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NEWS YOU CAN TRUST I **THURSDAY 14 MARCH 2019 I VOL. 15, NO 266 I N300
Eastern business climate brightens as Onne, Warri, Onitsha River Ports undergo reforms …modernise infrastructure, position for service efficiency …expert calls for downward review of tariffs, charges AMAKA ANAGOR-EWUZIE
f the reforms and modernising of port infrastructure going on at the Onne Container Terminal, Warri Old Port and Onitsha River Port are carried through, import/export and associated businesses in the Eastern part of Nigeria will soon heave a sigh of relief. The three Eastern ports, considered the most viable in that part of the country, are cur-
$-N 357.00 360.00 £-N 466.00 474.00 €-N 398.00 405.00
Market I&E FX Window CBN Official Rate Currency Futures
NGUS MAY 29 2019 362.05
NGUS AUG 21 2019 362.50
10 Y 20 Y -0.03 ￼-0.14 14.20
NGUS FEB 26 2020 363.40
Buhari directs NNPC to take over troubled $2bn JV oil assets from Shell DIPO OLADEHINDE
resident Muhammadu Buhari has directed state-owned Nigeria National Petroleum Corporation (NNPC) to take over oil blocks worth $2 billion from Royal Dutch Shell
NNPC to confirm assumption of operatorship by May 2
plc, in an area that’s at the heart of environmental and human rights controversies. According to a letter dated March 1, 2019, seen by BusinessDay, President Buhari through the office of the Chief of Staff
Abba Kyari directed NNPC and its upstream arm, Nigeria Petroleum Development Company (NPDC), to take over the operatorship of the entire Oil Mining Licence (OML) 11 not later than April 30, 2019 and also ensure
smooth re-entry given the delicate situation in Ogoniland. “NNPC/NPDC to confirm by 2 May 2019 of the assumption of the operatorship,” said the letter Continues on page 38
Continues on page 38
Inside Ethiopian Airline crash: FEC approves ban of aircraft type in Nigeria p. 2 Full text of National Housing Fund (Establishment) p. A1-p. A3 Act 2018
Rescue team searching for more victims from the rubbles of a collapsed building, Ohen Private Nursery and Primary School, Itafaji, Lagos Island, yesterday. See story on page 2
2 BUSINESS DAY NEWS Malabu scandal: Prosecutors say Aliyu Abubakar helped Jonathan distribute $520m cash bribe g
liyu Abubakar, chairman of AA Oil, was an agent of former President Goodluck Jonathan helping him distribute $520 million in cash bribes, Italian prosecutors said in court documents filed in a Milan court on March 13. The charge sheet seen by BusinessDay said that Paolo Scaroni, in his capacity as CEO and executive director of Eni, among other things, met personally, together with Claudio Descalzi, now CEO of Eni, and Jonathan, during both the finalisation of agreements phase (13 August, 2010) and the final phase, during an election rally in Nigeria on 22 February, 2011. Earlier, the prosecutors had said that Jonathan probably received as much as $200 million to approve the controversial $1.3 billion sale of OPL 245 oil field. The prosecutors also accuse Etete and other players of receiving authorisation from Oil Minister Diezani Allison-Madueke to dispose of 100 percent of OPL 245, following a decision taken by President Jonathan, and conducted confidential negotiations with Aliyu, who was operating as an agent for Goodluck Jonathan. Barneby Pace of Global Witness who was at the court in Milan said the prosecutor started by saying that an Italian lawyer who claimed to be acting for Aliyu Abubakar visited them yesterday (Tuesday) asking for a new delay. The lawyer failed to appear in court and did not provide a written request, leading prosecutors to push that the trial should go ahead. Abubakar confirmed that he has received the information regarding the charges against him and his lawyers for a delay in giving his testimony. He is supported by some defendants saying that Abubakar is an important witness and his new lawyers haven’t had time to review all the evidence.
The judges ruled that given the seriousness and complexity of even just the charges against Abubakar, a delay should be granted and the prosecutor would offer a new date. Abubakar is facing charges in Italy in this case but prosecutors weren’t able to serve the papers on him until recently. Given the scope of the charges and evidence against him, he and his lawyers are given time to digest it. Nigeria is projected to lose $6bn in future revenues because of damaging terms in the contracts. “This is one of the biggest corporate corruption trials in history with Shell and Eni and some of their most senior executives in the dock accused of massive corruption,” said Pace. “We hope that this trial signals that powerful companies are not above the law and can be held to account.” Italian prosecutors are arguing that when Shell and Eni paid more than $1 billion to settle legal disputes over the block and acquired rights to develop it, much of that payment went into bribes and kickbacks. An Italian judge in 2017 ordered Royal Dutch Shell and Eni to stand trial over alleged corruption in Nigeria involving the award of OPL 245 nine years ago. Apart from the two companies, 13 people including Eni CEO Descalzi, his predecessor Scaroni, and former chairman of the Shell Foundation Malcolm Brinded would be tried for their roles in the deal. Italian prosecutors had earlier indicted Shell and Agip for their role in the 2011 messy deal in which Nigeria sold the juicy oil block to the two oil majors. Dan Etete, a former petroleum minister, and Bello Adoke, a former Attorney-General, are amongst several Nigerians indicted in the deal, which was approved by ex-President Jonathan. Shell and Eni’s Nigerian subsidiary, Agip, are also among those already being prosecuted in Nigeria.
•Continues online at www.businessday.ng
Nigeria’s non-oil sector drives tax revenue in 4 years
…buttresses need for economy diversification ENDURANCE OKAFOR
he dire need for Nigeria to further diversify its economy away from crude oil has been brought to the fore as tax revenue from non-oil sector which has remained above oil sector revenue since 2015 seems to be showing the way to go. In the last four years, tax revenue from the non-oil sector has consistently surpassed revenue from oil sector, BusinessDay checks of figures from the Federal Inland Revenue Service (FIRS) show. The FIRS recorded tax revenue of N5.3 trillion in 2018, accounting for 58 percent of the total national expenditure for the year. This also represents the highest tax revenue the country has ever remitted. Out of this, 54 percent was collection from the non-oil sector, as against the 46 percent from the oil sector. The trend was the same in 2017, 2016, 2015 and through to 2010 when BusinessDay started tracking the data from the FIRS figures. “The case has always been made to diversify the economy away from oil. Increased tax revenue is just one of the many potential gains from doing so,” Rafiq Raji, chief economist at
Macroafricaintel, said. Further analysis of the tax figures from the tax agency revealed that before the 2018 tax revenue record, the highest revenue figures ever attained by FIRS was N5.07 trillion, in 2012, when oil price hovered around $100-$120 per barrel. Foreign earnings from crude oil distracted the development of Nigeria’s agriculture and tourism sector as “many sectors became victims in Nigeria when there was oil boom”, Hamat Bah, Gambia’s minister of Tourism and Culture, told BusinessDay in Banjul recently. “It was only about three-four years ago that Nigeria started thinking about really diversifying the economy. It should have been done long time ago,” Bah said. Nigeria’s reliance on crude oil export as its main source of foreign earnings exposes the nation’s economy to shock from the instability in oil prices, Raji said. Faltering crude oil prices directly affect the nation’s local currency, its ability to implement budget and, therefore, determines the country’s economic growth rate.
•Continues online at www.businessday.ng
Thursday 14 March 2019
L-R: Ido Sum, partner, TLcom Capital LLP: Omobola Johnson, honorary chairperson, Global Alliance for Affordable Internet, and Timothy John Berners-Lee (TimBL), inventor, World Wide Web (WWW), at TimBL’s visit to Nigeria to celebrate Web at 30 in Lagos, yesterday. Pic by David Apara
Lagos building collapse: Victims’ parents, relatives disconsolate amid rescue operations …Ambode orders full investigation, as Buhari, Atiku condole with victims’ families ...LASEMA to release official casualty figure on completion of rescue operations JOSHUA BASSEY, TEMITAYO AYETOTO, INIOBONG IWOK, Lagos, & TONY AILEMEN, Abuja
odinat Ekemode, a friend of a victim with two grown children trapped in the collapsed building at Ita-Faaji on Lagos Island, Wednesday, sat at a corner opposite the rubble anxiously praying that her friend would be found alive with her children and brother. The three-storey building with a pent house, located at No 14 Massey Street, opposite Oja, ItaFaaji, in the heart of Lagos, Nigeria’s commercial capital, caved in at about 10am when teaching sessions were ongoing at a nursery and primary school on the third floor, trapping scores of pupils under the rubble. The building also houses a convalescence centre and
a provision store on ground floor. “We were still together around 11pm yesterday. Only for me to hear that Iyabo and her kids are trapped,” Ekemode said in a shaky voice, gloom written all over her face. “We are expecting the three of them to come out alive,” she said, even as she condemned the owner of the collapsed building and the state government for allowing the building to stand. Iyabo, who lived on the first floor of the building, and her children were yet to be rescued as at 4:42pm on Wednesday when BusinessDay visited the scene. “We have been able to rescue over 40 people,” Tiamiyu Savage, chairman, Lagos State Emergency Management Agency (LASEMA), said. “Yes, we have lost few but we can’t place the number yet until we are sure from those who made it to
the hospital. There are four people who we have identified to be alive. We are trying to ensure we bring them out alive and then push them out alive. Then we will now begin scanning for possible lives under this rubble,” Savage said. Like Ekemode, parents and relatives of affected pupils and other trapped victims were disconsolate as the rescue mission deployed, including operatives of LASEMA, Federal Fire Service and National Emergency Management Agency (NEMA), searched through the debris. Lagos State governor, Akinwunmi Ambode, said full scale investigations would be conducted to ascertain the remote and immediate causes of the building collapse. LASEMA said official report
Continues on page 38
Ethiopian Airline crash: FEC approves ban of aircraft type in Nigeria ...Boeing to deploy software enhancement in few weeks ...Ethiopia to send black boxes to Europe IFEOMA OKEKE & TONY AILEMEN
igeria’s Federal Executive Council (FEC) on Wednesday approved government’s ban on the operation of the controversial Boeing 737 Max 8 and 9 in the country’s airspace. This follows the Ethiopian Airlines’ Boeing 737 Max 8 plane crash on Sunday, which killed all 157 people on board. Indonesian Lion Air’s Boeing 737-800 Max aircraft had also crashed on October 29, 2018 some 13 minutes after take-off from Jakarta, killing all 189 people on board. Hadi Sirika, minister of state (Aviation), after the weekly FEC meeting presided over by President Muhammadu Buhari, told State House Correspon-
dents that the aircraft had been banned from being flown in or out of Nigeria pending the determination of the outcome of the investigations by its manufacturers. “The Civil Aviation Authority whose mandate it is to issue advisor y has already issued advisory that nobody should fly into Nigeria or out of Nigeria using the Boeing 737 Max, pending the determination of the actual cause of the crash in Ethiopia and also pending the outcome of the response of the manufacturer itself,” Sirika said. He noted that although no Nigeria operator currently has the aircraft in its fleet, no airline operator would be allowed to fly the aircraft into the country. “Regardless of the enormous
safety records of the Boeing 737 Max, it has caused safety concerns in the world of aviation and as you know, aviation is universal. Aviation is one; there is no aviation A or B, what affects one affects the other,” he said. Sirika said aviation safety was a priority for the Nigerian government, adding that the country was joining the on-going global efforts to ensure that the aircraft was safe before it could become operational in Nigeria. Meanwhile, Boeing, the United States aircraft manufacturing giant, has said it would deploy a 737 MAX software enhancement across the fleet in the coming weeks.
•Continues online at www.businessday.ng
Thursday 14 March 2019
4 BUSINESS DAY News
Dangote, NNPC, others take steps to boost fertilizer production Olusola Bello
s the Dangote Fertilizer Limited is ready to roll out soon, the company as part of its efforts to sustain production has signed a Gas Sale and Aggregation Agreement (GSAA) with the Nigerian National Petroleum Corporation (NNPC), Chevron Nigeria Limited (CNL) and Gas Aggregation Company of Nigeria Limited (GACN) as the ‘Aggregator.’ NNPC and CNL are obligated to supply 70mmScf/d of natural gas to Dangote Fertilizer Limited to enable it start up operation of the newly built fertilizer plant. The Dangote Fertilizer Plant at Ibeju Lekki, Lagos, is a flagship mega fertilizer project designed to support the Federal Government’s drive
of this country, Emefiele said. Although Nigeria is currently almost self-sufficient in fertilizer production, the size of the fertilizer plant is twice that of Eleme Petrochemical. He urged other Nigerians to support government’s drive in developing the nation’s economy. “I believe this project will transform Nigeria’s economy and we hope and pray that we will have other Nigerians join in the development of our own economy. It is not about word of mouth, it is by action. They need to risk their capital and do what they believe that will help and I think in a lot of areas, with the support of the government, we will try and transform them like we did in cement,” he said. The $2 billion fertilizer production plant with the
capacity of processing over 3 million tons of the product annually is the largest single-fertilizer complex in the world. The plant, which covers 500 hectares of land, is aimed at not only meeting the supply needs of farmers across the sub-region towards boosting crop yield but also to reduce product cost. “This is going to be one of the largest single capacity complex in the world producing in total 8,000 tons of urea daily. We’ll be having two trains of ammonia and two trains of urea and each train will produce 4,000 tons. So, in a year it will be 3 million tons. “Fertilizer imports into the West Africa sub-region, especially from abroad, are expected to drop drastically by this development,” he said.
R-L: Dapo Okubadejo, partner/African head, deal advisory and private equity; Nike Oyewolu, head, marketing operation; Ijeoma Emezie-Ezigbo, partner, deal advisory, and Oluwaseun Osunkoya, manager, deal advisory, all of KPMG, at a press conference on the presentation of the new KPMG “ Doing Deals in Nigeria2019” in Lagos. Pic by Pius Okeosisi
Gunmen attack police station in Edo, kills DPO, four others IDRIS UMAR MOMOH/ CHURCHILL OKORO, Benin
unmen on Tuesday attacked the Divisional Police Headquarters, Afuze, the administrative headquarters of Owan East Local Government Area, killing the Divisional Police Officer (DPO), crime officer and two other officers. Also killed was a boy said to have been hit by a stray bullet. The hoodlums who attacked the police station with explosive devices also set ablaze vehicles and motorcycles within the premises
and a police Hilux patrol van parked inside the premises of Independent National Electoral Commission (INEC) in the locality. The officers killed in the attack are Inspector Tosimani Ojo, the DPO of the station, Sergeant Justina Aghomon, a pregnant woman, Inspector Sado Isaac, and Corporal Glory David. The Edo State commissioner of police, Muhammed Danmallam, who visited the scene of the incident, said investigation would commence immediately, pledging that those responsible for the attack would be brought to book. According to Danmallam,
urgent steps will be taken to curb the increasing cases of criminality in Owan axis of the state. Sergeant Justina Aghomon, the deceased female officer, was recently transferred to the station from Benin City. She was also said to be on duty when the hoodlums struck. The heavily armed men also broke into the cell and released all the suspects. An eyewitness, who pleaded anonymity, said the incident happened between 7.15pm and 7.30pm on Tuesday, saying the hoodlums used explosive to blow up the office of the DPO before shooting him to death.
Thursday 14 March 2019
Reforms bring Facebook, MainOne to invest in Edo
… as they sign gas agreement to develop the agricultural sector and in turn improve the Nigerian economy. Natural gas is the feedstock of the Dangote Fertilizer Plant. This GSAA for the supply of the major raw material needed to run the fertilizer plant is another demonstration of the NNPC/CNL JV’s commitment to the domestic gas market. Not only Nigerian banks are funding the fertilizer project but also foreign banks, the CBN is contributing about N50 billion for the fertilizer project. The amount Godwin Emefiele, CBN governor said was just a drop on the entire fund the project cost. The bank will continue to show support to individuals and companies that display the determination to help and support government and the CBN in restructuring the base
Another eyewitness, Godwin Ikpekhia, said the incident occurred at about 8pm Tuesday night when many of the officers of the Division had gone for outside duty. “We only heard gun shoot and nobody knew what happened until this morning. The DPO with three other officers who were on duty were killed on the spot inside the building. “The hoodlums didn’t stop at that they went to the INEC office and were shooting sporadically in order to attack men who were on duty. Election materials and police van in INEC office were burnt down by the hoodlums,” he said
EO of MainOne Cable Company, Funke Opeke, says the investment by Facebook and MainOne in broadband network infrastructure in Edo State is as a result of Governor Godwin Obaseki’s ease of doing business reforms and commitment to boosting productivity through technology. Opeke, who discloses this in an interview with journalists, says the project in Edo is part of Facebook’s mission to connect people around the world via the internet. MainOne has been laying fibre cables across the state since November last year, in what is seen as a major step to firm up the state’s burgeoning technology ecosystem, after the launch of the Edo Innovation Hub. Noting that the investment is part of the 750km open-access fibre infrastructure in Nigeria implemented with MainOne, she says, “The overarching focus for Facebook is improving internet connectivity and empowering partner operators such as MainOne with the tools to build networks to connect more people. “With our partnership with Facebook, we have invested in building new infrastructure in states like Ogun and Edo that is open-access and can be used by all operators. You may recall that the major challenge impeding broadband proliferation in Nigeria is the limited access to distribution infrastructure to get the abundant internet capacity available in submarine cables on the Nigerian shoreline in Lagos to the hin-
terland.” The leadership in Edo State prioritises technology development, which is why the project was able to scale through in the state, she states. According to Opeke, “Our work brings our team in contact with the leadership in many of the states. These particular states have leadership that is promoting the development of technology ecosystems and job creation in their states. “When we had the opportunity to engage and share with them our capabilities and accomplishments on previous projects in places such as the deployment of fibre infrastructure for Silicon Yaba with CCHub, the deployment of Express Wi-Fi with Tizeti in Lagos as well as our aspirations for pervasive broadband everywhere in Nigeria, they welcomed us to build infrastructure in their states. “The Edo State government has prioritised technology as one of the cardinal pillars of the ongoing reform agenda in the state, introducing ICT-compliant pedagogy in primary schools; building the Edo Innovation Hub, where school leavers and graduates undergo beginner and advanced training in technology, as well as revamping technical education to increase productivity. “The duo of Governors Godwin Obaseki and Ibikunle Amosun have identified ICT as critical themes for the transformation of their states and have been supportive of our fibre expansions.”
Over 200 SMEs seek space in Edo Production Centre, as state assures regular electricity supply
do State governor, Godwin Obaseki, says not less than 200 Small and Medium Scale Enterprises (SMEs) in fabrication, furniture making, printing and polythene production have applied to work from the Edo Production Centre, which will soon open for business. Addressing journalists after inspecting the renovation work at the facility, Governor Obaseki said, “We have over 200 applications from SMEs who want to come and locate here. We have had many SMEs coming together as cluster or cooperatives, who applied and have been given space for fabrication, production of polythene-based products and furniture making.” Obaseki explained that arrangements had been completed to get uninterrupted power supply to the facility while the Magistrate Court within the premises would be relocated.
“The power contractor has assured that within the next fortnight, they will provide electricity for the Production Centre. We should be relocating the court houses to the various local government councils,” he said. On the plan to ensure free flow of traffic along Sapele Road, which is the major road connecting the Production Centre, the governor said the state was working with the Federal Government to fix potholes on the road and install street lights. Senior Special Assistant to the Governor on Jobs Creation and Skills Development, Ukinebo Dare, said the Edo Production Centre was set up to assist SMEs scale up production, reduce costs and grow their businesses. The Production Centre is owned by the state government in collaboration with the Bank of Industry, MEND and Benson Idahosa University, she said.
Thursday 14 March 2019
6 BUSINESS DAY News
Thursday 14 March 2019
30 Years of World Wide Web: Inventor pushes contract for the web
Monarch to politicians: Stop politicising Army
… seeks affordable connectivity, bridge gender digital divide, data protection
im Berners-Lee, inventor of the World Wide Web (www) who is in Lagos, Nigeria, as part of a 30-hour tour to various cities to celebrate the 30th anniversary of the web, has urged governments, companies and citizens to uphold the contract for the web, which aims to ensure the inclusion of everyone on the web and safety of personal data. Berners Lee, who spoke with BusinessDay, Wednesday, after the celebratory event in Ikoyi, Lagos, said, “The contract of the web is about companies, government and individuals all working together to make sure that the web is better, and it will require the attention and commitment of all of them. There is no simple solution because the government, companies and individuals all have their roles to play to achieve data security and web safety.” According to the principles of the contract for the web, governments will ensure
that everyone can connect to the internet by collaborating with providers to drive down data costs so that anyone, no matter who they are or where the live can participate actively online and not be denied access to full internet access. The contract also seeks to ensure that governments respect people’s fundamental right to privacy so that anyone can use the internet freely and without fear. The contract for the web expects companies to play their role by also making internet affordable, respecting consumers’ privacy and personal data and to develop technologies that support the best in humanity and challenge the worst. While citizens should be creators and collaborators on the web, so that the web has rich and relevant content for everyone and build strong communities that respect civil discourse and human dignity, as well as fight for the web to remain a global public resource, open for all. Rosemary Leith, one of the founding directors of the World Wide Web Foundation a non profit founded with
Tim Berners-Lee, said; The web, over the past 30 years has really grown across the globe, and we feel that the future of the web is in Nigeria, Dakar, Bangkok and as the web becomes even more and more international, we started the web foundation when 20 percent of people were on the web, and another two billion people have come on the web since we started this web foundation 10 years ago, and we hope that over the next 10 years, we are going to see more people on the web.” According to Rosemary, the foundation seeks to bridge the gender digital divide by supporting women and girls on the web. “As well as web access, we feel very strongly that women are under represented on the web and the economic impact to families, companies from that diversity is very clear to see. In fact, the numbers of computer scientists are decreasing, so we have to work to get women on the web across the world. We are very excited to meet with young women here in Nigeria and do whatever we can to include them,” she said.
… decries high influx of fake soldiers during elections Iniobong Iwok
lowu of Kuta, Osun State, Hammed Adekunle Makama, has warned politicians to stop politicising activities and role of the Nigeria Army in ensuring the security of the nation. Olowu in a statement on Wednesday said the report from some states in the South-South indicated that military were used to perpetuate violence on innocent citizens and disrupt electoral process. He warned desperate politicians to stop dragging the military into politics because of its dire consequence on the nation’s stability and national cohesion.
According to the monarch, the army represents the nation’s symbol of unity, stressing that the onus is on them to remain apolitical. He decried a situation whereby some politicians armed their thugs in military fatigues to cause mayhem, saying this is not acceptable. “In the process of using the army to protect the will of the people, especially in Rivers State, some of them were attacked and hospitalised. We owe our military high regards because of their oath to protect our territorial integrity and if the need arises, lay down their precious lives for the country. “We believe our military is apolitical and that explains why the Chief of Army Staff,
Lt Gen. Tukur Yusuf Buratai promised to set a high powered investigative panel to unravel the level of culpability of any disgruntled army officer if any, before, during and after the election. “The international observers commended the Army for maintaining peace and displaying utmost professionalism during the presidential and National Assembly elections conducted a forthright ago. “I also want to sympathise with traditional rulers in the South-South and South-East and urge them to continue to be the symbol of peace and unity that the office of traditional institution has conferred on them,” the statement said.
EFInA builds capacity of financial services stakeholders on Agent Networks deployment
inancial Inclusion is a key driver of economic development. Indeed, the more people included, the more they have access to financial services that will ultimately improve their leaving conditions and gradually get out of poverty. Achieving universal access to formal financial services requires pervasive and sustainable Agent Networks
across nation. Many studies have revealed the importance of Agent Networks in driving access to financial services, especially at the last mile. Nigeria currently has about 22 Deposit Money Banks, over 800 Microfinance Banks, 25 Mobile Money Operators, yet, 36.6 million adults (36.8% of the total adult population) remain financially excluded.
The National Financial Inclusion Strategy (NFIS) identified Agent Networks as one of the important channels required to achieve the Financial Inclusion target. Going by the shift from physical bank branches to branchless banking globally, the revised NFIS strategy considers increasing the Agent target from 62 to 476 Agents per 100,000 adults by 2020.
Thursday 14 March 2019
8 BUSINESS DAY News
African leaders need to prioritise continent’s growth - Elumelu CALEB OJEWALE
frican leaders have been challenged to prioritise the growth of the continent, and to care about humanity and welfare of the continent’s 1.2 billion population over possible selfish tendencies. Tony Elumelu, founder, Tony Elumelu Foundation, and chairman, Heirs Holdings and the United Bank for Africa, said this at the inaugural Africa Now Conference held in Kampala, Uganda, this week. In a keynote address on “The Leadership Needed to Catalyse Africa’s Transformation,” to an audience of public and private sector leaders on Tuesday, Elumelu offered a robust and direct message to African leaders from the public and private sectors. “The leaders we need in Africa today, are leaders who genuinely care about humanity. We need leaders who are driven by an ambition to leave society better than they met it. We need leaders who understand and care about creating a positive legacy. We need leaders who are genuinely committed and care about the future of Africa,” Elumelu said. Hosted by the President
of Uganda, Yoweri Kaguta Museveni, the Africa Now Conference, an initiative of the Africa Strategic Leadership Centre, gathered Heads of State, public and private sector leaders to discuss and develop growth opportunities for the continent. In his speech, President Museveni outlined key enablers required to empower the African people and transform the continent. “With independence, although a lot of time was lost with military governments engaged in primitive fascism, nevertheless, many African governments have correctly identified two crucial stimuli that can catalyse social transformation. These are education and health for all (human resource development) and private sector-led growth.” Elumelu commended President Museveni on the achievements of his country, emphasising the need for public-private sector collaboration to drive sustainable development, encapsulated in his economic philosophy, Africapitalism. According to Elumelu, leadership should not be about directing blame, leadership is not about absolving responsibility. Leadership is the
catalyst for positive change. “We need to take collective responsibility for our own future – as I have often said, no one is going to do it but ourselves – whether we are in the public or private sectors. “This is the philosophy of Africapitalism, which is a call on the private sector to play its role, the leading role in securing our continent’s destiny – and achieving it by creating both social and economic wealth,” he said. Speaking on the concept of shared prosperity, Elumelu stated that the Tony Elumelu Foundation’s Entrepreneurship Programme was a robust mechanism to empower Africa’s entrepreneurs, with the goal of efficiently and effectively delivering wealth creation directly into local communities. Reiterating the importance of entrepreneurship in unleashing the continent’s true potential, Elumelu concluded by making a call to partners, charging private sector leaders to focus on inclusive wealth. “As private sector leaders, we realise that, if the wealth we have is not inclusive, if the prosperity we have is just for family and self, it will not help us create the society we need” he concluded.
125 years anniversary: FirstBank embarks on 125km relay walk to greatness
n Saturday, March 16, 2019, First Bank of Nigeria and other corporate entities in the FBNHoldings Group will collectively have a 125km Relay Walk to celebrate the bank’s 125 years of unbroken business operations in commemoration of its 125 years anniversary. Following the flag hoisting ceremony, the anniversary activities curtain raiser event that held March 1, 2019, the 125km Relay Walk, which is to be carried out at locations across Nigeria and other countries where the bank operates, is among the many activities lined up to celebrate the bank’s 125 years anniversary. Furthermore, to celebrate its contribution to the growth and development of Nigeria over the years, predating the independence of the West African country with a view to reinforce the collaborative efforts of all institutions of the group, FBNHoldings, as well as building on the heritage for the next 125 years and beyond. According to Adesola Adeduntan, CEO, First Bank of Nigeria, “The 125km Relay Walk is a representation of
the collaborative effort of not just FirstBank but all entities in our holding company, FBNHoldings, that have in the last 125 years impacted lives and contributed to the growth and development of our host communities and countries where we do businesses. “At FirstBank, we are proud of the strides made across these locations where we operate, as without the effort of all staff – past and present – as well as our customers and stakeholders, there would be no FirstBank. “The 125km is a mark of our incredible journey of delivering impeccable financial services to our customers as we leave no stone unturned to remain an icon of admiration in today’s financial services industry in Africa.” On how the “Relay Walk” would be carried-out and what it means to the brand, Folake Ani-Mumuney, group head, marketing and corporate communications, FirstBank, explains, “As a Group, we have journeyed through the ages, our footprints spreading far and wide with indelible landmarks of several firsts.
Thursday 14 March 2019
Machines, Tila Farms make winning start at GTBank 2019 Lagos Int’l Polo Anthony Nlebem
he much-awaited 2019 GTBank Lagos Polo International Tournament galloped off in an exhilarating fashion on Wednesday, with Lagos Machines and Kaduna Tila Farms commencing their Silver Cup adventures on winning notes. The Machines defeated Kano Nakudu 8-4 while Tila Farms stroll passed low flying Lagos. Two more games were decided on the opening day, but the game that kept the legendary Ribadu Road polo ground on fire was the titanic Open Cup clash between Lagos Carveton Saopolo and debutants from Abuja, Team Almat. The Machines and Nakudu match commenced the twophase of what promises to be a bumper-to-bumper galloping expedition at Nigeria’s commercial capital and the former lived up to their high rating as they took the game to their opponent from the opening bell. However, it was Nakudu who had their nose in front with Idris Ahmed scoring the first goal of the tournament with a low shot to make up for his incredible open-goal miss about a minute earlier.
Thursday 14 March 2019
Thursday 14 March 2019
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Okey and Nigeria’s struggle to solve a perennial problem
n the distribution of Nigeria’s patronage, politicians consider certain ministries or agencies juicier than others. This “juice factor” is usually connected to how much rent or contracting occurs within the space. This is why NNPC, Customs, FIRS, CBN, Ministry of Finance, Power and Works Ministry are the ready places that you see average politicians and bureaucrats warm up to. There are also silent ones like TETFUND, NDDC and Ministry of Petroleum. Not forgetting the National Security Adviser with not only huge capital budgets but opaque spending. However, does that really matter? In the line of things, are we not meant to pay attention to planning and policy spaces such as Ministry of Planning, Ministry of Trade and Investment and others who mainly set policy objectives? I have been paying a bit of attention to the ideas of Okey Enelamah of the Ministry of Trade and Investment, who came into government with a great record of success in the private equity industry. I must admit that it took a while to fully understand what he was up to; we are all witnesses to President Buhari’s ability at enlisting many “ghost ministers” only seen in newspaper articles, their impact hardly felt. In this space, Okey Enelamah, who leads one of the most important Ministries
in Nigeria, seems to stand out. Let us review what he has been up to. I like the idea of Made in the Nigerian Exports known as “Project MINE”. In a recent article, I made it clear that Nigeria keeps basking in small numbers that are heavily dependent on oil. 95% of Nigerian export value is still tied to oil, putting the Nigerian currency value in an unstable mode. A quick review of Nigerian export numbers which rose from $44bn in 2017 to $62bn in 2018, was still dependent on the upswing in oil prices. Compared to South Africa with exports of $103bn with a more diversified portfolio and a smaller population, Nigeria cannot fix its competitiveness challenges unless it asks itself: What am I going to sell to the world? However, as usual with lofty ideas in Nigeria, Project MINE is facing challenges as the Nigeria Export Processing Zones Authority (NEPZA) is resisting the transfer of N14.38bn into a Special Purpose Vehicle known as Nigeria Special Economic Zones Company (NISEZCO). Under the Project MINE is the creation of the Special Economic Zones (SEZs), a model that India has rightly used to scale its infrastructure challenges, aimed at boosting exports. The federal government is raising $500m in equity in the next few years and it has identified Enyimba Economic City, Funtua Cotton Cluster, Lekki Free Trade Zone as the early investments. These are good ideas and the huge goal to “Increase and diversify foreign exchange earnings to at least US$30bn annually by 2025, by increasing manufacturing sector exports” is welcome. Side-stepping the bureaucracy might be a good short-term reprieve to achieve its aims and this might have a lasting effect on the implementation. However, as seen in the debilitating condition of Agbara Industrial Area,
starting out such projects with its sparkling facilities is great but the big questions remain: how is it structured for maintenance? How does it not become just another idea ground to extinction by bureaucracy? That Nigerian government is looking for another N15bn to revitalize its Kano and Calabar export processing zones is an evidence of its poor perennial maintenance culture. Diversifying Nigeria’s export base which is interlinked with jobs, economic growth and currency stability is an existential challenge for Nigeria. Also linked to the export growth plan is the recent $30bn export financing deal that Nigeria signed with African Export-Import Bank, Africa Finance Corp., the African Development Bank, Bank of Industry and Nigerian Sovereign Investment Authority. While the details are still sketchy, Nigeria needs to do more to support entities interested in manufactured exports out of Nigeria. This is tied to the entire competitiveness process of business registration, infrastructure for the movement of goods, quick port services and standardization of agencies. The route to making a country globally competitive forces it to raise its standard of service delivery. This is why I believe that Nigeria needs to be more export-growth oriented than reducing imports. Using limited imports to conserve foreign currency does not make a Nigeria immune from oil price swings, only a diversified exports base will do it. I have also noticed an improvement in Nigeria Trademark Registration but the process needs to be more decentralized and faster. Wilbur and Orville Wright had it easier registering their patent and trademark in 1906 than what exists in Nigeria today. We have to do more, but not for trademark registration alone but in improving our human
A keener look into thriving economies shows that their foundations are built on people, not just on the size of their population, but turning them into assets
capital development as a nation. No matter how lofty the ideas of boosting our exports might sound, without investment in the human capital, it will always come short. Nigeria has a huge gap in technical and adaptive skills, creating challenges for manufacturing entities to find the right personnel. A keener look into thriving economies shows that their foundations are built on people, not just on the size of their population, but turning them into assets. This is what we systematically destroyed. We did not turn our own citizens into assets, losing the opportunity to understand that the unit of diversification lies in optimizing human capital within societies that create opportunities to allow citizens to thrive. A look at economies staying ahead and diversifying apace shows their focus on the “Knowledge Economies”. They continue to succeed because they prioritize people over politics. If President Buhari needs to keep a few of his ministers for his second term, Enelamah should get a shout. Nigeria currently has a diversified economic base but its foreign currency swings, public revenues and exports are tightly linked to oil. This is an anomaly that started since oil boo period in 1973 and each administration has failed to make a significant dent. It will be good to see where the Special Economic Zones (SEZs) anchor and the value they bring in another four years. This might be a chance to write a legacy in how Nigeria escaped a mono-product economy. Will the country hit it or miss it? The answer to this is beyond Enelamah as other agencies of government also have a crucial role in this huge task but he has re-started an important conversation. Oluseun Onigbinde is the co-Founder of BudgIT and currently an Obama Foundation Scholar at Columbia University, New York
Rev. (Dr.) S. T. Ola Akande: A life of grace, passion and goodness
hen a man becomes nonagenarian, such a man already embodies a legacy. Yet, a legacy is never an unqualified good. There are several who have passed through this world, and we hope to never ever see them again. And yet, there are those who are still alive and kicking, and we keep praying and hoping to have them with us forever. These kinds of people embody the legacy of a life well-spent. For Paul Tsongas, “We are a continuum. Just as we reach back to our ancestors for our fundamental values, so we, as guardians of that legacy, must reach ahead to our children and their children. And we do so with a sense of sacredness in that reaching.” There is no one who has come in contact with Reverend Samuel Titilola Oladele Akande—father, husband, pastor, teacher, author, educationist, Doctor of Philosophy, die-hard Baptist and grand nonagenarian—who will not immediately recognize that he or she is standing in the presence of an embodied legacy divinely scripted and delivered to the world by the Almighty. Papa Akande is truly a continuum whose very life reaches out and deep into the hoary past
of not only those who carried Christian values and the torch of Christ, but also those ancestors that embodied the best experiential insights the Yoruba culture could teach. This is just one of the reasons why it is a living blessing to have the 93 old Papa with us still, and to keep joyously celebrating every year that meets him on earth. I am especially gratified that I could appropriate Rev. Akande by an intimate kinship and excellence trajectory that ties both us, as well asRev. David AibinuOlaopa, Rev. T. A. Adejumobi, Dr. J. A. Adegbite, Prof. OjetunjiAboyade,Prof. E. LatundeOdeku and so many illustrious others, to Aawe—that small town of small people with mighty vision. I once had the good fortune, indeed one out of many, of benefitting from this trajectory of excellence. I had attended an interview at Niko Engineering Co. Ltd. owned by the late Eruwa-born billionaire, Chief AdeseunOgundoyin, to whom I was recommended for a job as his Research Assistant. This was far back at a time when I was still struggling to earn a living. I was eventually appointed as General Manager (Corporate Services). What was remarkable and a testament to how much that generation upheld meritocracy, was that Chief Ogundoyin later sent for me when the report of my sterling performance at the interview got to his desk. The first name that got out of his mouth was Rev. (Dr.) Ola Akande whom he regarded as a mentor by dint of his deep theological scholarship and how the grace upon his ministry greatly inspired his life, his business and his unquenchable thirst for knowledge as a Baptist and an intellectualentrepreneur in his own right. “I shouldn’t really have been surprised when I heard that you are also Aawe-born, as virtually all my Aawe friends I have are great minds and accomplished professionals” he concluded. Indeed, Reverend S. T. Ola Akande is a tow-
ering figure and exemplar of all that the Aawe parents invested in their children. Of course, when on March 31st 1926, Papa Daniel Oladele Akande and Mama Susannah Ayannihun gave birth to a wailing little lad, no comet blazed the sky to herald the arrival of a star. But both of them made a decision to invest in him the best of education they could afford, and the best of Christian upbringing they could inculcate in the impressionable mind of an eager boy. This is a life that reaches very deep into the heart of humanity and deeper still into the heart of God.It is indeed a life that is solidly comforted and supported by the everlasting love of a woman—Mama Comfort OlalonpeKehinde. A woman that stays with one for all of one’s life as pillar and embodiment of virtues as mama, now 87, is the diadem of one’s life. They have been together since 1956 when they got married. From an early age, and through the dedication of his parents, Papa Ola Akande had been connected with the Baptist Mission. While serving as a teacher at a Baptist school in Ghana in 1949, God started tugging at his young and yearning heart. Once Baba made up his mind to answer the call of God and enrolled in the Nigerian Baptist Theological Seminary at Ogbomoso in 1952, he set his face to a lifelong trajectory of educational and Christian service that has been without blemish. Pastor Ola Akande made a huge deal out of his ministry. For him, what is worth doing at all is worth doing well. And right from the onset when he took up the pastoral responsibility, he also cultivated a perspective that is different because it was founded on a different understanding of the values that Christ represents. Pastor Akande began to immediately make a good impression with his sermons (and of course laced with his impressionable Oueen’s English). These were
always well-composed, deeply researched, and well-delivered but fiery sermons that hit right to the hearts of evil and wrongdoing. These were messages I would leave Aawetown very early on Sunday mornings to listen to at OritaMefa Baptist Church, Ibadan. Listening to his sermons planted the seed of the thirst for a deeper understanding of the Scripture that led to my earning a Diploma in Christian Theology. I am not sure I am the only one that was so deeply inspired to learn more. I am definitely also not the only one that Baba’s sermons castigated. From the Ebenezer Baptist Church in Lagos to OritaMefa Baptist Church, Baba Akande was the scourge of those who would not be single-minded intheir worship. He takes Christ’s admonition in Rev. 3:15 seriously: “I know your deeds, that you are neither hot nor cold. I wish you were either one or the other!” And so, those who wished to have one leg in cults and fraternities and another in Christ, Papa combatted from the pulpit, and at great danger to his life. But it was a confrontation that was tinged with Christ’s compassion. It was this different spirit that enabled him recalled some OgboniFraternity members that the church had excommunicated. He trusted that the Word of God has the power, more than excommunication, to reach deep into their hearts. That different Christological perspective worked; those members eventually openly renounced their Ogboni membership and became hot, as Christ hoped they would. Note: The rest of this article continues in the online edition of Business Day @https://businessday.ng Prof. Tunji Olaopa, retired Federal Permanent Secretary & Professor of Public Administration. email@example.com, firstname.lastname@example.org
Thursday 14 March 2019
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Unlocking the potentials of the Nigeria commodity exchange ‘ UCHE UWALEKE
t the primary level, a commodity exchange connects buyers and sellers of physical commodities, a role that is particularly useful in enhancing market efficiency by helping to match supply and demand of commodities across time and geographic distances. In its sophisticated form, a commodity exchange, as noted by the United Nations Conference on Trade and Development, brings together buyers and sellers of commodity price risk, permitting those who wish to reduce their exposure to price movements to transfer it to those who are looking for such exposure. Thus, it contributes to unlocking finance to the commodity sector through price risk management as well as by providing access to capital markets. Indeed, the need for Nigeria to have a functional commodity exchange capable of attracting investors into the agriculture value chain and enhancing job creation cannot be overstressed. It will help support the non-oil sector, diversify the country’s export base and make the economy less vulnerable to external shocks. Through the provision of price transparency including better access to market, the income of farmers and their living standards will be enhanced. Agribusiness will become more attractive creating investment and employment opportunities in the commodities value chain with positive multiplier effect on the nation’s economy. At present, only two commodity exchanges are registered by the Securities and Exchange Commission in Nigeria.
