Godwin Emefiele, suspended governor of the Central Bank of Nigeria, who was suspended by the newly elected President, Bola Tinubu, has been arrested on Saturday, June 10, 2023.

Announcing his arrest, Nigeria’s secret police said in a statement without providing further details that Godwin Emefiele is in “custody for some investigative reasons”.

Bola Tinubu, suspended Emefiele as the central bank governor yesterday, nine years after he was appointed to office to oversee the monetary policy affairs of Africa’s biggest economy and most populous country.

Emefiele’s suspension “is sequel to the ongoing investigation of his office and the planned reforms in the financial sector of the economy,” according to a statement from the Secretary to the Government of the Federation. Folashodun Adebisi Shonubi, a deputy governor at the bank, immediately took over as acting governor.

Months of Investigation Into His Office

Emefiele’s arrest culminates months of investigation into his office by Nigeria’s Department of State Services, whose bid to arrest him in December was declined by a local court. The secret police had accused him of terrorism financing and economic crimes, but a judge ruled that it couldn’t provide evidence to support the allegations. However, it wasn’t immediately clear if new findings were made in the investigation.

Analysts, however, said Emefiele’s removal from office didn’t come as a surprise, pointing to some policies he introduced in recent months which were seen as controversial. Abiola Gbemisola, a Lagos-based financial analyst, identified some of those policies as the bank’s currency swap program as well as its decision to continuously print and lend money to the Nigerian government. “The central bank governor was very powerful” in office, Gbemisola said.

“I wasn’t expecting him to stay under the new administration, especially given the fact that he was not so kind in his policies leading up to the (February presidential) election. Rather than focusing on reducing inflation, he contributed to Nigeria’s high inflation by giving money to the federal government, printing money essentially to give loans.”
Gbemisola

Under Emefiele, Nigeria’s economy struggled with a weakened currency caused by the foreign exchange crisis as well as a surging inflation rate, which was at a near-two-decade high of 22.2% in April.

The bank’s move to replace the local naira currency with newly designed ones caused economic hardship for so many Nigerians that it affected the turnout in the February election while authorities were forced to reintroduce the old bank notes being replaced.

“The fact that he has been removed is a positive thing for the (financial) market and we can now expect to see something different,” Gbemisola said.

As Tinubu’s administration just kicked off, many Nigerians will be hoping that his action of suspending the governor will start yielding the needed result soon.