Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, has pledged not to leave a legacy of superintending over the death of any bank in the country.
The apex bank boss, who gave this assurance on Tuesday during an interactive session with chief executive officers and other top executives of private sector firms in Lagos, spoke on the theme: “The Nigerian economy in 2015: A review of recent developments in oil price and Nigeria’s foreign exchange market.”
He made the promise while reacting to remarks by one of the participants that he should suspend banks that are said to be encouraging unhealthy practices in the foreign exchange market.
Emefiele, who feared that such a move might cause panic in the system, averred, “I will try as much as possible not to suspend a bank, but we would try as much as possible to try to make them do the right thing. You see, I don’t want to leave a legacy of somebody who killed a bank. It is very simple. All I need to do is to ban them from the forex market from one week and there is going to be a run on the bank,” he said.
The CBN governor then went on to say that his aim was “to create financial system stability by ensuring that we support the banking and financial system so as to grow the economy.”
He held that it was natural for external reserves to appreciate whenever there is an increase in the price of crude oil as Nigeria is not the only country that have suffered depreciation or revaluation in their currencies.
According to him, “Beginning from Russia, whose currency has lost 40.3 per cent, Brazil and others. What we did was to look at 26 countries in the emerging market. Are you looking at Chile, Columbia? These are part of the emerging economies. I am not saying it is normal, but I am saying that sometimes this should be expected as a fallout of drop in commodity prices in the world.
“We have seen the pressure in the forex market arising mostly for the lopsided dependent on imports. Today in Nigeria, toothpick, tomato paste, furniture, rice, sugar, fish, petroleum products are all being imported into Nigeria.
“Perhaps, I want all of us to know that if we import one cent worth of toothpick, it impacts on the reserves. So, why should we be seen to be importing items that can be produced locally? I must give credit to the cement industry. The lesson from that sector is that if we are committed to a course, we can improve our economy.
“Some years ago, we were importing cement and the list of items of import in Nigeria, cement used to rank among the highest. Up to three years ago, we were importing cement in Nigeria, but today, we are not only producing cement for our local production, we have started to export cement and Alhaji Dangote is at the forefront of that,” he noted.
Emefiele threatened to ban the importation of certain goods and products which can be produced locally stressing that “We are not going to ban the importation of rice, but we are going to say we would no longer provide foreign exchange if you want to import rice into this country. If you want to use you dollars that you got from somewhere else to import rice, no problem!
“But with the way we are going, we would not allocate foreign exchange for you to import rice. The same way we would graduate it to other products,” he assured.
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