That the governor of Nigeria’s apex bank, Central Bank of Nigeria has been suspended by President Goodluck Jonathan may not longer be news, but what brought about his suspension and its attendant effects will remain a subject of discussion for a while.
Sanusi’s suspension on Thursday morning was contained in a statement released by the president’s spokesperson Dr Reuben Abati.
According to the statement, Sanusi was suspended due to reports of the Financial Reporting Council of Nigeria and other investigating bodies indicating that his tenure has been characterised by “various acts of financial recklessness and misconduct which are inconsistent with the administration’s vision of a Central Bank propelled by the core values of focused economic management, prudence, transparency and financial discipline”.
The statement further said the president’s resolve to reposition the CBN for greater efficiency and accountability made Sanusi’s suspension pertinent at this time.
He was directed to hand over to deputy governor Sarah Alade who will serve in his stead until ongoing investigations on working against the mandate of CBN, breaching of enabling law and due process are concluded.
He has been invited by the SSS, detained, questioned and released, all in one day.
The presidency had last month queried the CBN governor over donations to some universities and organisations and communities by the apex bank. The donations include N500 million to the University of Benin, Benin; N10 billion to Uthman Dan Fodio University, Sokoto; N4 billion to Bayero University, Kano; and N100 million to the Kano State Government. The Nigerian government considered many of the donations as ultra-vires as they were said to be outside the powers and functions of the CBN.
A letter said to have been written by Sanusi to the Nigerian government on alleged unremitted $49.8 billion oil revenue which was believed to have been leaked to former President Olusegun Obasanjo who used information on the said letter to write his widely read open letter to President Jonathan also strained Sanusi’s relationship with the presidency. President Jonathan therefore asked him to resign, but Sanusi declined and informed the president during a heated telephone exchange reported by Thisday, that he could only be removed by two-thirds of the Senate as required by law. He also denied leaking the letter.
An analysis of the situation at the time by online media, octopusnews, and report from Aso rock sources predicted the current development.
Octopusnews reported that the presidency was resolved on firing Sanusi by way of a suspension, and then bar him from accessing his office once the announcement is made, adding that one of the deputy governors within the bank will then be named to step into Mr. Sanusi’s stead while the CBN governors best bet would be to do an endless but fruitless battle with the presidency through the court. Aso Rock strategists believe that with Nigeria’s slow judicial process, the CBN governor would be unable to get the court to reinstate him until his tenure expires in June.
“If all things go well, the presidency will give Sanusi the Salami treatment soon,” a highly placed source in the presidency said Thursday. “At least we are all agreed on that,” the online news platform quoted a source as saying.
Nigerians have wondered if the alleged sins of Mr Sanusi were enough to earn him a suspension or the presidency just chose the desperate option to kick out a pain in the a**.
Many Nigerians will refer to former aviation minister Stella Oduah whom many wanted sacked over an alleged N255 million bullet-proof cars scam which was investigated by a presidential committee whose report was probably thrashed. She stayed on several months as minister after several investigations and analysis found her culpable.
Nigerians’ perception of president Jonathan because of that and many others, had not been of a president who hates graft and does not condone breach of laws. Sanusi’s suspension would therefore be easily categorised under the ‘bitter vendetta’ list.
Although Nigeria reassured all stakeholders in the country’s financial and monetary system that its decision to suspend Sanusi was taken in good faith and in the interest of the Nigerian economy, analysts say the government’s decision to take the step at this crucial time in the country’s economy proves otherwise and spells doom. The nomination of a replacement (Zenith Bank MD Godwin Emefiele, who has to be confirmed by the senate before resuming office when Sanusi’s term ends) just hours after the suspension also suggests foul play.
Sanusi has over the past few months worked on ensuring a stable naira, using Nigeria’s forex reserves to buoy the weakening currency. He has also in conjunction with the country’s Bankers’ Committee and the Monetary Policy Committee (MPC) brought up policies to keep the economy stable. If the country’s forex reserves deplete to a particular point, the CBN may have no other choice than to devaluate the naira, a scenario Sanusi recently said holds no advantage for Nigeria.
In a report published on February 13 by Renaissance Capital, the investment company predicts a further fall in Nigeria’s forex reserve which has fallen over $7 billion in 10 months, citing subpar oil production and higher imports due to election-related spending.
Sanusi’s recent policies are seen as a threat to politicians who would want enough cash flow as they campaign for the country’s general elections which will hold in 2015. One of such policies is the increase in the public sector Cash Reserve Ratio (CRR) to 50%, which may be further moved to 100%. He also attempted increasing the private sector CRR but was outvoted by other members of the MPC.
Investors will be apprehensive about what comes next, and rightly so, as the economy might just have been pushed into a state of uncertainty.
Looking at the issue from another angle, Sanusi was probably too loud for a central bank governor. He failed to use diplomacy on several occasions when he should have. It may therefore not be wrong to say Mr Sanusi shot himself in the leg.
Sanusi’s replacement, Dr Sarah Alade may be the only one who can tell the fate of investors…most investors wouldn’t wait to find out.