Unlike Dr. Death, Christopher Dunsch, a real-life Texas based surgeon who in 2017 killed nearly 40 patients he operated on between 2011 and 2013, Nigeria’s ex central bank governor, Godwin Emefiele, uses mortal monetary policy errors to ensnarl the vast majority of Nigerians in the dungeon of poverty.
Since Emefiele became the number one monetary policy officer of the nation in 2014, the country has undergone a recession, while a huge number of Nigerians have been living in pestilential squalor, which unfortunately, leaves President Tinubu and his team a herculean task of fixing a battered economy.
Of course, the single most important responsibility of the central government is ensuring price stability and thus contributing to economic development and financial stability.
However, Godwin Emefiele mortal errors are responsible for protracted price instability and economic downturn as red-hot inflation is stealing workers’ wages and disrupting asset prices.
A deep-witted sagacious central banker formulates policies that allures foreign investors so as to shore up the external reserves and magnify business activities and spur economic growth.
But Godwin Emefiele’ opaque, nebulous, and vague policies such as the ban on forty something items from the official widows of the Apex bank in a country of over 200 million without infrastructure to support local production and his inability to curb the foreign exchange crisis brought on by the precipitous drop in crude oil prices exacerbated by the coronavirus pandemic eroded investors ‘confidence in Nigeria’s domestic economy as evidenced in a sharp drop in foreign direct investment (FDI).
FDI flows into the Nigerian economy dropped from $8.41 billion in the first quarter to $1.69 billion in the second quarter, accounting for a 80% decrease within three months, according to the Nigerian Investment Promotion Commission (NIPC).
The report had also revealed that the total value of investment interests in the first half of this year fell by $1.57 billion to $10.11 billion, compared with the value recorded in the second half of the previous year.
Nigeria’s inflation rate was 8.06 percent in 2014, and now it has skyrocketed to 24.61 percent in March 2023, according to data from the National Bureau of Statistics (NBS).
The harsh macroeconomic environment created by Godwin Emefiele has paralysed the manufacturing activities while companies are passing on rising input costs to consumers in the form of higher prices. In short, a lot of firms have closed shop while some have exited the country, a double whammy for a country reeling from high unemployment.
A multi-national consulting firm, KPMG, has said the Nigerian unemployment rate had increased to 37.7 per cent in 2022 and will further rise to 40.6 per cent, due to the continuing inflow of job seekers into the job market.
The number of Nigerians living in poverty stands at over 133 million, according to recent data from the NBS.
Buhari should have chastened Emefiele
Like a dog shaking off fleas, outgoing president Muhammadu Buhari should not have renewed Emefiele’s tenure in 2019, maybe that would have saved the country from this calamity.
Of course, some leaders chasten their economic advisers when there are no improvements in economic conditions or improvement in standard of living.
Turkish President Tayyip Erdogan, had fired four central bank governors in the space of 4 year over high inflation and weak lira.
Emefiele’s Political Naira redesign policy brings Hardship and poverty
Godwin Emefiele loves to stoke chaos in which he seemingly thrives in.
Yemi Kale, a former Statistician General of the NBS, said Nigeria may see a major collapse in its Gross Domestic Product (GDP), as a result of the negative impact of the central bank’s Naira redesign policy on cash availability.
This is because about 40% of Nigeria’s N198tn GDP in 2022 is informal of which about 90% is cash based. Further 30% of formal sector GDP is cash based. This means N106.9tn of total GDP is cash based, said Kale”
Even after the Supreme Court has ruled that old banknotes remain legal tender until the end of the year, the new notes are still inaccessible and scarce.
Does it mean the withdrawal of old notes was politically motivated?
“The leadership of the CBN over the past 9 years did not believe in the liberalisation of the FX market, contrary to the orientation of the Tinubu administration which seeks liberalisation of the FX market to block leakages and enhance the transparency in a way that should stimulate FPI and FDI into the economy,” said Abiola Rasaq, former Economist and Head, Investor Relations at United Bank for Africa Plc.