On Friday, President Bola Tinubu of Nigeria made the decision to suspend Godwin Emefiele, the Governor of the country’s Central Bank. The following day, Nigeria’s secret police confirmed that Emefiele had been arrested and was currently in custody for questioning. While the specific charges against Emefiele have not been disclosed, a press release from the government stated that his suspension was due to an ongoing investigation into his office and planned reforms within the financial sector of the economy.
This event marks a significant downfall for one of the most influential figures in the Nigerian government. Emefiele was appointed as the head of the central bank in 2014 by former President Goodluck Jonathan and went on to become the second-longest-serving governor of the bank after his tenure was extended by former President Muhammadu Buhari. During Buhari’s administration from 2015 to 2023, Nigeria experienced two recessions, with inflation reaching an 18-year high of 22.22 percent.
Additionally, the country’s debt profile skyrocketed to over $150 billion, more than triple the debt left by the previous government, according to the Debt Management Office. Emefiele served under Buhari for eight years, overseeing Nigeria’s most significant economic downturn. However, critics argue that he lacked a clear vision for the country’s monetary policy and mainly acted as a yes-man to those who placed him in his position. Traditionally, central bank governors maintain a certain distance from politics, operating behind the scenes.
Nevertheless, analysts suggest that Emefiele played an unusually large role in both political and economic matters as the governor of the apex bank. Under Emefiele’s leadership, the Central Bank of Nigeria (CBN) gained unprecedented power, surpassing other economic authorities such as the Ministry of Finance or the budget office. This consolidation of power coincided with Nigeria’s economic challenges and resulted in the emergence of a separate black market for US dollars, multiple exchange rates, and a weakened national currency, the naira.
In an attempt to stabilize the naira, Emefiele implemented various unorthodox measures, such as cutting down trees used by black market vendors, banning cryptocurrency trading, and restricting access to information about the value of the dollar in the black market. Over time, the CBN’s circulars became infamous among Nigerians as more items were banned, and tighter restrictions were imposed on financial transactions.
Consequently, Emefiele earned the nickname “Emperor Meffy,” a play on his name, reflecting his dominant authority and controversial policies. During Emefiele’s tenure, inflation continued to rise, and Nigerians experienced a decline in their living standards. A significant portion of the population, around 133 million out of 220 million people, now live in multidimensional poverty, lacking access not only to financial resources but also to education and basic infrastructure. One of the most contentious aspects of Emefiele’s leadership was the CBN’s lending to the government, surpassing legal limits and contributing to inflation.
Under the Ways and Means Advances clause, the CBN lent the government 22.7 trillion nairas ($49 billion). This practice led to accusations that the apex bank was essentially functioning as a “printing press” for the government. Emefiele’s involvement in politics became increasingly apparent as Nigeria’s economy worsened. In 2020, during protests against police brutality, the central bank froze the bank accounts of several protest leaders without a court order.
Furthermore, Emefiele’s ambition extended to an unsuccessful attempt to run for the presidency in May 2022, a direct violation of the country’s constitution, which prohibits central bank governors from participating in partisan politics to protect the independence of the institution. One of Emefiele’s most criticized moves was the redesign of higher denomination currencies,