Whereas the privately-owned AFEX Commodity Exchange, registered in 2014, is running against all odds, the much older government-owned Nigeria Commodity Exchange (NCX) is still struggling to find its feat due, in part, to inadequate funding. As disclosed on its website, the NCX was originally incorporated as a Stock Exchange in June 1998 but was converted to a commodity exchange in August 2001. The conversion was informed by ‘the need for an alternative institutional arrangement that would manage the effect of price fluctuations in the marketing of agricultural produce which had adversely affected the earnings of farmers following the abolishment of commodity Boards in 1986’. The sub-optimal performance of NCX, despite its potential to transform the agriculture sector, has been blamed on several factors including the fact that the conversion from a stock exchange to commodity exchange was done without due regard to the availability of the necessary conditions. The requisite infrastructure for physical trade including warehouses and grading laboratories is deficient. There is also the lack of supportive government policies and institutional infrastructure. The NCX has not acquired the required traction to take off owing to weak legal and regulatory regimes especially in terms of the absence of rules that enable an efficient delivery mechanism through warehouse receipts. It goes without saying that agriculture remains poorly organized with unsophisticated small holder farmers. All these were not taken into consideration before the conversion was done. So, it was a case of putting the cart before the horse. The experience of many European and Central Asian (ECA) countries, including some in Africa, seems to suggest that the government should take the lead in the development of a national commodity exchange because if there is no full government buy-in, the potentials of the exchange may never be fully unlocked. For instance,
beyond the planned investment by the Nigerian Sovereign Investment Authority (NSIA) in the NCX, government contractors can be encouraged to buy minimum quantities of designated commodities from the Nigeria Commodity Exchange. In this regard, the Ethiopian model recommends itself. In terms of trade value, the Ethiopian Commodity Exchange (ECX) can be considered as one of the success stories in Africa and this could not have been the case without government intervention. In a 2015 study on ‘Commodity Exchanges and Market Development’ Shahidur Rashid, of the International Food Policy Research Institute, noted that ‘although the ECX was launched in 2008 with a mandate to trade cereals, it was soon realized that its trade volumes were insufficient. In late 2008, the government therefore passed a proclamation requiring all coffee and other export crops grown in Ethiopia to be exported through the ECX. At one point in late 2008, the government had to confiscate 17,000 tons of coffee from 80 exporters attempting to bypass the ECX’. As documented in the study, this measure was positive for the ECX which generated over US$1.0 billion in revenue in 2012, sufficient to defray the cost of its own operations. Similarly, Shahidur Rashid had noted that in 2012, the World Food Programme (WFP) accounted for about 60 per cent of the total trade in commodities worth about US$9.0 million traded on the Malawi’s Exchange. By implication, it is difficult to sustain the Exchange’s operations without government or donor support. Against this backdrop, the recommendations of the Technical Committee on Commodities Trading Ecosystem set up by the Nigerian SEC should be given serious consideration. In its report, the committee had recommended that ‘government should as a matter of policy, procure grains into the strategic grains reserve through the exchanges and mandate all of its agencies such as NEMA to procure their grains through the commodity exchanges. This will
…commodity exchanges organized as public-private entities achieved better outcomes
ensure quality, price transparency, and foster the development of the exchanges. International agencies operating in Nigeria such as the WFP should be encouraged to buy their agricultural commodity requirements through the exchanges’. Some other recommendations of the technical committee which bear noting include conducting awareness-raising campaigns among key stakeholders in target areas to improve understanding of the commodities market and encourage participation, enacting the warehouse receipt bill into law which will go a long way in ensuring that farmers have easy access to credit, bringing on board smallholder farmers through well-organized cooperatives to improve liquidity as well as encouraging investment in all the requisite supportive infrastructure such as warehouses and storage facilities by the NCX and the private sector. To deliver in all these dimensions, it is best to regard the commodity exchange as a public-private partnership, with the public responsibility being to act as a catalyst and where necessary provide a supportive framework. This was the kernel of a 2011 working paper prepared under the FAO/World Bank Cooperative Programme titled ‘Commodity exchanges in Europe and Central Asia: a means for management of price risk’. In it, the authors demonstrated that commodity exchanges organized as public-private entities achieved better outcomes. To this end, the government, through the Federal Ministry of Agriculture and Rural Development, should channel every effort, in partnership with the private sector, to unlock the potentials of the Nigeria Commodity Exchange including through putting in place adequate funding arrangements as well as jettisoning the reported plan to reintroduce marketing boards for some designated commodities.
Uche Uwaleke of Nasarawa State University Keffi is Nigeria’s first Professor of Capital Market and the President of the Association of Capital Market Academics of Nigeria
A time for everything
o everything in life, there is a time and season. A time to lament and a time to laugh. Now that the presidential election has been fought and won, the time to laugh has come. We have had enough of lamentations. A number of good and virtues things must come on board while quite a number of obnoxious things must give way to sanity. The time has come to restore all that the political locusts, cankerworms, and caterpillars have eaten. The time to rise up and build is now and we must strengthen our hands for the good work. The time also has come to turn the reproach of the political lunatics in our midst upon their heads and give them for a prey in the hands of law enforcement agencies without fear or favour. Many of our politicians have ruled and ruined this country and today are departing the
political scene without being desired because God recompense good for evil. It is a time for woe to be unto them that have managed the affairs of this country by unrighteousness. A terror to themselves they shall be and to all their friends and they shall not fail to fall by the sword of their own enemies; except they stop to walk in lies and refrain from strengthening the hands of evildoers. They need to repent of their iniquities to behold the good which God shall do for this country in the next four years and beyond. The hearts of leaders whether political or otherwise are in the hands of God. Like the rivers of water, he turns them wherever he wills. I am inspired and convinced that God will put his law in the inward part of the incoming leaders and write it in their hearts. I trust God will make them sharp threshing instruments having teeth that can thrash the political mountains in this country and beat them small and make the hills of corruption as chaff. In the next four years, I believe the throne of our leaders will be preserved by mercy and truth and false balances in any form and shape shall be an abomination. We shall have a sigh of relief neither because of APC nor PDP but because God will do a new thing, make a way in the wilderness and rivers in the desert and then we shall remember not the former things and neither the things of old shall be concerns anymore. Where we are today as a country is not edifying but we can begin to engage reverse gear
and be faithful in our stewardship to get to the desired destination. There are examples in history once cast in the same mold as ours but the situations were turned around for good and achievements began to speak for themselves. For instance, the Athenian Statesman, Pericles (c. 490-429 BC) rose to power in 460 BC. He ensured that all those dealing with public funds were carefully watched to avoid the temptation of fiddling the accounts. Besides, all others who served in his government had their background examined to see if they were qualified to serve. Favoritism and nepotism had no role to play in appointment to offices and thus, there was no one with any itchy fingers in his cabinet and none also to ill-advise him. We can replicate this in Nigeria. But the questions is: who bells the cat? By the time of his death in 429 BC, he had adorned Athens with beautiful legacies that speak till this day. There was also Henry VII who was king of England between 1485 and 1509 and was said to be the most astute businessman ever to sit on the English throne. When he assumed office, he found the Royal Treasury almost empty and without lamentation left it in 1509 with several millions. Could it be because the World Bank, the International Monetary Fund (IMF), the Paris Club and the African Development Bank (ADB) existed not at the time! No. He was violently in love with integrity. As we move into the next phase of our political life as a country, we look forward to a reign
of progress devoid of odious political leaders with an ulcerated and revolting sense of honour and manhood. We look forward also to the absence of men and women political advisers like Strafford Thomas Wentworth (1593-1641) who, as the Chief Minister to Charles 1(King of England 1625-1649) was responsible for many of the king’s deadly actions. We look forward to a reign where sentences against evil works and actions would be executed speedily so that the hearts of the sons of men will cease to always be fully set to do evil. We look forward to political appointees at all levels who will appreciate that ‘better is a little with righteousness than vast revenues without justice.’ What more! We look forward to un-amputated Judicial and Legislative arms where diverse weights are considered an abomination and dishonest scales a crime against humanity. Finally, we need a President and we already have one in action and in waiting whom we expect to be courageous, farseeing, intelligent and sensitive and would not mind whom he attacks in the interest of Nigeria and Nigerians. The President has the chance and power to reform Nigeria and cure the ills in the next four years. The current wretched and unworkable system must be consigned to history. Prof Iyoha is of the Department of Accounting, Covenant University Email: firstname.lastname@example.org
Frank Aigbogun editor Patrick Atuanya DEPUTY EDITORS John Osadolor, Abuja Bill Okonedo NEWS EDITOR Chuks Oluigbo EXECUTIVE DIRECTOR, OPERATIONS Fabian Akagha EXECUTIVE DIRECTOR, STRATEGY, INNOVATION & PARTNERSHIPS Oghenevwoke Ighure GENERAL MANAGER, ADVERT Adeola Ajewole ADVERT MANAGER Ijeoma Ude FINANCE MANAGER Emeka Ifeanyi MANAGER, CONFERENCES & EVENTS Obiora Onyeaso BUSINESS DEVELOPMENT MANAGER (South East, South South) Patrick Ijegbai CIRCULATION MANAGER John Okpaire DIGITAL SALES MANAGER Linda Ochugbua ASSIST. SUBSCRIPTIONS MANAGER Florence Kadiri GM, BUSINESS DEVELOPMENT (North)
Bashir Ibrahim Hassan
GM, BUSINESS DEVELOPMENT (South) Ignatius Chukwu
Thursday 14 March 2019
Job: Averting the coming anarchy
obs are central to the economic development of any nation. E c o n o m i s t s h av e long established a link between the employment rate and economic growth. When citizens are gainfully employed and produce valuable goods and services, both the citizens, the economy and the society prosper and vice versa. And that is the first indices with which leaders are judged in advanced economies is the number of jobs created and how low the unemployment rate is. As at 2010, the unemployment rate was 5.9 percent. It rose steadily yearly to 8.19 percent in Q2 of 2015 at which point the current government came to power. In Q3 2017, the unemployment rate had more than doubled from to 18.8 percent and peaked at 23.10 percent in the Q3 2018 while unemployment rate and underemployment had also jumped from 26.53 percent in Q2 2015 to 43.3 percent in Q3 2018. In concrete terms, 20.9 million Nigerians are currently unemployed while 18.2 million are underemployed. This brings the total of unemployed and underemployed to 39.1 million people out of a total labour force of 90.4 million.
The youth (45 per cent of the population is aged below 15) account for the majority of the unemployed and underemployed in Nigeria. While youth unemployment in 2010 was 8.05 percent, it has climbed to 13.41 percent in 2017 and climbed to an all time high of 38 percent in Q2 2018. It however decreased to 36.50 percent in Q3 2018. Concretely, there are 44 million youth in the active labour force. Out of these, only 19.73 million, representing just 45 percent of the active labour force, are in full time employment. The other 55 percent are just trying to eke out a living or as we say in Nigerian parlance, hustling with no full time employment. Sadly, youth unemployment has been growing steadily since 2010. However, it has intensified since 2015, fuelled, no doubt, by a weak economy and huge population growth. While estimates in 2014 by the NBS show that 1.8 million graduates in the country move into the labour market every year, the Stutern Graduate Report (2016) suggests that 2.5 - 3 million young Nigerians annually enter the labour market without the prospect of jobs. This is not to talk about those who could not go to school (a recent report from UNESCO put out of school children in
Nigeria at 13 million), those who only completed primary or secondar y school and couldn’t proceed to higher institutions. Actual figures from the NBS show that about 9 million youth have entered the labour market since 2015 and are not able to find employment. This is scary! The problem is not just about not finding work; it is also about those in employment losing their jobs as a result of the weak economy. While according to available statistics at the NBS, Nigeria created a total of 1.6 million jobs in 2015 and 1.538, 208 jobs in the first three quarters of 2016, a total of 7.956 million Nigerians became unemployed between January 2016 and September 30, 2017. The NBS estimated that the number of unemployed Nigerians rose from 8,036 million in 2015 fourth quarter to 15.998 million in third quarter of 2017. Equally, data from the Manufacturers Association of Nigeria show that about 272 manufacturing plants were shut down across the country in 2016 alone. The import of this is clear: the economy is not creating opportunities fast enough for its youthful and growing population. A clear sign is that while the country’s population is growing at a healthy 2.6 percent per annum with a youth population
of over 60 percent, economic growth has remained well below 2 percent. Jobs for Nigeria’s ballooning population appears to be the most pressing national emergency in Nigeria today because youth unemployment is a waiting time-bomb and if nothing is done about it, the millions of jobless youth we through into the system will make the country ungovernable for us all. Certainly, governments do not have the capacity and resources needed to create the kinds of jobs needed to absorb Nigeria’s young population and keep them away from mischief. Only a strong collaboration with the private sector and massive private sector investments will create the opportunity for creation of jobs at that scale. But just allowing the private sector to take charge of the economy alone won’t do the magic. There should be a high level government plan on job creation to delineate sectors and their potentials to create massive jobs. With that, the government can then begin a strategic engagement with the private sector and investors to nudge them towards its plan while at the same time removing bottlenecks and obstacles through policies to aid massive investments at the scale required to creating the desired jobs.
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Thursday 14 March 2019
COMPANIES & MARKETS
Bismarck Rewane retires from FCMB’s Board as Non-Executive Director
C O M PA N Y N E W S A N A LY S I S A N D I N S I G H T
Access bank to boost credit extension, capital with $162.5 million loan DAVID IBIDAPO
Access Bank Plc, a Nigerian tier-one deposit money bank, has signed a loan agreement worth $162.5 million, with a bilateral private-sector international financial institution to boost its capital and fund lending operations. Access bank, which is currently in the process of merger with mid-tier lender, Diamond Bank, signed this agreement with the Netherlands Development Finance Company. According to a report by Bloomberg, Dutch development bank, FMO, is arranging the loan, while financial institutions including Belgian Investment Co. for Developing Countries, Blue Orchard Microfinance Fund, Finnish Fund for Industrial Cooperation Ltd. and Ecumenical Development Cooperative Society U.A. are providing the financing, the Lagos-based company said in a statement. Furthermore, the statement provided that, “The funds will qualify as Tier two capitals, which will help the bank fund, a five-
year expansion plan.” According to a report released on the NSE, Access Bank explained the signed loan agreement will ensure the bank’s 5 year strategy to becoming Africa’s gateway to the world is achieved. Shedding more light to this, Herbert Wigwe, CEO of Access Bank explained, the drive to support the promotion of growth and job creation of the private sector through improved access to financing. According to him, “attention will be paid to strengthening the Micro, Small and Medium sized enterprises that have been constrained by lack of access to finance.” “We believe this relationship will be the beginning of many more international partnerships with such entities,” he added. Linda Broekhuizen, Chief Investment officer at FMO said, “Through this transaction, FMO strengthens its long-standing relationship and commitment to our-reputed client Access Bank.” Recall, nine months ended financials of banks
L-R: Anup Singh, domain lead and manager, Microsave Consulting; Ronke Kuye,CEO, SANEF Limited; Esaie Diei, CEO, EFInA; Degbola Abudu, CEO, Capricorn Digital Limited, and Titilola Shogaolu, divisional CEO, Interswitch Financial Inclusion Services Limited, at the 2days training of EFInA Agent Networks Providers in Lagos.
showed a cut back by banks in loan books as Nigeria deposit money banks enjoyed bigger opportunities in the fixed income space of the Nigerian financial market. Recent developments in the banking sector has shown Nigeria deposit money banks retracing steps to expanding and growing loan extensions to
the private sector to boost employment. In a financial presentation by Guarantee Trust Bank (GTB) for full year 2018, the bank estimated a loan growth by 10 percent in 2019. This therefore provides a positive outlook for the private sector in terms of credit access. Meanwhile, ahead of merger with diamond
bank, Access bank year to date performance is down 11.8 percent approximately with a market capitalization which currently stands at N175.01 billion. Access Bank agreed last year to buy Carlyle-backed Diamond Bank in a deal worth about $200 million. It plans to complete the takeover on April 1 after the shareholders of both
banks approved the deal last week. Access Bank shares dipped 0.83 percent to N6 after the close of trading on the floor of the Nigerian Stock Exchange on Tuesday. That worsened the bank’s year-to-date loss to 11.76 percent, underperforming the market which dropped 0.4 percent since the beginning of the year.
Nova Merchant Bank doubles profit, assures shareholders of value creation ISRAEL ODUBOLA
ova Merchant Bank, a Lagosbased newly-licensed merchant bank, posted an impressive full year outing as after-tax profit jumped 125 percent to N1.15 billion for the year ended December 31, 2018. The bank’s net interest income, which represents the difference between interest income and expense, stood at N1.51 billion in the review period, indicating a 30 percent increase over N1.16 billion posted in 2017. Reacting to the result, Anya Duroha, Managing Director and Chief Executive Officer, said that the result reflects the bank’s resilience, commitment, and
Source: Company’s financials
dexterity of the company’s workforce. He said that the bank has leveraged technology to reduce cost whilst widening clientele. “We will continue to focus on growing our business, providing solutions
tailored to our clients’ needs, building high-performance culture, motivating our employees and creating sustainable value for our shareholders.”, Duroha stated. Gross earnings in the
review period spiked 54 percent to N1.88 billion, an uptick from N1.22 billion reported a year earlier. The total assets of the recently-authorized bank grew in double-digit (47 percent) to N25 billion in
2018. Total liabilities of the bank soared to N7.37 billion in 2018, compared with N1.48 billion in 2017, buoyed by dues to customers. According to Duroha, the stellar performance shows that the bank is set to enjoy the dividends of its investments in technology, operations, and people. He added that the bank will sustain growth in subsequent years as it scales its business and expands its client base. On his part, the Chairman, Board of Directors, Philip Oduoza, stated that they have built a strong foundation for the success of the bank, and they remain optimistic about their business model and value proposition. “We remain committed
to the implementation of our over-arching philosophy of new thinking, new opportunities to create value for all our shareholders”, Oduoza averred. Oduoza, a former Group Managing Director of United Bank for Africa Plc, assured stakeholders that the bank will continue to deliver profitable and sustainable results. He added that the bank’s operations are guided by its core values of fairness, integrity, passion, teamwork, and uniqueness. Nova Merchant began operations in the country last year. The bank’s products and services cover corporate banking, investment banking, wealth and asset management, with targets on clients in private and public sectors.
Editor: LOLADE AKINMURELE (email@example.com) Graphics: David Ogar
COMPANIES & MARKETS
Thursday 14 March 2019
Bismarck Rewane retires from FCMB’s Board as Non-Executive Director …stock slides 3.85% OLUWASEGUN OLAKOYENIKAN
ismarck Rewane, the managing director of Financial Derivative Company Limited, a Lagos-based risk and financial advisory firm, has retired from the Board of First City Monument Bank Plc (FCMB) as an independent Non-Executive Director. The retirement announcement of the renowned economist came after the acceptance of the bank’s Board at its meeting on Friday, the tier-two lender said in a notice filed at the Nigerian Stock Exchange (NSE), Tuesday. Rewane holds a Bachelor’s degree from the University of Ibadan and is an Associate of The Institute of Bankers,
England and Wales. He worked with the First National Bank of Chicago (later became the International Merchant Bank Nigeria Limited) as a General Manager and Treasurer of the Bank. He has also served as a Director of both Lion Bank of Nigeria and Intercity Bank Limited. The former director has over 40 years’ experience in the financial services industry. He served on the Board of the First City Group Ltd., FCMB (UK) Ltd, Top Feeds Nigeria Ltd., Delta Packaging Nigeria Ltd., Seepec Nigeria Ltd., Nigerian Economic Summit Group, Modant Marine Ltd., Virgin Nigeria Airways Ltd, Nigeria LNG Foundation, UBA Custodian Ltd., UNIC Insurance Plc, Navgas (a Vitol subsidiary) and Guinness Nigeria Plc.
Early this year, he was appointed by President Muhammadu Buhari to lead the minimum wage technical advisory committee that will advise the government on smooth implementation of the new minimum wage. “The Board and Management of FCMB Group Plc appreciate his valuable contributions and for always being available whenever called upon,” the midtier bank said. FCMB shares extended its bearish performance to the second trading day after the close of trading on the floor of the NSE, Tuesday. The stock dipped 3.85 percent to settle at N2, bringing its return since the start of the year to 5.82 percent.
L-R: Lisa Iduoze, HR team lead, Pension Alliance; Olalere Olabiran, country HR manager, Nokia; Anu Martins, head, client services, THT; Nick Zaranyika, CEO, THT and Kieran Godden, COO, THT at a cocktail event organised by THT to celebrate its clients in Lagos.
PFAs in need of new clients GREGORY KRONSTEN, OLUBUNMI ASAOLU AND CHINWE EGWIM
ssets under Management (AUM) of the regulated pension industry, increased by 14.9 percent y/y in December to N8.64trn (US$28.1bn), also by 1.6 percent m/m. They are growing at a healthy rate yet, at just 6.8% of 2018 GDP, are running well behind many peer markets. Nigeria was relatively late (2004) with its legislation creating a sound structure for regulated pensions. The South African industry dates from 1996, and its AUM represent more than 70% of comparable GDP. The industry in Nigeria has a need of new products.
The industry’s holdings of FGN paper amounted to 73.1% of their AUM in December, compared with 70.4% one year earlier. The stake of the PFAs in naira debt markets remains pivotal. Their holdings of FGN bonds at end-December represented 49.2% of the stock of the instruments at endSeptember. The share of AUM invested in domestic equities has declined over 12 months from 8.9% to 7.0%. The NSEASI fell by 17.8% over the same period. We understand that the regulator has lifted the requirement for retirement savings account holders under
a set age to hold a minimum exposure to equities, and thereby eased the pressure on the PFAs to invest in an asset class with which they are not always comfortable. The latest PenCom data show a total of 8.41 million scheme memberships, implying an average portfolio of N1.03m (slightly higher than November). This average should decline because from 01 January the PFAs have been able to market micro pensions for the self-employed and employees of small firms. The regulator has suggested an increase in AUM over an unspecified timeframe of N3trn.
L-R: Ulhas Theurka, HR manager, Simba Group; Karthik Govindarajan, head of marketing, Simba Group; Chioma Akpotha, nollywood superstar; Vivek Pendharkar, head, deputy business, Simba Group; Naved Hassan, head of training, Simba Group, and Nitesh Kumar, head, service, Simba Group, during the TVS International Women’s Day in celebration of their Queen Riders.
Spectranet unveils product targeted at empowering women to realize potentials
s part of efforts to enable women connect to the world and access opportunities, internet service provider; Spectranet 4GLTE unveiled MiFi pack to commemorate the International Women’s Day 2019. The product was launched by renowned actress Tina Mba. Crafted with women at heart, ACE MiFi empowers them by connecting to the world with seamless internet access and realise their true potentials. Other top-of-theline features of the ACE MiFi are; parental control, sharing of data amongst users, more than 10 connected users, unmatched working battery life of up to 10 hours and memory card slot expandable up to 64GB. Chief Executive Officer, Ajay Awasthi said: “Spectranet recognises the role played by the women in bringing about
deep societal changes and the sacrifices they make to ensure the quality of life for each one of us. It is with this acute sense of reverence that we are commemorating the International Women’s Day. Being a technology company, it is an honour and privilege to help create more opportunities for the enterprising women of Nigeria by ensuring faster, affordable and reliable access to the internet”. Speaking on the previous edition of the commemoration, Awasthi noted, “Last year, we had the privilege to honour two outstanding women at the Ikeja Golf Club. The move was well received and it encouraged us to do more for the causes related to women. Every woman should be supported and given the opportunity to do even more in the Nigerian society. We can make this happen by making sure women get access to world-
wide opportunities through seamless internet connectivity. Commenting, celebrity guest and thespian, Tina Mba lauded Spectranet for appreciating the resilience of Nigerian women and encouraging them to activate their potentials. “I am excited by the rare privilege to join Spectranet in commemorating a very important day, the International Women’s Day. Nigerian women are resilient. They defy odds and go all the way to make an impact. “Spectranet has extended a hand of friendship to women. They want their products and services to be women-friendly. I’m happy to be the point of contact between the brand and women in leveraging the aspirations of women, regardless of occupation or specialization. When you empower a woman, you empower a child and by extension the world.”
L-R: Emmanuel Kelechukwu, guest speaker: Ife Olranwaju, CEO, Foshizi Tours: Ekaette Umoh, convener: Ehi Okoyomon, co-chair, and Latifat Balogun, CEO, Hatlab, during the 50 Business Plan Competition and conference to mark Ekaette Umoh’s 50th birthday in Abuja. Pic by Tunde Adeniyi
L-R: Abdulwarees Solanke, head of laboratory services; Antonio Ayodele, GM, both of the Lagos State Environmental Protection Agency (LASEPA); Andrew Enahoro, head of legal and corporate communications, and Apo Basil, manager risk and safety, both of Promasidor Nigeria, during a courtesy visit by Promasidor team to the General Manager of LASEPA in his office in Alausa-Ikeja, Lagos.
Thursday 14 March 2019
Broadband Infrastructure @Businessdayng
Bank IT Security
Nigeria’s internet users sit on ‘keg of gunpowder’ as cyberattacks rise FRANK ELEANYA
ew data released by the National Bureau of Statistics (NBS) on Monday confirmed what is already obvious, that the number of active internet users in Nigeria is growing at breakneck speed. They are seizing every cheap phone opportunity to leapfrog the digital revolution, in which Nigeria already seems to be lagging behind. In the fourth quarter (Q4) of 2018, active internet users grew by 13.6 per cent reaching 112.1 million compared to 98.7 million in the same period in 2017. On a quarteron-quarter basis it rose marginally by 5.3 per cent from 106.5 million in Q3 2018. Mobile phone penetration at 93 per cent accounts for majority of the internet usage. That amount of internet users is no mean feat especially when put in the context of being the combined population of at least African countries including South Africa (estimated 54million), Ghana (27 million), Rwanda (10 million), Tunisia (10 million), and Mauritius (1.2 million). It has also become a rallying point for authorities in Nigeria when marketing the country’s
potentials to investors. Nonetheless the inability to strengthen Nigeria’s cyber security framework has meant that millions of citizens who are embarking on the journey online are exposed to the increasing threats of cyber criminals. Lost in the digital euphoria, they hardly ask questions about data protection and privacy. Nigeria leaped from 5th place in 2017 to third in 2018 in terms of top 10 countries by share of users attacked by mobile malware, according to researchers at Kaspersky Lab. The report showed that in 2018 there were 116.5 million cyberattacks, compared
to 66.4 million in 2017, with a significant increase in unique users being affected. Nigeria at third place accounted for 37.72 per cent of these attacks. Three other African countries joined Nigeria in the global top 10. For instance, Algeria finished in 5th place with 35.06 per cent, Tanzania came in 8th with 31.34 per cent and Kenya was 9th accounting for 29.71 per cent of the attacks. The researchers said smartphones have become easy targets as their role in business processes and day to day life grow. “In 2018, mobile device users faced what could have
Visa launches $200,000 global competition for women entrepreneurs CALEB OJEWALE
n celebration of the International Women’s Day last week, Visa has launched a program inviting women entrepreneurs from around the world to tackle FinTech and Social Impact challenges for a chance to win $100,000 in each of the two challenges; a total of $200,000. Tagged the Visa Everywhere Initiative: Women’s Global Edition, the program will culminate with a finals event to be held during kick-off of the FIFA Women’s World Cup France 2019. To participate, companies with at least one female founder are invited to submit solutions that tackle challenges facing the FinTech and Social Impact landscapes today through one of the two innovative briefs. • Challenge 1 (FinTech): Leveraging your company’s unique capabilities, how could your solution help transform consumer, pay-
ments and/or commercial experiences locally, regionally or globally? • Challenge 2 (Social Impact): How can women entrepreneurs around the world drive social impact by supporting sustainable and equitable livelihoods and strengthening local/ regional economies? According to Lynne Biggar, chief marketing and communication officer at Visa, more than163 million women around the world have started their own business in the last five years, accounting for up to 37per cent of the workforce. Women entrepreneurship is on the rise and Visa is committed to inspiring more women to break through barriers through platforms like the Visa Everywhere Initiative. Since 2015, the company in a statement said, Visa Everywhere Initiative has provided visionary solutions for commerce and payment challenges of tomorrow. The program
has activated regionally in 75 countries and awarded more than 70 leading startups with monetary prizes, mentorship and access to Visa’s clients and partners. Now, for the first time, the program will shift from regionally focused events to a worldwide program centered on FinTech and Social Impact to shine a spotlight on the millions of underrepresented women business leaders and Visa’s commitment to micro and small businesses catalyzing change. The programme opened for submissions on March 6th and closes April 14th through www.visa.com/ everywhereinitiativeglobal. To reward the most impactful solutions, Visa says it will provide $100,000 to each challenge winner, along with expert mentorship, access to clients and Visa’s vast network of partners. The winners will also receive tickets to the opening game of FIFA Women’s World Cup.
been the fiercest cybercriminal onslaught ever seen,” says Victor Chebyshev, security expert at Kaspersky Lab. “Over the course of the year, we observed both new mobile device infection techniques, such as DNS hijacking (http:// bit.do/eKudD), such as along with an increased focus on enhanced distribution schemes, like SMS spam.” Today’s cyber criminals are sophisticated and have found new ways to penetrate security measures all the time. As a result, a growing number of entities, from small companies to the federal government, are at risk of losing data, money and their reputation.
Enyioma Madubuike, founder of LegitNg, a legal firm, told BusinessDay that the Kaspersky report underscores the need to firm up data protection and security laws for Nigerian institutions responsible for consumers’ data. Cybercrimes in various forms (Phishing, Botnet, Ebank theft, online credit card theft, etc) are punishable offences in many countries. To be sure, cybercrimes are criminal activities where activities where computers, network or electronic information technology devices are the source, tool, target or place of crime. They are carried out by way of illegal access into another’s data base, illegal interception, data interference, system interference, misuse of devices, forgery and electronic scams. In China, as well as in many African countries, punishment for cybercrimes can fetch up to five years imprisonment. Like most of these countries, Nigeria also has a cybersecurity law. The Nigerian Cybercrime Act 2015 is the first federal law created specifically to deal with the criminal threats and issues facing the digital age. Its objective is to provide an effective, unified and comprehensive legal, regulatory and institutional framework for the prohibi-
tion, prevention, detection, prosecution and punishment of cybercrimes in Nigeria. Despite the law’s existence, criminals have carried on business as usual and - as the Kaspersky report clearly shows - have become emboldened. The cybersecurity law has hardly been enforced or sent any offender to prison. “A serious cause for concern is that data protection regulation and awareness is not measuring up to uptake of new technologies,” Madubuike said. Cybercrimes have negative implications for everyone which is why big tech companies like Google, Facebook, Amazon and Microsoft are committing enormous resources to fight back criminality some of which are perpetrated using their platforms. Without a solid cyber security framework and management to provide protection, Nigeria’s growing internet users represent a windfall for cyber criminals. The release of the CBN Cyber Security Framework in 2018 to essentially drive security within banks and payment service providers (PSBs) was a step in the right direction. However, like the Cybersecurity law, the CBN will need to take enforcement and education very serious.
