Two Peas in Central Bank’s Pod
By Lawal Dahiru Mamman,
In the past two years, Nigeria’s economy has been struggling like an injured beast trying to get back on its feet, desperately seeking support to regain its stability and reassert dominance. The Central Bank of Nigeria (CBN) plays a pivotal role in ensuring this stability, and its policies, working in conjunction with others, should bring relief to the nation.
As an organisation, it has come under fire, but it remains undeterred in fulfilling its statutory role for which it was established. Firstly, it announced the launch of a new Compliance Department, aimed at restoring transparency and resilience within Nigeria’s financial system.
Secondly, it announced the introduction of the Non-Resident Nigerian Ordinary Account (NRNOA) and Non-Resident Nigerian Investment Account (NRNIA) for Nigerians in diaspora. According to the apex bank the NRNOA will enable Non-Resident Nigerians (NRNs) remit their foreign earnings to Nigeria and manage funds in both foreign and local currencies.
Having a critical look into both policies, a ray of hope has beaconed. The former unveiled by CBN Governor Olayemi Cardoso, signals a shift in the apex bank’s operations, addressing past challenges around transparency and aligning with global standards.
The new department, slated to become functional by the end of February, will have a dual purpose of enforcing accountability within the CBN and ensuring fair practices across the financial ecosystem.
Such innovative initiative is poised to galvanise Nigeria’s long-awaited economic growth and development, fostering a more vibrant and competitive business landscape.
The renewed commitment to transparency and accountability is evident in this approach. In this manner the apex bank aims to encourage foreign investment, support fiscal operations in critical sectors, and promote innovation, investment, and job creation.
Financial and business communities have lauded the CBN’s move, expressing hope that these reforms will restore confidence in Nigeria’s financial institutions and position the country as a competitive player in the global economy.
On the two innovative account options specifically designed for Nigerians living abroad. The Non-Resident Nigerian Ordinary Account (NRNOA) and the Non-Resident Nigerian Investment Account (NRNIA) aim to provide diaspora Nigerians with seamless access to manage their funds and invest in the Nigerian economy.
Major benefits of the advancement are enhanced economic participation since NRNs can now access and contribute to the Nigerian economy more effectively. On the other hand, NRNIA offers access to Nigeria’s Diaspora Bond and other locally issued debt instruments targeted at the diaspora.
These accounts will also provide a safe and secure environment for NRNs to manage their funds directly, reducing reliance on third parties which have caused so much problem and even torn families apart, because some persons were not faithful to the trust that was placed upon them.
Holders of these accounts can maintain both foreign currency and local currency accounts, offering flexibility for various transactions and investments.
Diaspora remittance will surely be expanded because the NRNOA enables NRNs to remit their foreign earnings to Nigeria and manage funds in both foreign and local tenders.
Without doubt, this will improve the Gross Domestic Product (GDP) of Nigeria. Although it may not show the real state of Nigeria, it is a progress that must be appreciated owing to potential impacts in the long-term.
As Nigeria navigates the complexities of its economic landscape, the CBN’s initiative must be commenced. With its commitment to transparency, accountability, and sustainable growth, the apex bank is signaling its readiness to tackle the challenges head-on and drive Nigeria’s economic recovery and development.
The move is expected to increase the diaspora community’s contribution to Nigeria’s socio-economic development. With remittances accounting for a significant source of financial inflows for Nigeria, reaching $3.82 billion in the first nine months of 2024, this initiative is a development that should not be downplayed.
Last Line
The Central Bank of Nigeria (CBN) plays a pivotal role in ensuring the country’s economic stability, and it’s imperative that they adhere to the policies and regulations guiding their operations.
Given the significance of its responsibilities, the CBN cannot afford to fail Nigeria and its citizens. The consequences of failure would be far-reaching, affecting not only the economy but also the livelihoods of millions of Nigerians.
Therefore, it is essential that the CBN’s team follows the policies to the letter, ensuring that their actions align with the bank’s objectives and the country’s economic goals.
Commitment to transparency and accountability is crucial in building trust with the public and stakeholders. By adhering to policies and regulations, the CBN can promote a sound financial system, support fiscal operations in critical sectors, and encourage foreign investment.
The CBN’s team must recognize the importance of their roles and the impact of their actions on the country’s economic well-being. By working together to uphold the policies and regulations, they can ensure the CBN’s success and contribute to Nigeria’s economic growth and development.
