The ongoing political feud between President Goodluck Jonathan and rivals in the ruling Peoples Democratic Party over his assumed intention to run for another term is threatening the economy, according to a report by Reuters on Wednesday.
The Governor, Central Bank of Nigeria, Mr. Lamido Sanusi, recently said he had discovered that tens of billions of naira were traded for dollars in cash, much more than importers needed to buy goods or investors to repatriate funds, and there was no trace of where the money came from or where it was going.
Reuters quoted Sanusi as saying, “Obviously this was some form of money laundering to cover all the trails. And with interest rates as high as they are, the only people who can take that much naira and buy dollars are people who are not borrowing their money.”
The prime suspects, Sanusi said, were politicians jockeying for position ahead of what look likely to be bitterly divisive 2015 polls.
He blamed the “dollarisation of the economy by political elites” for the continued weakness of the naira, despite central bank’s moves to prop it up with dollar sales that had depleted the reserves to an eight-month low.
The Chief Executive Officer, Financial Derivatives, Mr. Bismarck Rewane, said, “The need of politicians to spend money now will be a big drag on the economy.
“If it comes from the treasury, the fiscal deficit will widen, you’ll get more inflation, the naira will weaken.”
The Director, Centre for Democracy and Development, Mr. Jibrin Ibrahim, said, “The crisis in the PDP is very deep, and I don’t see them resolving these issues … It’s such an open and destructive fight.
“The northern political class feels it needs to get back into power, and the President will do all he can to stay in.”
