The Senate confirmed the nomination of the Managing Director, Zenith Bank Plc, Mr. Godwin Emefiele, as the next Governor of the Central Bank of Nigeria on Wednesday.
The former Zenith bank Managing Director answered questions on the economy from senators of the upper legislative chamber.
Emefiele pledged not to spend any money in contravention of the law and decried the uncontrollable injection of foreign currencies into the economy, stressing that the development, if not curbed, could lead to the collapse of the system.
“We will be fair, just and firm in the discharge of our duties and ensure that we have a strong exchange rate,” he said.
Their appointments were later confirmed with the Senate President, David Mark, asking them to justify the confidence reposed in them by discharging their duties effectively upon resumption and “without fear or favour.”
An attempt by Senator Kabiru Gaya to stop the screening of Emefiele by citing Order 53 to draw the attention of the Senate to the fact that the issue of the appointment of the next CBN governor was in court was thwarted by Mark, who overruled him by arguing that the matter in court had nothing to do with the screening exercise.
Emefiele noted that the core mandate of the CBN was to achieve monetary and price stability, ensure strong exchange rate and build foreign reserves.
He promised to ensure a sound financial system and work hard to achieve macro economic stability in the country to keep the inflation rate down, while also ensuring that the interest rate would continue to come down.
He said, “During my tenure, whatever monetary policy decisions we take will be those that will lead to the improvement in the level of employment in Nigeria because employment is very crucial to national development.
“Today, we have an employment emergency in Nigeria and we must ensure that whatever decisions we take at the CBN will be those that will lead to improvement in the level of employment in Nigeria.
“We will ensure that we work with the manufacturing companies to ensure that we improve on their level of production, and by extension, ensure that we achieve economic growth and development in Nigeria.
“We will ensure that the CBN and all stakeholders in the economy play a central role towards ensuring that we grow the Nigerian economy in a stable environment. We will do this through the adoption of the development banking model that has been tried and tested in different jurisdictions in the world.”
Emefiele noted that in some of the frontier and emerging markets in the world, development banking was being used as a tool to achieve economic growth, development and industrialisation.
On the issue of deducting depositors’ money for withdrawals and deposits, he said it was because of the cash-less policy that was introduced to the economy last year.
He noted that the policy was very important because all nations of the world had embraced electronic channels for doing business.
He said, “Nigeria, being a very important country in the comity of nations, should also embrace the cash-less regime. We are going to look at part of the policy that has to do with penalty being imposed on excess withdrawals.
“We will review it to ensure that we mop up all the cash outside into the banking system notwithstanding the limit, but we will encourage people to make sure that they embrace the electronic form of doing business; then, we could say that when making withdrawals, you should pay something to encourage you to embrace the electronic system. We will look into that and make it better.”
On devaluation, the CBN governor-designate said it was true that the reserves were dropping, but attributed this to speculative attack on the naira because people thought that there would be devaluation as a result of what was happening in the world currently.
He said, “There is no need for anybody to worry about devaluation because it is a very devastating action to be taken in the country, particularly because we are an import-dependent country.
“Devaluation will hurt the economy. We have an economy that is still very strong with about $39bn in foreign reserves to sustain about nine months of import. For as long as we have crude prices standing at about $100 per barrel, it is a strong economy.
“So, if we allow devaluation to happen, it will hurt the economy. Because we are import-dependent, if we allow devaluation, many people will lose their jobs, prices of goods and services will go up; productive capacity will come down and eventually lead to inflation.
“The policy being adopted now, which allows us to hold on to exchange rates and ensure that we do not engage in devaluation, should be continued.”