With Dele Sobowale

Why must a banking system with Islamic background be forced on the throat of a country that is plural in religion? It should not be accepted or else Nigeria is heading towards disintegration.” Reverend Peter Akinola, immediate past Primate of the Church of Nigeria (Anglican Communion) in Vanguard, Monday July 11, 2011, p 8.

You will recollect reading last week that, “Sanusi is now guaranteed to ignite controversy simply by saying “good morning” at 7 am.” The choice of words was deliberate.

It was designed to signpost the fact that the issue of Non-Interest or Islamic Banking had become controversial mainly because the CBN Governor announced it.

That in itself is an indication of how much of the followership, nationwide, the CBN Czar has lost. Yet, there is nothing more dangerous for a leader to look back and find that nobody is following.

*CBN Governor, Malam Sanusi Lamido Sanusi

For Sanusi to succeed in his mission as Chief Monetary Policymaker, he must find a way to carry the rest of us along. Right now, he is on his own — even when he is right.

Reverend Akinola represents the “Christian” position and his pronouncement is similar to what other members of the Christian Association of Nigeria, CAN, have said on the subject.

The former Primate of the Church of Nigeria has carried the CAN position to the extreme in his prediction of dire consequences – more catastrophic than even he imagines. But, is the man of God right?

Before proceeding, let me declare that I was brought up an Anglican. I attended St Peter’s (Anglican) Primary School Faji Lagos, Igbobi College (founded by Anglicans and Methodists) and was confirmed in 1960 by Bishop Howells (Anglican) of blessed memory.

By the way, our laws were largely bequeathed to us by Britain and they have their origins in Judeo-Christian precepts with little influence from Islam or traditional religions.

If Nigeria, a plural society, as admitted by the Reverend, did not disintegrate on account of that, it is difficult to imagine that the mere introduction of a new set of banks will do it.

At any rate, how many countries will emerge from the disintegration? This is Nigeria, with 250 ethnic groups, not Sudan. So, nobody reading what follows should read religious bias into it.

I am also a Christian! And our faith enjoins us to search for the truth in all matters. On this matter, CAN has been unnecessarily alarmist.

However, two points must be acknowledged which might support the position of the Christian communities. Nigeria is a country notorious for turning measures which had been successfully adopted elsewhere into astonishing failures.

Examples include NEXIM, NERFUND and SAP; all economic initiatives during the Babangida administration which were copied from other nations after successful trials and which turned to nightmares for government in Nigeria. IBB at one point was reported to have asked “Why is it that no economic theory works in Nigeria?” or, words to that effect.

The answer I gave at the time was simple: “No policy had been faithfully executed as intended by economists; politics and corruption get in the way.” Non-interest banking, on the face of it, constitutes no threat to non-Muslims. But our penchant in this country for subverting even the most noble intentions gives room for concern and caution.

And those anxieties are not allayed by the CBN Governor’s invitation to those opposed to it to “go to court.” The courts can decide whether or not he has the power to introduce any banking product. No court on earth can stop social upheavals that might result from it.

Courts can determine law but they cannot persuade people – that is the duty of the CBN to which it should attend with deliberate urgency. Fortunately, all is not lost – at least not yet.

Second, the stipulation that a Nigerian Islamic Bank must establish Sharia Advisory Committee must be problematic. The question needs to be asked if such Advisory Committees were established in the US, Britain, France, South Africa and Luxembourg – countries predominantly or totally Christian.

Why not request for an Advisory Committee, period? To that extent, the CBN has raised fears which must be addressed.

One thing needs to be made absolutely clear; nobody will be compelled to patronize a non-interest or Islamic bank.

For once, Malam Sanusi Lamido is being hounded by my fellow Christians for no just cause. Fortunately, this is not just my position, it is also the stand taken by Dr Okonjo-Iweala, a Christian, the re-appointed Minister of Finance.

The immediate past Governor of the CBN, Professor Chukwumah Soludo, another Christian, must also maintain the same view because he actually approved the establishment of the bank before he left office.

Sanusi is merely trying to implement the measure started by his predecessor – nothing more. And let me quickly add that in seeking solutions to our economic problems, we cannot afford to be blinded by religious sentiments. We must look for answers wherever on this planet we can find them – including the Arab countries.

Most of the hysteria in connection with the introduction of Non-Interest Banking is actually premature. While it is a new idea in Nigeria, it is already in operation in several countries including the United States, Britain, France and South Africa – among others.

If those predominantly Christian nations can survive non-interest or Islamic Banking without disintegration, there is no reason why Nigeria cannot.

What then is non-interest or Islamic Banking? Briefly stated, it is a form of banking under which borrowers are not charged any interest for the loans advanced.

In lieu of interest as in conventional banking institutions, the bank takes any equity position which allows it to share in the profits and losses of the venture. Again, unlike conventional banking under which the bank takes very little interest in the operations of the firm, sometimes leading to diversion of funds into other activities (including illegal transactions), the non-interest banking institutions take more interest in the businesses they promote.

They provide expert advice; they mentor and they work closely with entrepreneurs to ensure, as much as humanly possible, that the venture succeeds.

Indeed, if there is a great contribution to international finance by non-Western countries and the international gate keepers, World Bank and IMF, Non-interest banking, coming from outside the mainstream, which is falling apart, might be considered one.

For Nigeria specifically, Non-interest or Islamic banking might attract more funds into the banking system and permanently crash interest rates charged by traditional banks. One of the factors responsible for high production costs might be removed.

It is estimated that $4 trillion is floating around in the Middle East – petro-dollars seeking outlets for investment. We would be foolish not to try to attract some of that money.

If anything at all, the investors should worry about investing in Nigeria. After what we did to NERFUND – our own participatory investment vehicle, and our penchant for not repaying bank loans, foreign investors seeking Non-interest Banking licence should not be discouraged further by unnecessary alarm based on religious sentiments.