Food Import: There Has Been A Capture Of CBN Politically – Mailafia

Dr Obadiah Mailafia

 

 

The presidential directive to the Central Bank of Nigeria (CBN) on food importation has continued to spark mixed reactions across the country.

Among those who faulted the order recently is a former deputy governor of the apex bank and development economist, Dr Obadiah Mailafia.

The economist who appeared as a guest on Channels Television’s breakfast show, Sunrise Daily, believes the affairs of the CBN are being interfered with, rather than operating as an independent institution.

“There has been a capture of CBN politically; it has no autonomy anymore,” he said in an interview on Thursday.

Mailafia added, “It (CBN) has no independence anymore. It is just an appendage of some people who are using it for whatever purpose that they want.

“It’s like we’ve gone back to the military days where the military will literally bring trailers to the mint and order printing of fresh mints, load them into trailers and drive off with them.”


READ ALSO: Don’t Give A Cent To Anybody To Import Food Into The Country, Buhari Tells CBN

On Tuesday, President Muhammadu Buhari ordered the CBN to stop providing foreign exchange for importation of food into the country.

President Buhari                                                                                        CBN Governor, Godwin Emefiele

 

The President, who hosted the All Progressives Congress (APC) governors to Eid-el-Kabir lunch in Daura, had explained that the directive was important considering the “steady improvement” in agricultural production and attainment of “full food security” in Nigeria.

He stressed that the foreign reserve would be conserved and utilised strictly for diversification of the economy, and not for encouraging more dependence on foreign food import bills.

But the President’s directive to the apex bank had been criticised by economic experts and other Nigerians, including a former CBN deputy governor – Professor Kingsley Moghalu.


‘Thoughtless Thought’


On his part, Mailafia aligned himself with the position of the critics of the presidential directive, saying he was disappointed.

He described the order as ‘thoughtless’, saying certain procedure must be followed before making critical decisions relating to a nation’s economy.

The former CBN governor also insisted that the country has yet to attain the level of food sufficiency that could warrant such an order.

“We can never be more primitive in riding an economy. It is not only primitive, it is backward, completely backward thinking and we are not self-sufficient in food; that is very wrong,” he said.

Mailafia added, “I wish there was any thinking here; there’s been no thinking whatsoever.

“It’s thoughtless thought; you don’t run policy on a web, you run policy based on a technical and scientific understanding of the situation at hand and then, you put together a technical paper working out the various scenarios for every alternative cause of action.”

Food Import: Moghalu Faults Buhari’s Directive To CBN

Professor Kingsley Moghalu

 

The presidential candidate of the Young Progressives Congress (YPP) in the 2019 general elections, Professor Kingsley Moghalu, has criticised the presidential ban on providing foreign exchange for the importation of food into the country.

Professor Moghalu faulted President Muhammadu Buhari’s directive to the Central Bank of Nigeria (CBN) during an interview on Wednesday.

“The Central Bank does not require the formal and explicit approval of the President in order to perform its job,” said the former CBN deputy governor on Channels Television’s Politics Today.

He added, “That is another way of saying that the President himself or any political authority outside the bank should not be giving the bank direct instructions.”

READ ALSO: Don’t Give A Cent To Anybody To Import Food Into The Country, Buhari Tells CBN

President Buhari had said the directive was important considering the “steady improvement” in agricultural production and attainment of “full food security” in Nigeria.

But Moghalu, who cited Article 1 of the CBN Act (2007), stated that the apex bank has been mandated to be independent in the discharge of its responsibilities.

He, however, noted that the President can act exercise his powers by approving on three key areas of the financial institution.

The economist said further, “This is a fundamental principle of central banking around the world over the last four decades. There are only three instances in the operations of the Central Bank where the Central Bank requires the direct approval of the President.

“First is the approval of the annual account of the Central Bank. The President must approve it. Second is the approval of currency designs.”

“For the Central Bank to issue the coin of the realm as we say (naira notes), the President has to approve those designs and proposals.

“Thirdly, any external investment by the Central Bank itself as an institution has to be approved by the President. Outside of these three specific instances, the Central Bank does not require the approval of the President in order to perform its job,” he said.