Mr Cardoso and a Nollywood Magic

Mr Cardoso must learn new tricks

I am going to make a mountain out of a molehill because the little things matter.

On Nov 20, Bloomberg reported that the Monetary Policy Committee (MPC) meeting of the Central Bank of Nigeria (CBN) would not hold for the second consecutive time. Bloomberg reporters were informed through a text message by the CBN’s Director of Communications saying “MPC is not holding”.

This is absurd even by Nigerian standards. 

Typically, six meetings are held every year, in every other month starting from January. The committee was supposed to meet in September and November 2023 but did not. 

This meeting is important and so is the MPC, which is made up of not just the staff of the CBN but the CBN’s board members and other “reputable” professionals. In the CBN’s words “The Monetary Policy Committee is the highest policy making committee of the Bank”. They are supposed to assess the economy and make decisions to achieve the goals of the CBN, which is primarily to contain inflation and support the financial system. 

We are in an economic crisis, partially brought by inept policies at the CBN, and the new leadership at the CBN have shown no urgency. 

Why did the MPC not meet?

In his first formal speech at a CIBN dinner last week, Mr Cardoso, the new CBN Governor, attempts to justify this slow start by saying that the MPC meetings have been largely ineffective for some time and they needed time to make the meetings useful. 

It is true that the MPC meetings have become a monthly ritual without much impact but this approach is reckless. Postponing MPC meetings must be more thoughtful than sending a text message on the day the meeting should have held. 

If the new leadership at the CBN is serious, the meetings would have been a good opportunity to deliberate on the new agenda and present it to the public. Businesses, investors, analysts and the general public are all waiting for some direction on monetary policy. After all, it is a new government and a new CBN. Instead, they were made to wait, which means the economy waits. 

This is real life not fiction. We are not spectators glued to our seats with popcorn in hand hoping for some genius, which for some means the element of surprise. Let’s be honest, it helps in the cinema. But this is not Nollywood where directors can hope that the element of surprise can save a bad film.

The element of surprise is not a secret weapon for a Central Banker or a policymaker. 

Clear and simple communication on the direction of policy is essential. The economy must keep on running, not on pause. I have written about the CBN’s communication problem.

I doubt that leading the CBN would have been a surprise to Mr Cardoso, who has been a close associate of President Tinubu for a long time. The issues facing the Nigerian economy and the CBN’s role are well known. The policies to solve the problems are not innovative and have been around for the longest time. None of this is groundbreaking stuff. 

Mr Cardoso must learn new tricks.