Nigerian Central Bank Must Maintain Sanusi Independence: O’Neill

Nigeria’s central bank governor-elect Godwin Emefiele should maintain the institution’s independence after his predecessor was suspended after highlighting corruption, according to Jim O’Neill, former chairman of Goldman Sachs Asset Management.

Yields on the government’s Eurobonds due July 2023 climbed to a seven-month high and the naira dropped to a record low after Lamido Sanusi’s tenure at the central bank was cut short four months early on Feb. 20. President Goodluck Jonathan accused Sanusi of “financial recklessness and misconduct,” allegations that he denies.

“If I were a leader in this country, I’d pay attention to the fact that the markets didn’t like how that was done,” O’Neill, also a Bloomberg View columnist, told Bloomberg TV Africa in an interview scheduled to air on March 29.

Tension between Sanusi and Jonathan have escalated since December, when the central bank chief called for an investigation into state-owned Nigerian National Petroleum Corp. for allegedly withholding billions of dollars of oil revenue. Nigeria was listed at 144th out of 177 countries on Transparency International’s Corruption Perception Index last year.

“Clearly a lot of oil revenue has gone missing and the issue needs to be placed on the table and brought into more public focus,” O’Neill said. “He’s certainly done that.”

Record Yield

Yields on Nigerian 2023 bonds have dropped to 6.08 percent yesterday, down from 6.51 percent on Feb. 24, according to data compiled by Bloomberg. The naira traded at 165 per dollar, 2.4 percent stronger since touching a record low Feb. 20. The nation’s all-share index declined 2.8 percent since Sanusi’s suspension.

The central bank kept its benchmark interest rate at a record-high 12 percent today while the cash-reserve requirement on private-sector funds was increased by 3 percentage points to 15 percent.

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