Politics
Naira in Focus as New Central Bank of Nigeria Governor Starts Work
Utomi said Emefiele’s main challenge now was to work in tandem with Nigeria’s finance minister and put the best team in place to steer monetary policy, given the increased interest in the country as a potential boom market. Nigeria, already Africa’s leading oil producer and most populous nation, became the continent’s biggest economy in April after a long-overdue rebasing of gross domestic product.
Other analysts said that Emefiele’s biggest challenge in the short term was not inflation, currently nudging 8.0 percent, high levels of unemployment or ensuring greater equity in wealth distribution. Instead, it was next year’s general elections, which typically see profligate spending by politicians on the campaign trail.
Some have suggested that the alleged shortfall in NNPC remittances highlighted by Sanusi have been syphoned off to party political war chests. “There is no doubt that the tasks before Mr Emefiele as we enter the election year are daunting,” said Debo Adeniran, from the Coalition Against Corrupt Leaders pressure group.
Adeniran then said, “The new governor has to demonstrate a great deal of patriotism, guts and sagacity to moderate the way politicians spend for elections so as to absorb inflationary shocks and drop in the value of of the naira. …Political spending will cause inflation which will exert a lot of pressure on the naira.” Foreign reserves are also a pressing issue: according to CBN data, levels fell from $50 billion in the middle of last year to $37 billion last week.
Source: Yahoo
