Anambra State Governor and former Governor of the Central Bank of Nigeria, CBN, Professor Chukwuma Charles Soludo Thursday, accused the CBN under past management of illegally granting trillions in unbacked financing despite legal restrictions.
Governor Soludo who spoke during an interview on Channels TV’s Politics Today, said the actions of the past managements have overtime, contributed to the current woes being faced by the country as he analysed the naira’s decline under the new government.
Governor Soludo alleged that the administration of President Bola Tinubu took over a “dead economy” bequeathed by its predecessors.
He also blamed worsening indicators on past violations of the apex bank’s establishment law, which bars deficit financing above five per cent of prior year revenues.
According to the former CBN Governor, the Tinubu administration inherited an economy already beyond revival before it assumed office. He said his assertion was from a macroeconomic standpoint,
Governor Soludo said, “We explicitly put into the law that you can’t grant the Federal Government more than five per cent of the previous year’s actual revenue. And that so granted must be retired by the end of the year in which it was granted. And when the Federal Government fails to retire, the Central Bank is forbidden by that law from further advancing ways and means. That was the law 2007 Act of the Central Bank.
“But we sat all of us Nigerians watching the CBN illegally and brazenly violating that Act year on year and kept on printing money. That is when advance money is backed by nothing; you just credit the Federal Government with trillions N 4 trillion, N10 trillion, N15 trillion and we keep going.
“I said it before. This particular government inherited a dead economy from a microeconomic point of view, this government inherited a dead horse that was seen standing but people didn’t know that it was dead. I think it’s important for Nigerians to understand this.”
Recall that earlier this month, President Tinubu while negotiating an infrastructure loan in Saudi Arabia had also stated his administration took over substantial fiscal and infrastructure deficits.