Objective Assessment of CBN’s Report Card Under Emefiele

Mohamed El-Erian, who served as chair of President Obama’s Global Development Council in his book: “The Only Game in Town: Central Banks, Instability, and Avoiding the Next Collapse,” highlighted challenges that confront central banks globally. In our local experience, it will be wrong if we fail to acknowledge the critically important role played by the CBN, more so, Emefiele who steered the apex bank to take up the gauntlet when all else seem to have failed

According to El-Erian, central banks have been considered the only game in town because since the 2008 global financial crisis, they have been shouldering majority of the burden and could be said to have taken on the role of salvaging the global economy at the behest of their national governments. Owing to this, they have been described as ‘the only game in town.’

He further pointed out that central banks today, not by choice, but by necessity, have been venturing deeper into tricky terrain of unconventional monetary policies which have seen them heavily intervening in the functioning of markets.

He revealed that during the 2008 financial crisis, in the US, a myriad of emergency funding windows were opened to enable cash to be injected into the financial system, and from virtually any and all directions.

Indeed, just as highlighted in this synopsis, the Central Bank of Nigeria (CBN) like other central banks across the globe, had its own challenges and also resorted to unconventional tools to wade through.

In Nigeria, faced with the challenge of the slump in crude oil prices in 2014, which thereafter snowballed into a foreign exchange crisis, the CBN had to continuously adjust its policies to achieve the desired results.

In addition, the delay by President Muhammadu Buhari in forming his cabinet several months after he was inaugurated in 2015, then put the responsibility of managing the economy on the shoulders of the central bank under the leadership of Mr. Godwin Emefiele.

Even when the economy slipped into a recession, the central bank had to intensify its intervention in critical sectors of the economy, in line with its development finance mandate, which played a significant role in supporting economic growth. This saw the regulator developing home-grown policies to surmount challenges that confronted the economy.

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https://sundiatapost.com/2019/04/04/objective-assessment-of-cbns-report-card-under-emefiele/