The Chartered Institute of Stockbrokers and Association of Securities Dealing Houses of Nigeria have decried the proposed amendment of the Central Bank of Nigeria Act No. 7 of 2007, seeking to subject the annual budget of the CBN to approval from the National Assembly.
The group in a statement argued that such legislation would politicize the decisions of the central bank and could have economic consequences, according to Nairametrics.
In addition, the statement pointed out that the ability of the central banks to manage the economy objectively could be undermined by further changes in setting up a coordinating committee for monetary and fiscal policy.
The President and Chairman of the Council of CIS, Oluropo highlighted the central bank’s key role in ensuring economic stability saying, “Safeguarding the independence of the Central Bank of Nigeria is crucial for aligning with global economic best practices and ensuring decisions are driven by sound financial principles, free from undue influence.”
Meanwhile, the Chairman of ASHON, Sam Onukwue pointed out the possible impact on investor confidence, international credit ratings, and the general perception of a bank and its country in an international community.
He said, “An independent central bank is a cornerstone for maintaining the country’s standing in the global financial community, which directly affects investor confidence, credit ratings, and the overall economic outlook.”
However, both organisations recognised the merits of some proposals to improve company governance and compliance, they emphasised that wider implications must be taken into account.
The International Monetary Fund has called for caution in the context of ongoing amendments to the CBN Act, in its latest Article IV Consultation Report on Nigeria.
According to the IMF, these changes could undermine the autonomy of the CBN and hurt the economy.
The proposed amendments were applauded by some having considered the abuse at the CBN previous administration, but others had their reservations.
