By Innocent Anaba
Central Bank of Nigeria, CBN, was the focus of discussion at the 2012 Annual Public Lecture organised by the law firm of J-K Gadzama & Partners in Lagos, recently.
CBN’s insistence on the introduction of the N5,000 note, until President Goodluck Jonathan caved into pressure from Nigerians to stop it, had compelled Nigerians to ask if the apex bank was too powerful and should be brought under legislative control so that some of its policies can be thoroughly examined before implementation or it should be left to carry on with the way it has been carrying out its duties.
Speaking at the event, former Information Minister, Mr Frank Nweke (Jr), who delivered the lecture entitled: Nigeria in the Year 2012: The Vision of a Cashless Economy, noted that the National Assembly must not tamper with CBN’s autonomy, and described as “unhealthy” what he said was a deliberate effort by the lawmakers to “subordinate” the CBN.
He pointed out that such a move was “unhealthy and clearly portends danger for the management of Nigeria’s monetary policy management. In order for CBN to be effective, their work must be devoid of any political considerations and or interference.
“The precedents which are now being laid by the National Assembly with the proposed amendment of critical sections of the CBN Act 2007 to strip it of its autonomy, and most recent interference in the project CURE, run against the grain of global best practices,” he said.
CBN Deputy Governor, Corporate Services, Alhaji Suleiman Barau, who represented Mallam Lamido Sanusi, governor of the apex bank, warned against political control of the bank. He noted that politicians, who “think short term” would be more concerned about pleasing the electorate with a view to winning election, and could try to hold CBN back from certain policies that may appear unpopular.
Executive Director, Community Development Foundation, Mr Akin Akintola, on his part, said the CBN should have “100 per cent independence,” adding, however, that the apex bank should not run too fast to get policies that might subject the people to untold suffering.
Senator Nkechi Nwogwu, a former Chairman, Senate Committee on Banking, argued that CBN “is not an island” and cannot be absolutely independent.
“There is no agency that is an Island. We are saying that there are some CBN projects that need democratic review. Certain monetary policies must be brought before the legislature for a review. That is what we are concerned about. We are not at loggerheads with CBN. What we are saying is that they should consider the opinion of Nigerians.”
Chief Anthony Idigbe, SAN, agreed, noting that CBN should not be given the freedom of power without control, noting that absolute power can lead to corruption.
“The greatest fear of Nigerians is arbitrariness in implementation of policies. There should be some level of oversight over the CBN,” he argued.
For Chief Judge of Lagos, Justice Ayotunde Phillips, what she wants is a drop in the charges banks impose on transactions. Nigerian Bar Association (NBA) President, Chief Okey Wali, SAN, represented by Dr Joseph Nwobike, SAN, noted that interest rate regime in the country was “suffocating.
“Over 60 per cent of businesses that borrow money from banks ultimately fail. Those of them, who are operating do so on pretentious grounds. The issue of interest rate is more important to us Nigerians. “There is nothing with introducing N5000 banknote. What is wrong is access to it, and not whether or not it is introduced. In any case, the CBN governor is doing very well. He is an intellectual. But I think he has to do more in managing interest rate.”
Justice George Oguntade, retired Supreme Court Justice, in his own contribution, faulted the high interest rate, noting that it was “curtailing growth.” He recalled that he discouraged his wife from obtaining a bank loan to run a private school because repaying is difficult.
Idigbe, who discussed Nweke’s paper, said even law firms need credit to carry on successful practices so that they can compete globally.
Akintola criticised the imposition of penalties on Cash-lite Lagos, saying CBN should have encouraged incentives rather than fines. He said government should also pay the penalties.
Head of Chambers, J-K Gadzama & Partners, Abuja Office, Mr Henry Michael-Ihunde, called for a strong regulatory regime for the legal profession. He called for the establishment of an Independent Financial Ombudsman to address issues raised by bank customers in the cash-less regime.
Chief Joe-Kyari Gadzama, SAN, whose firm organised the lecture, said it was in fulfillment of their corporate responsibility to the society. He said, “By our mission and vision as a firm, we seek to contribute not only to the growth and progress of the legal profession in Nigeria, but the nation as a whole. This, we intend to achieve, through our annual public lecture.
“Over the years, issues affecting the Nigerian populace had been analyzed and solutions proffered. The annual event is part of efforts aimed at giving back a little to the society that had given us all we have today, especially now that we are not just a law firm, but a Limited Liability Partnership.”