For a central banker in a country struggling with inflation and economic meltdown, Olayemi Cardoso always looked remarkably unruffled and unflappable! Perhaps he manages to keep the cork on the bottle. It is admirable and reassuring that Nigeria’s Central Bank Governor is always calm and collected when talking to us on reforming the economy......CONTINUE READING THE ARTICLE FROM THE SOURCE>>>>>
Inevitably, the CBN has transformed under Mr. Cardoso. It is no longer the unwieldy bureaucracy it was a few years ago. Surplus and redundant personnel were eased out of the system while more technically relevant personnel were brought in. Old departments have been rejigged and new ones created. The era of fiscal rascality had elapsed and the CBN has returned to a regime of financial discipline and vigorous pursuit of its core mandate of price stability.
The CBN has become an aggressively innovative monetary and fiscal policy hub since Mr. Cardoso stepped into the glass house as Governor in September 2023. His reformist leadership has reinforced the CBN’s core mandate of designing and implementing monetary policy to regulate the supply, cost, and value of credit in Nigeria with the goal of achieving price stability and low inflation.
Coming in at a time of great economic challenges for Nigeria, Mr. Cardoso knew he had not much time to turn things around. He came prepared and knew what he had to do. In his first speech at the Annual Bankers’ Dinner in Lagos weeks into his tenure in November 2023, Mr. Cardoso left no one in doubt he was right for the job.
He spoke as a professional economist and Central banker, explaining the interconnectivity of global economies which makes global events impact domestic activities, including currency value. He also rightly acknowledged that impediments and constraints were reasons for the sub par performance of the Nigerian economy, stressing the need to de-bottleneck the economy and deal with the constraints. These are exactly the things the CBN under Mr. Cardoso is doing with professional commitment.
Mr. Cardoso introduced a series of comprehensive reforms designed to reinvigorate Nigeria’s economy, stabilize the banking sector, enhance foreign exchange markets, and foster financial inclusion for all citizens.
To combat inflation, the CBN took decisive steps to bring stability through strategic adoption of monetary policy rates that has now being adjusted to an unprecedented 27.50% in November 2024. It was an indication that the CBN was committed to controlling inflation and restoring confidence in the economy. This is beginning to bear fruits as the pressures are ease with even more optimistic projections for 2025.
Mr. Cardoso’s unwavering commitment to critical reforms also saw the CBN implementing a floating exchange rate system to allowed market forces to dictate the currency’s value, and reduce speculative activities thereby narrowing the gap between official and parallel market rates. This has brought stability to the foreign exchange market and enhanced transparency. The CBN also cleared a backlog of $7 billion in foreign exchange obligations.
Innovative approaches to increasing remittance flows were also crucial in strengthening the foreign exchange market which saw monthly remittances increased to $600 million by September last year. The CBN now targets over $1 billion monthly in remittances.
Mr. Cardoso may not have known he would ever become the CBN Governor. But he seemed to have long prepared for the job. After a solid academic background in economics, finance and administration from the Aston University in Birmingham, United Kingdom and Harvard University, Massachusetts, Mr. Cardoso spent 29 years at the top of the banking sector where he rose to become Chairman of Citibank Nigeria Ltd, from 2010 to 2022.
He had previously served as Executive Director at the Citizens International Bank Limited and Principal Partner at FBC Associates Limited from 1997 to 1999.
His public service career was no less impressive. He was Commissioner for Economic Planning and Budget in Nigeria’s commercial capital, Lagos State from 1999 to 2005. He was credited with spearheading the reforms that enabled the strong economic development of the state.
Mr. Cardoso’s stellar achievements in the private and public sectors was recognized with the conferment of a Doctorate in Business Administration (DBA) (Honoris Causa) by the Aston University in 2017.
Mr. Cardoso is assisted by some of the accomplished professionals in the country serving as his deputies. They are: Dr. Bala M. Bello, Deputy Governor, Operations Directorate; Mr. Muhammad Sani Abdullahi, Deputy Governor Economic Policy Directorate; Mr. Philip Ikeazo, Deputy Governor, Financial System Stability Directorate and Ms. Emem Usoro, Deputy Governor, Corporate Services Directorate.
Aside these talented deputy governors, Mr. Cardoso also brought in core professionals as advisers and consultants to enlarge the pool of technical personnel available to the bank.
For instance, Dr. Nkiru Balonwu, a Consultant/Adviser to the CBN Governor is helping the apex bank strengthen its Stakeholder Engagement and focus on Legal and high impact projects. She is a globally recognized strategist and consultant with over 25 years cognate experience. With a Master’s and Doctorate degrees in law from the University College London and the University of California respectively, Ms. Balonwu is also a Senior Fellow from 2022-2023 at the Mossavar-Rahmani Center for Business and Government, Harvard Kennedy School.
And there is Dr. Daphne Oterie Dafinone, also a Consultant/Adviser to the CBN Governor on development finance and governance matters. She is a chattered accountant with a PhD in Internal Audit & Corporate Governance from City University, London and has over 35 years experience spanning corporate governance, due diligence, corporate restructuring, mergers and acquisitions, reverse-takeovers, debt restructuring among others.
Among other brilliant aides of Mr Cardoso is Ms. Shola Phillips, a compliance expert who is the Special Adviser to the Governor on Compliance & Risk. She has garnered over 25 years’ experience across the sectors of the financial service industry in Nigeria, Europe, Asia and the United States of America.
These strategic appointments have helped reinvigorate the CBN machinery and positioned it to play crucial role in the ongoing economic transformation of the country. It has helped to deepen CBN collaboration with fiscal authorities to tackle underlying issues impacting the economy. Specific challenges, such as agricultural disruptions, high energy costs, and infrastructural inadequacies, were identified and addressed collectively.
These collaborations have led to more emphasis on enhancing credit access to key sectors such as agriculture and manufacturing to bolster domestic production and reduce Nigeria’s reliance on imports.
Beyond industry reforms, they are also pivots to help Mr. Cardoso activate the CBN’s broader vision of deepening financial inclusion and enhancing digital payment solutions for everyday Nigerian. Mr. Cardoso recently announced plans for an unprecedented high-level summit where the CBN would collaborate with key industry stakeholders to develop strategies that promote accessible, efficient, and innovative financial services.
This must be reassuring for stakeholders who now see the apex bank taking concrete steps to provide an enabling environment for financial service providers, foster competition, innovation, and expand access for Nigerians.
This is in addition to numerous other initiatives by the apex bank as part of the National Financial Inclusion Strategy (NFIS). The establishment of Payment Service Banks (PSBs) underscores the CBN’s commitment to provide affordable and accessible financial services to millions of Nigerians, and drive a digital transformation within Nigeria’s financial ecosystem.
Mr. Cardoso understands that a resilient financial system is crucial for economic development, this is why the CBN launched an ambitious recapitalization program designed to strengthen banks’ ability to support economic growth and withstand external shocks. The initiative mandated banks to raise additional capital, thereby enhancing their capacity to meet the country’s investment needs.
With Mr. Cardoso at the helm of CBN, Nigeria had turned a corner and disinflation is within reach.
— Tajudeen Suleiman is an Abuja based Journalist.