The National Association of Nigerian Students (NANS) has called upon the Federal Government to grant autonomy to the Central Bank of Nigeria (CBN).
Expressing concern over the country’s economic challenges, particularly hyperinflation, NANS emphasized that the key to addressing this issue lies in empowering the CBN to act independently and take decisive measures to stabilize the economy.
During an interview with our correspondent on Thursday, NANS Senate leader Akinteye Babatunde and former Coordinator of NANS Southwest, Adejuwon Emmanuel, highlighted the importance of allowing the apex bank to make autonomous decisions without undue influence or interference from the government.
Hyperinflation refers to a situation where prices of goods and services rise uncontrollably within a defined period. Babatunde stated that one of Nigeria’s fundamental problems today is the lack of autonomy of the CBN. He stressed that the primary objective of the CBN is to achieve macroeconomic development, including price stability, full employment, and regulation of the money supply. However, the dependence of the CBN on the government for decision-making undermines its effectiveness in achieving these goals.
To effectively address hyperinflation and stabilize the economy, Babatunde emphasized the need to empower the CBN. He mentioned that the bank possesses a wealth of expertise within its ranks and can access knowledgeable professionals from tertiary institutions across the country. By leveraging this expertise and collaborating with relevant stakeholders such as government agencies, academia, and the private sector, comprehensive and sustainable solutions can be formulated to tackle hyperinflation and promote economic stability.
Babatunde further highlighted the importance of transparency and accountability in ensuring the effectiveness of CBN policies and interventions. He urged the CBN to operate with utmost transparency by providing regular updates on decision-making processes, policy actions, and outcomes. This transparency would foster public trust and confidence in the CBN’s ability to effectively manage the economy.
Babatunde emphasized the need for Nigeria to adopt a more independent and proactive approach to monetary policy, one that prioritizes the long-term prosperity and well-being of its citizens. The recent circular titled “Harmonization of Reporting Requirements on Foreign Currency Exposures of Banks” issued by the CBN reflects its concerns over escalating foreign currency exposure of banks through their Net Open Positions. The circular directs lenders to sell excess dollar stocks to their customers, setting limits for overall foreign currency assets and liabilities to ensure prudential regulation.
