Opinion: Dr. Kingsley Moghalu: The voice of Reason and Conscience at CBN

Dr Moghalu

Dr Moghalu

By Emeka Chiakwelu


An average Nigerian identifies the Central Bank of Nigeria (CBN) by its
executive governor, in this case the suspended chieftain of CBN, Sanusi
Lamido Sansi who has everybody speaking about him. Not because he has
reversed the slumped, nosedived and gyrating naira into a stabilized and
appreciated currency. Neither has he made the smallest naira
denominations (1K, K5, K25, K50) a real medium of exchange, that have
occupied respectable place at monetary base and day-to-day business
transaction. Rather he is in everybody mouth because of his struggle with
the presidency and government of Nigeria.



This is not taking anything away from some good Sanusi has done especially
on reducing inflation rate. But his suspension and controversy are
gradually eclipsing his achievements at CBN. His accusation of corruption
on NNPC was not grounded on verifiable evidence and the way he goes about
doing it makes him more of a opposition politician than a respectable head
of CBN.



Sanusi has become controversial because he did encroach beyond the duties
of CBN governor as chief monetary policy advocate. Even without being
aware, he disfigured CBN and transformed himself into a politician,
whistle blower, pseudo- EFCC head and a foe to the executive branch of the
government. He chose to become a public warrior at the expense of his
monetary policy tool, CBN independent and public good. A strong
relationship between the presidency and CBN is essential for effective
colloboration . That will enable monetary and fiscal policy to be
complementary in achieving a sound macroeconomic stability without a
threat to CBN independent.
Sanuis in the quest to further his agenda has subsequently weaken CBN’s
independent by attracting unnecessary attention from the executive branch
of the government.



Then here comes Dr. Kingsley Chiedu Moghalu, Deputy Governor of the
Central Bank of Nigeria (CBN). This is an individual that does what he
suppose to do at CBN without engaging in politics but he is not a widely
recognised household name. I bet he will be the first to say that he is
not seeking for attention or popularity but all he wants to do is to get
his job done.



What is Dr. Moghalu ‘s job and responsibility at CBN? Moghalu is the head
of the Bank’s Financial System Stability directorate at CBN. He is
responsible for the regulation of banks and financial institutions, which
entails the management of systemic risk, and the development of finance
programs. He is at the vanguard of the implementation of cashless economy
and may be the most qualified bureaucrat at CBN with a PHD degree from the
acclaimed London School of Economics. Moghalu as the head of the Bank’s
Financial System Stability directorate at CBN is responsible for the
regulation of banks and financial institutions, which entails the
management of systemic risk, and the development of finance programs .



As for the pursuit of cashless economy, Nigeria’s apex bank “is targeting
an increase to 375,000 readers by the end of 2015, Deputy Governor
Kingsley Moghalu, who heads financial-system stability, said in a phone
interview March 11. Cards issued by Nigerian banks carry either the
MasterCard Inc., Visa Inc. or Interswitch Ltd.’s Verve logo, giving them
access to the world’s biggest payment networks. Of the 25 million
electronic payment cards in circulation, 18 million are Verve branded, the
company said in an e-mail today,” as reported by Bloomberg.



Apart from being one of the best minds in monetary policy and currency
expert, he is also an intellectual and author with making books to his
credit. His most recent book Emerging Africa: How the Global Economy’s
‘Last Frontier’ was well received by readers and critic alike. In book he
poured a verifiable and profound analysis on Africa as emerging market and
probe on the new tune in the international media on Africa as destination
of investments and development.



Dr. Moghalu said, “Why I wrote Emerging Africa – to decode and address the
real factors that have held Africa back, and the secrets of prosperity
they need to understand and apply in order to prosper, rather than merely
repeating conventional wisdoms that have not brought about a fundamental
change in the African condition.” And his intention is to see a
purposeful African development driven by African originality and a model
that will ensure a sustainable development.



Mogahalu is a thoughtful and grounded intellectual, he is not a crowd or
gallery pleaser and he is not afraid to question the conventional
acceptable belief that Africa is rising. He insisted that the facts must
be reconciled with reality to truly acknowledge that Africa is really
rising. He insisted that the statistics and facts must be grounded on
statistical reality not on abstraction as he question the validity of
rising Africa.


