BUSINESS News Update

Nigeria, The Gambia pledge more cooperation on financial system

CBN boosts diaspora remittances with N5 for every dollar

By Nduka Chiejina, (Assistant Editor)

The Central Bank of Nigeria (CBN) and the Central Bank of The Gambia have agreed to share more knowledge and know-how towards the development of their financial system.

CBN Governor, Godwin Emefiele and Governor of the Central Bank of The Gambia, Mr. Buah Saidy met on Tuesday in Abuja when Saidy and his team visited the CBN.

The CBN offered to print the Dalasi, national currency of The Gambia for the country.

Emefiele said Nigeria has been printing her currency since the early 1960s and assured thec Governor of the Central Bank of The Gambia (CBG) that “we have a lot of idle capacity instead of you going to Europe and other countries you will be able to benefit from our ideas”.

He said officials of the CBN will take the Gambian team to the security printing and minting company and follow the team back to Gambia to see how they can help the country structure the quantity so that Nigeria can also be of assistance to help in printing currency.

He assured The Gambian Central Bank delegation that the CBN “can be extremely competitive if only from the stand point of logistics and freight from Europe, it’s just going to be a few hours from here”.

Earlier, Mr. Buah Saidy had pleaded for Nigeria to help save The Gambian currency the Dalasi.

“Right now, we have a situation where we are very low on currency. At some point I get scared. We can’t allow Central Bank to run out of currency completely, that will be a disaster. We want to learn from you.

“The acute shortage that we have currently couldn’t have happened. We placed an order for two years of currencies to be printed but again the contract with De La Rue of London which has been printing our currencies has to be reviewed.

“This is another area I would want us to exchange ideas. If we decide to go with you, how we can collaborate with you in printing our currency,” Saidy said.

Another area the CBN has offered to assist the Central Bank of The Gambia is in the area of cyber crime. Emefiele recounted how he was told that the CBN had been hacked and he assured the person the “CBN system cannot be hacked. We have enough firewalls though expensive”. CBN he said can share knowledge with The Gambia.

Regarding CBN independence, Emefiele told Saidy that “our parliament has been very supportive, they put in place the CBN Act that grants independence to the CBN and we have our Banks and Other Financial Institutions Act (BOFIA) that also grants a lot of powers and authority to the CBN”.

He stated that the CBN “can bite when we find recalcitrant bankers or people who want to take advantage of the system for their own personal benefit. We don’t take any nonsense from people who want to take advantage of the system for their personal benefit”.

He advised the Gambian delegation the “everything must be done, keeping in mind national goals and objectives that is why the CBN will act very fast on any economic agent that tries to undermine our policies. That’s why we are very firm on this”.

Earlier, Buah Saidy gave Emefiele a run-down of Gambia’s economy and areas he wanted CBN’s  assistance.

He said he jettisoned advice by some people to seek the assistance of International Monetary Fund (IMF) and the World Bank in finding solution to Gambia’s monetary challenges and opted to approach the Central Bank of Nigeria for assistance.

“We are brothers and we are coming from our house to the next house. During Covid- 19 pandemic, we tried to survive. Gambia’s economy was hit by Covid just like any other economies on the face of the earth.

“Before the Covid-19, our growth was six percent. Currently, there is a contraction of 0.2 percent. For 2021, because of the roll out of vaccines and easing of lockdown, growth for 2021 is estimated at 4.1 percent. The IMF forecast Gambia’s economy at 4.9 percent.

“On monetary policy, we are holding very well trying to help the fiscal policy. So, we are conducting accommodative monetary policy. The broad money is about 25 percent, reserves money is 32 percent this year relative to last year. This year growth is very high. We are trying to be ahead of the curve. The inflationary pressure is visible.

“On the exchange rate front, it continues to be stable mainly due to high reserves level. It’s $402 million and it can do between 6 to 7 months of import cover,” saidy said

Listing areas they will require assistance from the CBN, Saidy noted that “when I took over, I realized we have certain weaknesses. We can learn from you, we really need assistance in the areas of IT modernization, cyber security and how to investigate cybercrimes. Another area is legal. We need to exchange ideas on legal compliance”.

He added that “when I took over as governor, we faced this difficulty to regulate the financial system. We want to learn how you do this foreign exchange sequence, forex management, financial sector supervision. Fintech is a new area how did you handle it? How you moved from Basel 1 to Basel 2 and 3?  Security is another concern which I want you to teach us”, he requested.

Responding, Emefiele said CBN will not pretend to have solutions to all challenges listed by his Gambia counterpart.

“We are not going to pretend to you that we have solutions to all the problems but of course, as the country with largest population in Africa, it also has its own problems”, he said.

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