The Next Billion Users will drive mobile apps and services in future Juliet Ehimuan-Chiazor, Country director, Google Nigeria
t is pretty well understood by now that the internet will change Africa, provided everyone can access it, and that this will enable unprecedented social and economic development across the continent. What is still unfolding, however, is how Africa is going to change the internet. Many Africans are still accessing the internet using unreliable connections, and low-end phones. Smartphone penetration on the continent stands at 33 per cent, according to figures released by Pew Research in October last year, and there are some 444 million unique mobile subscribers in Sub-Saharan Africa, according to the GSMA’s The Mobile Economy Sub Saharan Africa 2018 report. This equates to roughly 44 per cent of the population, and still well below the global average of 66per cent, the GSMA notes. That said, this is growth, and rapid growth at that. Back in 2015, there were 367m mobile subscribers, according to the GSMA’s 2015 report and the figure is set to rise to 634m
by 2025. Mobile broadband uptake, in particular, has increased from just over 20per cent of connections in 2015 to 38per cent in 2018 and forecast to increase to 87per cent by 2025, the GSMA says. In other words, more and more Africans are coming online every year, and they are doing it on their mobiles. For most Africans, things that people in Europe or America do on a laptop or desktop will only ever be done on a mobile phone. And this is driving change in how mobile phones, the operating systems that run them and the apps on them are developed and operate. As Google, we have had a dedicated focus on the Next Billion Users (NBU) of the internet since 2014 for this reason. Our team travels the world, interviewing people in countries like Brazil, India, Indonesia and Nigeria to find out what they need in a mobile phone, a smartphone, or a mobile app. In the developed world, technology is built from the ground up to have access to stable power supply and alwayson broadband connectivity, and it does not perform optimally without them. We have developed Android Go because
Team: Frank Eleanya, firstname.lastname@example.org; Caleb Ojewale, email@example.com
we know it is not like that in NBU countries. It brings standard smartphone functions to low end phones, and we’re hoping that it will encourage app developers across the globe to build products that work well on these devices. More recently we’ve started rolling out Google Station in Lagos and Abuja to provide free wi-fi to Nigerians in the public places they spend so much of their time. We know data is expensive, and we know connections are unreliable, so we are partnering local companies and Internet Service Providers to change this in as many locations as possible. This is not just enabling people in those areas to access free internet though, it is also giving entrepreneurs and businesses an opportunity to products and services that need the internet to operate. This means we are not just empowering users, but also empowering other people to build solutions to Nigeria’s challenges. We are not just expecting the Next Billion Users to come out of the developing world, but the next billion big ideas. And the internet is both going enable these ideas and be fundamentally changed by them.
Thurssday 14 March 2019
SHAPING PEOPLE INTO A TEAM
Race at Work SARAH CLIFFE
WE WON’T MAKE REAL PROGRESS TILL WE UNDERSTAND THE BARRIERS TO CHANGE. ore than two decades ago, Harvard Business Review invited 10 executives of color to a roundtable discussion of race in the workplace and published an edited transcript of their conversation. Recently I pulled that article out, thinking it would give me a sense of how the landscape had changed since 1997. But when I read it, I was startled. The discussion didn’t feel dated at all. In fact, the topics those leaders addressed are completely of-the-moment. African Americans are still seriously underrepresented in the senior ranks of organizations. Hiring and promotion processes still favor people from the same racial, gender and class background as the decision-maker. People of color still have less access to important social networks than whites do and still sense that white colleagues are surprised when they show they’re competent, intelligent and hardworking. Well-meaning white people don’t think they could possibly be part of the problem. But rigorous research into implicit biases suggests they’re probably wrong. These realities don’t just create barriers; over time they wear people down. And they’re made worse by the fact that the people with the power to improve things (most of whom are white) tend to be deeply uncomfortable talking about race in their own workplaces. So how can we begin to change the dynamic? Over the years, Harvard Business Review has published many articles about how to tackle these problems and increase diversity in organizations. But if you’re
an individual white manager, as I am, what can you do on your own? At a minimum, you can start to learn more about what it feels like to live and work in the United States when you’re not white. Some recent books and podcasts can help. The best-known of these is Michelle Obama’s terrific memoir, “Becoming.” There are two strands of the book. The first is a classic American success story. Born into a happy, tight-knit working-class family, Obama relied on innate talent, luck, community support and her own drive to get a first-class education at a public magnet school and then Princeton and Harvard Law. She’s a profoundly orderly person who fell in love with and married an idealistic whirlwind of a man and has since raised two delightful children with him. She’s done work that makes a difference in the world. Oh, and she was the first lady. The other strand makes the story more complicated. Michelle Obama never has the luxury
of forgetting about race. Some of this is personal, as when a cousin asks her why she talks “white.” Some of it’s systemic, as when her public school is starved for resources following the white flight from her South Side neighborhood. She writes about the time her brother was stopped by the police because he was riding a new bike. About the extra energy it takes to be the only person of color in a classroom or a boardroom. About the sometimes subtle, sometimes blatant attempts to make her and her husband into the “other” — him a Kenyan and a secret Muslim, her an “angry black woman.” Obama is matter-of-fact about all this. She has no self-pity and, in truth, very little anger, but she doesn’t sugarcoat the reality that she and other African-Americans live. She might say that it’s just the tax she pays for being black in America. Still, it’s a very high tax — one that’s easy to forget if you don’t have to pay it. Obama is a pragmatist; Casey Gerald, in contrast, may be a genuine visionary. His beautifully
written memoir, “There Will Be No Miracles Here,” builds on his famous TED Talk. Like Obama, he describes a swift ascent from very modest circumstances, but he also makes a powerful argument for societal change. “I ... made it to the mountaintop,” he writes, “ ... and I have come with urgent news: we must find another mountain, if not another world, to call our own.” It’s worth noting that this apocalyptic tone — applied not just to race but to an array of ideas and institutions — was echoed in other upcoming memoirs from millennial black writers that I looked through. Maybe that’s a coincidence, or maybe it signals some interesting changes coming from a new generation of black intellectuals. But let’s get back to pragmatism. For a broad view of how people of color navigate the workplace, you might turn to “Let Them See You,” by Porter Braswell, co-founder of the jobsearch firm Jopwell. A self-help book aimed at professionals from underrepresented groups, it has the attention-grabbing headlines
c 2017 Harvard Business School Publishing Corp. Distributed by The New York Times Syndicate
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typical of the genre — such as “why you need a personal brand at work” and “your elevator pitch for diversity.” But behind the zippy language is a sophisticated understanding of the challenges racial minorities face at work as well as a wealth of smart tips for flipping them to be an advantage. I’d recommend it not only to the target audience but also to white professionals interested in supporting a workforce that’s more comfortably, productively diverse. More insights can be gleaned from various podcasts. I particularly like “Code Switch” and “Still Processing”; neither focuses primarily on workplace issues, but both feature accessible conversations on race-related topics. NPR’s “Code Switch” looks at how race, gender, ethnicity and identity intersect in people’s lives. (Episode recommendation: “The ‘Code Switch’ Guide to Handling Casual Racism.”) “Still Processing,” hosted by New York Times cultural writers Jenna Wortham and Wesley Morris, looks at news and pop culture through the lens of race. (Episode recommendation: “We Sink Our Claws into ‘Black Panther’ with Ta-Nehisi Coates.”) In addition to great cultural commentary that offers a window into the nonwhite American experience, these podcasts offer a playbook for talking about race honestly, even when you’re worried about saying something stupid or stepping on a land mine. They model the sort of behavior we need more of in the office. Of course, educating yourself about others’ experience is just a first step. It’s on all of us to make sure that 20 years from now, Harvard Business Review’s 1997 roundtable sounds truly antiquated.
Sarah Cliffe is Harvard Business Review’s editorial director.
Thursday 14 March 2019
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GTBank: Market sentiment continues to support share pricing Iheanyi Nwachukwu
arlier this month, precisely on Wednesday March 6, 2019, Guaranty Trust Bank Plc (GTBank) released its audited financial statement for the year ended December 31, 2018. Investors had started snapping up the shares of the bank following the impressive financials and proposed final dividend. The scorecards Snapshot of the results released to investors at the Nigerian Stock Exchange (NSE) shows the tier 1 lender’s group gross earnings grew by 3.7percent to N434.69billion in 2018, from N419.22billion it recorded in 2017. GTBank Plc reported 6.2percent decline in Interest Income to N306.96billion from a high of N327.33billion in 2017. Net Interest Income (NII) of N222.43billion against N246.66billion in 2017 represents a decline of 9.8percent. Loan Loss Expenses stood lower at N4.90billion, a remarkable 59.7percent decline from N12.16billion in 2017. Non-Interest Income grew by 39percent, to N127.73billion from N91.89billion in 2017. Loans & Advances of N1.262trillion in 2018 represents a decline of 12.9percent, from N1.449trillion in 2017. The bank grew deposits by 9.7percent in 2018 to N2.356trillion from N2.147trillion in 2017. Cost to Income Ratio (CIR)
stood lower at 36.7percent in 2018, from 37.6percent in 2017, down by 0.9percent. Return On Average Equity (ROAE) of 30.9percent against 30percent in 2017, represents an increase of 0.9percent. GTBank reported profit before income tax (PBT) increase by 9.1percent to N215.58billion, from a low of N197.68billion in 2017; while after tax profit for the year increased by 10 percent to N184.63billion from a low of N167.91billion in 2017. The bank closed the 2018
financial year with Total Assets of N3.287trillion and Shareholders’ Funds of N575.6billion. In terms of Assets quality, non-performing loan (NPL) ratio and Cost of Risk improved to 7.3percent and 0.3percent in December 2018 from 7.7percent and 0.8percent in December 2017 respectively. In addition, coverage ratio for NPL stood at 105.1percent and Capital adequacy ratio remained very strong, closing at 23.4percent despite the implementation of IFRS 9. Returns to shareholders
GTBank has continued to report impressive financial ratios in terms of profitability, efficiency and capital for a Financial Institution in Nigeria as revealed by its return on equity (ROAE) of 30.9percent, cost to income ratio of 37.1percent and capital adequacy of 23.4percent. These ratios are a testament to the efficient management of the bank. GTBank Plc earnings per share (EPS) increased to 654kobo from 594kobo in 2017. During the 2018 financial year, the directors declared and paid an interim dividend of 30kobo per ordinary
share on the issued capital of 29,431,179,224 Ordinary Shares of 50 Kobo each, for the half-year (H1) period ended June 30, 2018. The directors recommend the payment of a final dividend of N2.45kobo (only) per ordinary share of 50kobo (bringing the total dividend for the financial year ended December 31, 2018 to N2.75kobo (2017: N2.70kobo per share). Stock trading information At the equities market, price list of stocks as at March 8, 2019 shows GTBank shares at N37.30; indicating the stock has gained 8.3percent year-to-date (ytd). The stock had reached a 52-week high of N48.50 and a 52-week low of N30.90. With shares outstanding of 29,431,179,224 units, GTBank market capitalisation is in excess of N1.097trillion. Analysts’ comment Vetiva Capital Research analysts who are reviewing their target price for GTBank Plc as noted in their March 7 commentary said the bank overcompensated for the lag in core banking activities with a surge in non-interest income of 39 percent year-on-year. In summary, the analysts view the bank’s performance as impressive “but not superlative given the slight reduction in net interest margins full year 2018 (9.2percent) against 2017 (10.4percent). “We expect reduced industry margins in fees and commissions and other non-interest income
Continues on Page 19
Thursday 14 March 2019
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Impressive earnings result in the banking space drove marginal gains…
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he local bourse, after several tussles between the bulls a n d t h e b e a r s, closed last week in the positive region with a paltry +0.3percent week-onweek (w/w) return, with the Nigerian Stock Exchange (NSE) All Share Index (ASI) settling at 31,924.5 points. Sequel to the bullish theme, investors’ wealth inched higher by N36.3billion to close the review week at N11.9trillion while year-todate (YtD) returns stood at +1.6percent. Contrary to the somewhat bullish but quiet theme in the market, performance across sectors was broadly bearish as four of the sectors under our coverage closed negative. Analysing the sectors hierarchically, the Oil& Gas (-2.6percent) index topped the losers’ list, dragged by price declines in SEPLAT (-3.6percent) and MOBIL (-5.6percent). The Industrial Goods (-1.7percent), Insurance (-1.3percent), and Consumer Goods (-1percent) indices also trended a bearish path largely owing to sell-off on DANGCEM
of 1.0x at 0.9x; 22 stocks advanced over the week against 34 decliners. Looking ahead into the new week, we expect further earnings publications to drive sentiment with uncertainties in the polity gradually abating. Overall, we imagine the possibility of further uptrend as investors continue to hunt for tickers with attractive dividend yields. Money Market : Rates continue to compress postelection Last week, system liquidity remained buoyant as foreign portfolio inflows continued to trickle in after the presidential election, evident by the high level of activities at the Investors & Exporters window. Thus, the CBN paced up its liquidity mop ups during the week. In addition to its weekly wholesale FX intervention that was floated on Monday, the Apex bank floated OMO auctions on 4 of the week’s 5 trading days, successfully mopping up a total of N809billion, as against N292.6billion OMO inflow. Meanwhile, most of the demands across the various auctions were skewed to the mid-tenor bills as the CBN
bills. Accordingly, average yields trended higher to settle at 13.5percent from 13percent in the week before [91-day (up 176 basis points (bps) to 12.4percent), 182-day (down 69bps to 14.2percent) and 349-day (down 30bps to 14.9percent)]. This week, we expect interbank rates to start the week higher given our expectations for CBN to sustain its liquidity tightening stance. Also, we expect profit takers to continue to dominate activities at the secondary treasury bills space. Bond Market: A largely bearish week for government bonds In the bond space, the Debt Management Office (DMO) opened for subscription, FGN’s 2-year and 3-year Savings Bond with 11.62percent and 12.62percent interest rates per annum, respectively. In the secondary market space, the sentiment was largely bearish during the week as the CBN’s aggressive liquidity tightening stance stifled the inflow into the bond market. Consequently, average FGN bond yields trended higher by 39bps to
Corporate Treasury Series
Top ten reasons why a Treasury Management System is necessary for treasury’s success
O (-0.8percent), NB (-6.3percent) and AIICO (-2.7percent). The Banking (+3.4percent) sector was the lone gainer for the week, thanks to impressive financial reports for GUARANTY (+5.1percent) and ZENITH (+4.2percent). Notably, GUARANTY (Revenue up 3.7percent to N434.6billion, PAT u p 1 0 p e r c e n t t o N184.6billion), NESTLE (Revenue up 9.1percent to N266.3billion, PAT up 27.5percent to N43billion), S TA N B I C ( R e v e n u e u p 4.7percent to N222.4billion, PAT u p 5 3 . 9 p e rc e nt t o N74.4billion) and SEPLAT (Revenue up 65.2percent N228.4billion, PAT down 44.7percent to N44.9billion) all published their FY-18 result, with all reporting impressive PAT. The Agricultural sector closed flat for the week. Market breadth - a proxy for investors sentiment- was underwhelming as it closed below the market threshold
refused to float long-dated bills. Consequently, marginal stop rate for the mid-tenor bill was gradually dropped to 13.44percent from the previous stable level of 13.50percent. Overall, interbank rates (Open Buy Back and Overnight rates) trended lower, averaging 10.7percent compared to 14.6percent in the preceding week. Elsewhere, the CBN published Federal Government’s Q2-19 Treasury Bills issuance calendar. According to the calendar, FG plans to roll-over total maturing bills during the period, worth N503.2billion with more concentration on the 91-day and 182-day bills relative to less issuance of the 364-day bills on aggregate. In the secondary treasury bills market, sentiments mixed as players move towards the high yielding long-dated bills while maintaining a soft posture on the short and medium-dated
close at 14.3percent (prior week: 13.9percent) and average yield for FGN Eurobonds trended higher by 24bps to 7.1percent. Meanwhile, activities in the stock market rubbed off positively on some of the Corporate Eurobonds. Notably, investors turned bullish on DIAMONDBK and ACCESS’ Eurobond following shareholder approval of both company merger. Consequently, the average yield for corporate Eurobond declined by 16bps to 8.7percent. This week, we expect sentiments to be slightly bullish buoyed by continued foreign portfolio inflows which have been recently further buoyed by the European Central Bank (ECB) decision to suspend its tightening stance and begin another round of stimulus. However, the CBN’s sustained liquidity may constrain sentiment.
btaining the right amount of funds in the right currency at the right time at the right after tax cost is the hallmark of a successful treasury function, writes Bruce Lynn, Founder, The Financial Executives Consulting Group Success can be extremely difficult to achieve if Treasury only possess “hand tools” (that is spreadsheets, multiple bank web sites, emails, etc). Besides, spending all of treasury’s scarce resources just processing transactions leaves little time left over to even know if “success” was achieved. What follows is a somewhat humorous look at the top 10 reasons why a multi national company should acquire a more powerful set of liquidity and risk technologies like those offered by several bank and non bank treasury technology vendors. 1. Man is a tool using animal; treasury technology is a tool that allows more work to be accomplished. 2. Properly used treasury technology allows treasury and non treasury users to operate in 3 dimensions simultaneously managing profitability, liquidity and risk. 3. Improperly used technology allows a company the opportunity to make its mistakes faster. 4. Today’s technology
( s p re a d s h e e t s, e ma i l s, multiply bank web systems) does not play well together leading to operational risk (e.g. failure to complete, unintentional errors or even intentional errors often known as fraud). Technology can provide global “visibility” to reduce operational risk especially in highly complex organisations with many inputs and outputs. 5. Technology allows treasury to create metrics needed to control balances and process transactions. Metrics can be associated with the “four flows”: a. Workflows b. Cash flows c. Information flows d. Accounting flows 6. Liquidity (i.e. operational cash + financial cash flows) is too important to be left solely to treasury to manage; users in all parts of the company should use the same technology to mange their portion of the “four flows” and allow the company to match sources and uses of funds within given risk parameters. 7. The best technology allows treasury to compare plan, actual and forecasts results when asked the following questions by the CFO: a. Its 9AM - where in the world is my cash and in what currency?? (cash position) b. It is 11AM – Do I
invest or borrow? (liquidity management) c. End of the day – Will I be over borrowed, over exposed or under invested next period and how will I know? (risk management and proper use of metrics) 8 . Ti m e i s a s c a rc e resource; good technology allows treasury to become both: Efficient – do what I do today better to control today’s risks Effective – accomplish tomorrow’s tasks, the ones I do not do today, to minimise tomorrow’s risks 9. A well trained treasury staff is the secret ingredient that makes any technology work better regardless of a vendor’s claims about the features contained in their offering. In other words, treasury technology is not concerned about how many banks accounts are in use or what balances are in them, but the smart treasury department is concerned. 10. The old adage; “measure twice and cut once” applies; double check your technology needs, then execute them well and do not be afraid to ask for help as long as the “ask” makes business sense. In partnership with the Association of Corporate Tr e a s u r e r s o f Ni g e r i a (ACTN)
Thursday 14 March 2019
Helping you to build wealth & make wise decisions
Lafarge Africa Rights Issue GTBank: Market sentiment ... records 100% subscription Continued from Page 17
afarge Africa Plc has announced the results of its just concluded Rights Issue, which it said recorded 100percent subscription. Lafarge Africa issued to existing shareholders 7,434,367,256 ordinar y shares of 50 kobo each on the basis of six (6) ordinary shares for every seven (7) ordinary shares held as at December 4, 2018 at N12per share. The Rights Issue which had opened on December
17, 2018 and closed on January 28, 2019, recorded a total of 1,826 acceptances for 7,434,367,256 units valued at N89.212billion were received in connection with the Rights Issue. 1,734 shareholders accepted their Rights in full totaling 5,931,501,457 ordinar y shares, out of which 738,731,071 ordinary shares were traded on the floor of the Nigerian Stock Exchange. 92 shareholders with a provisional allotment of 395,875,060 ordinary shares partially accepted their Rights for 202,401,994 ordinary shares, thus the
balance of 193,473,066 ordinar y shares were renounced; 34 subscribers purchased Rights of 738,731,071 Ordinary Shares on the floor of the Nigerian Stock Exchange. Of the 1,734 shareholders who took up their Rights in full, 734 shareholders also applied for additional 1 , 3 0 0 , 4 6 3 , 8 0 5 o rd i na r y shares and were allotted in full from the renounced Rights. A total of 1,106,990,739 ordinary shares were fully renounced bringing the total number of shares renounced to 1,300,463,805 ordinary shares.
lines in the medium to long term from peer competition via reduced rates and other transaction incentives. Our rating is currently under review,” according to Vetiva research analysts. “Looking ahead, we expect the bank to renew its appetite to expand risk asset in a bid to drive interest income. Again, we anticipate a lower yield environment going forward, hence, we do not expect the bank to be as bullish on government instrument as observed in recent time”, United Capital research analysts said in their March 11 earnings update following GTBank Plc scorecards for 2018. Accordingly, the analysts
retained their stable outlook for Guaranty Trust Bank Plc. “We expect market sentiment to continue to support pricing over the short to medium amid increasing stability in the polity as well as the broader economy. Consequently, we retain our target price (TP) of N46.7 per share, a 25.2percent premium to the current price of N37.3/share. Hence, we maintain our BUY rating on GUARANTY,” United Capital research analysts added. Management’s comment Segun Agbaje, Managing Director/CEO of Guaranty Trust Bank Plc, said, “In 2018, our focus on staying nimble, strengthening customer relationships and driving our digital-first strategy paid off. We successfully navigated the pressures of our challenging
and radically changing b u s i n e s s e n v i ro n m e n t , recorded growth across key financial indices and reaffirmed our position as one of the best performing and well managed financial institutions in Africa”. “This result reflects, not just the fundamental strength of our brand, but also our commitment to our values of excellence, creating value for all stakeholders and putting our customers first in everything that we do. Driven by these values, we are building the bank of the future by pairing the best of our business with the massive potential of digital technologies to create Africa’s first integrated and trusted platform; Habari”, Agbaje added.
Court reaffirms SEC regulatory oversight over public companies
T L-R: Magnus Nnoka, president, Risk Management Association of Nigeria (RIMAN); Kaodi Ugoji, Associate executive director, Corporate Development, FMDQ OTC Securities Exchange (FMDQ); Allan Ralph Thomson, managing director/CEO, Dreadnought Capital, lead facilitator; and Jumoke Olaniyan, vice president, Market Architecture, FMDQ, at the FMDQ-Sponsored Q1 2019 Quarterly Risk Roundtable of RIMAN at Exchange Place, Lagos.
NOVA Merchant Bank declares N1.15bn profit after tax …continues to focus on scaling its business
OVA Merchant Bank Limited has declared a profit after tax (PAT) of N1.15 billion for the year ended December 31, 2018, a significant increase from N510.6 million achieved in 2017, marking a 125percent increase. The result is achieved as it begins to reap the benefits of its investments in its operations, technology and people. The impressive result demonstrates the Bank’s growth trajectory which is expected to accelerate as it scales its business and grows its client base. NOVA achieved strong growth across all parameters. The Bank recorded a 54.10percent growth in gross earnings from N1.22billion in 2017 to N1.88billion. The bank
further grew the total assets by 38.89percent from N18bn to N25billion between 2017 and 2018. This impressive performance marks a very successful year for the newly licensed merchant bank which recently deployed a state of the art and fully digital core banking application. The Bank also recorded remarkable growth in customer acquisition and in line with its objective to be the employer of choice, promoted about a third of its workforce. Anya Duroha, the MD/ CEO, commented “Our stellar results are a culmination of the hardwork, commitment, resilience, discipline and resourcefulness of all our employees. We have been able to drive strong customer acquisition and deploy
leading edge technology whilst optimising our costs. We will continue to focus on growing our business, providing solutions tailored to our clients’ needs, building a high performance culture, motivating our employees and creating sustainable value for our shareholders”. Remarking on the results, Phillips Oduoza, Chairman of NOVA Merchant Bank said “We have been able to build a strong foundation for the success of the Bank and approach the future with confidence and optimism in our business model, value proposition, clients and employees. We remain committed to the implementation of our overarching philosophy of ‘New Thinking, New Opportunities’ to create value for all our stakeholders.”
he Court of Appeal has reiterated the Securities and Exchange Commission (SEC) powers to intervene in the management and control of any public company which is considered to have failed, is failing or is in crises. The SEC is statutorily mandate d as the ap ex regulator of the Nigerian capital market to ensure the protection of investors and maintain a fair, efficient and transparent market. Recall that in 2008, the SEC conducted an investigation on Big Treat Plc a public listed company (1st Respondent) and its directors which revealed several infractions of the Investments and Securities Act 2007 such as inadequate internal control systems and a breakdown of corporate governance in the company. Based on the foregoing, and pursuant to the provisions of Section 13 (v) of the ISA 2007, the Commission in 2010 approached the Federal High Court seeking a number of reliefs against Big Treat Plc (1stRespondent), three of its directors – Pamela Wu, Harries Wu, Steve Wu – and
two entities owned by them – New Frontier Engineering and Construction Company Ltd and Skyone Group of Companies Ltd with a view to preserving the assets of the 1stRespondent. In the course of the proceedings, the Commission applied for and was granted an ex-parte order of interim injunction restraining the 2 n d – 6 t h R e s p o n d e n t s, their agents, servants or privies from obstructing the Commission in the exercise of its statutory oversight responsibilities to the 1st Respondent including the appointment of an interim management to take charge of the day to day administration of the 1stRespondent with a view to preserving its assets in the interest of its stakeholders pending the determination of the Motion on Notice already filed in this suit. However, the ex-parte order was subsequently vacated on the grounds that the 1st Respondent (Big Treat Plc) “was not a capital market operator amenable to the control and management of the appellant in times of financial distress”. The Commission appealed against the decision of the
Federal High Court and the sole issue for determination as raised by the Commission before the Court of Appeal was “whether the lower court was right when it held that the 1stRespondent (Big Treat Plc) is not a capital market operator because it does not play any specific role in the capital market and as such, not registerable or subject to the control of the Appellant (the Commission)”. The Court of Appeal in a judgment delivered on 31stJanuary 2019, held thus; “That the 1st Respondent, an issuer of securities, having been duly registered with the Appellants and was at all material times performing the specific function of issuing securities in the capital market was subject to the intervention of the statutory powers of the Appellant as the pinnacle regulatory authority for the Nigerian capital market whose sole purpose is to ensure the protection of investors and to maintain fair, efficient and transparent capital market as well as reduction of systemic risk as stated in the preamble of the ISA- the beacon light to the powers of the Appellant under the ISA.” The Court of Appeal further held that; “In conclusion, I most respectfully hold that the court below should not have vacated the interim preservative order made by it to protect the imminent collapse of the 1stRespondent but the Appellant who at all material times was exercising statutory powers under the ISA to stem the tide of decay in the internal management of the 1st Respondent.”
Thursday 14 March 2019
‘Women need to develop role models that inspire when their spirits are down’ The international women’s day was marked last week, and it was a chance to hear from women from all walks of life on their successes and challenges particularly in the corporate world. OWEN OMOGIAFO, MD/CEO Transcorp Hotels Plc, in a chat with CALEB OJEWALE, shared some insights on excelling in the corporate world as a female CEO.
ow has it been so far since you took over as Managing Director of Transcorp Hotel? I am now two months on the job as MD/CEO of Transcorp Hotels Plc, and we intend to be Africa’s foremost hospitality brand. So far it has been challenging, enlightening, at the same time very rewarding. The hotel is a Hilton, managed by Hilton but owned by us and it has been interesting learning about hospitality from the technical aspect. Running a hotel is not just about putting up a beautiful building; anybody can do that. It is beyond the building, and even though we are proud of all the renovation we have done in the hotel from floors 1 to 10 with ultramodern, world-class bedrooms and meeting rooms, but it is beyond that. It is beyond just having the beautiful building but ensuring the services our guests get when they come in at each contact point; from the security at the main entrance, being received by the concierge, all the way to reception and anyway where else within the hotel. What we want is that each guest that comes in has that distinct Transcorp hospitality touch so that when you leave here, you feel like you have gone through a very positive experience. As you can imagine, it is not the easiest thing to do. When I got the appointment, a number of people were like, how are you going to cope? You are married! (like it is an illness) you have children, what’s going to happen. You cannot take the job because it involves going out of town; what will your husband say. And my husband said: when are you moving? That was the only thing he had to say (laughs). I have three children aged; 15, 14, and 1. My two older kids are in secondary school, and it will not really be in their best interest to start moving them now as it will unsettle too much. For now I shuttle between Abuja and Lagos running two homes. Seeing you are able to balance work and family, what would your advice be to women who are getting into such roles, but have to sacrifice one for the other? It is not easy being a woman in the workplace, but there is a cliché nothing good comes easy. As a woman, you first need to have a conviction of what you actually want to do. After that comes the how. Some
and say, we are seeing some feminine touch.
people tell me it is easier for me because I am at the top of my career, earning more etc, but pretty much earlier on in my career, I had gone on to start having two maids at home. It is not as if I was making a lot of money because I was literally earning money and then using it to pay other people’s salaries. But this was necessary to ensure efficiency at work was not compromised. Where I was working (at the time), I needed them to be able to rely on me. For them to be assured that if you give Owen a job to do, she will deliver, so that helped. For women in the workplace, I often advice they should please plan a lot. These days
Work life balance is not daily. It is never really a balance so at times work may get more priority, and at other times, it gets less to other personal (and family) needs. At the end of the day, achieving average is what matters
with the school structure, children get their calendar well in advance, so have a conversation with your boss or whoever is appropriate, for instance that, in four weeks’ time, I might need to be out of the office for three to four hours because I want to attend open day at my children’s school. Two weeks, give a reminder, one week before, and even 72 hours ahead. In essence, what I say to women is, learn to manage your time, and at the same time, manage the time and resources of other people so it will enable you succeed. There is one critical thing a mentor said to me a long time ago, and I shared this at the WinBiz conference last year. Work life balance is not daily. It is never really a balance so at times work may get more priority, and at other times, it gets less to other personal (and family) needs. At the end of the day, achieving average is what matters. The average over a period of time is what one should target to achieve a balance. Where the var iation between the time spent at work, and the time doing other (personal) things with one’s life achieves an equilibrium. One thing women should always remember is that, as a woman, you are important. Many times women forget that, maybe because of the way we are wired as natural born givers. There is also a negative emotion that tends to hold us back, the emotion of guilt. It is also important to have the right partner that supports you. I frankly would not have
been able to achieve as much as I have achieved without the support of my husband. For those who are not yet married, these are important questions to ask. How do you feel in a male dominated industry? I grew up as an only girl among three brothers and three other male cousins, and it was only when I started working I realised, oh, I’m a woman, and I need to be different. This is mostly because my father made me feel like there is nothing I cannot do. For me, I have always felt I can do anything a man can do, because it is how I have been brought up. I probably have an edge over the avera g e w o m a n w h o g re w u p being told: don’t climb trees, whereas I was encouraged to climb trees. All the other limitations of what a woman shouldn’t do never really featured in my upbringing. So, coming into a male- dominated environment, and based on my background, I’m able to hold my own. Naturally, being a woman, there is always more that is expected of you, or even as a younger person generally. When people have doubts about you, ensure that when they engage with you, they leave with a different impression. However, it has not all been rosy. Being female, they claim we know how to multitask and has conferred certain advantages. For instance in the hotel, my predecessor was fantastic and laid a very good foundation, but people come in now
Considering your background and the upbringing you had, what will be your advice for young women aspiring to achieve similar feats as you have? I tell people nobody’s circumstance can be the same as another person’s. Even children born in the same house leverage things differently. However, whether you are a man or woman, know where your strengths are, where your leverage points are, and then leverage them. You also need to raise role models for yourself and this does not have to be someone you know or get a chance to speak. It just has to be someone you look up to. Get yourself a totem pole, a role model, so even on the days your energy is waning, you can look up and say NgoziOkonjo-Iweala, got to that position as coordinating minister of the economy and others, and vying to be MD of world bank, yet she had children, how did she get there? In this digital era, most people are just a click away. I have some women I mentor but we have never met, we only just connected via social media. And there are so many other women like NdudiNwuneli, Mobola Johnson, Mo Abudu, IbukunAwosika, Bola Adesola and others. Have role models and as you are developing them, surrounding yourself with people that can lift you up. You know birds fly in formation, because as they are flapping their wings, they generate wind together to keep themselves up and that is what you need to look for. Also, as a young person, it is very important to identify people who have PHD (Pull Him/Her Down) syndrome. There are those who never want you to climb out of the pit, yet, there are others who offer their shoulders for you to climb out and you can then lift them up in turn. Being a woman in the workplace is not mandatory and not for everybody. However, top kudos to the professional homemakers. I have the greatest respect for the women who have also chosen to do that because it takes a lot to decide that I am going to dedicate my whole life to being the homemaker. Summary, know what you want, be committed to getting there, identify role models, set goals for yourself: professional and personal life, and then discipline yourself towards achieving those goals.
Thursday 14 March 2019
‘Women should be content, but not with mediocrity’
AWELE VIVIEN ELUMELU, the Chairperson of Avon Healthcare Limited and CEO of Avon Medical Services Limited, in this interview with CALEB OJEWALE, speaks about her vision for quality, yet affordable healthcare and access to Nigerians through her investments in Avon. Vivien, a medical doctor by training is also the African ambassador for the Gavi vaccine alliance. Excerpts:
s they say, beside every successful man, there is a woman. It is no longer behind, but beside. How has it been supporting your husband Tony Elumelu and the journey so far? It has been a journey, it has been a ride, and it has not been easy but he is someone who believes strongly in whatever (goals and dreams) he believes in. This makes it easy for you to believe along with him because he does not give up, he does not get tired, and he is tireless. It has been one hell of a ride as they say.
It has been how many years? Since 1993, that’s 26 this year! You know you stop counting (laughs). It was 25 last year. In your own right, you’re a medical doctor and you have Avon, which one could say is turning into a conglomerate of its own now [cuts in]... We are working towards that So, what was the vision behind setting up Avon and the brands underneath it? You know, it was simple. It was just healthcare. Being able to provide affordable healthcare of what I believe should be of global standards. That was the simple vision. We know we need healthcare in Nigeria. We know there are issues with healthcare. We just felt this was somewhere where could come in and play our own part in helping to improve the economy, because whether we like it or not we need a healthy workforce. We need a healthy nation to be a wealthy nation. So, that was basically it. And we know there are so many issues; we want to look at child cases, we want to look at immunization, we want to look at health facilities, there’s so much that needs to be to be done in the healthcare space. So, we just felt if we would come in here both in providing healthcare, as well as in providing access to healthcare. This we were looking to do through the HMO and then even providing healthcare through the hospitals and the clinics. So as I said, it was pretty simple; just wanting to be able to help provide affordable, quality healthcare to Nigerians. Looking at this part of ac c ess, y ou kno w , in terms of universal health
coverage, Nigeria ranks among the lowest in the world with coverage of less than 5 per cent. What are your strategies, in expanding this in the next say 5-10 years? One of the ways we try to play our own role is through advocacy. We know that we need the government to support the health sector. We need the government to support even the healthcare act. The government has a large role to play. We want them to be able to provide the system and infrastructure for people to be able to access healthcare. In insurance, they need to make it such that people understand the importance of it. I think for now, as you said it is just 5 per cent coverage. The government needs to step in and do something about it to ensure that more people are enrolled in insurance, more companies take part in insurance, and make sure that more staff are insured for proper health coverage. Even as health insurance companies, we continue to have meetings to see how we can improve in things we do. Again, this goes back to the advocacy in getting government to do more and even amongst us. Also in relating with the providers, because there is health insurance and there are the providers. We need to be able to work together to be able to deliver healthcare at the level that we would all like it to be. Going to immunization, again, we are notoriously poor in terms of immunization, and there was a time GAVI was saying they were going to withdraw funding for Nigeria [cuts in]... Thankfully they did not As African ambassador for GAVI, what are you championing right now, and what should we be expecting from you in terms of saving the lives of children that need vaccination in Nigeria and Africa at large. There is a lot of work going on. You know GAVI does not actually have offices in any country, so they work with the government. The organisation that we work through here is the Nigerian Primary Health Care Development Authority (NPHCDA). They are doing a lot of work so we keep working with them, having regular meetings with them and they are getting the word out there. So, it is just
about doing more work with them to ensure proper coverage, that’s basically it. We also need to continue to get the message out; we need more companies to come in and support, we need the parents to be enlightened as to the importance of vaccines, we also need the government to provide more support. Going to what I’ll probably call the fun part, I’m sure many young women want to be like you, since
Be content with what you have, at the same time, don’t be content, especially when you see that things are not going the way they should, with mediocrity or with things that you feel could be better
they want to be successful. What would you describe as the secret to your success so far and how can they be like you or better if possible. Actually, better, because we always want them to be better. I think first of all, you should be genuinely interested in improving yourself and improving the society around you. A bit of selfless interest, I would say. I wanted to talk about contentment but then, I would say even though you should be content with what you have, at the same time, don’t be content. This is especially when you see that things are not going the way they should, with mediocrity or with things that you feel could be better. Also, persevere and do not give up. I know we have a lot of challenges in our society, in our country, but persevere. It is only through persevering that we will all get there. If we all fold our arms and say there are too many challenges and there is nothing we can do, we will not make any progress. Is there any peculiar issue you think is affecting Nigerian women at the moment that you would want to say something
about it and you would want something done about it? Well, I would have to go back to healthcare, back to child brides, and back to Vesicovaginal fistula (VVF), which is still a problem in our society. We need to get the message out there. The habit is not good enough and we can’t have 10,11,12 year old children getting pregnant, going into labour, having difficulties, living with this stigma, and then being abandoned at the end of the day, because they put them in this situation and then abandon them. That is one big problem I do not like. Are you doing anything about it at the moment or any suggestions? At the moment, No. But we are looking into seeing what we can do right now. Soon, we will hopefully be able to do more. But we are looking into it right now to see where we can come in to help address this issue. Any other last words you want to add? I want to encourage women to continue to do what we can, support our men, support our children, and believe in ourselves that we too can do it.
