January 22, 2018 MPC meeting may not hold if Senate fails to act fast
The Monetary Policy Committee (MPC) meeting of the Central Bank of Nigeria (CBN), is by law expected to meet between January 22 and 23, but there are strong fears that the members may not be able to form a quorum due to the inability of the National Assembly to approve the nomination of one remaining member.
The MPC is the highest policy-making committee of the bank. It consists of the governor of the bank, who is the chairman, the four deputy governors of the bank, two members of the board of directors of the bank, three members appointed by the president, and two members appointed by the governor.
Business Hilights gathered that the nomination had been forwarded since last for clearance, but not much had been done by the lawmakers.
Already, financial analysts are calling for resolution of the debacle this week to avoid further plunging of the ailing economy to more difficulties.
However, there are hopes that as the National Assembly resumes plenary for the 2018 legislative year today, Tuesday, accelerated attention may be given to the process of the remaining member approval.
Details available showed that for now, only five members are in the MPC at the moment, whereas six members are required to form a quorum out of its 12 members, as defined by the second schedule of the CBN Act.
Two deputy governors – Sarah Alade, who was Deputy Governor for Economic Policy, and Sulemain Barau, who was Deputy Governor, Operations – had earlier retired in March and December 2017, respectively.
Another Deputy Governor, Adebayo Adelabu (Corporate Services), has served notice of disengagement ahead of the 2019 governorship election in Oyo State.
Alade’s replacement, Aishah Ahmad, is yet to be confirmed by the Senate since her nomination in October 2017.
Already, about five external ,members of the committee ended their tenures in November, 2017, and their replacements are yet to be confirmed by the Senate.
It would be recalled that the tight monitoring of the nation’s monetary policies by the MPC since last year had saved the collapse of the economy which just exited recession during the third quarter of 2017.
Critical roles of the MPC include the statutory mandate to review economic and financial conditions in the economy; determine appropriate stance of policy in the short to medium term; review regularly, the CBN monetary policy framework, and adopt changes when necessary.
MPC also communicates monetary/financial policy decisions effectively to the public and ensures the credibility of the model of transmission mechanism of monetary policy.
Another key role include the momentary determination of the interest rates.
Though unconfirmed reports claim that the Senate, may be withholding the decision to screen and confirm the MPC nominees until the presidency relieves the acting Chairman EFCC, Ibrahim Magu, of his duties in line with his rejection by the Senate which screened and found him unsuitable for the office.
Similar rumours have that part of the reason why the newly nominated deputy governor of the CBN, Aishah Ahmad, whose name has been forwarded to the Senate for confirmation has not been confirmed since two months ago is linked to Magu’s stay in office.
