Obinna Chima writes that President Muhammadu Buhari’s nomination of Dr. Kingsley Obiora as a deputy governor of the Central Bank of Nigeria is appropriate and if confirmed, Obiora will inject fresh idea into the economy
In June 2019, the Central Bank of Nigeria (CBN) Governor, Mr. Godwin Emefiele, unfolded the bank’s policy direction for the next five-year.
In the strategic plan, the central bank is targeting double-digit growth, single-digit inflation, $12 billion non-oil exports by 2023 and raising financial inclusion to 95 per cent level by 2024.
The central bank also intends to, within the period, retain the managed-float exchange rate, recapitalise the banks, preserve domestic macroeconomic and financial stability and foster the development of a robust payments system infrastructure, among others.
These and its achieving its core mandate as well as the herculean task of supporting the fiscal authorities in repairing the Nigerian economy, clearly require round pegs in round holes.
That is why President Muhammadu Buhari’s nomination of a 43-year old Alternate Executive Director of the International Monetary Fund (IMF), Dr. Kingsley Obiora, as a deputy governor of the CBN has continued to gain commendation.
Some commentators have said the appointment, which comes few months after the president constituted an Economic Advisory Council, shows the resolve of the president to attract the best hands in his quest to propel economic growth.
Obiora, whose nomination is subject to the Senate’s confirmation, is expected to bring energy, exuberance and a fresh perspective – a new look at old problems – to central banking in the country, while working with his other colleagues on the board of the bank.
With his nomination, Obiora will be replacing Dr. Joseph Nnanna, the deputy governor of the CBN currently in charge of Economic Policy, who will attain the age of 70 at the end of this month and will retire on February 2, 2020.
In a letter to the President of the Senate, Dr. Ahmad Lawan, Buhari said the nomination was in accordance with the provision of Section 8(1)(2) of the CBN Act 2007.
Prior to his stint as the alternate executive director at the IMF, Obiora worked with the CBN from 2014-2018, where he was the Special Adviser to the CBN Governor on Economic Matters and contributed significantly to the overall analytical and policy framework of the CBN.
He also led the team of several technical aides attached to the governor’s office.
From 2011 to 2014, he served as a Technical Adviser to the Economic Management Team as well as Special Assistant to President Goodluck Jonathan’s Chief Economic Adviser.
Under Buhari, he led the team that built the macroeconomic framework for the administration’s Economic Reform and Growth Plan (ERGP), which has been the central policy document for the current government. From June 2014 till July 2018, he served as special adviser on economic matters to Godwin Emefiele, governor of the CBN.
Between 2007 and 2009, he worked with the IMF as an economist in the European Department, where he was responsible for Lithuania and involved in real sector issues, analyses and forecasts for the country, among several other responsibilities.
Obiora is a seasoned economist, with a Bachelor of Science Degree in Economics and Statistics from University of Benin, as well as a Master of Science and PhD Degrees in Economics from the University of Ibadan.
In addition to his qualifications, he has attended several training programmes in Nigeria and overseas.
In fact, since his academic and career distinction of the early 2000s, Obiora has directly supported the economic policies of three presidents, including the incumbent.
While working at the Centre for Econometric and Allied Research (CEAR) between 2003 and 2006, he contributed to the development of an econometric forecasting model for Policy analyses for Nigeria’s National Planning Commission.
He also contributed to developing the macroeconomic framework for Nigeria’s National Economic Empowerment and Development Strategy (NEEDS) II programme under former President Olusegun Obasanjo.
Obiora has co-authored at least 25 academic papers, which have been published and presented across the world.
For instance, he authored the IMF working policy papers, which include: ‘Decoupling from the East Toward the West? Analyses of Spillovers to the Baltic Countries,’ published by the IMF in 2009, as well as, ‘Do Trading Partners Still Matter for Nigeria’s Growth? A Contribution to the Debate on Decoupling and Spillovers.’
CBN’s Strategic Focus
As stated earlier, Obiora is expected to contribute to the CBN in actualising its policy objectives for the next five years, both in terms of its core mandate as well as its aggressive development finance mandate.
