——CBN does not allocate forex
———No country allow speculators attack it currency
——seed of current problem were sowed by past leadership
The Central Bank of Nigeria CBN, yesterday said that Sanusi Lamido Sanusi, the Emir of Kano was playing to the gallery in his comment that there are five exchange rates in the country. It said that the CBN does not allocate dollars to end users but that request for foreign exchange are made through their banks. It further said that there is no where in the world where the apex bank sits idle and and allow vicious currency speculators to distort its currency endlessly.
In a response to Sanusi’ comment at a policy monitoring dialogue hosted by Savannah Centre for Diplomacy, Democracy and Development, at Transcorp Hilton Hotel in Abuja on Friday, that the CBN had been lending to the government above the limits stipulated by the CBN Act of 2007 and that no one was willing to lend to the Nigerian government, stating that “if senate approved, I want to see who will lend you $30billion when you have five exchange rates”,
CBN’ acting Director Corporate communication Mr. Isaac Okorafor said “First i want to state that the Central Bank of Nigeria has set up an inter-bank foreign exchange market where anyone who wishes to buy foreign exchange can bid for and buy through their banks.
” It is not true that CBN allocates dollars. There is no where in the world that the Central bank sits by and allows vicious speculators to solely distort the value of its currency endlessly. All central banks intervene to buy or sell in the market to ensure that the local currency is protected from dubious attacks.
According to the CBN Director “The channels for advice and contribution of ideas on the current economic situation by all patriotic Nigerians are open. It is rather unfortunate that some people have chosen to play to the gallary and to make statements to disparage those in leadership at this time in total insensitivity to the larger interests of the Nigerian economy.
He further said “We should not forget that the seed of our current economic crisis was planted by the failure of those who occupied public office in the past but failed to act in the long term interest of the Nigerian economy. It is easy to criticize from outside.
” It is always easier and the grass greener when people are out of office. The challenge we face today is a choice between pandering to the established interest in Nigeria’s speculative economy and the protection of the wages of the real stakeholers who work hard on fixed incomes. For they are the core victims of Naira depreciation.
“At this critical time in the life of our country the CBN will continue to explore avenues with the Federal Government in order to find solutions to the current economic situation. Already Nigerians are waking up to the call to be more productive and to look inwards and to be less dependent on the importation of foreign goods
and services.”
It will be recalled that Muhammad Sanusi II, emir of Kano and former governor of the Central Bank of Nigeria (CBN), had said on Friday that the apex bank is illegally lending to federal government. Sanusi also said “the problem of the current government is not having the right policies to fix the current economic woes”. Sanusi said the CBN had been lending to the government above the limits stipulated by the CBN Act of 2007.
Sanusi’s presentation showed that CBN’s lending to the government since Buhari came in had spiked from about N1.5 trillion to over N4.5 trillion.
He had said “The CBN-FGN relationship is no longer independent. In fact, one could argue their relationship has become unhealthy,” he said. CBN claims on the FGN now tops N4.7 trillion — equal to almost 50% of the FGN’s total domestic debt. This is a clear violation of the Central Bank Act of 2007 (Section 38.2) which caps advances to the FGN at 5% of last year’s revenues. Has CBN become the government’s lender of last or first resort?”
Sanusi said at the dialogue that no one was willing to lend to the Nigerian government, further stating that “if senate approved, I want to see who will lend you $30billion when you have five exchange rates”. Sanusi said the country is enmeshed in heavy debts, stating that out of every N1 Nigeria makes, 40 kobo goes to debt and 60 kobo is left for salaries, health, education, power, infrastructure. He said oil is merely a working capital that cannot make the country rich. Nigeria produces one barrel for 80 Nigerians; Saudi Arabia produces one for 3 Saudis, Sanusi said.
He noted that in every economy, growth is driven by “consumption, investment and net export”, adding that “our exports cannot grow, without regulatory certainty or an increase in the price of oil”. He lamented that the country was spending money on repaying debts and also on recurrent expenditure, as against education, healthcare, power, and other infrastructure.The emir also stated that Nigeria is the lowest per capita spender on development in Africa. On speaking truth to power, Sanusi said: “I can’t apologise for being who I am. The government I served, I did not keep quiet. When I am not serving the government, I cannot keep quiet.”
