Professor Kingsley Moghalu, a former deputy governor of the Central Bank of Nigeria (CBN), has called Zainab Ahmed’s fiscal mismanagement of Nigeria a “calamity” and blamed her for the nation’s deteriorating economy.
Moghalu, who ran for president of Nigeria in 2019 on the platform of the Young Progressives Party (YPP) but lost to President Muhammadu Buhari, expressed regret that Godwin Emefiele’s leadership of the country’s top bank had allowed it to become complicit in the excesses of the political elite and the ministry of finance.
The political economist, who was born in Anambra and uses the handle @MoghaluKingsley on Twitter, accused the CBN’s present leadership of being a puppet of the government rather than an independent organisation. With its capacity to manufacture money, it sees itself as a quasi-fiscal agent working for the current administration, according to Moghalu.
The Nigerian economy, according to him, has hit a wall as a result of poorly managed fiscal policy and a seriously compromised central bank that sold its soul to profiteers in the political and corporate sectors, he claimed.
It’s rare that I concur with Nigeria’s Minister of Finance Zainab Ahmed, Moghalu wrote in the tweet. Not for any reason in particular, but more because I fundamentally disagree with what I view as her stewardship of Nigeria’s finances. She did, however, recently provide an honest appraisal of how broke Nigeria is at the moment.
The less said about my cherished @cenbank and its Governor, the better. Because I think that is the worst tragedy of all. Why? Typically, the President is the immediate supervisor of the Finance Minister. If a minister is not a strong, respected, and accomplished person like @NOIweala, who politicians were wary of because she wasn’t exactly into one-chance bus travel disguised as “fiscal management,” and where a federal government is not reform-oriented as in the President Obasanjo era, the minister may be subjected to negative political pressure.
Additionally, President Obasanjo stood up for her and her efforts. Even though “parallel” activities that were kept outside of her purview, such as those in the petroleum industry, continued, President @GEJonathan actively supported her. However, where a @cenbank is truly independent, as we were in our time, it can act as a check on the worst excesses of wasteful politicians, who frequently dot Nigeria’s landscape of high-level public appointments. This is in the interest of the country.
“In the current situation, it is clear that the Bank’s leadership does not support the idea of operational independence for central banks. Instead, after the Presidency tells to “jump,” the Bank queries “how high?”. It considers itself to be a quasi-fiscal agent for the current administration, using its power to print money. The parasites and rent-seekers who profit from this arrangement describe this as “unorthodox” central banking (as in, of course, central banking in Zimbabwe and Venezuela).
“So, how did today’s outcome turn out? The Nigerian economy has collapsed due to a mismanaged fiscal environment and a seriously compromised central bank that sold its soul to politicians and private sector profiteers. How can we effectively combat inflation if the CBN is busy printing money for the government through illegal Ways and Means lending and then pretends to be doing so by belatedly raising the Monetary Policy Rate and what one commentator aptly referred to as a “dubious” cash reserve ratio policy on commercial banks?
Just as some would sarcastically or ignorantly allude to the levels of debt to GDP ratios of sophisticated, productive economies, don’t tell me that “inflation is a worldwide issue.” Real global difficulties are one thing, but fundamentally destroying our own economy at the hands of crooked officials, special interests, and inept political figures is quite another.
The combined fiscal, monetary, and foreign exchange catastrophe overseen by the Federal Ministry of Finance, Budget, and Planning, on the one hand, and the CBN’s leadership during the past seven years, on the other, is a tragedy for Nigeria that could have been prevented. It is extremely heartbreaking to observe the effects on the everyday life of Nigerians. The next president of Nigeria should take note of this warning tale.
“Doing what is right will be the proper politics if we want to rejuvenate and revive Nigeria’s economy. Let statutory autonomous institutions function as intended. Critical facets of our national life should be governed by competence.
“After all, the political leader will take the credit too when the favourable outcomes inevitably appear! For this reason, I have maintained that Nigeria’s economic management issues are not caused by a lack of skill. Lack of capable political leadership is the issue.
The CBN is currently Nigeria’s public sector’s largest repository of excellent, qualified technocrats. The Bank has always played a significant role in providing competent individuals for secondment to other government institutions. Technocrats and economists of the same grade are still employed. Their options are limited by the politics at the top.