The Country Director of the International Monetary Fund (IMF), Scott Rogers on Thursday faulted the call by members of the National Assembly for the removal of the autonomy of the Central Bank.
Mr Scott, who spoke during the presentation of the IMF’s report on sub Saharan Africa in Abuja, said that the sustenance of financial system stable in the country will be truncated if the institution is not allowed to function independently.
“Without an independent Central Bank, you do not have an independent monetary policy,” he said.
Mr Scott said it was primarily because the CBN was able to tighten monetary policies that Nigeria’s reserves are raising again.
“It’s important that the Central Bank has the autonomy to hire the people they need, to remunerate them competitively, to be able to undertake the modernization they need to be able to manage payments and financial supervision effectively,” he said.
Mr Scott further said that the CBN should be able to perform its duties without fears of being penalised “because they took an unpleasant decision on interest rate policy or because they decided that they needed to close a bank.”
The IMF representative who suggested the tightening of fiscal policies to control the rise in inflation rate also said that all hands must be on deck to achieve structural reforms in the country.
According to him, the federal government’s petroleum subsidy and the millennium development goal of 2015 may not be achieved owing to the volatility of the oil market and lack of political will.
The immediate past Governor of the CBN, Chukwuma Soludo last weekend also warned against any move that could curtail the autonomy of the CBN as guaranteed by the CBN Act 2007.
According to him, such a move could jeopardize the effectiveness of monetary policy and management of the macro-economic framework in Nigeria.
“The survival of CBN as an institution is at the heart of the survival of the Nigerian economy,” he had declared.
A bill to amend the Act establishing the Central Bank of Nigeria recently passed the first the reading in the Senate while a similar move is on-going in the House of Representatives.
The CBN was embroiled in a controversy with the lawmakers, when it failed to present its budget to the national assembly.
The CBN Act allows it ruin as an independent body without the scrutiny of the national assembly.