Thursday 14 March 2019
Will FMCGs navigate the murky waters in 2019? BALA AUGIE
ome analysts are of the view that the outlook for Fast Moving Consumer Goods sector remains positive in 2019 on the back of economic recovery. However, rising costs caused by decrepit infrastructure such as bad roads at the Apapa ports and volatility in material price of raw material at the international market could cast a pall on such positive prognosis. Consumer wallets have been squeezed that the patronage for goods have dwindled, and the implication is that companies are experiencing a precipitous drop in sales. Perhaps more worrisome is that companies is that they can no longer pass those costs to consumer because they had hiked in the price of product in 2016, and any attempt to
do so in 2019 is like hitting a house fly with sledge hammer as Nigerians are getting poorer are not motivated their pulse spring. For instance the cumulative revenue of 13 largest consumer goods firms were down 8.85 percent to N1.03 trillion in September 2018 as against N1.13 trillion the previous year. Only Nesle and Unilever bucked the trend as they recorded uptick at the top lines. Analysts at United Capital Limited said diversified food and beverage producer such as NESTLE and UNILEVER are expected to sustain a solid outing due to continued improvement in the broad macroeconomic environment. Expectedly, combined net profit of the 13 firms dipped 20.12 percent to N85.23 billion in September 2018 from N106.80 billion the previous year. Of course the continued drops in sales have a negative impact on margins. For instance, the combined
average net profit margin of the 13 firms fell to 5.47 percent in September 2018 from 6.18 percent in September 2017. “In all, our best picks in the sector are NESTLE and UNILEVER, buttressed by
their solid balance sheet positions, product and brand durability,” said analysts at United Capital Limited. “We are not very positive on FLOUR MIL and DANGSUGAR, as our short-term expectation is dampened
by the feedback effect of Apapa gridlock and smuggling activities on volume growth,” said analysts at United Capital Ltd. While the economy expanded by 2.38 percent in the fourth quarter of 2018,
it is still below the 7.50 percent recorded a decade ago. According to a recent World Bank data, 92.10 percent of Nigerians live at below $5.50 a day. The reality is that most people cannot afford to buy a packet of Spaghetti or proteins. Nigeria with a population of 180 million people has 87 million people, nearly half its population, in extreme poverty; as high inflation environment continues to erode discretionary income. More worrisome is that the country’s population is expected to hit 400 million by 2050, making it the third most populous nation in the world. This means there will be more mouth to feed in a country where policy makers are insensitive to the plight of the people. The Nigerian Industrial and Revolution Plan, published in 2014, identify weak purchasing power as an obstacle to industrialization in Nigeria.
Demand for premium detergent brands decline amid shrinking consumer wallet OLUFIKAYO OWOEYE
he rapidly worsening economic fortunes of Nigerians have forced most households to dump costly, premium soap (detergent) brands in the country for cheaper and newer brands. The reduced purchasing power among consumers which is further pressurised by rising unemployment has left most household with no choice than cut spending. The Nigerian laundry soap market has different market segments with each competing for visibility and profitability in the market space. This includes the bar soap, powder detergents, and liquid soap. Until a few years ago, bar soaps are the most popular in households, then, liquid soap was only popular among the elites. Today, with a growing awareness about the health benefits of hand washing and easy access to liquid soap, consumer behaviour seems to have changed towards liquid soaps. Market dynamics over the years In the past, OMO detergent (a household name which stands for “Old Mother Owl”) from the stables of Unilever
Plc. was the undisputed leader in the detergent market. The dominance of OMO as the detergent of choice dwarfed the performance of rivals as it boxed other small players, into a tight corner. This was eventually challenged in 1996 when Eko Supreme Resources, makers of So Klin, made entry into the Nigerian market with innovation, a white detergent, which was an industry first. It started by nibbling at the fringes of OMO’s market share and in addition, its offer of detergent with a deep-washing function gave Nigerians reasons to switch their loyalty to the new brand. For them with So Klin, they did not need to spend extra money to buy bleach for their white clothes. Another interesting dimension was introduced into the market by another manufacturing-giant, Procter & Gamble with the launch of Ariel detergent brand into the market. These major manufacturers are however unrelenting in their quest to dominate and hold the ace in the detergent market. Bearing in mind the various challenges posed by new entrants into the detergent product line, major producers now have more threats from the ‘not so huge players’ such
as Nasco Industries, producers of Brytex and Bonus, and Limex Global, the manufacturer of Miss Bimbo who are now making huge impacts in the detergent market. Sekinat Adewale, a seller at Ojota under bridge noted that most buyers now go for cheaper brands. “When people come here they just ask for the prices of the various brands and pick the cheapest,” she said. She further added that buyers now patronize local
hand washing liquids for their kitchen duties rather than the expensive washing liquids from manufacturers. “You know many people now have training on how to make liquid soap, so instead of buying the expensive ones, they would just buy the cheaper liquid soaps” she noted. Unfortunately, this paradigm shift by consumers has impacted negatively on the revenue of the major manufacturers in the country. PZ Cussons a major player in the
consumer goods space recently disclosed that its financial performance for the full year 2019 which ends in May will not be very profitable. This situation, according to the company, is largely due to the lackluster performance by its Nigerian subsidiary, PZ Cussons Nigeria Plc. where consumers’ purchasing power has reduced. Mr. Sunday Ekong, 45, a dry-cleaner said that most of the detergent brands are doing well in the market basically because they
all recognise that consumers want more for little amounts. According to him, most consumers consider price, size, and packaging when deciding on a brand in the market. “The limitations of traditional bar soaps have led to the development of synthetic detergents that are superior in performance. He noted that Sunlight, Ariel and So Klin are major contenders for the leadership position in the market, but that the odds favour Sunlight and Ariel brands.”
Thursday 14 March 2019
Nigeria ranks second in 2018 E-commerce trade Africa David Ibemere
igeria has been ranked in the 2018 United Nations Conference on Trade and Development (UNCTAD) Businessto-Consumer E-commerce Index ranked ecommerce uptake in Africa, and 75 globally. Leading Africa packs include Mauritius coming first followed by South Africa third, Tunisia, Morocco and Ghana coming in that order. According to the report Nigeria ranks second, largely thanks to a significant increase in postal reliability as measured by the Universal Postal Union (UPU). As Africa’s largest B2C e-commerce market (in terms of both number of shoppers and revenue), reliable delivery of products is critical. However on individuals that owns an ecommerce account Nigeria Globally, Netherlands took the lead having im-
proved from fourth place in 2017. The UNCTAD report further estimates that that the B2C e-commerce market in Africa was worth about $5.7 billion in 2017, which corresponds to less than 0.5 percent of GDP, far below the global average of over 4 percent. However, the uptake of eCommerce in Africa has seen online shoppers surge at an annual rate of 18 percent, which is way above the global rate of 12 percent. “There is no doubt that ecommerce is fast emerging as a new frontier in Africa and in the global market. As eCommerce continues to grow, retailers need to expand their distribution networks, build more fulfilment centres, and leverage more on third-party logistics (3PL) partners. At the same time, online retailers must place greater focus on conveniently locating their fulfilment centres close to their markets to facilitate faster deliveries.” The report further stressed reliable and solid
logistics and supply chain interventions are at the heart of successful ecommerce. This will ensure that the sector thrives and sufficiently satisfies customer demands for availability of goods purchased, timely, safe and secure deliveries exempt from breakages, bends or losses as well as favourable return policies.
On Nigerians online spending habit the report noted that payment still remains cash on delivery, followed by credit and debit card and mobile payment noting that the ecommerce sector is a new frontier in business that calls for close synergies between the ecommerce players and bac- end lo-
gistics to ensure a positive customer experience from that first click to eventual delivery. One of the major challenges for retailers the report call for a solid and long-term partnership between logistics players and ecommerce partnerships which will ensure growth and expansion for both
parties at the end of it all, the e-customer emerges the winner. UNCTAD further called on e-retailers to ensure they build trust with their targeted consumers. “Africa was worth about $ 5.7 billion in 2017, which corresponds to less than 0.5% of GDP, far below the world average of over 4%. hence the need to not only boost Internet penetration to grow e-commerce, but also existing Internet users to trust the online market for making purchases. Unlike developed markets such as the European Union, where 68% of Internet users made an online purchase in 2017, the corresponding figure in Africa was only 13% on average in 2017. “If the ratio of online shoppers to Internet users in the region was increased to 50%, an additional 77 million online shoppers would be added and the estimated B2C revenue (assuming average annual spend was halved) would more than double.
Ruff ‘n’ Tumble loses market share on economic woes BUNMI BAILEY
sther Ezenwa, 34, mother of three recalls how she visits the top class malls in Lagos to buy clothes for her newborn baby a few years ago, sadly, that has changed as she now visits night market in Berger, a suburb of Lagos to get clothes for her newborn baby. “Things have changed, I cannot afford the new clothes now,” she said. Nigeria’s fragile economic conditions, low purchasing power, and declining incomes have made consumers shift from sub-premium children wears to secondhand wears. According to a 2019 childrenswear report by Euromonitor International, an independent global market research company that provides strategic research services for the consumer markets, Gatimo Nigeria Ltd, through its retail brand, Ruff ‘n’ Tumble, a leading designer, manufacturer and retailer of designer children’s clothing in Nigeria lost the lead within childrenswear
that it had held up until 2018. Euromonitor International’s Childrenswear in Nigeria report offers a comprehensive guide to the size and shape of the market at a national level. “Due to a poor economy and falling incomes, demand has fallen for the subpremium children’s clothing sold by Gatimo Nigeria Ltd, through its retail brand, Ruff ‘n’ Tumble, a leading designer, manufacturer, and retailer of designer children’s
clothing in Nigeria” the report stated. The report further said that brand new children wear through formal retail channels were not considered essential for children in Nigeria due to parents considering that cheaper clothes often second-hand or smuggled are preferable for children as they outgrow clothes quickly. According to the Population figure estimates by Countrymeters based on the
latest United Nations data, at the beginning of 2019, Nigeria’s children population under 15 years old is 81.9 million Gbolahan Ologunro, an equity research analyst at Lagos-based CSL Stockbrokers said that most consumers cannot afford particular brands, they would have to shift to cheaper alternatives and more so if the product is considered as an essential commodity. “So rather than your per-
Analyst: Bunmi Bailey Graphics: Fifen Eyemisanre Famous
ception about the quality, the decision will be influenced more on pricing as oppose to quality and the perception about a particular brand,” Ologunro further said. Also, there are expectations that Mr. Price, a fashion retailer store and Pep, the largest single discount retailer in Africa may perform well in 2019 due to parents generally preferring cheap clothing for their children, except for special occasions and outings. In 2018, these retail brands performed well through their offering of a wide range of affordable but good quality childrenswear and are expected to continue to increase their presence to tap into growing demand among urban consumers and the increasing preference for apparel shopping through modern chains. In addition, the strongly growing population of children and increasing urbanisation is expected to boost demand for childrenswear increases. “Children aged 0-14 is expected to grow by 11 percent over the forecast period, whilst the number of urban households is expect-
ed to increase by 22 percent”. Research conducted by America research company Trend reiterated that Nigeria is the largest kids’ market in Africa and the second-fastest growing market with a forecast of double-digit annual growth through to 2022. Also, the United Nations estimates that 80 percent of Africans wear secondhand clothes. Oxfam says 70 percent of clothes donated globally end up in Africa. Clothing and textiles are collected from donors (firms and charities). They are then sorted, bundled and then shipped to Africa. Vendors purchase these items and sell them at a low price to Africans. The customer base of the secondhand clothing market is usually extremely cost-conscious and often promotes the ideologies of sustainability and environmentalism. Secondhand clothing, after all, is the recycling of used and or unwanted clothing, and this reciprocal buy, sell and trade transaction between the customer and the retailer save an incalculable amount of unwanted clothing from dumps and landfills.
Thursday 14 March 2019
Our aim is to have a 15-aircraft airline – Aero boss Ado Sanusi is the managing director, Aero Contractors. In this interview with IFEOMA OKEKE at the unveiling of a new uniform and accessories at Murtala Muhammed Airport Terminal Two (MMA2), Lagos, he spoke about the airline’s plans to add more routes to its network as it continues to get more patronage largely due to its Maintenance Repair and Overhaul (MRO) facility. Why have you decided to unveil a new uniform and accessories for your cabin? e are celebrating the new face of the cabin crew of Aero Contractors and we are also unveiling the successes that have been achieved over the last 24 months that I have been in the seat of managing the airline. The first thing we did was to unveil the new face of cabin services and also to tell you that we are opening new routes to serve our passengers better. What are the new routes you are opening? We are starting new routes and we are also reinstating those routes that we suspended. When I joined we were doing eight flights a day, we were servicing only Abuja and Port Harcourt. In the past 24 months, we have increased to more than 30 flights daily. We were carrying close to 8,000 passengers a month, now we are carrying almost 33,000 passengers every month. We have included Kano, we introduced more frequencies into Abuja, Abuja-Asaba, Warri, Uyo and we are now in the process of introducing Yola. We will have Lagos-Yola and Abuja-Yola, YolaAbuja and Yola-Lagos. This will open more routes to our passengers. Sokoto bound passengers going to Yola can come and join our Yola flight and those from Asaba can join our Yola flight. We are opening up Nigeria for our esteemed passengers. We believe that by the end of the first half of this year, we will have opened new routes
in the Eastern part of the county. We are looking at Owerri and Enugu and it will come very soon. Uyo was there before, so we are reinstating it. Are you getting more aircraft for these new routes you are opening? We started with one aircraft in the beginning of 2017 and now we have four airplanes. We intend to bring more airplanes into the system. We have two aircraft that we want to conduct C-checks on if the Nigeria Civil Aviation Authority of Nigeria,
(NCAA) gives us the go ahead to do that. We will conduct two C-checks on two 737 aircraft. Our aim is to have a 15 aircraft airline. What we have done today is that we are telling the passengers that we are back and we pride in safety and reliability, which is the best way to fly in Aero. How is your maintenance facility? The Maintenance Repair Overhaul (MRO) is doing very well and I am very happy about it. They say
Stark Legal Barristers to address pressing legal issues in aviation sector
n a bid to protect consumers in the aviation industry from stringent legal laws, Stark Legal Barristers and Solicitors have decided to share knowledge and enlighten the public as regards new legal laws in the aviation industry that protect the interest of consumers. Speaking during the press briefing, Mojisola Olugbemi, managing partner for Stark Legal Barristers said, “having seen the effect of some laws on consumers and the numerous encounters they face, we have therefore seen the need to address these matters by organising a one day event, succinctly focusing on consumer protection in the aviation industry. “The event which will hold on March 26 this year, 2019 will give an opportunity for direct stake holders to express their opinion, expertise and suggestions across diverse legal issues. It will also create an avenue for our clients and regulators to rub
minds. “More so, the decision makers will be present so that they can take note of what has been said and make resolutions on them in such a way that it will be favourable to the consumers, stakeholders and other parties involved,” Olugbemi said. She further said, “The event is centered on enlightening the public, both the lawyers and the masses,
educating them as well as sharing profound knowledge on new legal matters.” According to her, guest speakers that will be present at the occasion include Paul Oki of the Nigerian Airspace Management Agency (NAMA), Samson Fatokun, representing the International Air Transport Association (IATA) and Bankole Benard, president of the National Association of Nigeria Travel Agencies (NANTA), amongst others. She mentioned that the event was birthed from its celebration of five years of excellence. “We are using this as an avenue to celebrate our five years of excellence. Other than the journals we usually do, we decided to make it grand by organising the proposed breakfast event. This event will be held four times every year. Issues arising from telecommunication, energy and Fintech will be
charity begins at home. We have done three C-checks in-house, that means we have done C-checks on three aircraft for Aero Contractors. We have done a couple of 18-months checks for our customers, Nigerian airlines. We are about to do a C-check on another airline. We have a couple of Nigerian airlines that are lined up for C-checks. We are not interested in making mega profit now. What we are interested in is to develop the place and to ensure that we serve our customers. We want a situation where the Nigerian airlines are very comfortable bringing their airplanes here and we want to deliver their airplanes better than what they get outside the country. When are you signing the deal with Ghana to start their C-checks? We are happy to inform you that the Ghana Civil Aviation Authority has given us the authority to do checks on the aircraft that are registered in their country and we have done a lot of major maintenance for their aircraft. We are also looking at the Congolese government, who have shown interest in coming to give us the approval to do C-checks and other major checks in their country. ECOWAS has taken recognition of your maintenance facility. What does this mean for Aero? We have been called several times to attend meetings with ECOWAS because we were informed that ECOWAS is interested in opening a regional maintenance facilities and the West African countries are bidding to host that maintenance facility. Nigeria is
part of the countries that are bidding for that and the committee has come to us and we have shown them our capability and based on that, we have seen that they are very comfortable with us and I believe Nigeria has a very strong case to host the regional maintenance facility that the airports are willing to develop. We have entered into a joint venture with a Nigerian company to operate jointly their choppers. We have increased the number of helicopters we have in our fleet from three to seven and we intend to increase it to ten. Aero contractors used to operate over 30 helicopters out of the Niger Delta area and we were serving all the Gulf of Guinea regions and we want to go back to that. We want to put our foot-print to ensure we are a force to reckon with as far as logistics in oil and gas is concerned. What are the prospects for Nigerian airlines in 2019? I am appealing to the Federal Government to look inwards into the aviation industry to make sure that the industry is put on the front burner so that we can reap the benefits of aviation in the growth of the economy. We can just look at what the aviation industry has done for many countries. We can look at RwandAir and what it has done to the economy of Rwanda. We can look at what Emirates has done to the economy of UAE. You can keep looking at what airlines have done to the economies of various countries and I believe that the Federal Government can see that developing aviation is key to the success of the economy.
Air Peace emerges best airline at Nigeria Travel Awards
ir Peace has again been chosen as Nigeria’s best airline, garnering 44.7 percent of the total votes cast in the domestic airlines category of the third edition of the Nigeria Travel Awards organised by Jumia Travel in Lagos on Monday. The airline beat five other domestic carriers to clinch the “Best Local Airline of the Year” award. The first runner-up in the category came far behind with 15.6 percent of the total votes cast. Air Peace also picked the award for 2017. The winner of the award was chosen by members of the public through a simple online poll that closed on March 6. The airline with the highest number of votes picked the award. Speaking at the awards ceremony in Lagos, Omolara Adagunodo, the managing director of Jumia Travel Nigeria and Ghana, said the event was organised to celebrate and encourage those excellently acquitting themselves in their dif-
ferent spheres of operation. Air Peace was represented at the awards by Chris Iwarah, its corporate communications manager, Patricia Ebilah, assistant customer relations manager, and Efe OsifoWhiskey, corporate communications executive,. Speaking after receiving the award, Iwarah assured that Air Peace was in the airline business to do Nigeria and Africa proud. The airline, he assured, would continue to sustain the high standards it was reputed for. He said the carrier was poised to compete on the same platform with its counterparts across the world, especially with its soonto-commence long-haul flights to Sharjah, Dubai, London, Houston, Guangzhou, Mumbai and Johannesburg. He urged members of the flying public to continue to patronise Air Peace, assuring that the airline would neither disappoint them nor compromise the safety of its customers and crew.
Thursday 14 March 2019
Corporate Social Impact
Onuwa Lucky Joseph (08023314782) Editor.
How are women faring in Nigeria’s big corporates? ONUWA LUCKY JOSEPH
t used to be that women were the pillowtalking powers behind the throne. If they whispered the wrong things about you in their husband’s ears, you could end up on the gallows. Men were therefore careful to be in the good books of the ones who had the powers to turn a whisper into a lightning accompanying thunder. But women have since come a long way, to paraphrase that old beloved Virginia Slims advert. From being wives, paramours and mothers solely, they moved on to being all the preceding primarily while gently venturing gently into other areas farther afield. Today, a whole lot more women are now working the world in quite the same way that used to be exclusive to men. Not everyone is comfortable with the fact that today’s woman isn’t content to be support striker. They want to be the Yekini, the Messi, the Ronaldo. Banging in the goals from every angle. Never mind that a lot of them don’t know anything about Asisat Osoala, not to mention Pernille Harder, Sam Kerr, Eugenie Le Sommer or Marta; the great Marta of the Brazilian national female football team. Society, and truth be told, not a few women themselves, are conflicted as more women navigate their way around their new role in the world; not as merely figures fit for the cheering stands, or the reserve bench, or as support players, even though in these parts they still do all of those overwhelmingly, but more and more women are coming into their own as main strikers, masters deft at mesmerizing team mates with their stamina, brainwork and unassailable confidence. The corporate world used to be a man’s world exclusively now has a totally different colouration. Today’s woman fits in perfectly without resort to any feminist pretensions. Women are educated, some, better educated than their male peers. They are far more stable at the firms they work in. They give their all year in year out. And what they give measures up to anything that a man gives. They are painstaking, empathetic, tenacious, and they can show some balls to anyone intent on seeing some. Women have never been low on courage. They just evince it in a different way. And unlike men, they usually want to see more sides and debate their merits or lack before they take an informed position. They are clearly more intuitive. But their intuition is less guts (as in got the guts) as it is comprehensive subconscious consideration of issues before important decisions are made. These are all generalities, of course. Some women will rival their male counterparts in poor decision making and all the other factors that are known to drag organisations down. The good thing is that Nigeria’s corporate sector has shown itself not slack in recognizing our deserving women. The seeming strong arguments around cultural and religious considerations forged to keep women in the shadows have done little to stop their climb up the corporate ladders of several big and small corporates in Nigeria. Moving up the ladder is how their sterling track record validated; by their peers, male and female. Today, in respect of the International Woman’s Day that was celebrated worldwide last week, (08/0319), we take a look at how some of Nigeria’s leading corporate organisations are respecting the contributions of the women who work for and with them. Some companies have done really well. Others need a bit more encouragement. And that’s not to say that the men should be consigned to the fringes of the corporate world. But if merit speaks as it should, we would have more women running the ships in a lot more organisations. We ask you to enjoy and to make your judgments: FIRST BANK (Chairperson is the only female on the board. And 3 Senior Management Team members) Mrs. Ibukun Awosika – Chairperson Mrs Folake Anii-Mumuney, Group Head, Marketing & Corporate Communications Mrs Adeyemi Oluyinka Ogunmoyela – Chief Compliance Officer Mrs Oluremi Olayinka Ajose-Adeogun – Group Head, Corporate Banking Group ACCESS BANK (Chairperson is female, plus 2 Non-Executive
Adaora Umeoji, ZENITH
Adetola Adegbayi Leadway Aku Odinkemelu, Fidelity
Bola Atta, UBA
Oladoyin Olugbuyi , Zenith
Foluke Kafayat AbdulRazaq UBA
Furera Isma Jumare, Union Bank
Kunbi Adeoti Leadway
Osaretin Demuren, GTB
Bukola Smith, FCMB
Lola Cardoso, head, Group Corporate Strategy Union Bank
Mosun Belo Olusoga, Access
Ibukun Awosika, First Bank
Nwapa Adaobi-stella, Zenith
Ndidi Nwuneli Nestle Oyinkan Ade Ajayi Wamco
Nneka Onyeali Ikpe, Fidelity
Folake Fajemisin, FCMB
Yemisi Edun FCMB
Directors and 2 Executive Directors. Good one!) Mrs. Mosun Belo-Olusoga, Chairperson Mrs. Anthonia Olufeyikemi Ogunmefun – Non Executive Dr. Ajoritsedere Awosika – Independent Director Mrs. Titi Osuntoki – ED Business Banking Ms. Hadiza Ambursa – ED Commercial BANKING (North) Fidelity Bank (Three women on the 5 member Board of Directors. And a very healthy number in the Management Team) Nneka Onyeali-Ikpe , ED (Lagos & South West Directorate) Chijioke Ugochukwu, ED (Shared Services & Products) Aku P. Odinkemelu, ED Chinwe Iloghalu, DGM (Regional Head, Victoria Island) Ezinwa Unuigboje, DGM, Company Sec Chioma Nwankwo, AGM, Head Private Banking Janet Nnabuko, AGM, Head, Savings Evi Kanu, AGM Regional Head, Rivers Bayelsa Bank 2 UNION BANK (All the women on the board are the NonExecutive while there’s only one woman on the Management Team) Obafunke Alade-Adeyefa (Non-Executive Director) Beatrice A. H. Bassey (Non-Executive Director) Furera Isma Jumare (Non-Executive Director) Lola Cardoso, Head, Corporate Strategy
Titi Osuntoki, Access
CONOIL Miss Abimbola Michael-Adenuga, ED UBA (4 Women on the 19-Person Board, none of them Executive. But a good number of women in top management) Erelu Angela Adebayo - Non-Executive Director Foluke K. Abdul-Razaq - Non-Executive Director Angela Aneke - Non-Executive Director Owanari Duke - Non-Executive Director Dupe Olusole, Group Head Marketing Bola Attah, Group Head Corporate Communications Kubi Momoh, Group Head, Risk Management Amie Ndiaye Sow, Regional CEO, West Africa 2 Dupe Olorunjo, Divisional Head, Corporate Bank Patricia Aderibigbe, Group Head, Human Resources Abiola Bawuah, Regional CEO, West Africa 1 Adesola Yomi-Ajayi, Group Head, Global Financial Institutions
Felicia Obozuwa, FCMB
Victoria Uwadoka, Nestle
Nonye Ayeni, Zenith
GTBANK (The 14 member board is led by a woman. It included 2 Non Executive Director and 1 Female ED) Mrs O.A. Demuren, Chairman Mrs M.C. Olusanya, ED Mrs. V.O. Adefala – Non ED Ms. I. Akpofure – Non ED
top management suite) Adaora Umeoji, Deputy MD Nonye Ayeni, GM/Group Head, Treasury, Foreign Exchange & Correspondent Banking Nwapa Adaobi Stella, GM/Group Zonal Head, Ikoyi Zone Oladoyin Olugbuyi, Chief Compliance Officer
FCMB (2 Executive Directors, and a very strong presence in top management) Yemisi Edun, ED, Finance Mrs Bukola Smith, ED Business Development Mrs Olufunmilayo Adedibu, Company Secretary/Group Legal Counsel Mrs Oluwatoyin Olaiya, Chief Risk Officer/ Divisional Head, Risk Management Ms Felicia Obozuwa, Divisional Head, Corporate Services Mrs Folake Fajemisin, Divisional Head, Corporate & Commercial Banking
STANBIC IBTC BANK Mrs. Miannaya Essien, SAN – Non Executive Director
ZENITHBANK (Deputy MD, Female, and strong showing in the
LEADWAY Ms Adetola Adegbayi – ED, General Business Mrs Kunbi Adeoti – Head, Human Resources FrieslandCampina WAMCO Mrs Oyinkan Ade-Ajayi – Non Executive Director NESTLE Ndidi Nwuneli Non executive ED Victoria Uwadoka, Corporate Communications and Public Affairs Manager
Thursday 14 March 2019
Corporate Social Impact
Obama: Companies that Prioritize Greed over Good are Heading for a Reckoning
arack Obama is focused on his foundation these days, where’s he’s running several programmes that find and support the leaders of tomorrow. And he’s teaching these young entrepreneurs that companies who make a difference in the world have to be good citizens. That means two things: For one, they shouldn’t buy into the trope that government is the enemy of business. “For those who think government is the problem or it gets in the way, it’s useful to recall that the interstate highway system or electricity grid or dealing with problems after hurricane, or the weather satellite, these are all government functions that allow business to thrive,” he said on Wednesday during an appearance in Salt Lake City, Utah at a tech conference put on by software company Qualtrics. A for-profit company can’t be expected to solve issues where there’s no business case. “There’s no money to be made in taking care of say, badly abused kids. There’s no profit in it. But it is part of what it means to be in a civil society,” he said. Likewise, private companies
can’t and shouldn’t shoulder the burden of some forms of long-term research that our national labs and university partnerships do. “But that’s our seed corn,” he described, meaning it will eventually lead to new profit-making ventures. (Bill Gates is another one who routinely argues the benefits of government-supported scientific research.) But the second thing he teaches is, while companies shouldn’t be expected to focus on solving social issues, they are responsible for their own social track records. Today’s millennials and Gen Zs are watching how companies behave, not just to their customers but to their employees and communities, he said. “If a company doesn’t care about non-discrimination and not having sexual harassment in your company, is unconcerned about climate change, you are going to start losing customers at some point,” he said. And social consciousness has to be built into the company. It can’t just be a marketing ploy or an afterthe-fact philanthropic effort. Companies have to be built ask-
ing themselves “how are we treating our employees? Are we paying them fair wages? Are we setting up systems internally that assure that if an outstanding female employee gets pregnant, that’s she’s not suddenly diverted off advancement?” If they don’t, there will be a reckoning. “This next generation, they will consume in part based on how do I feel about buying from you. If they don’t feel good about it, I can just press a button ... and they’ll switch in a second.” Obama’s take isn’t unique. There’s a growing number of companies who subscribe to the “stakeholder value” theory taught by the World Economic Forum and its famous conference in Davos, Switzerland each year. It holds that business can be a force of good in the world through a simple shift in thinking. Instead of prioritizing shareholder value over all else, companies must look at “stakeholder” value, encompassing all of its constituents which includes employees, partners, customers, community and shareholders.
(By Julie Bort, Business Insider, USA)
When will Nestle and Cadbury start turning Nigerian Cocoa to Nigerian Chocolate? ONUWA LUCKY JOSEPH
ecently, the president of the Manufacturers Association of Nigeria, Engr. Mansur Ahmed, made one of those comments that no one would describe as profound in view of its having been said and repeated many times before now. What did he say? “You produce cocoa, turn it into cocoa butter and export it. What you get from that cocoa butter, manufacturers of chocolate will make literally a thousand times more than you do.” Any new information there? We don’t think so. It’s in the same class as the oft repeated call for ‘diversification of the economy’. Something that is echoed ad infinitum at every fora attended by public officials. In this particular instance, the indignation was with regards to Nigeria as a raw materials destination, this against being the hub for sourcing of end products which would earn us many times more the income we get from selling raw materials. Speaking in in the same vein but this time in reference to the leather industry, he said “If you take the process from hides to finished leather and compare the value that is added from that finished leather to a pair of women’s handbags, the difference is huge.” The question is not whether Nigerians know this to be the case or
not. The issue is with those who have the powers to do something about it. Are they doing anything to change the way the game is played? Why are the big companies that are merchandising cocoa-based products not doing more to see that Nigeria exports finished instead of unfinished products? If we did that, the cocoa industry share of Nigeria’s GDP is sure to rise
significantly. Of course, some might say that this is not a problem peculiar to Nigeria. All the other countries that produce cocoa in Africa have the same issues. The question then would be, how about Nigeria leading the challenge for getting more value for our produce? What is so difficult about that? Why isn’t more pressure
being brought to bear on Cadbury and Nestle to see that Nigeria gets more for her cocoa? We do know that Cadbury or instance has a processing subsidiary known as Stanmark Cocoa Processing Industry. But to what degree does it operate and how much value do they add to the process? Is it done to a semi raw stage before being exported to be further refined and then imported back to the country? There’s more than meets the eye when international business and big conglomerates as well as big interests converge. Our national interest imperative should encourage us to nudge the big cocoa businesses into initiating value addition locally. Why do we continue to export cocoa in its rawest form as beans to the major cocoa importers, Netherlands and Germany and Switzerland? It cannot be because say, for instance, that the Swiss demand exclusively high quality products. Nestle in Nigeria can guarantee that. While we understand the imperative of business to make profit, it’s also important that as a nation, we make the most of what we produce, rather than spending all that time in the sun and rain and yet our farmers have not much to show for it, and cocoa contribution to the GDP is anything but stellar. Additionally, we can ensure the survival of the local processing companies e.g. Cocoa Products Ile Oluji Ltd which started operation on the
31st of May 1984. It currently produces 24,000 tons per annum inclusive of cocoa liquor, cocoa butter, cocoa cake and cocoa powder. Oluji Pure Cocoa Powder is sold in many supermarkets and enjoyed by families nationwide. But it is not chocolate. Question is, is chocolate production something like rocket science? Now, come to think of it. We hardly process our crude oil anymore, preferring instead to buy the more expensive versions from abroad. Is our preference for raw and crude materials a reflection of the state of our technology? Or is it a middleman hijack for the sole purpose of getting more money for work not done? These are questions Nigeria must answer sooner than later. AFRICA NEEDS THE RIGHT MINDSET I would rather argue, that we need to mobilise the right mindsets rather than more funding. Africa has everything it needs in real terms. But Africans remain mentally married to the idea that nothing can get moving without external finance. We are even begging for things we already have! That is absolutely a failure mindset. (President Paul Kagame) If Africa was a country, which African leader would you elect to the position and why?
(For feedback, contact us at email@example.com/ 08023314782)
Thursday 14 March 2019
Energy Report Oil & Gas
Why micro solar is increasingly popular in Nigeria, Kenya Olusola Bello
icro solar is proving popular in c ou nt r i e s like Nigeria and Kenya where the alternative would be a small diesel generator. Electrification is progressing on a different path than before. Micro-renewables are increasingly s e en as a cheaper and more effective way of achieving universal electricity access targets in developing economies. Diesel remains expensive, but renewables can deliver small amounts of power for critical needs at much lower capital cost than the build out of electricity and gas grid infrastructure, delivering in terms of both capital and operating costs. Given the rise in gas supply, both pipeline and
LNG, oil-for-power use will eventually resume its steady long-term downward trend. After an increase in 2019 and 2020, a major downward adjustment could occur if there is a change in US policy on
Iran after the 2020 presidential elections, at precisely the same time that the impacts of the IMO’s sulphur cap are being resolved However, oil in power generation faces threats from
Oil prices could hit $80 per barrel in first half of 2019
ohannes Benigni of JBC Energy has explained why he says oil prices could hit $80 per barrel in the first half of 2019, before more supply comes online in the second half of the year. Prices could then slide towards $50 to $60 during the period. He said the underline factor is that there is less demand in the market. “In the midst of economic slow down global oil demand is shrinking while supplies is rising, especially when you look at the United States and other players. With this development now it is safe to say that the market is sliding toward $50 , $60 per barrel now by the second half of the year”. He said initially there are all the supplies constraints that was pushing the price to about $80 per barrel. Meanwhile United States will drive global oil supply growth over the next five years, adding another 4 million barrels per day (bpd) to the country’s already booming output, the International Energy Agency has said on. U.S. oil output, including natural gas liquids (NGLs) and other hydrocarbons, will climb to 19.6 million bpd by 2024 from 15.5 million last year, the Paris-based agency said. Gross crude exports will double, leading to greater competition especially in the Asian market.
Crude output in the United States will rise nearly 2.8 million bpd, growing to 13.7 million bpd in 2024 from just under 11 million bpd in 2018, the IEA said. The outlook points to pressure on demand for crude from the Organization of the Petroleum Exporting Countries as the United States and other rivals expand supplies. However, in a boost for the producers, the IEA does not see a peak in global demand yet. “The United States is increasingly leading the expansion in global oil supplies, with significant growth also seen among other non-OPEC producers, including Brazil, Norway and new producer Guyana,” the IEA, an adviser to the United States and other industrialized countries, said in its five-year outlook. A boom in U.S. oil supply due to shale oil has countered efforts by OPEC and its partners led by Russia to restrain supplies. The so-called OPEC+ group began a new round of oil supply cuts in 2019 to support prices. U.S. crude exports will surpass shipments from Russia and nearly catches up to Saudi Arabia by 2024, diversifying global supplies, the IEA said. “The United States emerges as a significant oil exporter,” said Fatih Birol, IEA executive director, during a press conference at an industry summit in Houston. “The second wave
of shale production growth is coming.” Global oil demand growth is set to ease as China slows, but will still rise by an annual average of 1.2 million bpd to 2024 when it will reach 106.4 million bpd. Even so, the IEA does not expect moves such as greater adoption of electric cars to put a cap on demand growth yet. Goldman Sachs has said oil demand could peak by 2024 under some circumstances. “The IEA continues to see no peak in oil demand, as petrochemicals and jet fuel remain the key drivers of growth, particularly in the United States and Asia, more than offsetting a slowdown in gasoline due to efficiency gains and electric cars,” the IEA said. Demand for OPEC crude will rise but given the growth expected from the United States and other non-OPEC producers, Saudi Arabia and its allies will probably have to maintain efforts to withhold supplies. “Market management by producers is likely to remain necessary for some time given the outlook for the call on OPEC crude,” the report said. The IEA forecasts demand for OPEC crude will drop in 2020 and then rise to average 31.3 million bpd in 2023. The 2023 figure is up by just 600,000 bpd from this year and less than the previous forecast.
