How Soludo Solution Saved Nigeria From World’s Worst Financial Crisis

By Joe Anatune

When Prof chukwuma Soludo was appointed the Economic Adviser to former President Olusegun Obasanjo and Chief Executive of the National Planning Commission, he saw the need to put together a plan that will mobilise the resources of Nigeria to make a fundamental break with the failures of the past and bequeath a prosperous nation to generations yet to come.

He galvanised Nigerians, critical stakeholders in furtherance and the result was the conceptualisation and launch of the National Economic Empowerment and Development Strategy (NEEDS) and its states’ counterpart SEEDS.

This was in 2004. On page 78 of the NEEDS document under the sub-title Financial Services, the policy thrust for the sector was ‘’to build and foster a competitive and healthy financial system to support development and avoid SYSTEMIC DISTRESS.’’ The document identified low capitalisation of the banks as a drawback and the imperative to address it as one of the many reforms the sector needed to support development.

It is therefore noteworthy that three years after the inauguration of the NEEDS, 2007-9, the world was thrown into one of the worst financial crisis since the Great Depression of 1929. The Too Big to fall movie of 2011 by Henry Paulson – Secretary of Treasury that focused on the actions he and Federal Reserve Chairman Ben Bernanke took to address the situation is an interesting watch any day.

Recall that US biggest investment bank, Lehman Brothers, collapsed and sparked unprecedented crisis in the global financial system. Tried, as they did, even America’s Federal Reserve and Treasury Department were unable to pull the chestnut out of the ravaging fire so to speak as housing prices fell by 31.8%. Banks lost money to defaults in mortgage repayments, interbank lending freeze and credit to customers and business dried. Key financial centres of the world were affected but Nigeria was not affected. What happened?

There was vacancy for governor of Central Bank of Nigeria (CBN). Obasanjo was on a head hunt for neither a banker nor a retired one but somebody in his words ‘’who understands development.” He appointed and redeployed Professor Chukwuma to the position because he thought and rightly too that Soludo is a development thinker and doer. Soludo set sail swiftly with the reforms he had earlier encapsulated in the NEEDS for the financial sector. He wasted no time as he hit the ground running by announcing far reaching sector reforms. The most apparent was the consolidation of a motley crowd of 87 banks into 24 big and strong banks that have today become global players. The solution was the berth of the big and strong banks that have been weathering the systemic distress and was able to withstand the shocks from the global financial meltdown.

Now you can clearly see how planning ahead and taking the needed actions can save a country and generations from avoidable disasters. More important, we need planning to leapfrog our society from good to better whether we shall be alive to see the benefits or not.

It is in realisation of the above that the elites of Anambra are coming together in large numbers to urge Soludo to heed the calls to run in the Anambra governorship 2021 election under the umbrella of Soludo Promoters Forum(SPF). Coming on the heels of earlier inaugurations of the forum in Aguata, Anaocha, Idemili South and Idemili North, Arch E.C.k Okafor, Chike Nwegbe, Donatus Nwabueze Obasi, Chief Chuba Okonkwo etc will lead the elites in Njikoka local government to launch the LGA’s chapter. They are motivated by the need for a tested and trusted legacy thinker and doer with the proven capacity to lead Anambra state in the post-covid-19 era with its myriad of challenges that have no room for trial and errors.

  • Joe C Anatune writes from Awa in Orumba North Local Government Area, Anambra State.

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