The battle line is drawn and hardening with each passing day. The billion naira question is: Will Soludo survive the impending war as he did that of the banking consolidation? The answer is: may be —Dele Sobowale, Sunday Vanguard, August 19, 2007, p 7.

FORGIVE me for quoting myself but it is merely designed to remind our readers of the fears that were expressed immediately after the governor of Central Bank of Nigeria, CBN announced the new strategic alliance for the naira on Tuesday, August 14, 2007.

The governor received a standing ovation for another virtuoso performance from the audience except for a few. One of the few not standing and clapping was the “Duke”, Nduka Obaigbena, the publisher of Thisday, sitting very close to me. The Duke was not convinced by the governor.

I was also not standing. But, I was glued to my seat, despite the long cherished Yoruba custom of giving honour to whoever deserves it. Instead, I was immobilized because of an Area Boy’s instinctive feeling that a war had been declared by the governor without realizing it.

Blood would flow or heads would roll. Whose blood and whose heads? After the briefing, most of my media colleagues headed back to Lagos and Ibadan; so did I. But, I quickly repacked my bags and headed back north where I suspected a battle line was forming against Soludo.

Driving to Jos, Kano, Katsina, Kaduna and Lokoja at a pace that Napoleon Bonaparte, 1769-1821, would have envied, I proceeded to get in touch with friends from my ten years spent working and living in the north that I knew to be within the northern power structure or were close to it.

By Friday night, August 17, 2007, when I sought the services of a university cyber café to send my piece: New naira policy: will soludo survive this? I was certain that there was nobody of significance in the north who was not against the policy for one reason or another.

With the North solidly against, it would have required a totally unified south for Soludo to expect a drawn battle; no victor and no vanquished. Unfortunately, I also knew that even the south was strongly divided on this issue. The conclusion from all this was obvious: Soludo was headed for a defeat which might even go beyond the reversal of the policy but which might threaten his job as well.

The events of the last two weeks have confirmed my worst fears. Professor Soludo had been forced to withdraw the policy; he has also been distanced from the Economic Management Team, EMT, while two of his subordinates have been included probably without his prior consent.

Calls for his resignation still rang out despite his public capitulation to superior forces. He wisely followed that age-long counsel of sages: “Accept gracefully what you cannot otherwise refuse.” But, is the war over? It is doubtful and the reasons are not too difficult to discover.

First, the nation now has “a wounded lion” who, as long as Soludo remains in office, poses a threat to those whose vested interests his policies would damage.

And as long as Soludo strongly believes in those policies his presence in the office leaves open the possibility that they might re-emerge again. Secondly, within the CBN, he has at his command enough incontestable constitutional powers to make some of his adversaries pay dearly for the humiliation he has suffered as a result of this public rebuke.

Thirdly, the tacit approval of those policies by the World Bank and other key Western financial players means he possesses an “external army” which could still be mobilized in support of his position. In the end, he might turn the victory into a defeat for his detractors.

While that is true of Soludo, it is also unlikely that Yar’Adua will move very soon to remove the CBN governor unless Soludo himself resigns especially after the capitulation.

The nation requires a certain measure of stability in its macro-economic policies and Soludo remains the last key player from the Obasanjo administration. Even, if the reforms are to be re-visited, as they should, the process needs to be gradual to ensure that the nation does not again enter the trap of frequent policy reversals.

For that reason,Yar’Adua needs Soludo still at the CBN and will probably keep him there despite the insistence of the “fire-eaters”of the north who want him to push the CBN governor out immediately.

Interestingly enough, this totally avoidable disaster was brought about by two factors which have received little attention, at least to the best of my knowledge.

The first was the Central Bank of Nigeria Act which was signed into law on May 25, 2007, four days before his departure, by former President Obasanjo. I know Baba Iyabo’s admirers will again ask us to leave him alone. But, when a leader departs office by leaving banana peels all over the place, he has “murdered sleep.”

The Act, which was hardly put through the rigours of public debate and scrutiny such as attended the Freedom of Information Bill, FIB, empowered the CBN governor to an extent unprecedented in our history.

Whether or not such enormous powers which might be justifiable, given Soludo’s previous track records, would be generally advisable, if others less talented as he came to the helm, was probably not considered at all. It is my belief that Obasanjo saw it as an instrument to protect his “reforms” and nothing more. But, in the end it has placed the CBN governor and any President in potential conflict.

The other element contributing to the tragedy was the quality of legal advice Soludo received. To the extent that Section 19 subsections 1 and 2 made it mandatory for the governor to seek the approval of the President before national currency is issued, then the governor was misled by his legal advisers who failed to draw his attention to those provisions of the Act.

There is little doubt in my mind that Soludo would not have acted as he did if the legal advisers have briefed him properly on the due process. Where do we go from here? I think Yar’Adua should be magnanimous and accept the governor’s apology; keep him in office and work with him for the sake of our country. Anything else will just prolong this unfortunate and needless controversy and distract everyone from the enormous tasks of nation building ahead of all of us – both in and out of government.

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