Olusola Bello, Team lead, Analysts: Isaac Anyaogu, Stephen Onyekwelu, Graphics: Joel Samson.
distributed renewables and small-scale LNG as an alternative to off-grid diesel generation in remote areas. Renewable energy sources and batteries are competitive against diesel in island
settings, while small-scale LNG infrastructure is expanding in the Caribbean. Both renewables and smallscale LNG can offer competition to diesel in large archipelagos such as Indonesia and the Philippines Oil demand for power generation has been in longterm decline since 1990 as countries have gradually displaced oil with cheaper feed stocks, primarily coal and natural gas. Since 1990, this process has freed up some 2 million b/d of oil for other uses. However, oil for power still accounts for just over 4 million b/d of demand or 4-5% of global oil consumption. There are two reasons why oil-for-power use will buck its long-term trend in both 2019 and 2020, even though the secular forces pushing it slowly towards obscurity are now more powerful than ever before.
Iran’s use of oil for power generation is likely to rise sharply this year as a result of the re-imposition of US sanctions on the country’s crude exports from November 5 last year. Iran’s crude exports were estimated at between 1.1-1.3 million b/d in January and February, according to industry sources, down from 2.5 million b/d in April 2018 just before Washington withdrew from the 2015 Iran nuclear deal. Iran’s internal response to sanctions in the past has been to increase oil burn for power generation, maximise refinery throughput and use petrochemical plant to produce oil products such as gasoline. In 2010, Iran’s oil use in power generation was about 225,000 b/d, but, by 2013, at the height of the earlier sanctions period, this had more than doubled to 471,000 b/d.
IBEDC upgrades services, tasks customers on prompt payment
he Ibadan Distribution Company (IBEDC) has appealed to its customers to show appreciation by offsetting their bills and lodging complaints in a civil way whenever the need arises. The company made the appeal in a statement signed by Angela Olanrewaju, Head Branding & Corporate Communication, IBEDC. It also asked the customers to take advantage of the various complaint channels that IBEDC had provided. The company said it had fulfilled promises to customers in its franchise area for quality and improved service delivery. According to the company, IBEDC has recently upgraded two distribution substations at Awujale and GRA Distribution Substations in Ijebu-Ode Business Hub under Ogun region of its franchise area. It said the company upgraded the overloaded 200KVA 11/0.415KV transformer of GRA Substation to 500KVA 11/0.415KV distribution Transformer. The Disco said customers at Oke -Aje market, Igbo Electronic market, JDPC & Lekan Bello Avenue, Heri-
tage Estate, Stadium road & Ijebu-Ode Club road had been experiencing incessant power outages as a result of the overloaded 200KVA transformer, adding that the new upgrade had brought improved and quality supply to the community. In the same vein, the company replaced the old and burnt 200KVA 11/0.415KV transformer which threw the residents of Igbeba under Awujale Substation into darkness with a new one. “IBEDC in fulfilment of her promises to all the company’s esteemed customers ensured the replacement of the community’s transformer. “Also, in a bid to ensure that our esteemed customers get quality services the Transmission Company of Nigeria (TCN) and Ibadan Electricity Distribution Company (IBEDC) in Osun region have resolved the prolonged issue of irregular power supply in Ile-Ife and its environs. “It would be recalled that for some years, Orile –Owu, Ikire, Wasimi and Sekona were experiencing erratic power supply due to some challenges with the indoor circuit-breakers at TCN Substation in Ile-Ife. “However, with the col-
laborative efforts from both TCN and IBEDC, the troubled indoor circuit-breakers were successfully converted to outdoor circuit breakers, and regular power supply and even quality services are presently being restored to these localities and their environs. “With the commissioning of three newly installed out-door Circuit-breakers on each of the six 33KV outgoing feeders, namely: OAU, Iron and Steel, Ikire/ Wasimi, Orile –Owu, Ife- Township and Sekona will be having its separate and respective outdoor circuit breaker. “The latching of one feeder to the other is now a thing of the past,” the company added. It enjoined customers in these areas to reciprocate the good gesture through prompt and regular bills settlement to encourage the company to do more. IBEDC warned the communities to desist from tampering with the company’s installations but to always report faults promptly to the company’s offices around them for prompt rectification. The company further appealed to the communities to always be vigilant and protect its installations from vandals.
Email: firstname.lastname@example.org, Tel: +234-8023020011; +234-7037817378
Thursday 14 March 2019
Nigeria’s PIGB gathers dust as Senegalese president promises continuity on oil production Olusola Bello
hile the Petroleum Industry Governance Bill (PIGB) is gathering dust with many viable projects stalled by President Muhammadu Buhari’s refusal to sign the bill, his counterpart in Senegal, President Mack Sall, who was also recently re-elected, is set to oversee Senegal’s journey to first oil production. Currently, there is a high level of uncertainty in the oil and gas industry because operators are not sure which direction President Muhammadu Buhari is heading, despite his re-election. The expected oil and gas industry reforms have been stalled. Senegal, which is the latest entrant to West Africa’s hydrocarbons sector is expected to be producing oil and gas from 2022. Macky Sall, as Senegal’s president, promises continuity to international oil companies (IOCs) at a cru-
cial moment for two multibillion-dollar offshore hydrocarbons developments underway there. A change of presidents, following the 24 February election, while unlikely to scupper projects that should be transformational for the Senegalese economy, would have added an element of uncertainty in the sector. The re-elected president has guided the development of both a Woodsideoperated SNE oil project off the central coast, and BP’s Tortue-Ahmeyim gas development straddling the maritime border with Mauritania in the north—both of which are targeting first production in around 2022. BP’s Greater Tortue project, according to Petroleum Econmist, already has the green light, and Woodside’s SNE development is poised to be next. Development of Africa’s most westerly hydrocarbons province is gathering pace. BP has taken a positive final investment decision (FID) on its gas project straddling the Mauritania/Senegal
L-R: Solape Akinola, delivery integration lead, Shell Nigeria Exploration and Production Company (SNEPCo); Bayo Ojulari, SNEPCo’s managing director; Maikanti Baru, group managing director of NNPC; and Bashir Bello, general manager, Business and Government Relations of Shell Nigeria, at the recent presentation of the book: ‘In Pursuit of Excellence’ a compendium of SNEPCo’s deep offshore story and feats to the leadership of NNPC in Abuja.
border, while Australian independent Woodside is promising the same for its SNE Senegalese project by mid-2019. The FID made by BP and its partner, UK independent Kosmos for the Greater Tortue/Ahmeyim
SNEPCo unveils deep water operations in Nigeria …as company publishes its deep-water journey
he government partner of the Shell Nigeria Exploration and Production Company (SNEPCo) has showered encomiums on the firm for its pioneering role in the deepwater sector of the Nigerian oil and gas industry. Maikanti Baru, group managing director of NNPC, has described SNEPCo as a clear leader in deep water whose performance is exemplary. “SNEPCo is a trail blazer. They set the pace with the Bonga FPSO, being the first deep water exploration business in Nigeria,” Baru said at the presentation to him of ‘In pursuit of Excellence’ a publication of SNEPCo detailing the company’s entry into the offshore exploration in the Gulf of Guinea and how the venture has brought so much benefit to Nigeria and Nigerians in local capacity development
and the growth of support industry, among others. Bayo Ojulari, managing director of SNEPCo, who presented the 90-page book to the NNPC leadership in Abuja said the company was mindful of its pioneering role in deep-water exploration in Nigeria and would want others to learn from Shell group technical expertise to make Nigeria a leading oil and gas producing country. “We have documented lots of our efforts which opened up Nigeria’s deep water and have contributed largely to the country’s oil revenue,” said Ojulari who restated SNEPCo’s continued commitment to positive impact on Nigeria’s economy and the socio-economic welfare of the people through sustained social investments in education, health and sports. The company, with over 95
percent Nigerian staff, helped create the first generation of Nigerian deep-water oil and gas engineers and recently celebrated the 800-millionbarrel mark in 13 years of operations. In recognition of its pioneering initiatives in Nigeria, SNEPCo was in early 2018 honoured as the best Nigerian oil and gas company in technology and innovation at the maiden edition of the Nigerian International Petroleum Summit (NIPS) held in Abuja for pioneering in-country Subsea Tree Refurbishment, a remarkable feat in local capacity potential which resulted in significant savings. This was the first time in the Nigerian oil and gas industry that a Subsea Tree was fully stripped down and refurbished locally with all its original functionality restored.
project—well flagged in advance—followed the 21 December formal signature of a bilateral framework accord between the governments of Mauritania and Senegal on how to develop and share the spoils from the gas field they share.
The West Africa region is aiming for global supplier status as its making head way despite some output disruptions. Despite ongoing conflicts throughout West Africa, the region’s energy sector continues to make
progress toward becoming a leading global oil and gas supplier. According to GlobalData, nearly $194bn will be spent on African oil and gas fields between 2018 and 2025. Nigeria has struggled for years to resist the threat from militant groups. The attacks are impeding the country’s efforts to expand exploration outside the Niger River Delta, in the hope of finding new crude reserves. There are a number of deep-water projects in Nigeria that are waiting for concrete action from the government but there is nothing to show that action would be taken on them in the immediate future, except for Bonga South West on which the commercial framework has been cleared with plans ahead to develop the $10 billion project. Its Invitation to Tender has just been made public for interested investors to apply.. Other projects include Zabazaba and perhaps Exxon Mobil’s Owowo, among other projects.
Oil Prices sustain upward movement
il prices rose by 0.3 per cent on Tuesday, as result of output cuts led by the Organization of Petroleum Exporting Countries, OPEC and healthy market demand The Brent crude futures were at $66.75 per barrel, up 17 cents, or 0.3 per cent while the U.S. West Texas Intermediate (WTI) crude oil futures were at $56.97 per barrel up 18 cents, or 0.3 per cent. “Despite economic headwinds, we still see Brent prices averaging $70 per barrel this year and expect WTI to lag, averaging $59 per barrel in 2019,” said Bank of America Merrill Lynch. It said that was partly due to demand for marine diesel expected from next year as part of new fuel rules from the International Maritime Organization. “With diesel yields already maxed out, refiners may need to lift runs in 2H19 to meet rising demand for marine
distillates,” it said. A rally in broader financial markets also supported crude futures, although analysts still warned of risks to the global economy. Oil prices have been receiving broad support this year from supply cuts by the Organization of the Petroleum Exporting Countries (OPEC) and nonaffiliated allies like Russia aimed at tightening markets. Traders also pointed to the political and economic crisis in OPEC-member Venezuela as a driver for oil prices. Venezuela’s oppositionrun congress on Monday declared a “state of alarm” over a five-day power blackout that has crippled the country’s oil exports and left millions of citizens scrambling to find food and water. Offsetting OPEC efforts to tighten the market and disruptions like Venezuela is a surge in U.S. oil supply. The United States will drive global oil supply growth over
the next five years, adding another 4 million barrels per day (bpd) to the country’s already booming output, the International Energy Agency said on Monday. U.S. crude oil output will rise nearly 2.8 million bpd, growing to 13.7 million bpd in 2024 from an average of just under 11 million bpd in 2018, the IEA said, making the United States by far the biggest oil producer in the world. With U.S. production booming, the country needs to import less and is increasingly turning abroad to sell surplus oil. “The decrease in net crude oil imports (December, 2018) was driven primarily by lower imports from Saudi Arabia (down 160,000 bpd month-onmonth) and higher exports to Asian countries such as South Korea (up 200,000 bpd monthon-month), China (up 90,000 bpd month-on-month) and India (80,000 bpd month-onmonth),” Barclays bank said.
Victor Eromosele, executive director the Centre. He said that confirmed speakers include Kayode Akinkugbe, CEO of FBNQuest Merchant Bank, Wale Shonibare, senior country director of African Development Bank, Anthonia Okoh, director project
and export finance, Africa, Standard Chartered Bank, Dr Weib Boer, CEO, Al On and Dapo Okubadejo, Africa Lead, deals and advisory, KPMG Nigeria, among others. Nigerian National Petroleum Corporation and Nigeria LNG Limited would be well represented
at the event. Sessions would be chaired by President of the Chartered Institute of Bankers of Nigeria (CIBN), Uche Olowu and Partner, Aelex, Soji Awogbade. Chairman CPI Board of Governors, Chief Chambers Oyibo will be the chief host.
CPI to hold Energy Finance Forum FRANK UZUEGBUNAM
inancial sector CEOs and energy sector CFOs will be rubbing minds at the seventh annual Energy Finance Forum 2019 (EFF-VII) organised by a leading in-
dustry think-tank, the Centre for Petroleum Information (CPI). The all-day event billed to hold Friday, March 15 has as its theme: “Financing gas and power: Deploying strategies that work.” “With many deals in the gas and power sectors under discussion, the timing
could not be better. Also, this year is unique because we have a rare combination of very senior executives from across sectors who are fine communicators and wellgrounded in their subject. Delegates should find the event provides excellent networking opportunity,” said
LegalBusiness BD Thursday 14 March 2019
Business Law Industry Report Practice Intelligence Partnerships
Conformity to our professional ethics and established standards is no longer negotiable - Dele Adesina, SAN ... Says Ethical Lawyers are not born, but made In this edition, Former General Secretary of the Nigerian Bar Association (NBA) Dele Adesina, SAN speaks to BusinessDay Law Editor, THEODORA KIO-LAWSON about developments in the legal profession, appointment of judges, corruption in the judiciary among other things. EXCERPTS:
ow do you think the legal profession has progressed in the0 last few years?
I entered into this profession with great hopes, vision and great aspiration. I see the Legal Profession as a profession that has the ability and capacity to move the Nation forward by correcting the ills of the Nation, shaping its cause with a view to bringing about a better society and this perfectly accord with the understanding of the Legal Profession as an instrument of Social Engineering. Largely, I must say I have experienced the fulfilment of this vision. I saw
a Nigerian Bar Association that championed the course of legality in governmental affairs, supremacy of the rule of law in all its ramifications as well as obedience of court orders and judgments. Between 1987 and 2012, the NBA played a pivotal role in directing political, governmental and societal affairs in Nigeria. In particular, between 1987 and 1989, the NBA leadership was vocal on the issue of restructuring this Nation through the convening of a sovereign National conference. Even though this was the peak of military dictatorship in Nigeria, the NBA stood resolutely against military dictatorship and this continued until the military administration yielded to Civilian Democracy and continued up to and including 2008. The NBA made decisive intervention through quality and well researched opinion and participation during the fuel subsidy crisis of 2012. Regrettably however, these decisive interventions of the Bar in the affairs of this Nation seems no longer as potent as they used to be. On the part of our Judiciary under the dynamic leadership of the Supreme Court, several epoch-making decisions have been handed down not only to check the excesses of Governmental actions but also to shape and stabilize our Democracy.
I recall such epoch decisions like Ojukwu V. Lagos State Government where, to use the language of the Supreme Court; the practise of executive lawlessness by Government was deprecated. I also recall the judgement of the Supreme Court in the case of Bello V. Attorney General of Oyo State where the Supreme Court described as unconstitutional and act of executive lawlessness when a convicted Appellant was executed during the pendency of his Appeal. One must also remember the case of Oodua Investment V. Talabi where the Supreme Court said technicalities constitute a blot/stain on admin-
istration of justice and propounded the principle of substantial justice while condemning technical justice to death in our justice administration system. We must also not forget the decision of the Supreme Court which democratised political party system in Nigeria even though, in my contention, the principle of democratisation of political parties was brought to a ridiculous level with 91 political parties and 73 presidential candidates contesting the recently concluded 2019 elections. Whether this has impacted positively or negatively, the just concluded 2019 elections have a lot to tell. Similar reference can
further be made of several other monumental decisions including but not limited to Attorney General of Lagos State V. Attorney General of Federation & 35 Ors. More recently however, the profession has not witnessed the best of times. It will not be an overstatement if I say that the profession is indeed going through a trying period. Today, for instance, there is the general perception that the Judiciary in Nigeria is corrupt. A perception that is capable of damaging the trust and confidence of members of the public in the Judiciary. It must be recognised although that perception may not amount to proof but it can be more dangerous even than reality. I believe that this seeming general claim of the Judiciary is corrupt to borrow the language of a colleague is a fallacy of easy generalisation. I make bold to say that there are still impartial and incorruptible judges in the Nation’s Judiciary today as much as we found in the days of old. I believe it is a condemnable act to judge a whole system or the entire institution by the inadequacies of a few. I submit that the proper thing to do in the situation we have found ourselves is not to embark on a general condemnation of a system that has no alternative but that of continuContinues on page 31
Cryptocurrency and government regulation in Nigeria BISI AKODU
e have for many years been in the age of technology which has permeated all sectors of global economies. To be on the cutting edge individuals in the corporate world have to be technology savvy or “techi” if they want to compete in the ever changing corporate landscape and move their businesses to the next level. With advances made in technology has come cryptocurrency which has been defined as a digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank. I quote “Decentralized cryptocurrencies such as Bitcoin now provide an outlet for personal wealth that is beyond restriction and confiscation” There has been a lot of positive and negative discourse on the value of crypto currency to fiscal systems. With all the hype about the Bitcoin the bubble eventually burst in June last year and has left a lot of Bitcoin investors, including myself, skeptical as to whether there is a future for cryptocurrency without government regulation. I was recently briefed by a client seeking legal advice regarding the
use of cryptocurrency by way of an Agri Coin to unify farmers, farm products and product trading in the rural areas of Nigeria. The coin would be utilized to project, coordinate and monitor agricultural services. I was really interested in proffering legal advice in such a
‘techi’ area. I immediately, but with some help from my ‘techi’ sons embarked on research into this subject. I didn’t mention the fact that it was one of my ‘techi’ sons who urged me to invest a small amount of money in the Bitcoin, which unfortunately I lost and for-
tunately had the sense not to invest my entire life savings. As a lawyer I am always interested in new products and services. To enter a discussion on the value of cryptocurrency it is important to learn about related things like blockchain, smart contracts and ICOs. It has been established that cryptocurrency springs from cryptography which is the process of converting plain text into unintelligible text and the reverse; it is entirely digital which relies on encryption that enhances secure transactions. In researching this topic I can say with some authority that cryptocurrency was devised as an alternative form of payment to cash and cash equivalents such as credit/debit cards, cheques, etc., independent of traditional banks. In other words the use of cryptocurrency dispenses with the use of intermediaries in the form of banks and other financial institutions. Cryptocurrency is based on a technology called Blockchain. To answer the question, “what is a Blockchain?” we first need to define a ledger. In accounting, a ledger is a computer file or a book where you can find a complete record of a company’s financial transactions throughout its life. Using this record, accounting officers can prepare the company’s
financial statements. The ledger records financial information on liabilities, assets, expenses, revenues and owners’ equity. With the above information in mind, Blockchain is simply a decentralized ledger, meaning, the records it contains can be verified autonomously without the need to have a central entity. It should also be noted that it is not just a public ledger, but a real-time ledger that records practically anything that can be put on record, including contracts, financial transactions, information on supply chain, physical assets, etc. One major idea behind Blockchain technology is that there is no one organization or person who is in charge of keeping this ledger. Instead, the ledger is open for everyone in the chain who can see every detail of every record. Each of the records in this chain of records is referred to as a block. So, in summary, think of Blockchain as a long chain of records (financial transactions or otherwise) made up of blocks, with each block being each of the records that make up the long chain. Each block is encrypted and has a time stamp. Smart contracts are computer protocols intended to digitally facilitate, verify, or enforce the Continues on page 30
INDUSTRYFILE Insolvency expert questions the ranking of employees’ entitlements over claims of victims of environmental degradation
Thursday 14 March 2019
Public-Private-Partnership and Road Infrastructure Development in Nigeria …Understanding the Presidential Executive Order No. 007 of 2019
O Dr Kubi Udofia
L-R: Prof Damilola Olawuyi of Hamad Bin Khalifa University, Qatar; Prof Fidelis Oditah SAN, QC, President ILA, Nigeria Branch; Prof Ibironke Odumosu-Ayanu of University of Saskatchewan, Canada; Prof Edwin Ezike of University of Nigeria Nsukka and Dr Babtunde Ajibade SAN – Principal Partner, SPA Ajibade & Co.
corporate insolvency and restructuring expert, Dr Kubi Udofia, has questioned the justification in ranking employees’ pre-insolvency entitlements above claims of victims of environmental degradation in liquidations proceedings in the Companies and Allied Matters Act, 1990 (CAMA). Udofia made the observation at the Annual Conference of the International Law Association (ILA), held in Lagos, Nigeria with the theme “Business, Human Rights and Corporate Obligations in International Law”. In his presentation on the treatment of employees in corporate insolvencies from an international human rights perspective, the Insolvency expert highlighted the major international law conventions, which protect employees at the insolvency of employers. Udofia who spoke about strategies adopted by countries in the protection of pre-insolvency entitlements of employees of insolvent employers ranging from the grant of priority in insolvency to the establishment of social security schemes, noted that in Nigeria, CAMA gave preference to employees’ pre-insolvency entitlements over other unsecured claims. Acknowledging the vulnerability of employees in insolvency
processes, Udofia stated that other involuntary creditors such as tort victims and victims of environmental degradation were equally very vulnerable and deserving of similar protection. To illustrate his point, he pointed out that a fisherman or farmer whose only source of livelihood, namely a river or farmland respectively, had been polluted by an insolvent company prior to the company’s insolvency was arguably in no better position than the company’s employees. The ILA was founded in Brussels in 1873 and has its headquarters in London. It is currently headed by Right Honourable Lord Jonathan Hugh Mance, Justice of the Supreme Court of the United Kingdom. The ILA promotes the study, clarification and development of public and private international law, the furtherance of international understanding and respect for international law. Its membership ranges from lawyers in private practice, academia, government and the judiciary to nonlawyer experts from commercial, industrial and financial spheres, and representatives of bodies such as shipping, chambers of commerce and arbitration organisations. ILA has a consultative status with several United Nations specialized agencies.
n Friday, January 25, 2019, the Federal Government of Nigeria (“FGN”), in furtherance of its commitment to infrastructure development being a key growth driver and economic development enabler; issued the Companies Income Tax (Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme) Order, 2019 otherwise referred to as the Presidential Executive Order No. 007 of 2019 (“EO7” or the “Order”). Made pursuant to the executive powers of the Federation, as vested in the President by the Constitution of the Federal Republic of Nigeria, 1999 (as amended) and section 23(2) of the Companies Income Tax Act (“CITA” – Cap C21, Laws of the Federation of Nigeria, 2004), the Order established the Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme (“the Scheme”) as a Public-Private-Partnership (“PPP”) intervention in the delivery of good roads across the length and breadth of the country. Pursuant to the EO7, private companies will be able to finance construction or refurbishment of federal roads designated as “Eligible Roads” under the Scheme and recoup their investments by utilizing the approved total costs expended on the particular Eligible Roads, as a credit against the annual Companies Income Tax payable by such private companies in the corresponding year of assessment.
The value of the credit due to a private sector partner, known as the Road Infrastructure Tax Credit (“Tax Credit”), as calculated in accordance with the terms of the Scheme, will be reflected on the Road Infrastructure Tax Credit Certificate (“Tax Credit Certificate”) to be issued by the Federal Inland Revenue Service (“FIRS”), in line with the conditions stipulated in the Order. In specific terms, the Scheme, which has a duration of ten (10) years from the date of commencement of the EO7, is set up to: enable the FGN leverage on private sector funding for the construction or refurbishment of Eligible Road infrastructure projects in Nigeria; focus on the development of Eligible Road infrastructure projects in an efficient and effective manner that creates value for money through private sector discipline; and guarantee Participants in the Scheme timely and full recovery of funds provided for the construction or refurbishment of Eligible Road infrastructure projects in the manner prescribed in the EO7. This article provides a synopsis of the Regulations for the Administration and Operation
of the Scheme; Eligible Roads; Participants; and application of the Tax Credit granted under the Scheme.
bank to affect the pricing process, therefore trading is transparent. There are at present 10 cryptocurrency exchange platforms in Nigeria otherwise termed e-currency exchanges. There are on-line training courses on how to buy trade and invest in cryptocurrency with the interest of individuals increasing. The Central Bank of Nigeria (CBN) and the Securities Exchange Commission (SEC) both regulators of money market and capital market respectively have intermittently given warnings to the public regarding investing in cryptocurrencies. However, cryptocurrency businesses have not been prohibited and there is currently no legislation in this regard. The main issue seems to be defining what cryptocurrency is. Different jurisdictions have defined cryptocurrency as security, currency, property, cash equivalent, asset or commodity etc., this way it is easier to legislate, regulate and monitor. Nigerian Banks and Other financial Institutions as well as capital market operators are prohibited from investing in cryptocurrencies or carrying on business as a virtual currency exchange. Most authors on this topic includingChimezieChuta, the coordinator of Blockchain Nigeria User Group, who has written extensively are of the
opinion that “government must seek out avenues and intelligent approaches to deal with Blockchain and cryptocurrency”. With evolving global trends in the financial sector Nigeria is really lagging behind. There is the need for government to review the financial services sector and completely revolutionize institutions and soft structures if they want Nigeria to be part of the technology jet set. We have already seen a trend whereby Nigerian tech companies are operating through off-shore locations such as Mauritius. As an erstwhile member of Financial Systems Strategy 20:20 a CBN initiative established by Professor Soludo, CBN Chairman in 2007 to provide for a robust financial system that will power the Nigerian economy, I often wonder where we are with 2020 being just a year away! I personally believe that cryptocurrency has come to stay and the advantages clearly outweigh the disadvantages. Both CBN and SEC need to make an informed decision on how they can provide regulations for this product so that it can gradually be integrated into our financial ecosystem.
ELIGIBLE ROAD The EO7 defines an Eligible Road as any road approved by the President as eligible for the Scheme on the recommendation of the Minister of Finance and as duly notified to Participants and published pursuant to the Order. Such recommendation, however, is expected to be made from a list of roads presented to the Minister of Finance by the Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme Management Committee (“the Committee”), being the implementing and administrative body to be established pursuant to the EO7. As provided in the EO7, the list of Eligible Roads may be updated from time to time by the President on the advice of the Minister of Finance provided that such updates are published in the Official Gazette of the Federal Republic of Nigeria (“FRN”). To be continued nex Week
Cryptocurrency and government ... Continued from page 29
negotiation or performance of a contract. These transactions are trackable and irreversible. Smart contracts have been touted as the true building blocks of Blockchain applications. At the core of smart contracts is self-execution, code write-ups and Blockchain enforcement. This means that a smart contract is designed using lines of code and executes itself without the intervention of a third party and after fulfilment of certain laid out conditions. Using smart contracts, you eliminate both enforcement costs and ambiguity, making all business transactions instantaneous.Smart contracts lets you replace traditional contracts and can save time and money for your business. An Initial Coin Offering, also commonly referred to as an ICO, is a fundraising mechanism in which new projects sell their underlying crypto tokens in exchange for a crytocurrency be it Bitcoin, Ethereum etc. An ICO is similar to an Initial Public Offering (IPO) in which investors purchase shares of a company, in the case of an ICO they are purchasing units of cryptocurrency. SureRemit a Nigerian start-up company raised $7 million through a Blockchain ICO aided by ‘Hashed’ one of the largest cryptocurrency funds
domiciled in South Korea. The exigencies of commerce rely to a large extent on the dissemination of information. We rely on information in our daily commercial activities be it withdrawing or transferring money at an ATM point, opening letters of credit, operating credit cards, paying for goods and services, effecting a takeover bid the list is inexhaustible, but it is clear that information is the main driver and often lack of information can lead to dire consequences. That is why it is imperative in banking transaction to “Know Your Customer” similarly in the case of M & As due diligence investigations is a sine qua non. Where am I going with all this? I am looking at the value of cryptocurrency in global financial systems and the need for government regulation. Some exponents believe that cryptocurrencies are ripe to compete with traditional financial systems and that “money is an asset with value meaning that money competes with money” therefore cryptocurrencies should be fully intergarted into global financial systems. The downside is that without government regulation massive fraud and theft may be perpetrated through cryptocurrency which can be used to promote money laundering activities, support radical movements
and bad governments, finance illegal drug trafficking and human trafficking. Truth be told there will always be crime and criminals therefore the axiom “prevention is better than cure” comes in, hence the need for government regulation. Si n c e m o n e y ha s a l way s played a fundamental role in the development of global financial systems and historically paved the way for global trade and economic growth, we are gradually seeing a transition from physical currency to almost virtual currency. The fact that most economies have or are in the process of doing away with cash means that financial systems are still evolving. Although some skeptics are of the view that cryptocurrency can never be worth more than zero, it should not be disregarded as a technological whim. Hence, governments should start looking seriously at the advantages of promoting legislation and regulations in this regard. The value of digital assets is increasing with the world’s top five companies having data as a primary asset. Trading in cryptocurrency in Nigeria is becoming very popular and can be a profitable idea for investment ; we even have full time crypto traders who employ various strategies and methods of trading. Because the trading is decentralized there is no central
Bisi Akodu is the Managing Partner, Olisa Agbakoba Legal
Thursday 14 March 2019
Conformity to our professional ethics and established standards is no longer negotiable... confidence of court users in the Judicial system in the long run?
