Only
recently, the JP Morgan Index Team in a statement released to selected media
groups disclosed its decision to delist Nigeria from its Government Bond Index
by the end of October. This is in spite of the fact that Nigeria’s apex bank
had, at every turn, explained its policy decisions in line with its code of
transparency. Little wonder many analysts see JP Morgan action as either
blackmail or disrespect or even both.
The reader
may want to know: what is JP Morgan, a commercial bank among others, that, its
assessment should be taken so seriously? How was Nigeria before 2012? And what
is not working in Nigeria that justifies this action? Do they really have
the morals to arrive at that decision? While the World Bank and the IMF, the
real managers of economies are laboriously pursuing developmental goals and
building institutions around the world, the JP Morgans of this world are busy
pursuing selfish commercial interest.
The action
veils their real intention, which is purely commercial interest. It is quite
obvious that the JP Morgan index team has refused to acknowledge the structure
of Nigeria’s peculiar economy cum the strangulating effect of the oil crisis.
The investment bank has also refused to respect the actions so far taken by the
CBN as necessary at this moment not to allow the economy to crash. What works
in a particular country, may not work in another.
Since the
CBN decided not to further devalue its currency, these neo-colonialists and
their local collaborators have embarked on tailored-made criticism crafted to
suit their commercial interest. Precarious as the situation is, with the
federal executive council yet to be constituted to complement the efforts of
the apex bank, the CBN has been managing the economy.
The
unreasonable attacks started from The Economist and later Standards and Poors
and now JP Morgan, which had earlier given notice, in January, to phase out
Nigeria from its Government Bond for
Emerging Markets (GBI-EM) for lack of liquidity in the economy. This is
nothing but a demonstration of arrogance by the international financial
institutions that cares for no one but their selfish interest alone. What
really is the concern of the JP Morgan in forex issues, which is global and not
peculiar to Nigeria? It had earlier given a target date of December 15, to
decide on Nigeria, and therefore the unanswered question is – why the sudden
change to September 15? More so that, the bank is known to deal and trade in
bonds and this makes clear their interest.
Yes, we need
development partners but not as determinants of our fate. We are peculiar
people with rich heritage and intelligence. If I may ask, what have we really
benefitted from their so-called economic agenda? If Nigeria and the CBN have
decided to chart a new course for its people, who are the JP Morgans of this
world to say otherwise? It is also interesting to note how every financial
analyst, commentator, broker, institution, captains of industry and agencies
within and outside Nigeria, especially in Europe and North America, is so
fixated with Nigeria, and the call for devaluation of the Naira.
Quite
disheartening too is the fact that some Nigerians, many of whom lack the grasp
of what usually plays out in such game as to who stands to lose, if Naira is
devalued, have joined the financial blackmail train in piling pressure on the
Central Bank to devalue the Naira.
What product
are we exporting that we need to devalue the Naira to create market for? Is it
the crude oil that has driven its value underground? Inasmuch as many are at
daggers drawn with Godwin Emefiele,
the Governor of CBN and his team, every country has to do what it has to do to
protect its economic interest, and Nigeria should not be railroaded into a
western designed strategy that will end up impoverishing Nigerians and
enriching the pocket of investors.
If Nigeria
succumbs to the blackmail of international financial institutions and
uninformed local analysts, the Naira will have a free fall and would not be
worth more than what late Ugandan military leader, Idi Amin Dada, referred to as “toilet paper”. And recent was the
case of the Zimbabwean dollar. Whoever is calling for the devaluation of the
Naira has evil intentions as alluded to in press statement issued by the bank
on the wake of the action by JP Morgan.
As the
statement said, “doing so would lead to an
indeterminate depreciation of the Naira”. The consequence of this is
dire, and should be left only to imaginations. Advocates of devaluation are not
just what they are, but insensitive to the plight of many Nigerians who spend
over 70% of their expendable income on food alone. Further devaluation of the
currency will exacerbate the present high inflationary pressure, which will
eventually erode whatever little gain the large population of the Nigerian
masses, most of whom are already wallowing in abject poverty have, and this may
trigger public unrest because of the abnormal high cost of food items that
Nigerians are presently experiencing; the very worst time in history.
With this
scenario playing out, the federal government should stop the usual rhetoric
about economic diversification which stage we had long passed; rather it should
radically diversify its source of income, and forge a strong partnership and
collaborate with the monetary authority.
Let JP
Morgan take its index elsewhere, as any promise made of a weaker Naira exchange
rate that would promote industrial and economic growth is suspect. Though the
CBN policies and its obstinacy to the call for devaluation may look quite
unfriendly, but it is about patriotism and responsibility to protect our
heritage, the Naira, reduce inflation, create jobs and grow the national
reserves.
No
responsible country will heed the call for devaluation recommended by JP Morgan,
given our economic vulnerability and weak productive base, and allow the Naira
to crash to its own death. Supporters of JP Morgan’s misadventure to blackmail
Nigeria into unprofitable devaluation to enable its cronies profit should
understand that Nigerians are smart and intelligent to see through their
selfish desire. Nigerians have resolved to carve a new and profitable course
for economic renaissance. What the CBN needs from Nigerians now is support and
understanding.
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