For instance, cognisant of the fact that close to 40 per cent of adult Nigerians do not have access to financial services, the bank has implemented series of initiatives that would drive our efforts aimed at building a more financially inclusive society.
Some of these measures include the promotion of alternative banking channels, agent banking and the Shared Agent Network Facility (SANEF), all of which are intended to deepen penetration of agent networks in underserved locations across the country.
The recent unveiling of the policy on payment service banks was also an additional step aimed at leveraging on the distribution networks of nonbank entities, such as fast-moving consumer goods companies, Fintechs, and mobile network operators, in providing financial services to underserved communities.
“With these schemes in place, we believe that over the next two years, over 80 per cent of Nigerians will have access to financial services,” the CBN Governor, Mr. Godwin Emefiele had said.
The CBN governor had said in the next five years, monetary policy measures would be geared towards containing inflationary pressure and supporting improved productivity in the agricultural and manufacturing sectors.
Also, the CBN, working with other stakeholders, pledged to, in the next five years, reduce the cost of food items, which has considerable weight on inflation.
“Our ultimate objective is to anchor the public’s inflation expectation at single-digit in the medium to long run. We believe a low and stable inflationary environment is essential to the growth of our economy because it will help support long term planning by individuals and businesses.
“It will also help to lower interest rates charged by banks to businesses thereby facilitating improved access to credit and a corresponding growth in output and employment.”
He had said the country remained committed to a free trade regime that is mutually beneficial and particularly aimed at supporting domestic industries and creating jobs on a mass scale for Nigerians while the dynamics of global trade continues to evolve in advanced economies.
He said the CBN would support measures to increase and diversify Nigeria’s exports base and help in shoring up reserves.
“We intend to aggressively implement our N500 billion facility aimed at supporting the growth of our non-oil exports, which will help to improve non-oil export earnings,” he stated.
He said though the goals were onerous and tasking, the CBN would remain committed to fulfilling its mandated objectives of price and exchange rate stability.
He added: “We will continue to work to safeguard the stability of our financial system, while supporting the development of a payment system infrastructure that will improve access to credit for all eligible Nigerians.
“Nevertheless, additional emphasis will be placed on supporting greater growth of our economy and in reducing unemployment, through targeted interventions in the agricultural and manufacturing sectors.”
Emefiele said the CBN would also work with its counterparts on the fiscal side in supporting improved foreign direct investment (FDI) flows to various sectors namely agriculture, manufacturing, insurance and infrastructure.
He said the measures, while supporting improved inflows into the country, would also help to stabilise exchange rate and build external reserves.
According to him, between now and 2024, emphasis would also be placed on improving speed and efficiency of payment channels, while working to ensure that digital channels are safe and secure as this will help to build confidence in the nation’s payment system.
Emefiele said to improve utilisation rate, the CBN would continue to ensure that payment channels were interoperable, to enable individuals with digital devices to transact across different banks or payment modes.
He assured the public of significant improvement in the payment system under his leadership.
He said the CBN would further work with NIBSS, banks and Fintechs in developing a regulatory sandbox to “enable us to test financial innovations by Fintechs and banks in a controlled environment, in order to assess its impact on the growth and safety of our financial system.”
The CBN governor said he would boost productivity growth through the provision of improved seedlings, as well as access to finance for rural farmers in the agricultural sector, across 10 different commodities namely rice, maize, cassava, cocoa, tomato, cotton, oil-palm, poultry, fish and livestock/dairy.
According to him: “Our choice of these 10 crops is driven by the amount spent on the importation of these items into the country, and the over 10 million jobs that could be created over the next five years if efforts are made to expand cultivation and processing of these items in Nigeria.
“We believe these measures will help to boost not only our domestic outputs but also improve our annual non-oil exports receipts from $2 billion in 2018 to $12 billion by 2023.”
He said CBN intervention programmes would strengthen the linkage between farmers and agro-processors/ manufacturers by ensuring that the output of farmers is purchased by agro-processors/ manufacturers.
Therefore, it is expected that when confirmed by the Senate, Obiora, who has over the years demonstrated an unquenchable desire for excellence, hard work, and commitment to assigned responsibilities, would contribute in actualising the central bank’s mandate.