Continued from page 29 ally and spiritedly identifying the inadequacies and the bad eggs with a view to dealing with them. As Nigeria continues to grapple with the challenges of justice administration and justice sector reforms, why does it seem like a foolproof solution to these challenges may continue to elude us? Let’s first of all attempt to identify some of these challenges. I have just talked about the challenge of allegation of judicial corruption. There is also the question of intractable delay and congestion in our Courts. I will not be surprised if cases of 2010, 2014 are still pending in our Courts in 2019 at the different layers of the courts. There are people today who believe you only know when you institute a case; you never can tell when such cases will be concluded. Every suit instituted in Nigeria at the Court of first instance has the potential of ending at the highest and final Court of the land. The question is why? Indeed, the little experience I have had over the years make me to believe that if there are other Courts after the Supreme Court, perhaps headed by God Himself, there will be further Appeal particularly political cases. The problem of delay and congestion in our Courts as I have said over and over again and in one paper or the other or interview of this nature is both systemic and attitudinal in nature. Systemic, in the sense that the 1999 Constitution as amended imposed on us a largely unitary and triangular system of Judiciary. At the base of the triangle you have hundreds of High Courts throughout the 36 States of the Federation and the Federal Capital Territory, Abuja. Some States like Lagos and Rivers have over 50 Courts presided over by over 50 Judges handling several thousands of cases and delivering several hundreds of judgments per annum. At this base also, you have the Federal High Courts throughout the Federation as well as the National Industrial Courts. Bearing in mind what I said earlier, I believe it is not an over statement if I say 85% of the judgments of these High Courts go on appeal, to the Court of Appeal comprising of about 16 divisions only. Apart from Lagos, Abuja, Port Harcourt, most of the divisions of the Court of Appeal have one Court. At the top of the triangle, you have only one Supreme Court where at least 90% of the judgements of the Court of Appeal go to on appeal. There is nothing any one can do about this except the constitution is overhauled completely. Closely related to these are interlocutory appeals most of which are also needlessly pursued to the highest court of the land. Some of us have also argued that interlocutory appeals ought to terminate at the Court of Appeal. So, in this area, unless you bring about a fundamental change in the provisions of the Constitution on the Judiciary, these problems will continue regardless of the number of your conferences, seminars and symposia. For me, relevant amendments of the Constitution creating Court of Appeal for the States and possibly Supreme Court for the State and reviewing the right of appeal with or without leave will solve the seemingly impossible problem. If this
is done, the States will have a full complement of hierarchy of their Courts while, the Federal Courts will restrict itself to the matters contained on the Exclusive legislative list in the Constitution and other issues of grave constitutional importance. Just a point on the issue of attitude of the Practitioners both at the Bar and on the bench, many times a Lawyer gets to court well prepared for his case only to be told that the court will not be sitting for one reason or the other or an opposing Counsel applies for an adjournment for one reason or the other. You also have the issue of inadequate facilities in our Courts. It is a common knowledge that the proceedings of the Court are still largely recorded by long hands in the 21st century. There are situations when the Judges, Lawyers and litigants are in Court and proceedings are going on fine, and suddenly light goes off. For lack of adequate funding, many courts will not be able to switch to generator. Consequently, Proceedings will be forced to be adjourned. We also have the issue of lack of discipline on the part of the Practitioners impacting negatively on the overall administration of justice. I have had cause to talk about overhauling the disciplinary mechanism of members of the Association since 2014. Today, it will not be an overstatement to say that in the profession, we have lost our dignity and nobility. There is a compelling need to hold individual Practitioner both juniors and seniors accountable and responsible to the demands of high professional etiquette and legal standard. We have gotten to a point when the Association must realize that a practical observance of conformity to our professional ethics and established standard as in the day of old is no longer negotiable. Ethical Lawyers are not born, they are made. The other part of the question why it appears that the solutions to the challenges in the administration of justice are eluding us is because we have failed either as a Nation or as a people to practically confront the challenges and solve them. Again, let me say that no matter how many seminars or conferences we hold, as long as we fail to take practical steps to implement suggested solutions, we shall not only remain at the same point but the situation will be getting worse. One of my very usual phrases is that no problem is ever solved by technically avoiding the problem. The simple and direct answer to your question is that we have continually avoided our problems, hoping
that they will solve themselves. It is self-deceit. As long as we continue to do the same thing, in the same way, we shall inevitably continue to get the same result. Talking about implementations of decisions, for instance, the problem of delay and congestion in our courts were exhaustively debated and solutions propounded by the Legal and Judiciary Committee of the National Political Reform Conference of 2005. I was privileged to be a member of that Committee/ Conference. Similarly, there was another Conference in 2014. I have read the conference report on the Judiciary. Very many practical solutions were also suggested. These various suggestions all of which I submit can effectively and efficiently address the challenges facing our administration of justice are articulately documented in the reports of these conferences. The question is what have we done to implement any of them? What has the National Assembly done to incorporate those suggested solutions in the Constitution? What has happened to the reports of the conferences? The existing situations provisions of the law must be changed if we must bring about the needed reforms. With specific reference to the profession, in 2002, under the presidency of Chief Wole Olanipekun SAN and I as the General Secretary of the Bar, we embarked on a deliberate journey of amending the Legal Practitioner’s Act. We introduced mandatory continued legal education; we introduced the issue of renewable licensing of Lawyers annually and some other novel suggestions in the proposed amendment. 2002 till now that is about 17 years after, that amendment has not seen the light of day either because successive administrations want to have a fresh input to the amendment or the non- attachment of relevant importance to it by the National Assembly. The big question for me is how do we transit from the stage of philosophy and propounding theories and suggestions into the stage of effective implementation of those theories and suggestions? Until this transition takes place we shall continue to mark time at a point. In the last two years, the Judiciary and even the Bar has been in the limelight for reasons that border on integrity, with the head of the judiciary coming under intense scrutiny for these same reasons, how do you think this would affect the
I think I have alluded to this point earlier. For me, unless something definite is done to restore the sanctity and the integrity of the judiciary, unless definite steps are taken to reverse the perception I talked about earlier, loss of confidence by the Court users is imminent. And if this is allowed to happen, the Nation will suffer it. The way and manner these issues are handled so as not to cause irreversible damage is very paramount. This is because there is simply no alternative to the Judiciary. I doubt if investors both local and foreign will be excited to invest in a Country whose Judiciary cannot be trusted. So, everybody has work to do. If we need to begin again by meaningfully and objectively setting up machinery for holistic examination of the system in all parameters, so be it. The Judiciary in any event is part of the society. Although we expect the Practitioners as “Caesar’s wife” to be above board. The Nation must provide for the operators of the system the necessary machinery to make them as “Caesar’s wife” function effectively and efficiently. Remunerations must be looked at and substantially improved as a means of insulating the judicial personnel from corruption. A Judge once told me that the salary of Judges is an incitement to corruption. We must also look at the post retirement life of the personnel. If some of these things are done, perhaps the story will change. It will be a tragedy if we allow our past to define our future. The time to invest in the Nation’s judicial system and administration of justice generally is now. Until the coming of the present administration, the budget of the Judiciary was at a downward trend year in year out. There was a time it went as low as to 50 Billion per annum. I found out all these as far back as 2014. Let me conclude this point by saying that in addition to the problem of under-funding, the problem of inadequate infrastructural facilities, undue political influence and poor remuneration must be adequately addressed. Recently, a group of Senior Advocates of Nigeria came together to start up an initiative known as the Justice Reform Project (JRP) - with a view to reforming value systems in the justice sector and regaining the respect for the Rule of Law. We do understand that quite a number of other senior lawyers are identifying with this initiative. Are you open to supporting this project? From all that I have said above, believe me when I say that I shall be ready and willing to support any initiative that will bring about the needed reform in our administration of justice. Our value system as a profession is well known. Our ethical standard and the responsibility it imposes is also well known. The challenge we have is that of lack of functional and effective mechanism to hold practitioners accountable and responsible. I have spoken with some of the members of the Justice Reform Project. Like I said, I believe in what they believe in. However, my point of departure is whether we need a separate or
distinct platform independent of the existing platforms that we have in the profession. I will give you an example, the immediate past President of the Nigerian Bar Association, A.B Mahmoud SAN on the platform of Nigerian Bar Association embarked on the holistic reform of the legislative and regulatory framework of the profession. The NBA Legal Profession Regulatory and Review Committee I recall was headed by Chief Anthony Idigbe SAN. The Committee did not only proffer suggestions to remedy the inadequacies that we have all noticed but they produced a comprehensive draft of Legal Profession Regulation Bill to repeal the existing Legal Practitioner’s Act and the Legal Education Act. This draft bill contained novel and fundamental proposals including but not limited to provision on mandatory continuing legal education and development, Compliance and Enforcement Committee to be responsible for investigating professional misconduct (which is one of the sore points in the profession today), annual practice license, provision of compulsory insurance indemnity, liability for negligence and serious penalties for unprofessional conduct among others. I am also aware that the copies of the draft bill were circulated to all the branches of the Association and other stake holders including but not limited to the Body of Senior Advocates of Nigeria which also comprises of members of the justice reform project for their input. I also recall that the Body of Senior Advocates set up a Committee to review the draft bill and make recommendations which recommendations have also been submitted. The question is rather than attempting a “begin again”, can the Body take the A.B Mahmoud initiative further through aggressive pursuit by the Legislative and Advocacy Committee of the Association for the enactment of this bill by the National Assembly. For me, this is better than starting again. It is the idea of starting all over again that I do not agree with. It is this lack of continuity that has made the initiated reforms driven by Prof. Ernest Ojukwu SAN, under the Wole Olanipekun’s presidency since 2002, not to have succeeded up till today. Another challenge I have in the work of the JRP is this perception or believe that all the existing platforms of the institution are irrelevant and unhelpful in the process of bringing about the needed reform. For me, I don’t think so. I don’t see the success of any reform agenda that will not pass through the platforms recognised by members of the Association such as the Nigerian Bar Association and the Body of Benchers knowing the profession as I do. So, If I am permitted to advise, as laudable as the initiative of the Justice Reform project is, I am of the opinion that this can be achieved within the existing frame work that we have in the profession. I will also suggest that in order to practically move forward this collective desire and aspiration of rebuilding our profession, the JRP should take off with the Chief Anthony Idigbe’s draft bill which I stated earlier is a very comprehensive draft reform, study it to see if additions or subtractions can further be made by the JRP and thereafter, we all pursue the passing of that draft bill into law. To be continued nex Week
Thursday 14 March 2019
‘Until renewables completely take over, downstream will remain a fundamental industry in any country’ ABAYOMI AWOBOKUN is the Chief Executive Officer, ENYO Retail and Supply. In this interview with FRANK UZUEGBUNAM, editor, West Africa Energy Intelligence, he talks about Enyo’s quest to leverage on affordable technology, downstream liberalisation, outlook for 2019, amongst other issues. Excerpts: ENYO is the new kid on the block in the downstream sector. Tell us more about the company? nyo is owned by shareholders that have a long history of investing successfully in the oil and gas supply, distribution and marketing space on a local and global scale. These shareholders identified an opportunity in the local market that their expertise could optimise and also felt that the local market would benefit significantly from their investments. This led to the development of the ENYO Retail brand and the development of a team to put it all together under the stewardship of a very experienced board. Specifically, our shareholders have extensive expertise in global supply and trading, international supply to Nigeria, terminals and storage management and most importantly efficient distribution within the country. We are now investing in last-mile distribution and marketing as we have a huge chance of building a great offering to the sector. Enyo Retail is all about filling the gap we see in the local market and one of the ways we are expressing our commitment to the Nigerian market. How economical is it to invest in a sector where you have to import your products, but the price is fixed, therefore capping your income? The sector has numerous opportunities despite its challenges. Enyo retail is creating jobs for Nigerians while providing options to consumers. It is deepening the distribution capacity of the country to ensure that the days of unmet demand for fuel products are a distant past and most importantly, it is a good corporate citizen. The downstream is a fundamental industry in any country and until renewables completely take over, it will remain an essential one. The current regime has been put in place to ensure a degree of stability on many other fronts of the economy and as soon as progress is made on some of those fronts, it is not unusual to expect some liberalisation of the sector. Liberalisation will deepen investments in the sector; this will help create more jobs and even boost entrepreneurship. We believe that season is on its way and we are glad to be players in the sector ahead of some of those changes. Our plan is to scale our
business very quickly, leveraging technology and to use innovation to develop a loyal customer base. We are focused on being competitive and consistent in the delivery of value to our consumers. Our end goal is to be a major player in the retail space with roots in oil and gas. Can you elaborate on Enyo’s emphasis on technology? Nigeria’s downstream distribution is perhaps one of the largest in Africa with up to 12-15 billion litres of refined products sold annually. This could easily
generate up to $6bn in revenues and significant sums in profits to corporates and indeed to the government as taxes. In addition, it employs thousands of professionals and creates hundreds of entrepreneurs annually. It is easily one of the most successful sectors on the continent by virtue of its size and capacity. Unfortunately, it enjoys a very low level of technology utilisation compared to other sectors of its size and importance. Enyo Retail seeks to contribute to the renaissance of the sector especially as
2019 will be a good year for our business and our teams. Our brand will enjoy more recognition; more consumers will get the chance to interact with us; more sites will open in many more neighborhoods; more of our products will get to more homes and we will deliver more value to all our stakeholders
it relates to the use of affordable technology and we are doing this by building our entire value chain on locally develop technology and expertise. Our utilisation of technology is one of the most competitive in the sector; it boosts our visibility of all elements of our supply value chain and helps us deliver competitive margins compared to our main competitors. We are also able to provide more career options for our teams as a result of our technology systems ensuring we reduce the rate of staff redundancy we suffer compared to the industry. Most importantly, our systems allow us deliver quality products and better measurements on volumes delivered to our customers allowing us to focus on customer loyalty and innovative non-fuel products for our customers. What investment is needed for such technology? Our focus is on affordable technology only, so what we are deploying and are using is consistent with the cost expectations of our business. In our view, the cost we cannot afford is the cost of not using technology to scale our business. Traditional fuel distribution companies are currently facing
all sorts of challenges that we are not faced with because of their manual systems and processes in this interconnected world. We are certain that businesses that seek to succeed in our sector will have to adapt to the challenges faster than manual systems can cope with. The difference between a technologically driven value chain and one that is not could be as high as 30 percent in staff costs. A technologically driven supply chain pays for itself in a very short timeframe and as the company scales, it is well positioned to benefit from cost economies better than if it were a manual supply value chain. It is usually more difficult for big businesses to change the way they operate despite the changes to their business landscape. We are building our business to be nimble, agile and constantly testing new levels of adaptability to changes we foresee in the horizon. What is your target in terms of retail stations and other projects? As of October 2018, we had just over one percent of the Nigerian distribution market share and remember it is a vast country. Enyo Retail is already operating in 13 states of the country. We started in the South West of the country but are now almost equally spread between the north and the south; we have operations in the east and also in Kano in the northern part of Nigeria. We will continue to grow our market share. The board and shareholders are keen to see us build a nationally relevant company and generate more quality jobs for Nigerians. I believe by 2019, our brand will be well known across the country. We have very successful shareholders and as such have very high chances of achieving our goals. What is your outlook for 2019? 2019 will be a good year for our business and our teams. Our brand will enjoy more recognition; more consumers will get the chance to interact with us; more sites will open in many more neighborhoods; more of our products will get to more homes and we will deliver more value to all our stakeholders. We will end the year as a much stronger company, a bigger brand in the hearts and minds of our consumers; a more efficient fuel distributor, and fast-growing lifestyle brand in Nigeria. We look forward to the future.
Thursday 14 March 2019
GARDEN CITY BUSINESS DIGEST Exploring cultural resources for economic value:
How ‘Strongest State Nigeria’ contest can rescue Nigeria’s cultural resources IGNATIUS CHUKWU & FAVOUR ICHEMATI
bout 74 culture ambassadors, male and female, of the 36 states and FCT Abuja, were in camp for a period showcasing the cultural resources of each state. After the camping, the ambassadors went home to await recall. Only 10 sets would make it back. How? The reality TV show would run for viewers to enjoy and also vote the best 10 sets back. The others would suffer some heartbreak. The organizers of ‘Strongest State Nigeria’ scheme say this is a way of introducing some contest in Nigeria’s cultural belts to promote peace, love and unity. The essence is to make an economy out of the way Nigeria live their Millicent Jackson lives; our culture. Explaining details on Port Harcourt, the Camp Commandant, Millicent Jack, salvage Nigeria’s cultural resources.” regarded mostly for her costuming effects The BellaNaija platform owner said: in Nollywood, said Nigeria’s experience in “In view of the above, Mega Solo Movie the global culture space is both unique Academy has designed ‘The Strongest and challenging. “Blessed with diverse State Nigeria’ reality TV show series cultural identities both in language and aimed at promoting Nigeria’s culture, behaviour, its people are very much unity and love with peaceful coexisviewed as culturally rich globally.” tence amongst Nigerians. SSN reality The tlented costumier, dancer and TV platform is established to showcase actress, and former Vice President of Ac- our rich cultural values, strength, tors Guild of Nigeria, who is also the CEO peace and unity in diversity. of Kilali Kreative Minds, based in Port “Our dear Rivers State and 35 Harcourt, said recent studies reveal that other states and the FCT Abuja are due to clash of cultures, some of Nigeria represented in this wonderful initiaunique cultural heritage is under threat. tive. Therefore, we welcome you all, “It is our responsibilities to protect and especially the press to bring this pro-
PORT HARCOURT BY BOAT
he King or winner of all elections these days in Rivers State is Violence. This phenomenon is perpetrated by either by the military, militants or militias. The voter is no longer the centre piece of any elections in the former oil power but the man with the gun. Time was when the man with a voters’ card was king. Not any more. The new king is the man with the gun. So, cult groups and sundry criminals went to acquire arms. At the polling stations, while the innocent voters would queue up, the hoodlums would rush in and cause havoc, overpowering the usually unarmed policemen. They were snatching ballot boxes to stuff votes. Soon, the policeman was made to bear arms and do battle with the armed hoodlums. The matter changed. Militias were thus introduced and they took over from ordinary hoodlums and common thugs.
gramme to a success.” Display: Jack, a entertainment personality in Nigeria, explained that SSN has a national camp and after the first round for all states, they are decamped. Now, only 10 states will come back, but this is on being voted back. Each state has two participants, a male and female, known as king and queen of the culture of that state. They will display the traditions and culture of the state they represent and handled social life, living, interactions, work, art, and even quarrels, using only resources from their cultures. They would form a community government and have all the officers such as chief, councilors, etc. The Camp Commandant is Millicent Jac. Economic value: The essence is to explore economic potentials of the nation’s cultural heritage even while having leisure and fun. “This is to promote harmony, love and peace and to boost the economy. The winning king and queen will get whopping N10m prize money. Each set is to sensitse their state and the state that comes first would be the strongest state in Nigeria, culture-wise, and the governor would automatically be installed as the strongest governor in Nigeria. The dresses, accessories, food, and other artifacts of states would be on display and could attract tourism and shows that would attract investors. That way, culture would have helped to boost the economy of Nigeria.
120 fresh entrepreneurs get N400,000 each to create wealth
hell Nigeria has released another 120 groomed entrepreneurs with N48m (N400,000 each) to join 7,077 others already making waves in the private sector to create wealth and employ others. They represent the 2018 batch in Shell’s LiveWIRE scheme that has gone nationwide. Shell’s General Manager (external relations), Igo Weli, said they have reached out to banks to support the scheme, saying the scheme enables young people to start their own businesses and create jobs for themselves and others. “It provides budding young entrepreneurs with access to the essential business knowledge and customised support they need to transform their enterprising ideas into a viable and sustainable business.” He said 2018 was an exciting year in enterprise development because in addition to the regional programme, Shell launched a special LiveWIRE programme in Ogbio local Government Area in Bayelsa specifically for Oloibiri where oil was first found in commercial quantity in Nigeria. He warned the beneficiaries that the road to successful entrepreneurship is seldom smooth but that those who remained determined and focused always came out great. Shell presented two global award winners who were previous participants in LiveWIRE as success stories. Bayelsans in the audience hailed as Yolo Bakumo Smith, CEO of De-Rabacon Plastics that recycles used plastics. Hey also unveiled Henry Chukogu of Alternative Energy firm that said he is sought after everywhere for his product. They both appealed to the new batch never to joke with their seed capital. Various financial experts, entrepreneurs, bankers, and career activists took turns to motivate the young entrepreneurs and urged them to remain on course. Shell said the company was proud of the flagship youth scheme and would not deviate.
Of Rivers elections: Military, militants, and militias The militias are armed with Ak-47 and more. They no longer showed interest in ballots direct results at ward collection centres. Those with militias began to win elections like those of old who had thugs. Enter the military! The government said the military should step in to stop the militants that stopped the militias. The military proved more lethal. Soon, the politicians realized that whoever had the military had something big, victory. This was tested between 2011 and 2015. Now, 2019, the military came in full swing. They did not bother with ballots, ballot boxes or even small results. They went for the RECs, the highest collation centres. It went from hijacks to heists. The problem is that the military now have two factions; the fakes and the original. The problem is, the owners of the original military would blame hijacks on the fake military. The owners of the fake military would blame it on the original military. Now, the matter went full scale whereby women are being mobilized to protect RACs. Imagine! In Okrika, the women laid ambush and when soldiers, real or fake, attempted to jump in from the backyard, the women captured them, in fact de-robed them. Videos are go-
ing viral showing different types of the military on duty, some being captured and exposed. This is in keeping with calls that real military must parade fakes, if truly there were fakes. Some arrests are popping up, but, would it be real or fake arrests? In the two dimensional world of Rivers politics, everything is two; real and fake. For everything that is real here, we have the fake: fake ballot papers, fake PVCs, fake result sheets, fake results, fake INEC officials, etc. Even the INEC REC here is being dubbed by the APC as PDP agent masquerading or faking as REC. So sad! At the INEC headquarters in PH, the fakes met the real military. The police said they had right at the gate, soldiers pushed them, saying they were the real owners of the gate duty. All eyes were on the over all results. Eyes became red, and journalists fled. Someone asked; how do fake military, dressed in fake uniforms, carry fake military rifles, and drive in fake armoued vehicles and trucks? What a world of fakes! Even the political parties have original and fake. Some candidates are fake, too. This is because, some parties have been de-listed but their shadows are fiercely contesting through formerly obscure
For everything that is real here, we have the fake: fake ballot papers, fake PVCs, fake result sheets, fake results, fake INEC officials,
parties. So, you do not know who your real opponent is; real of fake candidate. Some candidates decamped or formed associations and went to the Brick House to declare their loyalty to one candidate. The governor said by what happened, 98 per cent of all candidates had coalesced into his party, PDP. Yet, at the polls, tens of candidates paraded as contestants. So, who were those that were no longer contesting? They collected decamping fees only to return to look for re-camping bonus. The over all outcome is that the eventual results have been described as fake and INEC (real of fake) has suspended the fake election processes. Many wonder if the governor and lawmakers that may emerge would be fake or real. Now, the real military is probing the fake military while the fake military is probing the militants who spoiled business for them; whereas the militants are probing the militias who posed problems for everyone. In Rivers lost polity, the elections are about the military, the militants, and the militias. Each type reports to some stakeholders, and the stakeholders shout loudly against the one they do not have but hide the one they have. God will help us!
MANUFACTURING IN FOCUS
Thursday 14 March 2019
In Association with
Reviving manufacturing sector through efficient raw material sourcing ODINAKA ANUDU, MAURICE OGU & GBEMI FAMINU
aw material sourcing is a critical part of the manufacturing process. Without it, production is stalled and the entire value chain is disrupted. This is, perhaps, why the ongoing Manufacturing &Equipment Expo, taking place at Landmark Centre in Lagos, focuses on raw material sourcing as well as the use of modern equipment and technologies that aid manufacturing. Nigerian manufacturers are facing challenges in sourcing raw materials locally today. Utilisation of local raw materials by manufacturers stood at 56.6 percent in the first half of 2018, which is down by 4.12 and 9.1 percentage points from 60.72 percent in the same half of 2017 and 65.7 percent in the preceding half respectively, according to the Manufacturers Association of Nigeria (MAN). The reasons for this slow-down are not far-fetched. Peter Njonjo, president of West Africa business unit of Coca-Cola, told BusinessDay after his firm acquired Chi Limited recently, that there were issues on local input sourcing that needed attention. “Right now, there is not much local material sourced locally— even in oranges,” he said. “This is down to the fact that we don’t have large-scale agricultural projects that can competitively produce some of them here,” he said of Chi’s input sourcing, in an exclusive interview. He explained that on the dairy side, the situation was not different. “It is a lot more longer term, because you need to have the animal with the right yield in terms of milk, which can survive in the Nigerian environment. “So, there are many challenges that we will have to overcome. But one of the things that we have to do is to work with government and private sector in some of these projects. We also have development partners that we can work with to finance some of these projects,” he added. This shows that huge investment is required in local inputs because some of the agro-based crops that serve as raw mterials require resources and time to grow. Gestation period for palm oil, for instance, is between three and eight years, according to experts. On the other hand, solid inputs like gypsum, used by cement makers, need beneficiation, which involves some investment. Issues around availability and
A cross section of participants
quality of locally available raw materials are also critical. Millers such as Flour Mills of Nigeria, Honeywell and Chagoury are willing to add 10 percent of cassava flour to their wheat, but issues around quality, standards and regular availability of locally available crops are hurting the plan. The Federal Government made a policy on High Quality Cassava in 2013, encouraging
millers to add five to 10 percent of cassava to their wheat, but the policy is not practicable owing to quality issues. Olalekan Saliu, secretary, Flour Milling Association of Nigeria, told BusinessDay that much of the cassava flour in the market did not meet industrial standards. He said millers were still buying up the industrial grade cassava flours from big processors like
Russell Hughes, commercial director, Clarion Events West Africa, addressing the participants at the 2019 Manufacturing& Equipment Expo on Tuesday
Industrialisation and true inclusive economic growth cannot be achieved by focusing solely on primary products
Thai Farms. “Much of the cassava flour produced by the small- and medium-sized processors is of low quality and does not meet industrial requirements, but we are still buying what is available from processors with industrial grade cassava flour,” Saliu said. The situation also extends to the steel sector, where even scraps of sheets are not always available. More so, ores are equally scarce. Jude Abalaka, managing director of Tranos Contracting
Limited, a manufacturing and engineering solutions provider, said that quality and availability were two key issues that must be worked on to put Nigeria on world’s manufacturing map. “There are some raw materials that cannot be found yet,” he said. “For example, common types of stainless steel are 304 and 316. Getting to the market, the seller may not know that steel has grades. So, after telling him what you want, he will offer something else,” he added. He said that quality was interwoven with availability. MAN attributes the falling local input sourcing among manufacturers to two factors. “This may be adduced to the general sluggishness of the economy and a renewed ability for importation of raw-materials considering the tranquillity in the foreign exchange market.” The foreign exchange market has remained stable in the last 18 to 20 months owing to the Central Bank’s management finesse, which has helped manufacturers to access dollars to import inputs. Nigerian manufacturers import a number of inputs, ranging from wheat to sorghum, to animal skins and packaging materials. In 2016, manufacturers were unable to access dollars as the economy went into recession due to low crude oil prices and Niger Delta militancy. Nigeria relies on crude oil for 90 percent of its foreign exchange earnings and any hit on oil hurts the entire economy. “Sometimes we do not get the required quality here. This makes us look for it elsewhere. If you are a consumer, you will not like a product you buy regularly to change taste due to quality issues. Sometimes too, it is about availability,” a manufacturer, who did not want her name mentioned, said. It was found that some cement makers sometimes import limestone due to issues around quality and availability. But recently, Gloria Elemo, professor and director-general of the Federal Institute of Industrial Research, Oshodi (FIIRO), said quality was no more an issue, as the body had come up with a number of innovations that aided the manufacturing sector in input sourcing. A number of manufacturers are already pumping billions in local input sourcing by way of backward integration or partnership with local suppliers to prevent a repeat of 2016 when 54 firms went under owing to lack of access to dollars. Nigerian Breweries is substitut-
Thursday 14 March 2019
MANUFACTURING IN FOCUS
L-R: Masur Ahmed, president, Manufacturers Association of Nigeria (MAN); Aliyu Abubakar, representing minister of industry, trade and investment; Zainab Hammanger, representing director-general, Raw material Research and Development Council; Paul Gbadebo, group managing director, Flour Mills Nigeria, and Joseph Out-Oru, project manager, Clarion Events West Africa, during the 2019 Manufacturing and equipment Expo in Lagos, yesterday. Pic by Olawale Amoo
ing barley for sorghum sourced locally from an agriculture-based firm called Psaltery Nigeria Limited. More than 250,000 farmers spread across several agronomic zones in the North are directly or indirectly involved planting sorghum for the country’s biggest brewer, BusinessDay understands. Jordi Borrut Bel, managing director of NB, said at a pre-AGM meeting held in Lagos in 2018 that the brewer would raise this from 50 to 60 percent. Oluyemisi Iranloye, MD/CEO of Psaltery Limited, supplier of cassava starch to NB, at a recent visit that her firm optimised the cassava value chain in the country by providing industrial quality cassava starch to extract maltose syrup for use in NB’s brewing process. She added that the firm had created a supply chain involving up to 5,000 farm families, including more than 2,000 registered and unregistered outgrower farm families, marketers, transporters and retail input suppliers. Nestlé Nigeria is sourcing 80 percent of its maize, sorghum, millet, soya, cassava starh, cocoa powder, palm olein from more than 41, 600 local farmers and processors scattered across the country. Nestlé Cereals Plan project has over 30,000 farmers who supply 100 percent of the grain requirement for Golden Morn Maize. Through its Sorghum and Millet in the Sahel (SMS) project, now called Nestlé Nigeria & IFDC / 2Scale Project Sorghum & Millet, the food and beverage giant has engaged up to 10,671 farmers. “The Industry has huge needs and we must help farmers improve their yields to meet them. To achieve real success with connecting farmers to industry, a 360 degree approach which will
include the aggregators, processors, and logistics suppliers must be considered within this value chain,” said Mauricio Alarcon, CEO of Nestlé Nigeria Plc. Dairy maker FrieslandCampina WAMCO is sourcing some of its raw milk from farmers in communities in Oyo State. As of 2017, over 70 farming communities, including 962 women, supply raw milk to FrieslandCampina WAMCO on a daily basis, BusinessDay found. “The capacity the company has there is even more than what I can supply. Things have dramatically changed for us dairy farmers,” Mayosore Olatunde Rafiu, CEO of Genius Integrated Farms, one of the milk suppliers in Iseyin, told BusinessDay. Second biggest brewer Guinness Nigeria Plc is ramping up local use of maize and sorghum sourced from farmers from 43 percent to 87 percent over the next two years. “Our patronage has increased tremendously from manufacturing companies. Some of the crops we farm like dry maize were being imported into the country before the foreign exchange crisis. But with the shortage of forex, importers and manufacturers could not bring in dry maize to sell and make profit, so they are now buying from us at large quantity,” said, Abiodun Olorundenro, chief executive officer, Green Vine Farms, said in an earlier interview with BusinessDay. Azeeco International supplies cocoa to Cadbury, Olam, and Bolawole international, BusinessDay found. Major manufacturers such as De-United Foods and Chikason Group source palm oil from manufacturers, including Presco and Okomu.
Dangote Farms, Savannah Farm and Ikara Processing Plants had off-taker arrangement with tomato farmers. But Dangote tomato plant is currently not in operation owing to high cost of tomato seeds. PZ Wilmar, which is a subsidiary of PZ Cussons, has ac-
Huge investment is required in local inputs because some of the agrobased crops that serve as raw mterials require resources and time to grow. Gestation period for palm oil, for instance, is between three and eight years, according to experts
quired over 50,000 hectares of oil palm plantation in Cross River State. The firm acquired the defunct Calaro Oil Palm Estate, formerly owned by the Cross River government, as well as the 12,805 hectare Kwa Falls oil palm plantation, formerly owned by Obasanjo Farms. It also bought the 5,450-hectare Ibiae Oil Palm Estate and another 8,000 hectare estate in Biase. Santosh Pillai, managing director of PZ Wilmar, said the company has invested approximately $150 million. “We are determined to continue with these investments and looking for opportunities to expand our plantations in the state. We have also invested around N20 billion in an oil palm refinery in Lagos,” he told BusinessDay in an exclusive interview. Dangote Sugar is investing over $2 billion in over six states in the country through its Savannah Sugar plc in Numan, Adamawa State, North-East Nigeria. It is already expanding plantations in backward integration projects in sugarcane and has pledged to extend this investment to Nasarawa State. Flour Mills of Nigeria, through its sugar subsidiary known as Golden Sugar Estate Limited, is investing $300 million in sugar production at Sunti, Niger State. Backward integration occurs when a company buys its suppliers or internally produces segments of its supply chain MAN and Clarion Events West Africa have partnered to raise local input sourcing among manufacturers to encourage more local investments in input sourcing sub-sector and reduce overdependence on the FX market. Apart from the Federal Government delegation, the Raw
Materials Research and Development Council (RMRDC) is handy to showcase some of the raw materials not yet known by local manufacturers. Modern machinery and technologies are also on show at the ongoing event, helping key players to discover suitable machines for them. More so, the event is collocated with Multimodal West Africa, which is logistics-focused. The essence of this is to enable manufacturers discover the right logistics to choose. At the Day One of the event, which held yesterday, John Coumantaros, chairman, Flour Mills of Nigeria, said the manufacturing sector had the prospect to foster economic growth and prosperity in the country. He said there was a need to examine various challenges confronting the manufacturing sector such as infrastructure deficit, unfavourable policies, economic downturn, dwindling consumer spending, and high cost of production. He also pointed out that although the country was on growth path following the severe economic crisis the country experienced from 2015 which eventually resulted in an economic recession, there was a need to address structural rigidities and other challenges facing the manufacturers. Coumantaros, who was represented by Paul Gbededo, chief executive/ group managing director of Flour Mills of Nigeria, stated this was important for the growth to be sustained, and for the country to achieve economic prosperity. “Industrialisation and true inclusive economic growth cannot be achieved by focusing solely on primary products,” he said. “Nigeria needs a more diversified and stable alternative than oil to drive an economy that could feed and empower its growing population.” He was of the opinion that going forward, there was a need to develop a sectoral value chain policy and upstream value chains to become global, attract international investment, while creating a fast track platform that would provide access to trade and financial incentives to foster economic development. Mansur Ahmed, president of MAN, said that the event served as a forum to deliberate the path of development for manufacturers in Nigeria. “This annual international event provides a common ground for large manufacturing organisations and SMES to explore new production process that will increase their production output,“ he said. Hussaini Ibrahim, directorgeneral, RMRDC, represented by Zainab Amangar, director for investment in the agency, stated that the event was designed to promote quality growth and economic diversification. He opined that local sourcing of materials was important for productivity among manufacturers in Nigeria.
Thursday 14 March 2019
Investing in Rivers State Shell gets rare path on the back on human capital development
Technocrat admits Shell is pro-youth, is foremost in human capital development • Guns cannot feed you everyday but Shell’s skill will – Sokrari Davies • As LiiveWIRE unleashes 7072 youth entrepreneurs in Niger Delta Ignatius Chukwu
hell Petroleum Development Company (SPDC) last week in Port Harcourt unveiled 120 young entrepreneurs who walked away with N400,000 each (or N48m total) to start businesses for which they had received world-class training. As the young men and women drawn from Rivers, Bayelsa, Delta, Edo, Imo, Abia, Akwa Ibom and Cross River waved their cheques and poured out their hearts of relief and appreciation, a female technocrat from the Rivers State government sprang to her feet and declared that Shell is indeed an exemplary multinational corporation, if truth must be told. Sokari Davis, the Director of Secondary School Education, who has followed education and human capital projects of the oil company for years, said at the 2018 Regional LiveWIRE graduation and awards ceremony where another 120 young persons marched into entrepreneurship cokcpit that guns cannot feed any youth everyday but that the skill Shell was giving the thousands of youths will. This is your chance – Sokari Davies The Director made it clear that of all the companies operating in the oil region, SPDC stands tallest in the genuine quest to build a new army of self-assured entrepreneurs and depopulate the army of militants and restive youths. She said : We have been in
L-R: Best graduand 2018, Emi Harry, receiving a plague from Shell’s Gloria Udoh
partnership for long with Shell in education for long. They are proyouth. The new thinking in education is that the child has to know a skill because education is about knowing what to do in any situation or to anything that requires remedy at the right time. Shell has demonstrated unmatcheable level of commitment to educational develoment of the oil region and youth development. If every company coming to the region does one project as Shell does, rstiveness would reduce drastically. Despite oil theft and other problems that hamper their operations,
Shell still helps the youths of the region in their quest to self-accomplihment by consistently promoting programmes that open opportunities to the youths of the region to prosperity. We are here to say the truth, and we will not hessitate to speak out if they do bad. To the youths and entrepreneurs, we say, do not forget Shell tomorrow after getting help from them to start life. We also urge you to train others as you have been trained. Do not allow the circle to beak or stop. Lack of jobs has created havoc in the oil region. Disaster: We do not like what we see these days in our society and re-
gion. Because of insecurity created by youths, most persons do not go home anymore. We now crave for a time when every person can feed himself so that people do not have to kill others to feed. Remember that guns will not feed you everyday. We are in the middle wacting both the multinationals and our youths and we will blame whoever is blameworthy. More applause : More pro-development and proentrepreneurship organisations seemed to abandon their taciturn and conservative nature to heap commendations on Shell’ ability to
steadily support young entrepreneurs in the oil region to set up businesses and to get exposed globally. GroFin Other countries know that Nigeria or Delta is where the gold is. It is only Nigeria that does not know this. Only Shell has cared to respond to our request for partnership to rescue the Niger Delta. No word has come from other companies for the SME fund. This is important to note. Out of 54 companies we have invested in so far, 17 are 17 LiveWIRE companies. First key is ; integrity. If you eat your seed, you regret it. We mentor people, we link people. PIND Foundation for Partnership Initiative in Niger Delta (PIND) official stated this that youth unemployment in Nigeria is 55 per cent at the moment. Rivers State case is worse. We must look for alternative models to tackle the menace. The graduands stand a good point to find solution. Over 7000 graduates of this scheme, and over 3000 recieved financial support to start. Shell has created this, we need to run with it. Look for opening areas and act. You have been given the right information to take action, but information without action is failure. An official from the UBA said thet are ready to partner with the beneficiaries and Shell while the GTB said low interest loan is available to SMEs. Princess Ogan said : «I am estatic that Shell is doing this. Government starts things and stops but Shell has continued this, yet, it is moving steadily.Look for a gap in the society and create a business out it. That is how to go. »
Global award winners from LiveWIRE testify Yolo Bakumor Smith : CEO, DeRabacon Plastics wo global award winners who were almuni members from the scheme came to give account of their success stories. Smith said : I was in LiveWIRE some five years ago. I had no plans whatsover to be a businessman after my university education. There was no job and we were just idling away, looking for a way out. Then, LiveWIRE came. I joined, trained and started a business. How I succeeded : Dont be afraid to fail, or to try. Build insight into the market. Create a clear cut budget for a blue print projecting costs, fixed and variable costs; and add 10 per cent of costs as eventualities. Repitition should be key. Dont be too fast to change a model that works for you. Don’t change for change sake. Draw your goals and commitments; set out a time target for marketing. Dont focus on all segments of the market or public. Choose your market, fight your market. You may need to go into the service side of your chosen business before trying out products for sale. This will help you create an income
line before products and the income would cushion your low moments. Scaling up : Do not scale up for the fun of it. Also, go into the kind of entrepreneurship you enjoy. Adhere strictly to your business plan. Work from home until you are sure you can pay for office. Entreprenuers are game changers, not mere traders. So, find a problem, solve it, make moeny from there. So far, 58 persons have beefitted from De-Rabacon Plastics. He plans to establish a construction company that uses 50 per cent recycled wastes as its building material. This will reduce landfils and blocking of drainage ways. He is tops in a global competition that attracted over 11,000 votes worldwide held in Kuching, Malaysia in November 2018. His firm started by collecting waste plastics of all kinds, sorting, granulating for cosmetics containers, bottles for drinks, construction materials such as paving blocks, pipe and low grade carpets, etc. Henry Chikaogu : CEO, Alternative Energy ‘I never ate my seed’ Altrnative source of power to homes, communities. I was in LiveWIRE in 2016. I was searching for
survival then Live WIRE happened. I had looked for a job to finance my passion. I aplied for LiveWIRE three times without success. I realised one needed to stretch out if one needed help. LiveWIRE thus gave me a platform. I had zeal. I never ate my seed. Instead, i advise you to plant it, leverage it to your destiny, to your breakthrough. Now, I have two branches; Port Harcourt and Warri . Yes, LiveWIRE opens up your mind and opens you up to the world. Malaysia trip launched us and celebrated us. Twitter opened us into inlimited sales opportunities. Now, I operate in the hub (physical market arena) and on social media. Igo Weli & Gloria Udo Igo Weli is the GM (External Relations) of Shell Nigeria. He has demonstrated huge commitment in bridging the perception gap between Shell and its publics especially the host communities, government and the media. He thinks it is better to tell the public the whole truth about happenings in the oil industry and allow them to make form opinions and take decisions. This shift seems to make impact in the way Shell is viewed these days. He was not able to make it to the event but a top manager
under him, Gloria Udo, was on hand to perform the needed tasks. Udo is described as a woman with a passion for the young ; a mentor to the Niger Delta Youth. She demonstrated this when she announced a personal prize of a laptop to the best graduand ; something she is said to do quietly every year. She was excited that the day was March 5, just three days short of the date of the 16th anniversary of LiveWIRE. Speaking through Udo, Weli said they have reached out to banks to support the scheme, saying the scheme enables young people to start their own businesses and create jobs for themselves and others. “It provides budding young entrepreneurs with access to the essential business knowledge and customised support they need to transform their enterprising ideas into a viable and sustainable business.” PHCCIMA’s Nabil Saleh Free incoporation, one-stop-shop created for young entrepreneurs The president of the The Port Harcourt Chamber of Commerce, Industry, Mines and Agriculture (PHCCIMA), Nabil Saleh, a chief, was represented by Erasmus Chukwunda,
the Director-General. The DG made sterling remarks thus : The programme is great, especially as the one to mark its 16 years in progress growing entrepreneurs. It is easy to start something like this but sustaining it is difficult. PHCCIMA is always invited at the graduation ceremonies. To graduands : This is a sure way to proceed to entrepreneurship. SPDC has just launched you. Millions out there are looking for this kind of opening. Please help others and think of how to proceed from here. PHCCIMA is there to take you to the next level. A category has been created for young entreprneurs in the south-south at the PHCCIMA to network. We have a one-stop office for all registrations and government processes. So, go into incorporation (enterprises or limited). It is free and it was created to boost businesses in this region. Its an opportunity for every young entrepreneurs to benefit. There are other benefits for joining the City Chamber. For instance, we have several collaborations with the Rivers State government. There are several projects all over the city of PH now to boost ease of doing business in the state.
