Nigerian Lawmakers Seek Sack Of CBN Governor Emefiele

House, CSOs, BillsSome lawmakers in the House of Representatives say the Governor of the Central Bank of Nigeria, Godwin Emefiele, should be sacked over his management of the country’s foreign exchange.

This is one position put forward as lawmakers considered the lingering scarcity of foreign exchange.

Addressing the House, a lawmaker said that the scarcity had continued to weaken the Naira against the dollar which now exchanges about 400  Naira to a dollar.

“The continuous weakening of the Naira against the dollar and other foreign currencies has affect the cost of goods and services production and has consequently made life more difficult for most Nigerians,” he said.

After deliberations on the issue, the House, however, resolved to have an ad-hoc committee investigate the Central Bank of Nigeria’s forex policies and recommend measures that would stabilise the Nigerian forex market.

The apex bank had on June 20 introduced interbank trading of foreign exchange to make the exchange market more flexible.

Despite the introduction of the policy, there is relative scarcity of forex, prompting the lawmakers to request that the Governor of the bank should be sacked.

The scarcity is propelled by demand for dollar needed by most importers, as the nation largely depends on imported goods.

It is a trend that the Nigerian government said some of its economic policies would address, reducing the preference of foreign products while patronage for made in Nigeria goods is promoted.

Highlights Of The Policy 

The CBN had released the highlights of the flexible foreign exchange market policy weeks after the Monetary Policy Committee announced its introduction.

After its meeting of May 24, the CBN said the policy would allow the bank retain a small portion of foreign exchange for critical transactions.

Key notes released stated that the market would operate as a single market structure via the interbank market and authorised dealers and that it would be purely an exchange rate market managed via Thompson Reuters platform.

Part of the key notes is that the CBN would participate via periodic intervention and would introduce primary dealers that deal with the CBN on a two way quote basis.

The primary dealers are also expected to deal with other players in the interbank market.

Other aspects of the key notes are that there shall be no pre-determined spreads on forex transactions and all forex purchases shall be transferable while 41 items shall remain inadmissible in the forex market for forex transactions.

The CBN will also offer long term forex futures and sales of forex forwards for end users must be trade-backed.

The non-deliverable OTC forex settled trades will help moderate volatility. The OTC settled forex feature shall be on non-standardised amounts, the apex bank said.

Another aspect of the key notes states that proceeds of forex shall be purchased by authorised dealers at the daily interbank rates.

The new police which the CBN said was a market-driven trading system, is expected to end the central bank’s 16 month fixed exchange rate policy.

After the highlights were released, Nigeria’s capital market made remarkable gains, with most stocks appreciating in price.

No Need To Panic

One of the leading global rating agencies, Fitch Ratings had welcomed the decision of the apex bank, saying that the shift to a more flexible foreign-exchange regime could aid Nigeria to adjust to lower oil prices and support growth.

It however, warned that the implementation of the new forex policy may present challenges if not properly managed.

Fitch explained that establishing the new framework’s credibility would be key to its effectiveness in attracting portfolio flows and Foreign Direct Investments (FDIs) to make up for lower oil export receipts.

Meanwhile, the CBN Governor, Godwin Emefiele, has reiterated that there was no need for businesses and investors to panic over the new forex policy, saying it will help address the imbalance in the economy.

Sanusi Suit: Power Outage Forces Judge To Adjourn

The Governor of the Central Bank of Nigeria (CBN), Sanusi Lamido Sanusi addressing journalist after a Monetary Policy Committee meeting in Abuja on Monday, 21 January 2013

A court in Lagos State, hearing a suit filed by the suspended Governor of the Central Bank of Nigeria (CBN), Mr Lamido Sanusi, against the Financial Reporting Council of Nigeria (FRCN), suspended proceedings on Friday when the temperature of the room became unbearable.

Due to poor supply of electricity from the Eko Electricity Distribution Company, the Federal High Court, Lagos was relying on generator-powered electricity supply which its unexpected refusal to come on, threw the court into darkness.

None of the seven giant generators came on, forcing the Judge to conduct proceedings in near-dark room with no air conditioning units.

Due to the increasing room temperature, counsels were permitted to remove their wigs if they wished while some lawyers turned their papers to hand fans.

Channels Television  judiciary correspondent, Shola Soyele, reports that there are ten judges, who sit at the Federal High Court in Lagos, but owing to the power outage and the unbearable heat in the court, only three judges conducted skeletal sittings to accommodate lawyers and litigants who had come before them.

When the heat became unbearable, Justice James Tsoho had to adjourn the case between Lamido Sanusi and the  FRCN till next Thursday.

This is coming a day after the Lagos State government ended the 2014 Economic Summit focusing on power sufficiency.

Mr Sanusi had filed a suit before Justice James Tsoho, urging the court to restrain the FRCN from investigating him.

Last week, the judge had issued an order restraining the Council from continuing its investigations against the suspended CBN governor until the suit had been heard.

The defendants had filed a preliminary objection to Mr Sanusi’s suit challenging the court’s jurisdiction to entertain the case.

Justice Tsoho said he would hear the objection and the plaintiff’s motion together.

Mr Sanusi recently won a separate suit against the Federal Government and security agencies for the unlawful seizure of his international passport after he was suspended.

The court asked the Department of State Security Service and the Nigerian Police to pay Mr Sanusi 50 million Naira damage.

Sanusi was suspended on allegations of financial recklessness.