Appointment of CBN governor: Beyond geo-politics
Over the years, except for few exceptions, the appointment of the Central Bank of Nigeria (CBN) governor has been based more on political consideration than on merit by whoever was the president. For this reason, the chances are narrowed to only those with powerful connections. This, however, has had dire consequences on the nation’s economy.
Ahead of June when Sanusi Lamido Sanusi’s tenure as the CBN governor expires, some individuals have begun to fly the kite of geo-political consideration in the appointment of his successor.
The opinion of Nigeria-watchers is that the job should go to the most qualified person, irrespective of geo-political zone of origin. Rather than emphasise where the person comes from, they argue that what Nigeria needs is a CBN governor who will focus on the economy, using macroeconomic policies and prudential measures to create jobs and revive key sectors of the economy such as agriculture and manufacturing.
Alas, merit has always suffered in a country where ethnic and geo-political balancing is an important consideration during federal appointments.
Such an arrangement has always enthroned and entrenched mediocrity. The quota system and federal character adopted by the Federal Government in job recruitments, admission into institutions of learning and political appointments have had telling consequences on the nation’s development. For instance, such considerations have given rise to corruption, impunity, exaggeration of ethnicity above the unity of the country, and outright deprivation of qualified candidates.
Following from the above background, pundits have advised the Federal Government not to pigeon-hole the search within a particular area but seek out the most suitable candidate for the position of the CBN governor irrespective of where individual may be found within the six geo-political zones of the country.
The pundits believe that wherever the next CBN governor comes from is not really an issue, provided such an individual will perform creditably on the critical role he or she is assigned.
In this regard, President Goodluck Jonathan’s reference and warning against Nigerians’ excessive attachment to ethnicity and religion is instructive. While addressing the National Executive Committee (NEC) of his party after the emergence of Adamu Mu’azu as the new national chairman of the ruling party, Jonathan said: “In Nigeria, we are all religious people, but some people take religion to a level that becomes a bit uncomfortable. As long as Nigeria is a secular society, your religion should not influence your decision.”
If the observation could be stretched a little further, it means that undue consideration should not be given to where an individual comes from in matters of appointment for national assignment.
Henry Nwagbara, CEO, Hencova Ltd, and policy analyst, advised that government must avoid politicising the appointment. According to him, government must employ the best hand for the job.
“I have always said that the quota system or rotational arrangement we patronise in this country has destroyed talents. Abraham Lincoln said, ‘You cannot strengthen the weak by weakening the strong. You cannot help small men by tearing down big men.’ This is the problem we have been facing in Nigeria. Let the best hand be appointed no matter [where] he comes from; let them look for a sound professional, whether an economist of banker; it must be on merit,” he said.
Determined outcome?
Someone recounted his experience when he was arrested some years ago as a result of a piece he wrote on CBN. But when he explained the reason for the article, and lectured his tormentors that the write up was, indeed, in the very best interest of the establishment, he was asked what part of the country he hailed from. His reply that he hailed from Oboro under Umuahia in the current Abia State attracted a shocking comment from the person interrogating him. He said: “If you hailed from the North, we would have pencilled you down as a future CBN governor”.
His reply was: “If it is God’s wish that I will be CBN governor, one day I will”.
The individual said the lesson he learnt from the encounter was that “CBN governors are determined well ahead of time. It is not by merit.”
Speculations
Speculation is rife as to who becomes the next CBN governor. A few days ago, there was speculation that Aigboje Aig-Imokhuede, immediate past managing director of Access Bank; Bisi Onasanya, MD, First Bank of Nigeria Limited; Mustapha Chike-Obi, MD, Asset Management Corporation of Nigeria, and three deputy governors and one retired deputy governor of CBN are in the race. The deputy governors are Kingsley Moghalu (Operations), Sarah Alade (Economic Policy), Suleiman Barau (Corporate Services Directorate) and retired Tunde Lemo. Others said to be on the card are Olusegun Aganga, minister of Industry, Trade and Investment, and Yerima Ngama, minister of state for Finance. Names of a few Nigerian technocrats in diaspora are also being touted as dark horses.