Thursday 14 March 2019
News Economy: Buhari banks on ‘luck’ for success Tony Ailemen, Abuja
resident Muhammadu Buhari on Wednesday said the Federal Government was doing its best to correct and reverse the terrible mismanagement the country had experienced, adding that “and with some luck, our best will be good enough.” The President, who was recently re-elected for a second four- year tenure, had faced heavy criticisms over the handling of the economy in his first four years. Nigeria’s economy, which is currently on a rebound had gone into a five-quarter recession from 2016 under his watch, soon after assuming office. Speaking when he received a delegation of noncareer Ambassadors, who
came to State House, Abuja, to congratulate him on his re-election, the President said “Nigeria was trying to live within her means so we can improve our lot.” He however assured that government was determined to upgrade the country’s profile, both locally and internationally. President Buhari said it would be inexcusable for government not to take care of its Ambassadors at their various stations, hence the special attention being paid to the country’s foreign missions. Speaking on behalf of the delegation, Ambassador Ashimiyu Olaniyi, said President Buhari’s election in 2015, and his recent reelection, were divine interventions in the affairs of the country. “You are God-sent. You have always come on stage at the critical moments of our
national history to right the wrongs of the past,” Ambassador Olaniyi said. He added that the President would be remembered “as an astute political leader who does not interfere in the political affairs of states,” noting that that singular quality had given credibility to all elections conducted since 2015. The delegation submitted that apart from records of achievements in the three focal areas of securing the country, reviving the economy, and fighting corruption, “your integrity is responsible for your victory, which we are privileged to celebrate with you today.” The Ambassadors appreciated the intervention funds that were released to various missions abroad, and pledged continued loyalty and support to the Buhari administration.
Nigerian polls: Anxiety grips politicians as US compiles reports on election violence, irregularities Innocent Odoh, Abuja
ome Nigerian politicians are said to be gripped by anxiety over their alleged roles in the irregularities and violence that marred the 2019 general elections in Nigeria, especially the governorship and state Houses of Assembly election in Rivers State and other places held on March 9, 2019. A source disclosed to BusinessDay on Wednesday that the US had been gathering information on these individuals whose actions led to the death of dozens of people before, during and after the elections, adding that the US
would slam appropriate sanctions on them as it had earlier threatened. “The US intelligence network has beamed its searchlight on certain individuals, who have shown desperation during the election and their actions have led to loss of lives. As I am talking to you now, they are jittery because of the US threats but they will not escape from it,” the source said. Nigeria held Presidential and National Assembly elections on February 23 and the Governorship and State House of Assembly elections on March 9. However, the US on Tuesday, March 12, said it was compiling reports on the
elections marred by irregularities and violence, especially during the March 9 elections across the country. Assistant Secretary of State, Bureau of African Affairs, Tibor Nagy, said this during a telephone conference in Abuja on Tuesday, stressing that the US Government would give appropriate response to the issues surrounding the elections. He said the US Embassy in Abuja and the Consulate in Lagos led by Ambassador Stuart Syminton, had been active in providing “phenomenal guidance” to Washington on how the government should and should not respond to the election-related matter.
Nigeria, India to grow $12bn bilateral trade via increased investment HARRISON EDEH, Abuja
he Nigerian and Indian government are working on ways to enhance the $12 billion annual bilateral trade between both countries in a way that will focus on investment. Okechukwu Enelamah, minister of industry, trade and investment, said this while receiving the Indian High Commissioner to Nigeria, Shri Abhav Thakur. Enelamah at the meeting lauded the relationship between Nigeria and India, but said it had become necessary to expand it beyond trade for increased investment. Recalling the fundamental cooperation between both countries and their common heritage in the Commonwealth of Nations, the minister said in a statement on Wednesday that Nigeria was
restructuring her economy and bilateral relationships to reflect same. The minister welcomed the envoy’s interest in ‘Project Mine,’ a new initiative by Nigeria to develop worldclass special economic zones to position Nigeria as the preeminent manufacturing hub in sub-Saharan Africa, and a major exporter of made-inNigeria goods and services regionally and globally. Last month, the Federal Government signed investment agreements with three development finance institutions - Afreximbank, Bank of Industry and the Nigeria Sovereign Investment Authority (NSIA) for the project. Thakur, who expressed interest in the project, requested a formal briefing to enable him sell the opportunities to Indian investors. The High Commissioner, who is new in the country,
congratulated the minister for the electoral victory of President Muhammadu Buhari and his government. He stated that Nigeria and India are important trade partners and expressed the need to grow the partnership. He said his country was looking forward to the Joint Trade Committee meeting holding in India in April. India and Nigeria, in 2017, agreed to establish the Committee at the level of Commerce Secretary from Indian side and Permanent Secretary from Nigerian to review the ongoing bilateral trade and commercial relations. The minister assured him of Nigeria’s attendance and promised the envoy that he would enjoy his stay, saying, “We are glad to have you in Nigeria. We are very hospital people and we believe you will enjoy your stay.”
38 BUSINESS DAY NEWS Continued from page 1 signed by Kyari.
OML 11 lies in the south-eastern Niger Delta and contains 33 oil and gas fields of which eight are producing as per 2017. In terms of production, it is one of the most important blocks in Nigeria as the terrain is swamp to the south with numerous rivers and creeks (Ogoniland). Ogoni oilfield is one of the largest fields in Nigeria with about 140 oil wells with the capacity to produce over 100,000 barrels of crude oil per day. Speaking to BusinessDay concerning the directive from the Presidency, Ademola Henry, team leader at Facility for Oil Sector Transformation (FOSTER II), said it might have made sense to transfer the assets, but again, the Ogoni
Buhari directs NNPC to take over... issues have to be resolved before anyone is allowed to mine oil from the ground. “It is interesting. The key is to ensure no conflict, ensure Nigeria gets the best deal possible and all decisions taken from an equity perspective,” Henry told BusinessDay. OML 11 is operated under a Joint Venture Contract (JVC) with NNPC having 55 percent, Shell 30 percent, French oil company Elf 10 percent, and AGP 5 percent. The licence is due for renewal on June 30, 2019. “What’s the Chief of Staff’s business with stuff like this? Where’s the Minister of State for Petroleum’s role here?” asked another stakeholder in the sector who chose not to be named.
When contacted by BusinessDay with inquiries regarding the current state of OML 11, Bamidele Odugbesan, media relations manager, Shell Nigeria, declined to comment on the matter. In response to an SMS sent to his cell phone, Odugbesan simply replied, “No comment.” In July 2018, sources told Bloomberg that Nigerian billionaire businessman and chairman of Heirs Holdings Limited, Tony Elumelu, was in talks with the Shell plc to buy the Nigerian oil assets in question. According to the reports, Shell’s oil mining licences 11 and 17 might be sold for $2 billion. Also included in the deals are infrastructure assets such as a natural gas-fired power
plant that would be managed by Transnational Corporation of Nigeria plc, another company in which Elumelu has major interest. Shell discovered oil in the Niger Delta in the 1950s and became among the biggest producers in the West African nation. Tensions between the company and the local people broke out over the years regarding pollution and Shell’s contribution to civil society. The growing crisis shot to world attention when in 1995 a prominent protester and Shell critic, Ken Saro-Wiwa, a member of the Ogoni ethnic minority, was executed by the Nigerian government alongside eight others. Shell’s Niger Delta operations have faced outside scrutiny. In 2011, a 260-page report by the United Nations Environment Programme (UNEP) said the company hadn’t
Thursday 14 March 2019
applied its own procedures when operating in the delta and that environmental destruction was worse than previously thought, creating a “tragic legacy”. Shell has continued to face opposition in the region, with some reports suggesting local people even blocked the company from accessing some parts of the delta for years. Shell’s share of total production in Nigeria was 266,000 barrels of oil equivalent a day in 2017, compared with 258,000 barrels in 2016, according to its annual report. “Security issues, sabotage and crude oil theft in the Niger Delta continued to be significant challenges in 2017,” it said in the report. Last year, Movement for the Survival of the Ogoni People (MOSOP) said Shell lacks the moral right to return to their land.
Lagos building collapse: Victims’ parents, relatives disconsolate... Continued from page 1
Godwin Obaseki (m), governor, Edo State; Osarodion Ogie (r), secretary to the state government, and others, at the governor’s inspection of renovation work at the Edo Production Centre in Benin City. Continued from page 1
rently undergoing reforms and modernising infrastructure to improve service efficiency.
“We are likely going to see diversion of cargo to the Eastern ports in the next few years if government ensures free movement of cargo in and out of those ports. This will enable those ports to not only compete with Lagos ports but to decongest Lagos in the interest of the economy,” said Tony Anakebe, managing director, Gold-Link Investment Ltd, a maritime analyst. Apapa and Tin-Can Island Ports are estimated to handle close to 70 percent of the entire Nigerian import cargo due to their advantaged location, high level of efficiency and availability of modern port infrastructure. This development has in the last five years led to persistent port congestion and gridlock on the roads leading to Apapa metropolis, resulting in rising cost of doing business. But this ugly situation may soon change as the West African Container Terminal (WACT), operators of the Onne Port which has the ca-
on the number of victims – dead and alive – would be released upon the completion of rescue operation which was still ongoing on Wednesday. However, unofficial reports put the casualty figure at 12 with several others injured said to be receiving medical treatment. Ambode said his government would ensure that those found to have compromised their integrity and official duty, leading to the building collapse and concomitant loss of human lives, are punished in accordance with relevant laws of Lagos State. “This is unfortunate but we will investigate what has happened and also see the punishment for whoever are the culprits. That is the secondary level but the most important thing right now is to save lives and I just appeal to people that they should give us the chance to save more lives,” Ambode said while visiting the scene. He assured that rescue operations would continue until all victims were rescued. The state government has also taken over the treatment of all of victims of the incident and would foot their hospital bills.
Sympathising with families of victims on Wednesday, President Muhammadu Buhari described the collapse of the building housing as “extremely saddening”. In a statement signed by presidential spokesman, Femi Adesina, President Buhari said he was “extremely saddened by the collapse of a building housing a school in Ita-Faaji area of Lagos, which left fatalities, particularly of small children”. “It touches one to lose precious lives in any kind of mishap, particularly those so young and tender. May God grant everyone affected by this sad incident fortitude and succour,” the President said. Atiku Abubakar, presidential candidate of the People’s Democratic Party (PDP) in the February 23 election, said he was saddened by the tragic loss of lives following the collapse of the building. “As a parent, Atiku Abubakar feels the pains and loss of having to bid your children farewell in the morning and not being able to welcome them into your warm embrace again,” Atiku said in a statement signed by Paul Ibe, his media adviser.
•Continues online at www.businessday.ng
Eastern business climate brightens as Onne, Warri, Onitsha... pacity to handle about 320,000 TEUs of containers and 325 reefer plugs per annum, recently ordered 10 terminal trucks, two reach stackers and one empty container handler worth $2.5 million (N900 million) to modernise the port and allow it to cope with increasing volumes. While some of the orders have come in, some are still being expected. Similarly, the future of the Warri Old Port is looking bright with its recent concessioning to the Ocean and Cargo Terminal Services Ltd by the Federal Government after a competitive bid worth $100.78 million. The concessionaire is to run the port for 25 years. “We have already begun to mobilise our team to hit the ground running as soon as possible. I want to assure that in no time, the fortunes of the Warri Port will change for the best,” said Taiwo Afolabi, chairman, SIFAX Group-led consortium Ocean and Cargo Terminal Services Limited. Arrangement is also underway to declare and gazette Onitsha River Port as Port of Origin for cargoes coming into the country from any
part of the world and Final Destination to those going out of the country as export. The Onitsha River Port has the capacity to handle 1.2 million TEUs, but is currently not in use. At the completion of the ongoing process, the port will be recognised by UNCTAD as a port to which goods can be consigned from, and from where goods can also be consigned to, from any port located anywhere in the world. The volume of imported containerised cargo in Onne Port has been growing in the past two years after the nationwide decline in volume between 2015 and 2016, BusinessDay checks show. The WACT Onne handled a total of 280,000 Twenty-foot Equivalent Units (TEUs) in 2014, but the volume dropped by 18 percent to 230,000 TEUs in 2015, and further dropped 30 percent to 160,000 TEUs in 2016, according to the Nigerian Ports Authority (NPA) statistics sited by BusinessDay. But the volume of containerised cargo started increasing in 2017, growing by 13 percent to 181,000
TEUs in that year, and 22 percent to 225,000 TEUs in 2018, the statistics further show. “A sizeable portion of this volume recorded in 2017 and 2018 was due to traffic in Apapa, as more shippers divert their cargo to Onne. This can also be attributed to the stability of the Naira against dollar and government’s encouragement of agricultural-based exports,” said Godwin Onyekazi, president, Nigerian Importers Integrity Association (NIIA). He said that WACT is positively impacting on trade and economic activities in the South-East and South-South regions by enhancing the competitiveness of Onne Port, which has succeeded in making the port more attractive to importers and shipping lines. According to him, Onne Port is about the only port outside Lagos that can be said to be really competitive, apparently due to the untiring effort at ensuring that containers shipped through the port are handled professionally and delivered in good time to the owners.
To make the Eastern ports more attractive, Iheanacho Ebubeogu, general manager, security, NPA, said government agencies operating in the nation’s seaport must review tariff and charges on ships calling ports in that part of the country with imported cargo by at least 30 percent to encourage effective utilisation. He said if the cost differentials between Lagos and Eastern port are down by 30 percent, importers will be attracted to use the ports. “When I mean review of tariff across board, NPA tariff has to come down, NIMASA should review their Cabotage tariff, Customs tariff should come down so that, people can be motivated. I do not want us to think that addressing security alone will achieve this,” he said. To address security challenges facing the port, Ebubeogu said there is need for synergy between NPA and other security agencies to ensure comfort to shipping and prevent host communities from interfering in shipping through piracy and other related crimes.
Thursday 14 March 2019
Investment in infrastructure can eradicate poverty in Africa - UK adviser MIKE OCHONMA
former UK International Development Secretary of State and strategic adviser, Douglas Alexander, says further investment in infrastructure development could play a significant role in helping Africa eradicate poverty in the continent. Speaking at Pinsent Masons’ inaugural Africa Infrastructure Conference, in Johannesburg, South Africa, this week, Alexander emphasised that infrastructure development in the continent had been too slow to ensure African countries reached their economic growth targets and eradicated poverty. According to Alexander,
Africa needed to attract more private capital for infrastructure development, as the considerable infrastructurefinancing gap was growing. He also urged African countries to use their limited resources wisely and strategically, such as on investing in the maintenance of existing infrastructure. On his part, Gareth Haysom of the University of Cape Town African Centre for Cities agreed that infrastructure development was critical to spurring growth in Africa. He stated that the infrastructure built in African cities in the next decade would shape these cities for the next 100 years. Haysom challenged the perception that population growth in African cities was
predominantly from rural migration, saying that while this does occur, much of Africa’s urban growth was the result of natural growth, with cities characterised by very young populations. This youth bulge has implications for urban development, such as demand for education, new forms of education and new types of technology, as well as presenting new ways in which citizens use cities. He also challenged the perception that African cities are largely poor, with many boasting an emerging middle class. However, this growth is precarious, which could challenge the provision of infrastructure, he said. While there are still high levels of poverty in many
African cities, he indicated that this does not affect the ability and willingness of citizens to pay for services, with many poor households actually paying more for services than those living in wealthier neighbourhoods. Another perception dispelled was that there is a clear divide in African cities between the formal and informal. Haysom indicated that the line between the two was actually blurred in many cities, with most informal activities linked to formal activities. Therefore, he emphasised that forward and backward linkages between formal and informal activities were essential for the functioning of cities, which can guide how infrastructure is developed.
FEC approves contracts for nation’s airports, Kano water supply loan Tony Ailemen
he Federal Executive Council on Wednesday approved contracts for the provision of security and safety equipment at some of the country’s airports. It also approved a foreign loan guaranteed by the Federal Government for the provision of water for Kano metropolis. Minister of State, Aviation Hadi Sirika, told State House Correspondents at the end of the weekly meeting that the council approved N4.05 billion for the procurement of safety and security equipment for Abuja, Kano and Port Harcourt airports with a view to guaranteeing safety at the airports in accordance with the International Civil Aviation Organisation (ICAO)
regulations. Sirika also said that over N529 million was approved for the supply of installation machines at the Enugu Airport including a transformer, while another N529 million was approved for the repair of the Minna Airport terminal building which, according to him, had been abandoned since 2012. The Council also approved a loan of €64 million guaranteed by the Federal Government for the development of water supply to Kano metropolis. The loan was sourced from the French Development Agency and has a 20-year payment period with a 7-year moratorium at 1.02 percent interest rate, according to Zainab Ahmed, Minister of Finance, who also briefed the correspondents.
Abuja Airport: FAAN gives ultimatum to foreign airlines
L-R: Ibe Kachikwu, minister of state for petroleum resources; Okechukwu Enalamah, minister of industry, trade and investment; Solomon Dalung, minister of youth and sports development, and Ogbonnaya Onu, minister of science and technology, during the Federal Executive Council meeting in Abuja. NAN
RIMA engages FMDQ on risks, development of derivative market HOPE MOSES-ASHIKE
isk Management Association of Nigeria (RIMAN) has collaborated with the FMDQ OTC Securities Exchange in sensitising members on the development of a robust derivative market and the inherent risks. Derivative, according to Allan Ralph Thomson, managing director/CEO, Dreadnought Capital, is a financial instrument that derives its value from underlying asset. He explains that derivatives, which also is Futures, Forward, or Swaps, is a bilateral agreement between the buyer and the seller whose respective values are derived from the value of an underlying asset. The naira-settled OTC
FX Futures product was introduced in 2016, with the Central Bank of Nigeria as the pioneer seller of the OTC FX Futures contracts. Magnus Nnoka, president of RIMAN, says the Association is advancing in the effort to extend risk management education to all sectors of the economy and African countries, with the recent establishment of RIMAN Risk Management Institute. Speaking at RIMAN’s quarterly risk round table programme themed ‘Derivative Risks: The Role of FMDQ in the Development of the Derivatives Market in Nigeria,’ Jumoke Olaniyan, vice president, market architecture, FMDQ, states that the total asset of the top 10 banks stood at N36.5 trillion last year and that the percentage in product – in-
strument that are impacted by market rate include 70 percent in treasury bills, 24 percent in bonds and 4.75 percent in equity. Olaniyan notes that part of what the FMDQ has done in derivatives market was to carry out a feasibility study where it discovered that there is no netting law, no law that protected market transactions. She notes that the FMDQ, among others, established the Central Counter Party (CCP) system to be able to clear all types of derivatives. Olaniyan was pleased at the progress of the review of the Companies and Allied Matters Act (CAMA), noting a well-crafted legal and regulatory framework for any market globally. “What was critical for us in Nigeria was we didn’t have
what we call a netting law and so our financial transactions were subject to the bankruptcy laws of Nigeria. “We didn’t have a law that protected financial market transactions and so what we have done in FMDQ is, along with the president and other stakeholders in the market we conducted a review of the CAMA, which didn’t have bankruptcy remoteness law in it. “We were able to infuse the netting law into the CAMA amendment bill, which we were so excited to hear, it has passed through the house and the senate. The Senate passed it mid-last year and the house passed it January this year, so, we are literally 80 per cent there, and we are just waiting for the president to sign the law and that literally puts us on the international market”.
he Federal Airports Authority of Nigeria (FAAN) has directed all foreign airlines operating at the Nnamdi Azikiwe International Airport Abuja to move to the new international terminal on or before March 31. Sani Mahmud, FAAN’s regional general manager, North Central, disclosed this on Wednesday, when Emirates Airlines commenced flight operations at the new terminal. Mahmud said that the deadline given in order to enable the authority carryout repairs and renovations on the old Terminal C, where foreign airlines had been operating. He said that Emirates was the fifth international carrier to move operations to the new terminal in addition to Ethiopian Airlines, Air Côte d’Ivoire, Asky and Air Peace. “(The Emirates Airline) arrived with 176 passengers and 16 cabin crew on board at exactly 3:00 pm with a Boeing 777 aircraft and it is expected to depart with 222 passengers on the same flight at 6pm. “This is the fifth international airline to relocate operations into the new terminal out of 14. “We have met with the remaining airlines and gave them up to March 31, to move into the new terminal that was inaugurated by President Muhammadu Buhari on December 20, 2018. “We believed that they have ample time to have moved into the new terminal and the old terminal is due for renovation. As
such, we have given them up to 31st of this month to move into the new facility and we will commence renovation of the old terminal. “We are confident that they will all move because we have given them offices and the connectivity is in place,” he said. The former Inspector General of Police (IGP), Ibrahim Idris, who was one of the passengers on board the Emirates flight, said he was impressed with the comfort at the new terminal. Idris said that the facilities at the new terminal were of world class standard, urging the management of the airport to ensure that the standard was maintained. “This is obviously a world class airport like you see in Dubai and elsewhere and it is impressive. “It shows that Nigeria is moving forward because it is a dramatic change and I want to urge FAAN to ensure that this facility is properly and adequately maintained.” Another passenger, Joyce Mekebo, said she could not believe that Nigerian government could build such a standard airport facility, adding that it was the first time she had tasted comfort in a Nigerian airport. “When I arrived, I said so the government could do something this amazing all these years and they denied us. So, for the first time I am landing in Nigeria and I am not sweating, everything seem standard and international and the airport is really beautiful.
RESEARCH & INSIGHT
Thursday 14 March 2019
In association with
A WEEKLY PUBLICATION OF BUSINESSDAY RESEARCH & INTELLIGENCE UNIT(BRIU)
Nigerian affordable housing provisions still in a decrepit condition ISAAC ESOWE
deficit, a lot of factors need to be addressed as growth in that space will only but experience a sluggish growth based on the constraints plaguing the sector. To address the housing gap, it is imperative that policy makers and key stakeholders collaborate on simplifying the finance structures for housing loans. So far, housing loan has been the major impediment that slows the pace of housing development, and it is so worrisome to note that the housing finance structure is motionless and extraneous in drive towards housing delivery in Nigeria. However, challenges exist along the entire housing value chain, and each construction in the system impacts on the availability of finance.
Recuperating the flow of finance for housing requires improvements along the value chain – some of which broaden outside of the housing finance sector. A weak value chain discourages investors, hence investor sought for other sectors to invest on. Consequently, the government does not have the capacity to invest in housing development or creation on its own, hence there should be an enabling environment set aside to attract and sustain the interest of investors geared towards creating affordable housing unit for the citizenry, even as in recent times, there had been an improvement in the housing space through different intervention from the key stakeholders and government to bridge the housing gap. The introduction of the National Housing Fund (NHF) is one of the initiatives that give hope that the Federal Mortgage Bank of Nigeria (FMBN) is ready to live up to its billings as one of the sources of single digit funds for an interested obligor. But then, the NHF has not achieved its full potentials as it has been confirmed to be insufficient to leverage on addressing housing deficit. The number of contributors to the National Housing Fund
(NHF) has been relatively small compared with the total number of the labour force. The participation from both pri-
vate and public sectors is still low as most organizations are presently not participating in the NHF 2.5 per cent monthly contribution, thus funds available for loans are not adequate to meet the housing need. Also, increasing population growth is another factor that has contributed to the shortage
able in a country like ours. It is worthy to note that; there is a direct relationship between population and housing stock; conversely, if one increase there should be a corresponding increase viza-viz the other. More so there has been a slight percentage change in the yearly population
of Nigeria which is expected to increase slightly in 2020 by 2 point bases to 2.62 per cent Macroeconomic environment Studies show that macroeconomic environment has direct influence on the property return and the interaction between macro economy and residential property market indicates that the Gross Domestic Product (GDP), inflation, interest and exchange rates are the major macro economic factors that influence property returns. The quality and quantities of the country’s housing stock is a measure of the country’s economic growth and prosperity. Also real estate sector has become a focal point of government fiscal and monetary policies and used as yardstick for realizing low level inflation, high level of employment, low level of unemployment and
balanced economic growth. Home ownership in Nigeria Industry experts argue that Nigerian home ownership which is gauged at 10 per cent is as a result of lack of healthy mortgage financing system in the country. 12734BDN
ver time, there have been serious discussions around the different initiatives to bridge the housing deficit which experts have estimated be no fewer than 20 million housing units. Yet, housing provision is still in its decrepit state. The effort of the minister of power, works and housing in respect to creating affordable housing units with a view to bridging the housing gap has not really addressed the challenge in the sector. The Central Bank of Nigeria’s (CBN) data on home ownership shows that home ownership in Nigeria is still very low when compared to other developing and developed countries such as Singapore with 92 per cent, while United State of America (USA) and United Kingdom (UK) home ownership amount to 72 per cent and 78 per cent respectively. China and Korea have 60 per cent and 54 per cent home ownerships respectively. Basically, after some insights gathered about the state of housing in Nigeria by BusinessDay Research and Intelligence Unit (BRIU), our observations show that the current challenges facing affordable housing are complex, and overcoming them successfully requires innovation and cooperation between multiple sectors and stakeholders. In bridging the housing
of housing units in Nigeria. As the Nigeria’s population keeps increasing exponentially, it exerts substantial level of pressure on the available housing stock which invariably leads to higher demand of housing units. Another factor that affects effective demand is the unwillingness of the banks and other financial institutions to lend mortgages to individuals. Nigeria’s population has continued to grow at an increasing rate. Based on figures available figure, Nigeria’s population figure will increase by 2.60 per cent to 200.9 million individuals in March 2019 and it is further projected to increase further by 2.62 per cent in 2020 at 3 per cent annual growth rate. The increment in population puts further pressure on the available housing stock and putting in population measures could be very difficult and most times unachiev-
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Thursday 14 March 2019
ECONOMIC MONITOR A WEEKLY PUBLICATION OF BUSINESSDAY RESEARCH & INTELLIGENCE UNIT(BRIU)
Nigeria’s position in the 2018 Logistic Performance Index 2018 from 2.40 in 2016 and 2.27 in 2012. These changes can be attributed to the growing availability of internet and broadband network which has supported the rise in ecommerce in the country. The increased spending in road and railway infrastructure is also contributing factors. Interestingly, Nigeria ranks 78 out of 160 countries on infrastructure score.
he Logistics industry is a USD 4.3 billion industry globally. It is the backbone of trade and commerce especially in this era of cross-border transaction and ecommerce wave. Accordingly, logistics and related interventions have the highest potential to reduce the cost of trade and to boost integration in the global value chain. The World Bank’s Global Trade and Regional Development Team publishes biennially (since 2007) a report, “Connecting to Compete: Trade Logistic in the Global Economy” that compares the performance of the logistic industry across over 160 countries. As with previous reports, the 2018 edition of the survey, reported the Logistic Performance Index (LPI). The LPI is a comprehensive measure of the efficiency of international supply chains, and a unique benchmarking tool created to help countries identify the challenges and opportunities they face in their performance on trade logistics and what they can do to improve their performance. The LPI is based on a worldwide survey of operators on the ground (that is, the global freight forwarders and express carriers), providing feedback on the logistics “friendliness” of the countries in which they operate and those with which they trade. They combine in-depth knowledge of the countries in which they operate with informed qualitative assessments of other countries where they trade and experience of global logistics environment. Feedback from operators is supplemented with quantitative data on the performance of key components of the logistics chain in the country of work. The LPI is the weighted average of the country scores on the six key dimensions: i. Efficiency of the clearance process (i.e., speed, simplicity and predictability of formalities) by border control agencies, including customs; ii. Quality of trade and transport related infrastructure (e.g., ports, railroads, roads, information technology); iii. Ease of arranging competitively priced shipments; v. Competence and quality of
International shipment This score measures pricing options and price competitiveness of international shipping. Here the Score (rank) of 2.52 (110) in 2018 shows the rigidities in the pricing mechanism. This yet represents a worsening situation relative to the 2016 score of 2.43 (118). South Africa with a score of 3.51, ranking 22 shows a better standing on international shipment far ahead of Kenya with a rank of 99 and Ghana, 109. logistics services (e.g., transport operators, customs brokers); Ability to track and trace consignments; vi. Timeliness of shipments in reaching destination within the scheduled or expected delivery time. This implies that getting logistics right, means improving infrastructure, skills, customs and regulations, policies and governance at the right proportion. The scorecard demonstrates comparative
performance of all countries (world), regional and income groups. We shall consider the position of Nigeria relative to other African countries, as well as her class categories in other region. Overall Performance – select countries The overall LPI score for Nigeria in 2018 was 2.53 a 3.80 percentage decline from the 2016 score of 2.63. The country average since 2007 is 2.57. Germany topped the list in
2018 with a score of 4.20 followed by three other European countries ahead of Japan and Singapore (Singapore topped the chart in 2012). Germany, topping the chart since 2014 has an average LPI score of 4.13. The 2018 edition puts Nigeria below other African countries such as Kenya, Cameroun, and Ghana. Despite improvement in the sector following ecommerce boom and start-up wave, the score for Nigeria as well other the 5 other countries seem to be moderat-
ing since 2014 – except for The Gambia and Cameroun that underperformed in the previous survey. South Africa seems to be the regional leader with an LPI score of 3.38 – albeit a decline from the 2016 score of 3.78. On the overall LPI, Nigeria ranks 110 out of a 160 countries – ahead of countries such as Zambia, The Gambia, Togo, Angola, Libya, Zimbabwe, and others. Customs score The custom score of the LPI shows the efficiency of the clearance process in terms of speed, simplicity and the predictability of formalities by customs and border control agencies. Nigeria had a custom score of 1.97 – the lowest since 2007. This emphasizes the informal, opaque processes at the ports and boarders. Compared to South Africa, Kenya and Ghana customs scores of 3.17, 2.65, 2.45 respectively, Nigeria shows relatively poor stand ranking 147 out of 160 countries. Infrastructure score Infrastructure score measures the quality of trade and transport related infrastructures such as ports, road, railways and information technology. Nigeria seems to have recorded some fair improvement on this measure. The record shows an increase to 2.56 in
Logistics quality This compares the competence and quality of logistics services based on transport operators, customs brokers and other players in the chain. Nigeria scored 2.40 ranking 112 of the 160 countries surveyed. This shows deterioration in the quality of services in the years before. In 2016, Nigeria posted a better score and rank of 2.74 and 74 respectively. Kenya went up the ladder this time to 64 and Ghana 90, South Africa at 36 however. Tracking and tracing The score of 2.68 and 92 reveals the level of technology and capability in tracking and tracing consignments in Nigeria. This is down from the 2016 levels of 2.70 and 82 in score and ranks respectively. Ranking 17 with a score point of 3.92, South Africa demonstrates capability as the regional benchmark. Timeliness This measures the timeliness of shipments in reaching destination within the scheduled or expected delivery time. Nigeria got her points up to 3.02 ranking 92 out of 160. It represents the highest score for Nigeria among other indicators and over the years since 2012. However, South Africa, Egypt, Benin and Rwanda were better regional performers.
Thursday 14 March 2019
Live @ The Exchanges Market Statistics as at Wednesday 13 March 2019
Top Gainers/Losers as at Wednesday 13 March 2019 LOSERS
VALUE (N billion)
MARKET CAP (N Trn
DANGFLOUR AFRIPRUD UACN
DEALS (Numbers) VOLUME (Numbers)
31,360.28 3,273.00 377,494,901.00 2.261 11.694
Global market indicators FTSE 100 Index 7,154.42GBP +3.27+0.05% S&P 500 Index 2,815.88USD +24.36+0.87% Generic 1st ‘DM’ Future 25,765.00USD +176.00+0.69%
Deutsche Boerse AG German Stock Index DAX 11,566.65EUR +42.48+0.37% Nikkei 225 21,290.24JPY -213.45-0.99% Shanghai Stock Exchange Composite Index 3,026.95CNY -33.36-1.09%
Jumia eyes $500m from US IPO, plans NYSE listing Stories by Iheanyi Nwachukwu
umia, an African ecommerce platform backed by MTN and Rocket Internet, filed on Tuesday March 12 with the US Securities and Exchange Commission (US SEC) to raise up to $100 million in an initial public offering (IPO). Morgan Stanley, Citi, Berenberg Bank and RBC Capital Markets are the joint bookrunners on the deal. No pricing terms were disclosed.
“The deal size is likely a placeholder for an IPO that we estimate could raise $500 million,” according to Renaissance Capital. The Berlin, Germanybased company was founded in 2012 and booked $147 million in sales for the 12 months ended December 31, 2018. It plans to list on the NYSE under the symbol JMIA. Jumia filed confidentially on November 19, 2018. Recall that last year, Jumia’s losses widened to $195.2 million on revenue of just $149.6 million. The
Coronation Merchant Bank Group reports full year PBT of N5.3bn …maintains Zero NPL ratio
oronation Merchant Bank Limited has released its 2018 Full Year Results to stakeholders in which the bank posted a Profit Before Tax (PBT) of N5.3billion. Loans & Advances to customers went up 70percent to N54.8billion as at December 2018 (December 2017: N32.3billion). Customer Deposits increased by 65percent to N126.2billion as at December 2018 (December 2017: N76.4billion). Profit Before Tax stood higher at N5.3billion (December 2017: N5.1billion). Shareholders’ Funds increased to N31.5billion as at December 2018 (December 2017 N29.5billion). Key Ratios show the bank’s Capital Adequacy Ratio of 19.7percent as at December 2018 (December 2017: 24.8percent); Loan to Deposit Ratio stood at 43.4percent as at December 2018 (December 2017: 42.2percent); NPL Ratio: 0percent as at December 2018 (December 2017: 0percent). Cost to Income ratio increased to 53.5percent as at December 2018 (December 2017: 52.6percent). Net Interest Margin was 5.1percent as at December 2018 (December 2017: 7.7percent); Earnings Per Share (EPS) was 90.62 kobo in December
2018 (December 2017: 94.09 kobo). Dividend Per Share (DPS) stood at 33 kobo in December 2018 (December 2017: 30kobo); while Return on Equity stood at 15.01percent as at December 2018 (December 2017: 17.17percent). “Despite a difficult operating environment, our company stayed the course, recording modest growth across most financial indices. The growth we recorded in our profitability and capital position is a testament to the strength of our business model and the commitment of our people”, said Commenting on the results, Abu Jimoh, Group Managing Director/CEO of Coronation Merchant Bank Limited. “When we look at where we stand today, our company is stronger, simpler, and better positioned to deliver long-term value to our stakeholders, thanks to the straightforward way in which we serve our customers and clients. As a platform for improving lives, our aim is to assist our customers to identify growth opportunities, harness these opportunities and in the process, enable businesses thrive, economies grow, and ultimately, help organizations fulfil their hopes and realise their ambitions”, Jimoh added.
company, which operates in 14 African countries including Nigeria, Kenya, Morocco and Egypt, is also burning through cash with negative operating cash flows of $159.2 million. The intended IPO, analysts said is a landmark first for e-commerce and tech businesses on the continent. It could also mark a possible exit by Rocket Internet, Jumia’s German par-
ent company, divesting its remaining 28percent stake in the company. As part of its pitch to shareholders, Jumia cites itself as “the only e-commerce business successfully operating across multiple regions in Africa” with four million active customers of December last year. That status is the result of a reshuffling as several of Rocket Internet’s African
online businesses across food delivery, real estate, hotel and flight bookings were reorganized under the Jumia brand in 2016— the same year it reached a billion-dollar valuation after an $83 million investment from insurance company AXA for an 8percent stake. It also notes its add-on services including Jumia Logistics, its product delivery arm, and Jumia
Pay, its payments solution, as added assets. But its SEC filing documents also show the company’s pan-African model has so far seen hundreds of millions of dollars in losses mounting each year by far exceeding revenue the company has been able to generate. As of Dec. 31 2018, the filings show the company has accumulated losses of nearly $1 billion.
