Our Policies are Focused on Job Creation, Supporting Economic Growth
Governor , Central Bank of Nigeria, Mr. Godwin Emefiele, in this interview, monitored on AriseTV, said the policies and interventions of the apex bank are geared towards supporting economic growth and job creation. Emefiele also reiterated his support for the federal government’s decision to close all the country’s land borders, saying it should only be re-opened when the affected countries reach an agreement.
Obinna Chima brings the excerpts: Y ou have been variously describedbymany astheunseenhand behind the Nigerian economy and somebody who directs the affairs of monetary policy in the country. Are you am an, whose career one recogn is es as both a central banker and former bank chiefexecutive?
Yes, you are correct. Before I came on board, I had spent 27 years in the banking industry and my career peaked at the time I became the chief executive of Zenith Bank and I am here now for more than five years and I believe we still have a lot of work to do. However, whether you call it as an unseen hand, I think it is not really about that. It is about making Nigeria, being the largest country in Africa and the most populated in the continent, not to miss the opportunity at this time to move forward. We have a leader, President Muhammadu Buhari, who is totally committed to the development and rediscovery of Nigeria and I think he deserves all the support, particularly from people like us that he has great confidence in. What we are doing here is to say that Nigeria must make progress.
Is it CB N’ s responsibility to create jobs? It is everybody’s responsibility. Whatever policy you put in place, they must be policies that impact the lives of Nigerians.
You have mentioned President Mu hamma du B uh ari quite a number of times and I am wondering whether the continuous threat to central bank’ s independence all over the world is not a concern to you and I am just wondering where you draw the line so as to ensure that the government does not impair the central bank’ s independence?
The central bank is an entity within the larger entity called Nigeria. So, when you talk about interference, by virtue of the fact that the central bank is putting in place, policies that would help to engender growth, policies that would help to create job, there is no conflict in that and in fact, it has nothing to do with the independence of the CBN. The independence of the CBN is enshrined in the amended CBN Act of 2007, and nothing is altering or in any way, affecting the independence of the CBN. When you say your mandate as CBN is price and monetary stability, it must be price and monetary stability that is conducive to growth, conducive to creating jobs and conducive to ensuring that industries remain alive, whereas the primacy of your mandate, which is price and monetary stability remains in tack.
But the concern is always to ensure that the central bank does not serve political interest, but rather have the common good inmind?
I take you back again. Whether you are a president or a CBN governor, you have been placed in a position by God to serve your people and put in place policies that would enhance the lives of your people. So, if by that you feel that the central bank is moving out of its realm, I don’t agree with you. What is important is that we have a country and an economy that must grow, and an economy where its people must be seen to live well and that is what we are doing and it has nothing to do with any conflict or intervention.
Is part of your fear not to allow politicians take measures that would lead to inflation- arypressure? The issue is that inflation is a canker-worm that we must all fight. When you allow inflation to take over, purchasing power will go down and will be totally eroded and that will affect people’s ability to live well in Nigeria. Politicians are actors in the economy and I can tell you that the primary mandate of the CBN is to put in place policies that would control inflation. And that we will do. We are not going to put the blame on the control of inflation on anybody. If the politician likes, because he is an actor, let him do whatever he likes. But, we will do what we need to do to make it impossible for him to take certain actions that would affect the level of prices in the country. That is our job and we will do it.
At 11.6 percent, inflation in Nigeria rose to the highest level in more than a year. What is your reaction to that? I have read a couple of reports where some attributed the rise in inflation to the border closure and I laughed. If inflation is up as a result of border closure, it means that as a result of the border closure, supply of certain basic items have gone down, while demand has either risen or has been flat. So demand has outstripped supply and by that you are facing a demand-pull inflation.And I have to speak now as a Nigerian. If prices of goods have gone up because we closed the borders, so that jobs can be created for our people, so that our industries can come back alive again, and prices are up by 0.3 basis points in one month, for me I am not going to lose sleep. All we need to do is for us to work hard to boost supply, so that prices can come down because supply has gone up to be able to match demand. I don’t have any apology to people, who feel the border closure has resulted to price increase. The reason is because it is creating jobs. Is it rice? Is it tomatoes or poultry? Before the border closure, I received a call from the president of Rice Farmers Association. He said, ‘Governor, because President Buhari said we should all go into the production of rice for the good of our country, so that we can feed ourselves and conserve forex, you have used the banks to make intervention funds available to us and we have expanded our factories.’ After expanding their factories, before the border closure, most of them were carrying nothing less than 20,000 metric tonnes of milled rice, par boiled rice that they couldn’t sell. After that, the President of the Rice Farmers Association called again to say, ‘Governor, you gave us Anchor Borrowers’ Programme, it may be difficult for us to repay, because we have paddy that cannot be sold because the millers are not buying.’ Poultry farmers called us and said they were carrying thousands of crates of eggs that could not be sold. Do you know eggs were being smuggled into this country? Tomatoes were being smuggled into this country? So, what are we producing if we could smuggle eggs into this country? All these were killing domestic industries and making people lose their jobs. So, you talked about inflation going up, those prices would moderate. I am so certain that they would moderate because efforts are being made to boost supply. I granted an interview recently in Benin, Edo State, where I said the borders should be kept closed even for two years or whatever is to be done to prevent dumping and smuggling, and see what would happen to Boko Haram, kidnapping and this country will blossom.
So, you also advised the government to closetheborders?
I did. I am not going to pretend about that. In any case, it was not me alone. I understand that the security chiefs said arms were being smuggled into this country were all coming in through these borders. So, arms coming in also contributed to the reasons we said the borders should be shut and let’s see what will happen.
You talked about manufacturers and I can tell you that some of them have said the biggest challenge they are facing is not