The man/woman for the job
A commentator advises the government to “look beyond politics and consider the challenges of the job in choosing Sanusi’s successor”, adding, “Government must avoid the embarrassment of a talkative CBN governor who speaks before thinking of the implication for the economy.” In the commentator’s view, “The 21st Century CBN governor must be conversant with trends across the globe, and must understand that his job is crucial to the economy of the country. He or she is not to serve a narrow interest of a cabal. He/she must be a technocrat, a person with track record of performance, not autocratic, but non-partisan and without hidden interest in the industry. The person must be of sincere character.”
A former manager with the defunct African Continental Bank (ACB), who spoke on condition of anonymity, said: “It is difficult to divorce politics from such an appointment in a country like ours. We run a system where everyone of government’s steps is criticised and viewed as marginalisation. If the post of a finance minister is in the south, as we have it now, it may be difficult to appoint someone from the same south as the CBN governor without being accused of marginalising people. However, if I were in the position of the President, I would look for the best hand, no matter where the individual might be found, after all, the bottom-line is performance in the interest of the country.”
The buck stops at President’s table
In Nigeria, the trend has been for every head of state or president to appoint his man as CBN governor with whom he can work hand-in-glove. Usually, when the governor assumes office, he changes existing policies and pursues his own agenda. Following this trend, President Goodluck Jonathan may have concluded plans on who to appoint as Sanusi’s successor.
Critics say that the President is not likely to appoint a person in Sanusi’s mould going by the alleged embarrassment the outgoing governor brought to Presidency.
A national daily recently canvassed the zoning of the slot to a certain part of the country. The author of the story had reasoned that 2014 being a pre-election year, politics must come into play in the appointment of Sanusi’s successor.
According to the report, “there are feelers that whoever will become the CBN governor will have to be someone that is a friend of the president because … the Presidency will not want to appoint anyone that will not be loyal to Jonathan.”
When Olusegun Obasanjo became president in 1999, he immediately appointed Joseph Sanusi, who retired nine years earlier as CBN deputy governor as substantive CBN governor in place of Paul Ogwuma. Sanusi started his own reform of increasing the minimum capital base of banks to N2 billion when not all the banks have complied with the capital requirement set by his predecessor in office. He abolished merchant banks and compelled many of them to convert to commercial banks.
This was in line with his vision that retail banking will serve Nigeria’s economy better. A critic said Joseph Sanusi further in 2001 introduced universal banking that made banks to become financial supermarkets.
On his re-election, Obasanjo appointed Chukwuma Soludo, a professor of economics, to replace the aging Joseph Sanusi. Immediately Soludo became CBN governor, he had a dream or vision for big and well-capitalised banks that would serve the credit needs of the economic units in the country. To achieve this aim, he increased the minimum capital base of banks to N25 billion, up from N2billion and gave banks 18 months grace period to comply.
By December 31, 2005, Nigeria had 25 banks from the nearly 80 banks in operation. The operating licences of banks that failed to meet the minimum capital were revoked. Although few banks met the capitalisation requirement on their own, many others met the requirement through mergers and acquisition or consolidation.
Experts picked holes in the exercise, alleging that it was full of flaws. In some cases, mergers resulted in marriage of strange bed fellows.
Repercussions of a politicized appointment
Often times, those appointed on the basis of connections rather than merits pander to the whims of their benefactors to the detriment of the country they are supposed to serve. The result is that each new CBN governor comes with policy reversals or somersaults that sometimes hurt the banks and the economy in general.
Appointment of a CBN governor on political grounds, to appease certain zones, results in warped policies targeted at pleasing individuals rather than move the country forward in terms of economic growth. Over the years, Nigerians have witnessed situations where the apex bank chiefs preferred to take orders from their traditional rulers to taking instructions from the President of the country.
There have also been instances where the CBN chiefs went contrary to the rules and donated huge sums of money to people from particular areas of the country because they themselves hailed from there. Such selective philanthropic gestures, rather than unite the country, worsen the culture of hate in society.
Politicisation of such an appointment creates the impression that Nigeria is not a serious country. What it tells the outside world is that the country is not interested in proper development but in the massaging of ego of some influential elements that have over the years held the country to ransom hiding under federal character and quota system.
By: Zebulon Agomuo