the Nigerian economy reopens fully for business, we will act quickly to enable faster recovery of the economy by targeted measures towards particular sectors that are able to support mass employment and wealth creation in the country. We will do so by focusing on four main areas, namely, light manufacturing, affordable housing, renewable energy, and cutting-edge research.

    In manufacturing, for example, it is pertinent to note that Nigeria’s gross fixed capital formation is currently estimated at N24.55 trillion made up residential and non-residential properties, machinery and equipment, transport equipment, land improvement, research and development, and breeding stocks. Of this estimated value, machinery and equipment, which are the main inputs into economic production, are currently valued at only N2.61 trillion. In order to pursue a substantial economic renewal, including replacement of at least 25 percent of the existing machinery and equipment for enhanced local production, we estimate at least N662 billion worth of investments to acquire hi-tech machinery and equipment. Therefore, the CBN will consider an initial intervention of N500 billion over the medium term, specifically targeted at manufacturing firms to procure state-of-the-art machinery and equipment and automated manufacturing models that would fast-track local production and economic rejuvenation, as well as support increased patronage of locally processed products such as cement, steel, iron rods, and doors, amongst several other products. The recent private sector investments in cement production using enhanced technology and automated manufacturing models is a good example of the kind of economic renewal we will be pursuing in this phase. We will develop a thorough screening process and stringent criteria for equipment types that would qualify for funding under this phase.

    In order to boost job creation, household incomes and economic growth, we will focus our attention on bridging the housing deficit in the country by facilitating government intervention in three critical areas: housing development, mortgage finance, and institutional capacity. We will pursue the creation of a fund that will target housing construction for developers that provide evidence of profiled off-takers with financial capacity to repay. The current identification framework in the banking sector using the bank verification number (BVN) will be used to verify the information provided by the off-takers before the developer can access the funds. We will consider ways to assist the Mortgage Finance sub-sector as well as build capacity at the State levels for their land administration agencies to process and issue land titles promptly, implement investment friendly foreclosure laws and reduce the cost of land documentation, as these have remained major inhibiting factors in the provision of affordable housing in the country.

    Over the next 3 years, we will also support the financing of environmentally friendly energy production, as this has a tangential long-term health benefits. We will look at efforts to drive innovation and research in every sector, through our universities, research institutions, creative industry initiatives, and all other media of novelty and inventions.

    In conclusion, I believe we must now envision and work toward a Nigeria with the cutting edge medical facilities to provide world class care to the sick and vulnerable, enable our universities and research institutions to provide the requisite education and training that is required to keep these ecosystems functioning sustainably and efficiently, and millions of Nigerians employed in meaningful and well-paying jobs. This is the Nigeria that we must aspire to build.

    COVID-19 may have plunged us into a crisis of unprecedented proportions. But, as Winston Churchill once admonished, we must never let a crisis go to waste.

  • CBN clears air on alleged Naira devaluation

    The Central Bank of Nigeria has reacted to news it has devalued the Naira by as much as 15 percent, moving it from the official price of N307 to N360 and also adjusting the import and export window price from N360 to N380.

    In a tweet on Saturday night, the bank deployed semantic obfuscation to describe its action, quoting Governor Godwin Emefiele as saying the devaluation “is an adjustment of price”.

    The bank had taken commercial banks by surprise on Friday when it sold dollars at N360, instead of N307.

    Later same day, the bank reflected its ‘new adjusted price’ on its website.

    Recall that the apex bank had on Friday made the adjustment cum devaluation to harmonise its multiple exchange rates and also because of the reality of the oil market, which gives Nigeria 90 per cent of its FX earnings.

    As at Friday, oil sold for $27.50 per barrel as against the budget benchmark of $57.

    Forex Reserve has also gone southwards to $35.9 billion.

  • Nigeria needs N100bn to revive cotton, textile, garment sub-sector – Emefiele

    The Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele says more than N100 billion is needed to revive Cotton, Textile and Garment (CTG) sub-sector.

    Emefiele said this while speaking with newsmen after signing ceremony of Memorandum of Understanding (MoU) with some critical stakeholders at the sub-sector in Abuja on Tuesday.

    He explained that the intervention needed on cotton farming and ginneries alone required close to N50 billion.

    He said the entire value chain did not end at cotton and ginneries, of course, there was textile as well as garments.

    The governor disclosed that some of the garment factories had also come asking for some facilities for them to retool to do more of sewing of these garments.

    “It is not about the money, the most important is about the fact that we seize this opportunity to create jobs.

    “We seize this opportunity for the industries that moribund and dead to come alive again in Nigeria and by extension helps to grow the Gross Domestic Product (GDP) of the country.

    “We are happy that we are effectively taking control of the entire CTG value chain, from the production of Cotton to the finished products which are textiles and garments.

    “CBN and Bank of Industry are ready to finance this sub-sector to help purchase modern technologies to enable them to produce the required quality products,” he said.

  • $9.6bn Judgement: Senate summons AGF Malami, Emefiele, NNPC GMD others

    The Senate has summoned the Attorney General of the Federation and Minister of Justice, Abubakar Malami and other relevant government agencies to brief it on the details of the Gas contract to the Process and Industrial Development (P&ID) Limited and the $9.6billion penalty awarded against Nigeria.

    Details shortly…