President Tinubu suspends Emefiele as CBN governor, names replacement

President Bola Ahmed Tinubu has suspended Godwin Emefiele as the governor of the central bank of Nigeria with immediate effect.

A statement from the Director of Information, office of the secretary to the government of the federation Wille Bassey says “President Bola Ahmed Tinubu has suspended the Central Bank Governor, Mr Godwin Emefiele, CFR, from office with immediate effect,”

“This is sequel to the ongoing investigation of his office and the planned reforms in the financial sector of the economy.”

Read also: What will a Naira devaluation mean for fintechs in Nigeria?

Controversies surrounding Emefiele’s governorship

The Central Bank of Nigeria under the leadership of Godwin Emefiele engineered the redesign of the 200. 500, and 1000 notes a few months before the 2023 general elections. The redesign led to a cash crunch as the fiat currency became scarce for citizens.

During his tenure as CBN governor, the apex bank also launched the eNaira, a CBDC expected to make the transition to a cashless society easy for Nigerians. This was accepted with mixed feelings by Nigerians, considering the CBN had previously prohibited the use of cryptocurrencies in the nation.

The CBN insisted that all its recent policies were steps in the right direction to move Nigeria towards a cashless society, while others claimed the Naira redesign was a tool to influence the outcome of the elections.

Since President Tinubu was sworn into office, there were speculations that the Central Bank of Nigeria (CBN) was set to devalue the Nation’s currency- the Naira, to N631 to the dollar from N461.6, however, the central bank has denied this.

During his inaugural speech, Tinubu said the current 18.5 per cent interest rate of the CBN is “too high”. Tinubu said it needed to be adjusted downwards to encourage investment. He described the interest rate as “anti-people” and “anti-business”.

“Monetary policy needs thorough house cleaning. The Central Bank must work towards a unified exchange rate. This will direct funds away from arbitrage into meaningful investment in the plant, equipment and jobs that power the real economy,” Tinubu said.

“Interest rates need to be reduced to increase investment and consumer purchasing in ways that sustain the economy at a higher level.” The president also said his administration will review the naira redesign policy.

What next?

According to the statement, Emefiele is to transfer his responsibilities to the deputy governor, operations directorate. Folashodun Adebisi Shonubi, the deputy governor, is expected to act as the CBN governor pending the conclusion of an investigation of Emefiele’s office.

“Mr Emefiele has been directed to immediately hand over the affairs of his office to the Deputy Governor (Operations Directorate), who will act as the Central Bank Governor pending the conclusion of the investigation and the reforms.”