On Emefiele’s successor

I agree it is too early to start talking of Godwin Emefiele’s successor, except Premium Times is speculating that the governor would soon be removed. I suspect President Buhari might have thought about the pros and cons of removing Emefiele should he be indicted in the Dasukigate scandal. However, this article is not about Emiefele’s future, it is about addressing some salient issues raised by Premium Times on what to consider when appointing the next CBN governor. In subsequent articles, I will show you why I think Godwin Emefiele is trying his best.

Since Premium Times is an influential online newspaper, chances are that some influential people might have stumbled into its Editorial titled: ‘#Dasukigate, Emefiele, and How to Appoint the Next CBN Governor’. Thus, it is important to address some points they have raised in that Editorial

Premium Times advised Buhari to consider a person’s integrity before appointing as a CBN governor. In my view, this advice is unnecessary and uncalled for. There is no organization that doesn’t do a background check before appointing a banker for any position. Or is the newspaper suggesting that some former CBN governors had some issues with their integrity before they were appointed. The key question to ask here is why some people with very high integrity leave government, after serving, with some questions on their integrity. Also, the suggestion, by the newspaper, that a CBN governor should be professional is needless. It is a given that a CBN governor should be professional and all former CBN governors have been professional, in my view. Does Premium Times blame Emefiele for obeying his boss’s directive? It is easy to say he should have resigned and not do what former President Jonathan allegedly asked him to do. Please let us be realistic and honest to ourselves, this is Nigeria. It is only a well thought out reform that can prevent such alleged malfeasance from happening in future. Paul Krugman once described Alan Greenspan as ‘three-card maestro’ with a ‘lack of sincerity’ who, ‘by repeatedly shilling for whatever the Bush admiration wants, has betrayed the trust placed on the Fed chairman’.

The influential newspaper agreed with Joseph Sanusi, ex-CBN governor (1999-2004), that CBN governors should not be appointed from chief executives of commercial banks, since these people were superintended by the CBN. This makes sense. Sadly, I do not agree with Sanusi that CBN governors should be appointed from deputy governors in the CBN. He suggested that such people would propagate the culture of the CBN after haven assimilated it (i.e. they might have grown within and with the bank). Sanusi also advised that commercial bankers can be brought in as deputy governors. With apologies to current deputy governors, there is no doubt that people who have grown within an establishment might not be able to bring in new thinking. Can’t you see the new thinking Dr Ibe Kachukwu is bringing into NNPC? One of the best Ministers of Health this country has ever had wasn’t even a medical doctor. Besides, great Central Bankers like Ben Bernanke never worked in the US Federal Reserve. Even if he worked for the US Central Bank, he worked in an advisory capacity. This is because the job of the CBN governor is beyond banking regulation, it is also very academic. It is my opinion that the Premium Times didn’t think through this recommendation. If they did, they would have known that had Soludo been a former deputy governor, he would not have been able to spearhead the biggest banking revolution in the history of Nigeria.

In trying to give examples of Central Bank governors who had been deputies, and had grown within the system, Premium Times gave a wrong example with Mark Carney. Though Mark Carney was former a deputy governor in the Bank of Canada, he wasn’t formed in the Bank of Canada. He came in to bring in new thinking in the Bank of Canada. He was moulded at Goldman Sacks as a rugged economist. The second example with Janet Yellen was even more confusing. Janet Yellen cannot be regarded as someone who was cultured by the Federal Reserve because she was appointed a deputy in the Bank (she was also the CEO of the Reserve Bank of San Francisco). To me, Janet is core academic, a professor of economics. Or is the newspaper suggesting that one has to be trained as a deputy before becoming a governor? The point here is that non-establishment people, most times, bring in progressive attitudes. There will always be junior colleagues to advise CEOs on ‘how the last oga used to do it’ anytime they are going over the board.

I wonder why Premium Times didn’t advise Buhari to consider appointing an academic as the next CBN governor. A well published, philosophical, vocal and convincing academic might just be the ‘economic team’ people are asking Buhari to appoint. By the way, do you know that Janet Yellen is married to a Noble Prize winner in economics? I am sure a lot of ideas would also be coming from her husband, an academic.

Since the Premium Times had heard of Mark Carney, the present UK Central Bank governor, I wonder why they didn’t inform their readers that Carney is a Canadian. This is the kind of advice they should be giving Buhari. Buhari should look for the best man for the job, irrespective of what tribe he or she is from. Let me give you one of my greatest fears. Should Buhari announce that he intends to appointment a new CBN governor, I am sure some power brokers would advise him why he should appoint a Northern who they think is qualified. The APC would not be left out in lobbying for that office. There is nothing bad in appointing a Northern or in the APC lobbying for that office. But, that should not be the main issue. Besides, the newspaper should have recommended a rigorous interview for applicants for that position. Mark Carney was interviewed before he got the job.

I agree with Premium Times that a CBN governor should be a scholar of high repute. Maybe with advanced degrees in economics and evidence of scholarly work in micro and macroeconomics. Yellen got her PhD from Yale; Bernanke got his from MIT; Carney got his from Oxford; Greenspan got his from New York University – the list is endless. I am not sure if some of our former CBN governors have peer-reviewed works on central banking or on the economy. I would advise Emefiele to start engaging The Economist and other organizations criticizing him on an intellectual and philosophical level. Emefiele shouldn’t see this as a distraction, it is part of the job.  It is my view that Soludo succeeded because you could not intimidate him intellectually. I also agree that a CBN governor should have some international exposure.

It is my view that a respected and influential newspaper like Premium Times should conduct more rigorous research before giving any advice to Buhari. Today, Premium Times is one of the newspapers I have genuine respect for, thus, if they fail, journalism has failed.

Dr Nwankwo sent this article from Benin City