He questioned, “based on the foregoing, the myth that Africa is rising
needs some pause and evaluation. Let us ask some fundamental questions.
Yes, growth rates have been better over the past decade, but are we seeing
signs of real transformation? Are manufacturing economies now the norm, or
will they likely soon be?1 Is growth outpacing population growth, or could
population growth and non-inclusive economic growth without jobs create a
youth bulge in future? What is the role of science and technology and
innovation in African economies?”


As a serious banker he is not moved by emotions and sentiments but stood
on facts and figures. If anybody needs any reassurance about the economy
of Nigeria, this is how he spoke about the economy of the country to
Africa Asset Management and his analysis is also backed by the econometric
forecasting that came from IMF:


“I think it is quite strong; the fundamentals of the economy are sound and
I think we are projected to grow by 7% in 2014. Increasingly, the growth
of the economy is coming from the non-oil sectors – that is a good thing.
I think that in the medium term the Nigerian economy is set to witness
some fundamental structural repositioning, that will happen as a result of
the power sector reforms, that are currently going on. The privatization
of the power sector assets has been very successful, and so power wattage
is set to rise rapidly over the next two to three years, and I think that
will release a lot of latent entrepreneurial capacity in the Nigerian
economy; we have a large informal economy.”


He further stressed on oil and economic diversity: “Also a number of
individuals are beginning to set up petroleum refineries and petrochemical
complexes and that will also begin to diversify the country away from
crude oil towards economic complexity. And that will be good for the
country, because it will reduce Nigeria’s import bill over the medium and
long term. Therefore I see the Nigerian economy as having a strong future.
The demographics are good to support economic growth, but the challenge of
job creation remains and Nigeria needs to create more jobs, because the
unemployment rate is high. It is also important to address the question of
inequality and economic growth and development; the poverty rate is about
60% and that is something that needs to come down over the next decade.”



When Moghalu was asked about the suspended Sanusi, he spoke up from
financial perspective and CBN integrity during the Africa CEO Forum in
Geneva with the Independent News. Moghalu emphasized “Somebody in the
central bank was taking on an activist political role. That is not our
function. Central banks over the world have clear functions and in your
country [Britain] and any other civilised country I know that central bank
governors operate within certain expectations and constraints and respect
those expectations and constraints.”



He spoke about Sanusi candidly without not mentioning his name:. “The
governor began to make very damaging public allegations against the
government… allegations that have not been proven, after the president
had sent him a presidential query about the finances of the central bank.
The government has given a reason for the suspension and that was… to
enable an investigation into the allegations against him.”



The problem here is that fighting corruption is not a bad thing, but
accusation without evidence and documented proofs may not only weaken CBN
but has the propensity to give Nigeria a negative image that may dissuade
investors to stir away from Nigeria. This is an important period in the
life of Nigeria and the country needs a good image to continue with its
economic development. Therefore Nigeria and Nigerians must fight perceived
and alleged corruption in a way that will not threaten the economic growth
and economic sustainability of the nation.



Dr. Moghalu maybe rightly called the voice of conscience at CBN not
because he execute his work, which he does brilliantly. But by standing on
principle and refuse to compromise the integrity and independent of CBN.
He will not succumb to extra curriculum activities that will in long run
weakens the CBN stability and retract its independent.


Emeka Chiakwelu, Principal Policy Strategist at AFRIPOL. His works have
appeared in Wall Street Journal, Huffington Post, Forbes and many other
important journals around the world. His writings have also been cited in
many economic books, publications and many institutions of higher learning
including tagteam Harvard Education. Africa Political & Economic Strategic
Center (AFRIPOL) is foremost a public policy center whose fundamental
objective is to broaden the parameters of public policy debates in Africa.
To advocate, promote and encourage free enterprise, democracy, sustainable
green environment, human rights, conflict resolutions, transparency and
probity in Africa. info@afripol.org, http://www.afripol.org,

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