CBN withdraws controversial policy document

The Central Bank of Nigeria says it has temporarily withdrawn the Monetary, Credit, Foreign Trade, And Exchange Policy Guidelines For Fiscal Years 2024 – 2025 document published on Tuesday, September 17, 2024.

It said the revocation of the document is to minimise risks of any further misrepresentation or misinterpretation, resulting in confusion among stakeholders.

It disclosed this in a new statement published on its website on Friday. The new release was, however, not signed by any CBN official.

On Tuesday, excerpts of the policy documents stated that the Bank will sustain its Ways and Means Advances to the Federal Government at a 5 per cent limit for the fiscal years 2024-2025, contrary to a bill passed by the National Assembly which raised the maximum borrowing percentage in the Act from five per cent to ten per cent.

Another controversial excerpt was the reinstatement of the cyber security levy, which was earlier suspended early this year due to serious public backlash.

But refuting these claims, the CBN said the guidelines were misunderstood by some outlets as new policies when, they are a compilation of previously issued policies and directives effective until December 31, 2023.

It also noted that some policies mentioned in the guidelines have been revised or replaced by newer updates.

The statement read, “The attention of the Central Bank of Nigeria has been drawn to certain instances of misinterpretation or misrepresentation of its biennial publication on Monetary, Credit,
Foreign Trade and Exchange Policy Guidelines published on September 17, 2024.

“In response, the CBN has temporarily withdrawn the document to minimize risk of any further misrepresentation.

“As is stated explicitly in the document to guide stakeholders, the CBN reiterates that the publication is a compilation of previously issued policies and guidelines issued by the bank up to a cut-off date, typically December 31 of the relevant year.

“As in all previous editions, the current document is intended to achieve the following objectives: A single reference source for the ease and convenience of stakeholders. A valid compilation of policies, directives, and guidelines for adjudication in conflict situations involving stakeholders.”

It stated further that “as a compendium of previously issued policies and guidelines, the provisions are applicable only to the extent that there have been no updates or revisions to the guidelines and policies contained therein. This is stated explicitly in the document to guide stakeholders.

“In line with prior editions, the most recent publication (January 2024) contains policies and guidelines issued by the Bank up to 31st December 2023, some of which will remain relevant
during the period 2024 – 2025.”

Continuing, the statement noted that, “In the light of these clarifications, we ask stakeholders to note the following: Some recent media publications referencing aspects of the Guidelines refer to policy positions of the Bank issued prior to 31st December 2023, which have changed in the light of revisions and updates in 2024. One example is the Cyber Security Levy, which was suspended in May 2024, superseding the circular reported in the Guidelines.

“Certain technical aspects of the guidelines have been widely misreported and misrepresented. For example, reports have mistakenly sought to link the fuel subsidy removal to external reserves. Such reports essentially missed the analytical basis for the original statement, which was intended to observe a potential risk that was to be mitigated by the policy. More recently, policies of the Bank around the Naira exchange rate and those of the fiscal authorities have positively altered the outlook of the subject in question.

“In summary, the guidelines must primarily be viewed as a record of policies, circulars and directives issued by the bank up to the end of 2023. They are not new directives and should not be reported as such.”

“The Bank will continue to provide clear monetary policy direction and advice for the overall good of the Economy. We urge all stakeholders to seek clarification of information about the Bank before publishing,” the statement concluded.