Thursday 14 March 2019
Live @ the Stock exchange
Thursday 14 March 2019
Prices for Securities Traded as of Wednesday 13 March 2019 Company
PRICES FOR MAIN BOARD SECURITIES (Equities)
Thursday 14 March 2019
World Business Newspaper
One in three asset management firms could disappear, says Invesco chief Head of Georgia-based firm says pressures on fees and costs are relentless ROBIN WIGGLESWORTH
third of the asset management industry could disappear over the next five years, as mounting fee pressures and rising costs spur more closures and consolidation, according to Invesco’s chief executive. The headwinds faced by the investment industry have already triggered a series of big mergers and acquisitions in recent years, with Janus Capital merging with Henderson Global Investors, Aberdeen Asset Management falling into the arms of Standard Life, and Invesco last year buying OppenheimerFunds for $5.7bn. The number of M&A deals in the asset management industry jumped to a record 253 last year, according to Sandler O’Neill, but this is likely just the beginning of a long, profound bout of consolidation that will reshape the asset management industry in the coming years, argued Martin Flanagan, chief executive officer of Invesco, the Atlanta, Georgia-based firm, since 2005. “The industry is going through dramatic changes right now,” he said in an interview. “Winners and losers are being created today like
never before. The strong are getting stronger and the big are going to get bigger.” The primary drivers are downward pressures on revenues, from a trend toward nearly-free passive funds, and upward pressure on expenses, due to rising investments in compliance, technology and cyber security. At the same time, many institutional investors, sovereign wealth funds or private banks are trimming how many companies they work with, which means that asset managers need to bulk up, Mr Flanagan argued. The need for scale was the main reason Invesco swooped for OppenheimerFunds last year. The acquisition, on track to close in the second quarter, should lift Invesco’s overall assets under management to about $1.2tn, vaulting it into the “trillion-dollar club” occupied by the likes of BlackRock, Capital Group, Fidelity and JPMorgan Asset Management. However, investors have reacted poorly to the acquisition — as well as other megadeals in the industry in recent years — adding to the broader concerns over how asset managers will cope with a tougher environment, once financial markets lose their post-crisis buoyancy. Even after this year’s stock
UK sets out trade plans to limit no-deal Brexit damage Bid by May government to pressure Eurosceptics ahead of showdown vote on EU divorce JIM PICKARD, DELPHINE STRAUSS AND JAMES BLITZ
he price of food and cars imported from Europe would jump under a no-deal Brexit, UK officials revealed on Wednesday in a bid to pressure Tory MPs to vote to prevent Britain leaving the EU without a withdrawal agreement. The UK government set out the long-awaited trade plans after Theresa May’s exit agreement with the EU suffered a humiliating second defeat on Tuesday. The plans, which would apply both to imports from the EU and from outside the bloc, would eliminate 87 per cent of tariffs but introduce 10 per cent duties on cars, and levies on beef, chicken and pork as well as protections for the ceramics industry. But there would be no duties or customs checks in the island of Ireland, since the UK has promised to avoid a hard Irish border. While the House of Commons is expected to back a motion on Wednesday evening opposing a no-deal Brexit, scores of Tory MPs are likely to vote against it, despite warnings from the Treasury that it would lead to deep economic damage for the UK. As the prospect of a no-deal Brexit rose up the agenda, Volkswagen confirmed that it might have to increase prices if Britain introduced tariffs. The British Retail Consortium said it was “particularly concerned about tariffs on certain clothes and textiles — a good proportion of which consumers were getting tariff-free from countries like Italy and Turkey”. But it added that non-tariff barriers, such as more checks and documentation requirements, would “have the greatest impact on consumers”.
The government set out the planned duties as Brussels’ chief negotiator warned there was a rising risk of a no-deal outcome “by accident”. Barely two weeks before the scheduled March 29 exit date, Michel Barnier told the European Parliament in Strasbourg that the risk of no deal had never been higher. He added there was no alternative to Mrs May’s deal and no point in further discussions with the UK until the British government “tell us what we want”. Meanwhile, Carolyn Fairbairn, director-general of the CBI business lobby group, said the tariff plans underlined the risks of no deal. “This tells us everything that is wrong with a no-deal scenario,” she told BBC Radio 4’s Today programme. “[This is] the biggest change in terms of trade this country has faced since the mid-19th century being imposed on this country, with no consultation with business, no time to prepare.” Ms Fairbairn added: “What we potentially are going to see is this imposition of new terms of trade at the same time as business is blocked out of its closest trading partner. This is a sledgehammer for our economy.” The plans to slash tariffs on most other goods under a no-deal Brexit could make UK industries more vulnerable to competition from overseas and create deep problems for Northern Ireland in particular. Stephen Phipson, chief executive of Make UK, the manufacturers’ organisation, said it was positive some industries were now protected, but the overall effect would still be “decimating” for manufacturing as a whole — while the decision to avoid controls at the Northern Ireland land border would allow inferior products to flood the market.
Invesco chief Martin Flanagan says the asset management industry is set to be reshaped in a profound bout of consolidation in the coming years © Bloomberg
market recovery, Invesco’s shares have lost 45 per cent over the past 12 months, compared to the S&P 500’s 0.3 per cent gain and the 23 per cent average drop for other listed asset managers in the US. Aberdeen Standard Life and Janus Henderson’s shares are down by about a third over the same period. Mr Flanagan argued the declines are overdone, and that Invesco’s shares — on a trailing
price/earnings ratio of just over 8 times, less than half the valuation of the S&P 500 — now discount any positives from the OppenheimerFunds purchase. These include synergies and benefits accruing from the fact that the target’s former owner — MassMutual, the insurance company — will become Invesco’s biggest shareholder. Invesco’s chief conceded that the adverse market reaction to
the deal could dissuade other asset managers from making big acquisitions, but argued that greater scale will be of paramount importance to any player hoping to thrive in the new, tougher era of investment management. “We’re not going back to the good old days,” he said. “The investments we have to make now are like nothing we have ever seen before.”
Shell aims to become world’s largest electricity company Oil major prepares for fundamental shift towards lower-carbon energy sources ED CROOKS AND ANJLI RAVAL
oyal Dutch Shell, one of the world’s biggest oil and gas groups, is aiming to become the largest electricity company by the 2030s, as it prepares for a fundamental shift in global energy supplies towards lower-carbon sources. Maarten Wetselaar, Shell’s director of gas and new energies, told the Financial Times that the group could develop a power business, including supplying customers, trading and providing equipment, that was the same size as its oil or gas operations. Speaking at the CERAWeek conference in Houston, Mr Wetselaar said that if Shell achieved its goal for cutting its greenhouse gas emissions by 2035, “the amount of power — of clean power — we will need to be selling . . . will make us by far the biggest power company in the world”. Achieving its ambition would depend on being able to secure an acceptable return on capital of 8-12 per cent, he said, but added: “With our brand, our global presence . . . and the adjacency to our gas business — we can get our hands on the cheapest gas anywhere — we should be able to win.” He added that Shell’s expected competitors, the established power suppliers, were “useless”, because they were shackled to outdated business models.
“Many of them are at a disadvantage, because they have this enormous legacy position, with coal plants and nuclear plants, but also a very centralised philosophy,” he said. “We see the future customer group being much more decentralised, where people do have a battery in their basement, people do have solar panels on their roof, and they want us to help them optimise.” By 2020, Shell plans to be investing $1bn-$2bn a year in new energy technologies including electricity. This is still a fraction of the group’s annual capital expenditure of about $25bn, but Mr Wetselaar said the early spending was for “proving this hypothesis” that Shell could succeed in electricity. “We will do that for a number of years,” he said. “And then we will scale it up, because otherwise we will never get there.” Shell’s plan is a response to an expected shift in the world’s energy system to much greater use of electricity, up from about 20 per cent today to about 50 per cent or more. Mr Wetselaar said the advance of electrification was “a when not an if ”. An “aggressive” scenario would mean reaching that point in 2050, and a more “leisurely” one in 2080. Shell’s business now is roughly 65 per cent oil production and refining, 25 per cent gas and 10 per cent chemicals and other operations, Mr Wetselaar said. By the
2030s, it could be 30 per cent each for oil, gas and electricity, with 10 per cent still in chemicals. Like other European energy majors including Total and Repsol, Shell has been investing heavily along the electricity supply chain — from generation to electric car charge points. It has made several small acquisitions including Sonnen, a German battery company, last month and last year’s takeover of UK power supplier First Utility, which gave it direct access to retail electricity consumers for the first time. It also bought New Motion, one of Europe’s largest electric vehicle charging enterprises. Shell and its rivals believe they can provide a better customer experience compared with traditional utilities, as they are able to deploy advanced technologies to crunch data about how and when customers use electricity to provide them with the best service. While investors have pushed energy majors to ensure they are robust should the world rapidly shift towards cleaner fuels, they have questioned if these companies will be able to make the same kinds of revenues from their legacy businesses. Mr Wetselaar said electricity was changing “from a boring, predictable system to a complex intermittent system”, which was “a really good opportunity for people that are good at energy trading. And we are very good at energy trading.”
FT The EU must match China’s drive to invest
Pressure grows in US to ground Boeing 737 Max jets
Italy and others should recognise the Belt and Road Initiative’s geopolitical goals
Politicians plan congressional hearings as FAA insists plane is safe to fly
nder its ambitious Belt and Road Initiative, China has been expanding its economy’s footprint across Asia and Africa, mostly in low- and middle-income economies. Now the project is aiming to leap into the top league, with Italy considering signing up as the first G7 country. A common European strategy for how to accommodate BRI is overdue. China’s objective — to tie the Eurasian continent closer together through comprehensive transport and infrastructure links — is a laudable one. Deeper trade and human links could be of benefit to all. But it is naive to ignore BRI’s geostrategic implications. As currently pursued, it goes well beyond the plain economic objective. There can be no doubt about the fundamentally one-sided nature of BRI. It is designed with China very much at its centre. Beijing is putting forward the financing, often the actual construction, and above all the master plan for the new trade routes — a plan designed with Chinese interests in mind. This is an entirely understandable strategy for an emerging power preparing to take its place as the world’s largest economy. China can expect much more than mere economic benefits if it can centre the Old World’s economic infrastructure on itself, so as to act as the core of continental production chains much as Germany does within Europe today. Such a strategy promises not just greater trade — which all should welcome — but, potentially, control of the infrastructure and of the rules governing the trade that flows through it. For example, Beijing has tried to bring BRI projects under the jurisdiction of Chinese courts. While better infrastructure links and greater trade can work to everyone’s benefit, Europe cannot let the attraction of a shortterm economic boost substitute for a strategy to shape BRI’s longterm geopolitics in its favour. Both in method and in content, BRI projects have at times been at odds with European interests. Beijing has conspicuously focused on parallel bilateral relationships with EU member states, starting with the poorest ones. The 16+1 initiative promises 11 EU members on the bloc’s eastern flank infrastructure investment that are often badly needed. China has signed a BRI-related memorandum of understanding with Greece. It hopes to do the same with Italy. Some of this may bring investment. But in each case it will be with China as the senior partner in the relationship, rather than an equal partner to a united EU. BRI participants in Asia and Africa have often learnt the hard way what junior status may involve. Pakistan and Malaysia have revisited some projects after finding their financing costs were higher than expected; Sri Lanka has had to forfeit the ownership of a Chinese-financed port.
Thursday 14 March 2019
Meng Wanzhou was arrested in December in Vancouver on charges of breaking US sanctions against Iran © Reuters
Trump ponders ending case against Huawei’s CFO US president may have the legal power to halt extradition of Meng Wanzhou KIRAN STACEY
hile Meng Wanzhou awaits the next stage of her extradition hearing, her lawyers are likely to be watching events in Washington as closely as those in Vancouver, where her case is being heard following her arrest on US charges last year. On several occasions, Donald Trump, the US president, has hinted he could stop the case against the Huawei chief financial officer as part of a grand bargain with China to end the trade war between the two countries. Lawyers said Mr Trump would have the power to do, but they warned such an unprecedented move would have long-term legal and political ramifications. “The president does have the power legally to intervene in this case if he wants,” said Brian Michael, a former federal prosecutor and a partner at King & Spalding. “But that would create a precedent whereby foreign governments think that criminal prosecutions are open to political interference.” Ms Meng was arrested last year in Vancouver on charges of breaking US sanctions against Iran. The arrest sparked a three-way international crisis involving the US, China and Canada. China responded angrily
to the arrest, accusing the US and Canada of harming her human rights, and has since detained two Canadians. Since then, Mr Trump has suggested intervening in the case if it would help seal a trade agreement with Beijing, which his officials have been negotiating for over the past few months. In December the president told Reuters: “If I think it’s good for what will be certainly the largest trade deal ever made — which is a very important thing — what’s good for national security, I would certainly intervene if I thought it was necessary.” Last week, Larry Kudlow, Mr Trump’s economic adviser, appeared to suggest something similar when he told CNBC: “There’s a legal process that’s going on. It may enter into trade — I don’t want to make any predictions.” Successive administrations have pledged to limit contact between White House and justice department officials regarding ongoing cases, but have made clear that national security concerns could override that policy. The constitution grants the president ultimate responsibility for making sure laws are upheld, and if Mr Trump wanted to enforce that in the face of opposition from local prosecutors or even the attorney-general,
he could fire and replace them with more biddable candidates. Soon after last year’s midterm elections, he did just that to Jeff Sessions, the attorney-general he criticised for recusing himself from the justice department’s probe into Mr Trump and his ties to Russia. The White House knows that Ms Meng’s case presents them with a dilemma, and that if she is extradited before a trade deal is signed it could put any continuing talks at risk. “Meng presents an impossible binary,” said Samm Sacks, a fellow at the New America think-tank. “If she’s extradited to the US, Beijing sees this as a massive escalation and will need to respond forcefully. If Trump releases her, you get backlash from the national security community.” If Mr Trump does decide to act, he has two main options. One would be to ask the attorney-general to intervene in the case to drop the charges altogether — something lawyers say would badly undermine the independence of the judiciary. “While it could be illegal for the president to act in this way to benefit himself, it would not be if he did so in what he believed was the national interest,” said Julian Ku, a law professor at Hofstra University. “It would not be illegal — but it would be very unusual.”
Fears grow that economic prosperity will be hit by a fall in population of young people Tom Hancock and Wang Xueqiao in Shanghai 10 hours ago HANNAH MURPHY
fter she gave birth to a baby girl two years ago, Chen Xianglin’s husband, parents and parents-in-law encouraged her to have a second child, but she was reluctant. “I value my daughter’s allround education and development, and the importance of spending time together,” said the 26-year-old accountant. “When I think about having to work, and the economic pressure, I think having one child is enough.” An increasing number of women in China are making the same choice. The number of new births in China fell by 2m last year to 15.2m — the second consecutive year of decline since China repealed its controver-
sial “one child” policy in 2015. China’s population expanded by 0.38 per cent last year — a rate comparable with western European countries. That was the slowest pace since 1961, when the country was struggling with the aftermath of a famine that killed about 40m people. While the population is growing, Beijing estimates it will peak in 2029 at about 1.44bn, before declining. Some have argued this signals economic woe for the country, as a shrinking working age population curbs the amount of goods and services that can be produced. “A decline in the population of young people and their smaller number of children ought to have profound repercussions for the Chinese economy,”
said Wang Feng, a demographer at the University of California Irvine. As well as overall population decline, an ageing population will intensify the shrinking of China’s workforce. The number of people aged over 60 will reach 479m, or about one-third of the population in 2050, up from about 16 per cent today, according to estimates from researchers at Renmin university in Beijing. Population trends will reduce Chinese GDP growth by 0.5 per cent annually over the next few decades, said Prof Wang, a trend that would become more pronounced as growth slowed. “A half percentage point off a 6 per cent growth rate is a lot more benign than a half percentage off when the growth rate drops to 3 per cent,” he said.
S airlines and the Federal Aviation Administration are coming under heavy pressure from politicians, passengers and some unions to ground the Boeing 737 Max aircraft involved in two deadly crashes in five months. The FAA is one of the few major aviation regulators to allow the 737 Max to remain in the air after a number of authorities grounded the plane or banned it from their skies. That has led to what experts say is an unprecedented rift between the world’s main flight safety agencies. Boeing and the FAA were facing the prospect of congressional hearings into the issue, as a growing number of politicians weighed in to demand action and it emerged that pilots had reported problems with the Max 8’s automated flight control system that was believed to be involved in a Lion Air crash in October in Indonesia. The FAA maintained that the plane was safe in a new statement released late on Tuesday. That came at the end of a day when European and Asian regulators acted to stop flights of the aircraft, a new version of Boeing’s best-selling 737. The EU issued a continent-wide ban of both the Max 8 and the Max 9, another variant of the plane. The FAA said other civil aviation authorities had provided no data that would merit a grounding, adding: “The FAA continues to review extensively all available data and aggregate safety performance from operators and pilots of the Boeing 737 Max. Thus far our review shows no systematic performance issues and provides no basis to order grounding the aircraft.” Southwest Airlines and American Airlines, the two US carriers that fly the jet, also continued to defend it as safe, as did pilots’ unions for both companies. The Air Line Pilots’ Association International said “we caution against speculation about what may have caused the accident”. Passengers, however, vented their frustration and fear on the social media sites of Southwest and American Airlines. When Southwest customer Tracy Harley asked the airline, via its Twitter account, “how can I see if my flight tomorrow morning is scheduled for a Boeing 737 Max 8?”, Southwest provided a primer on how to see which aircraft is used on which flight. “Hey, Tracy! Great question. To tell if your flight is a Max 8 flight, pretend you’re booking a new flight from the homepage, and click on your specific flight number on the flight selection page of http://Southwest.com — it will be designated as 737 Max 8. — Taylor” Nerves were frazzled on the Twitter account of American, where one customer said the airline was “pathetic” to trot out the “same canned reply” to every 737 Max question: “We are confident in the safe operation of all our aircraft.” Sunday’s crash of a 737 Max 8 flown by Ethiopian Airlines, in which 157 were killed, came just five months after a Max 8 owned by Indonesia’s Lion Air plunged into the sea shortly after take-off, killing all 189 passengers and crew. A preliminary report on the Lion Air disaster found that pilots had been bedevilled by a new stall-prevention feature on the 737 Max which erroneously kicked in during the flight.
Thursday 14 March 2019
COMPANIES & MARKETS
@ FINANCIAL TIMES LIMITED
Business attacks UK Northern Ireland tariff plan for no-deal Brexit Pressure mounts on DUP, amid warnings contingency plan will treat region differently ARTHUR BEESLEY, DELPHINE STRAUSS AND JIM PICKARD
ritain has set out proposals to set up a different customs regime for Northern Ireland from the rest of the UK in a no-deal Brexit, infuriating businesses, which compared the plan to a “punch in the face” and stepped up pressure over the issue on the region’s Democratic Unionist party. The plans, set out as part of government preparations for a new global tariffs regime if Britain leaves the EU without a deal, would not impose any duties or checks on goods crossing the land border into Northern Ireland, regardless of whether they come from the EU or beyond. The regime is intended to ensure no hard border on the island of Ireland. It would therefore open up the Northern Irish goods market to competition from across the world, while introducing checks for products crossing the Irish Sea to the rest of the UK. “It actually creates a unique economic status in Northern Ireland where we are different from the rest of the UK,” said Stephen Kelly, chief executive of Manufacturing NI, an industry group. “[This leaves us] with one door being shut in our face and one door being thrown open to allow the world in to punch us in the face.” Since the system would contrast with the regime elsewhere in the UK, it would require checks of 100 per cent of agricultural products on the route. The European Commission said that it would “carefully analyse the compliance of the UK plan with World Trade Organization law and the EU’s rights”, since its “differential treatment of trade on the island of Ireland, and other trade between the EU and the UK” raised concerns. David Henig, at the European Centre for International Political Economy, a think-tank, described the separate treatment of Northern Ireland as a clear breach of WTO rules that would be hard to overlook, given the supply chains criss-crossing the border, he said. Mr Henig added that the absence of checks at the Irish border as “an obvious smugglers’ charter” that would not be sustainable. Brussels confirmed it would impose standard WTO tariffs on imports from the entire UK — including Northern Ireland — in the event of no-deal. Allie Renison, head of Europe and trade at the Institute of Directors, said companies in Northern Ireland would be put at a competitive disadvantage and would be left “struggling to hold
their own overnight”. Manufacturing and agricultural businesses piled pressure on DUP over the issue, highlighting that under a Brexit deal rejected by MPs on Tuesday, Northern Ireland would have instead had access to markets in both the EU and the rest of the UK. The DUP, which provides Theresa May’s government with its majority in parliament, has consistently opposed the deal, because of its inclusion of a “backstop” provision that could treat the region differently from the rest of the UK to avoid a hard border. But the contingency tariff plan, which in the first instance would apply for 12 months, would itself treat the region in a different way from the rest of the UK. “In the space of 12 hours we’ve moved from the potential of the best of both worlds to the worst of all worlds,” said Mr Kelly, referring to Tuesday’s vote against Mrs May’s deal. Angela McGowan, Northern Ireland director of the CBI business lobby group, said the tariff proposal defied British government pledges to create a trade policy that worked for all UK regions. “It flies in the face of previous promises not to create the conditions for a hard border in Northern Ireland,” she said. “It’s going to leave the region highly exposed economically and politically.” Under the plan there would be new checks away from the Irish border to protect the biosecurity of the island of Ireland. There would be a new “designated entry point” in Northern Ireland where animals and animal products from outside the EU would require certification and pre-notification before arriving in the rest of the UK. There would also be new import requirements on a “very limited” set of goods such as endangered species and hazardous chemicals. Mats Persson, a former Downing Street adviser who now heads Brexit strategy for the accountancy firm EY, said that, while the proposals would help UK importers and consumers overall, they would create a clear incentive for “leakage of business” from Northern Ireland, where exporters would face EU tariffs, to the Republic of Ireland. He said that while the backstop could have established Northern Ireland as a base for businesses selling into both the EU and the UK, many agrifood companies with operations on both sides of the border might now consider moving jobs to Ireland.
The absence of checks at the Irish border has been labelled a ‘smugglers’ charter’ © Neil Hall/EPA
Oil groups face dilemma on climate change
Producers under pressure to show they take threat seriously but can survive lower consumption ANJLI RAVAL AND ED CROOKS
limate change presents oil producers with a dilemma. If the world is to meet the goal of the Paris agreement and keep the rise in global temperatures to “well below” 2 degrees Celsius, it is very likely that by 2040 oil consumption will have to fall. But oil companies want both to say they are taking the threat seriously, in response to pressure from investors, politicians and the public, and to hold out the promise that they can continue to grow. Many of the oil executives attending a major energy conference in Houston this week wanted to put across the same message about how they planned to tackle that dilemma. Even if demand does fall in the coming decades, they say, they will be resilient enough to thrive. Under the restrictions imposed by the carbon emissions targets, it will be a case of survival of the fittest
“We need to be able to be the last ones standing, as that production begins to decline,” said Wael Sawan, newly appointed as Royal Dutch Shell’s head of exploration and production. “I’m not in a position to guess whether that is going to be 2030, 2040 or 2050. What I can do is make choices today that build resilience in the portfolio that allows us to be robust when that happens.” It is quite possible that governments will not, in fact, take sufficient action to achieve the 2C goal. Even the commitments for emissions cuts submitted to the Paris summit in 2015 would only limit warming to 2.7-3.7C, models suggest. But the threat of a decline in oil demand over the next 20 years, well within the lifetime of many energy projects now under development, is forcing every producer to respond. The International Energy Agency’s “sustainable development”
scenario, consistent with limiting the temperature increase to 2C, envisages oil consumption of 70m barrels a day in 2040, a fall of roughly 30 per cent from today’s levels. To secure the future of their businesses, oil companies are trying to make their barrels the lowest cost to produce. Part of the work has already been done in the years since the 2014 price downturn. The energy majors have reduced costs by about 40 per cent, are making better use of existing infrastructure, rather than building new offshore platforms, and are more reluctant to plough billions of dollars into megaprojects that will take many years to complete. BP chief executive Bob Dudley said in a speech at the conference: “We have also developed a level of discipline on costs and capital that I think is here to stay, one that’s helping drive improving returns and is reassuring shareholders.”
Sterling and gilts muted after Hammond’s Spring Statement Focus remains squarely on Brexit votes ADAM SAMSON AND ALICE WOODHOUSE
terling held on to gains while gilts were little changed as investors broadly looked beyond the chancellor’s Spring Statement and remained focused on Brexit politics. The pound was 0.64 per cent stronger from Tuesday’s fix at $1.3157. Sterling also posted robust gains against the common currency, up 0.6 per cent around lunchtime in London. The market reaction to Philip Hammond’s Spring Statement was broadly muted despite a downgrade to the government’s UK economic growth forecast for this year to 1.2 per cent, from an autumn forecast of 1.6 per cent. Fixed income traders also appeared unfazed by a report by the Debt Management Office that said the government plans to issue £114.1bn in sovereign paper this year. The overall figure is lower than the £123bn projected by City
fixed income analysts in a poll conducted by Reuters. Issuance will be spread fairly evenly between short, medium and long term debt. The two-year gilt yield was up 2.6 basis points at 0.742 per cent, while the 10-year was up by a similar margin to 1.186 per cent. Yields rise when prices fall. “We expect ongoing safehaven demand and sizeable QE buybacks to ensure this increase in issuance is easily digested by the market,” said UBS analysts ahead of the DMO statement. Currency and bond traders remained fixated on Brexit after prime minister Theresa May faced a parliamentary rebuke on Tuesday night over the revised Brexit pact she negotiated with the EU. The loss has shifted control over Brexit from the PM to MPs, political analysts and currencies strategists said. That means a vote later on Wednesday over
whether Britain should exit the bloc without a deal, and another on Thursday on whether Brexit should be extended past March 29 will take centre stage. “Today, the Commons will likely vote to rule out leaving with no deal and tomorrow for the government to request a Brexit extension beyond the current 29 March deadline,” said Sue Trinh, an FX strategist with RBC in Hong Kong. George Cole, analyst at Goldman Sachs, echoed that view: “we now expect an Article 50 extension, and our economists’ base case remains that a deal is eventually passed, which should lead to a modestly stronger sterling and higher Gilt yields.” Meanwhile, Dean Turner, UK economist at UBS Wealth Management, said the bank had advised clients not to take “directional views on sterling [given recent volatility] and continue to hedge downside risks.”
Thursday 14 March 2019
The ECB after Draghi: ‘You need an actor who can act fast’ How wealthy Americans Mario Draghi used bold policies to rescue the eurozone, but will his successor have the firepower to deal with any global slowdown?
Criminal complaint alleges $25m bribery scheme to secure places at top universities JOSHUA CHAFFIN
n the eyes of some, Mario Draghi has a rock-star quality about him. How else to explain the clamour for selfies from MEPs when the European Central Bank president turned up for his last appearance at the European parliament in January. Best known for declaring in July 2012 that he would do “whatever it takes” to protect Europe’s single currency, the central banker was in Strasbourg to accept a plaque bearing the words, “To President Mario Draghi for saving the euro”. It represented the start of a farewell tour for the 71-year-old Italian who steps down in October after eight turbulent years in charge, a period during which he changed the DNA of the institution. The achievement of Europe’s current economic leaders, which include not only Mr Draghi and those in his inner circle but also Germany’s chancellor, Angela Merkel, is to have kept the eurozone together during the most serious crisis in its 20-year history. To do that meant carrying out root-and-branch reform of how the central bank operates, changing it from an institution built in the mould of Germany’s Bundesbank and obsessed with keeping inflation in check to one more willing to buy insurance against a vicious cycle of market panic and collapsing growth. “Under his leadership the ECB has broadened its toolbox,” says Roberto Gualtieri, chair of the European parliament’s economic and monetary affairs committee. A reference to the bond purchases worth trillions of euros, negative interest rates and using the central bank’s credibility to signal that euro borrowing will remain cheap for years to come. “The ECB now has a toolbox comparable to the Federal Reserve’s.” Yet Mr Draghi is handing over the ECB reins at a time when the European economy is again looking vulnerable. Growth is slowing across the eurozone and the chances of a recession are on the rise. With inflation only around 1.5 per cent at a time when interest rates are at zero, even the risk of a Japanstyle stagnation, which haunted the region during the euro crisis, has not completely disappeared. These worries forced Mr Draghi to make an about-turn last week on plans to slowly remove crisisera stimulus and offer fresh loans to eurozone banks, having spent the past two years trying gradually to wean them off the ECB’s easy money policies. And amid the backslapping celebrations of Mr Draghi’s legacy there is growing concern over whether his successor — yet to be selected — will have sufficient ammunition to deal with a long-term slowdown. With rates at record lows and the bank running up against limits on the amount of government bonds it can buy, the new ECB chief will need to be inventive if the region is hit by fresh shocks. “Trade tensions will prevail, as will some of the political uncertainty,” says Laurence Boone, chief economist at the OECD, which last week slashed its projection for eurozone growth from 1.8 per cent to 1 per cent. “Our main message is that the ECB cannot do everything — there should be some help from
‘get their kids into school’
the fiscal and structural side. “[But] what we have observed in the past is that when there is a sudden shock — and political risks tend to produce these shocks — you need an actor who can act fast,” she adds. It seems odd to say it now but Mr Draghi won the position only by accident. The job was expected to go to Axel Weber, then the Bundesbank president. But in 2011, with the gulf between Germany’s top central banker and the rest of the region’s monetary policymakers widening over the crisis in Greece, Mr Weber decided he could no longer succeed Jean-Claude Trichet as ECB chief and left his Bundesbank post that year. It left the way open for Mr Draghi. Although he joined the ECB direct from the Bank of Italy, he was no career central banker. His time at Goldman Sachs and the Italian Treasury had given him an excellent understanding of how markets — and politics — worked. By the end of 2011 both Mr Weber and Jürgen Stark, the other German on the ECB’s governing council, had quit, exposing the scale of the task facing Mr Draghi in persuading Germany’s conservative political and economic establishment to buy into the bank’s response to the eurozone financial crisis. The early signs were positive. Bild handed a Prussian helmet to Mr Draghi following an interview in which he convinced journalists at Germany’s most widely read newspaper that his ECB, like the Bundesbank, would protect the currency against inflation — an ever-present fear in the German mindset following the hyperinflation of the 1920s. However, the moment that has defined Mr Draghi’s tenure, and initially strained relations with Berlin, came in the summer of 2012, when he declared that he would “do whatever it takes” to protect the single currency against speculative bets on its demise as the eurozone crisis worsened. With markets beginning to panic that the currency area would split, the cost of borrowing for highly indebted member states — including Italy and Spain — had soared, threatening to push Rome or Madrid into default. The impact of Mr Draghi’s pledge to buy government bonds in potentially unlimited quantities was remarkable. In the months after, borrowing costs across the region’s periphery fell closer to those of core countries such as Germany. In the eurozone’s economic powerhouse, the declaration ignited suspicions that the region’s new monetary guardian was shifting away from the Bundesbank’s hard-money doctrine.
Bild even asked for its helmet back. Yet Mr Draghi’s bold response, it later emerged, had the implicit backing of Ms Merkel. “When Mr Draghi said he would do whatever it takes, it was clearly not thought through; he did not have that text prepared,” says David Marsh, a historian of the euro area and the Bundesbank. “But the crucial thing was that Ms Merkel backed him. [She] has an instinctive reaction of saving herself and knew a good thing when she saw it. The next ECB president, in a similar situation, may not be so fortunate.” Ms Merkel is set to step down as German chancellor at some stage and the political make-up across Europe, with the rise of populist anti-EU parties, could look very different after European elections in May. Mr Draghi also managed to isolate the Bundesbank president, Jens Weidmann, within the governing council by winning implicit support from the ECB’s German executive board member, Jörg Asmussen — a move that in effect split the German economic elite. “If we compare the [bond-buying programme] of Trichet with the OMT [outright monetary transactions] in 2012, the success of the latter versus the failure of the former is due to a change in political context,” says Lucrezia Reichlin, professor of economics at London Business School. “Draghi showed a high level of political sensitivity. His main virtue has been high political skills and effective communication.” Economic growth and inflation remained stagnant after the intervention, forcing the ECB to become the first main central bank to enter the topsy-turvy world of negative interest rates. In 2015 it followed the Federal Reserve and the Bank of England by beginning a €2.6tn bond-buying quantitative easing programme. But it faced immediate resistance from ECB hawks, worsening relations with two of the candidates tipped to replace Mr Draghi — Mr Weidmann and Klaas Knot, his counterpart at the Dutch central bank. However, the entire council including the hawks declared that QE was legal, even if it was not desired, to provide some cover against criticism of the bond purchases in northern member states. Three years on most now think the actions helped boost growth. “If you look at the massive fall in unemployment in the eurozone over the past few years, then you can see there has clearly been a massive stimulus,” says Richard Barwell, head of macro research at BNP Paribas Asset Management. “It was either down to Draghi deploying negative rates and QE, or Santa Claus. My money is on Draghi.”
illiam McGlashan had to make his son a football player. And quickly. In exchange for a $250,000 payment, a California-based universityadmissions consultant had arranged for the younger McGlashan to skirt the normal application process at the University of Southern California and be accepted as a prized American football recruit. A “side door” into the university, the consultant, William Singer, called it. The problem was that the boy did not play football. They did not even have a football team at his secondary school. “We have images of him in lacrosse. I don’t know if that matters,” offered Mr McGlashan, a top executive at the private equity firm TPG and co-founder with rock star Bono of the Rise Fund, a socially conscious investment vehicle. “They [USC] don’t have a lacrosse team,” Mr Singer responded. Then he took matters into his own hands.
Singer told one prospective client, Gordon Caplan, the co-chairman of the prominent US law firm Willkie Farr & Gallagher. In extensive phone conversations authorities recorded with 32 parents, Mr Singer comes off as an indispensable problem-solver and quasi-magician — a man able to spare one client, the actress Lori Loughlin, the apparent indignity of having to send her daughter to Arizona State University. “I can make [test] scores happen, and nobody on the planet can get scores to happen,” he boasted to one client of his consultancy, The Edge College & Career Network. “She won’t even know that it happened. It will happen as though, she will think that she’s really super smart, and she got lucky on a test, and you got a score now. There’s lots of ways to do this. I can do anything and everything, if you guys are amenable to doing it.” All told, Mr Singer collected about $25m in bribes over a seven-year period, according to authorities.
Yale University is one of the elite institutions at the centre of the alleged admissions bribery scheme © AP
“I’m going to make him a kicker/ punter,” he decided, listing specialist positions in the sport often occupied by the slight of frame. “I’ll get a picture and figure out how to Photoshop and stuff.” “He does have really strong legs,” Mr McGlashan joked. The two men bantered about the deal, and how Mr Singer had made other applicants appear to be champion water polo players for the same purpose. Months earlier, the 55-yearold Mr McGlashan had paid Mr Singer $50,000 to have someone doctor his son’s university entrance exam. “Pretty funny. The way the world works these days is unbelievable,” Mr McGlashan observed. Those discussions are reproduced in a criminal complaint filed by the Justice Department on Tuesday after an investigation into bribery in college admissions that resulted in charges against 50 individuals — including prominent actors and investors — and involved some of the most prestigious names in US higher education. At the centre of the scheme was Mr Singer, 58, who was fired in 1988 as a high school basketball coach in Sacramento because of his abusive behaviour toward referees. He later reinvented himself as a svengali in Newport Beach for his apparent mastery of the increasingly cut-throat university admissions game. On Tuesday Mr Singer pleaded guilty to federal charges including racketeering conspiracy and obstruction of justice. “OK, so, who we are — what we do is help the wealthiest families in the US get their kids into school,” Mr
US college admissions are supposed to be a merit-based business. But it has always had its set-aside places for children of alumni and those willing to fork over enough money through donations. At a time when the affordability of university education is emerging as a big US political issue, the revelation that the moneyed elites had gamed the system for their children — at the expense of more deserving candidates — is likely to be seized on by politicians. Daniel Golden won a Pulitzer Prize for his book, The Price of Admission, which detailed the underside of the business at a time when globalisation was raising the value of a prestigious university degree — and making it evermore competitive for students to access them. Writing for The Guardian newspaper in 2016, Mr Golden called it the “grubby secret of American higher education: that the rich buy their underachieving children’s way into elite universities with massive, tax-deductible donations”. He claimed that President Donald Trump’s son-in-law Jared Kushner — not regarded as a brilliant scholar in high school — was accepted by Harvard not long after his father Charles made a $2.5m donation to the university. Mr Singer called that “the backdoor”. At The Edge, he came up with a “side door”: arranging bribes for tennis, sailing and soccer coaches so that they would sneak his applicants into school as ostensible sports stars.
Thursday 14 March 2019
FortheRecord Full text of National Housing Fund (Establishment) Act 2018
Thursday 14 March 2019
Thursday 14 March 2019
Thursday 14 March 2019
Benue PDP restrategises for guber, state assembly re-run elections BENJAMIN AGESAN, Makurdi
he Benue State chapter of the People’s Democratic Party (PDP) has gone back to the drawing board in readiness for the re-run elections ordered by the Independent National Electoral Commission (INEC) in the state. Governorship and State Assembly elections held in the state last Saturday were declared inconclusive by INEC following cancellation of votes in a number of polling units across the state by the electoral umpire. Despite a lead margin of over 81,000 votes established by Governor Samuel Ortom of the PDP over his closest rival, Emmanuel Jime, of the All Progressives Congress (APC) in the guber race, the number of cancelled votes were declared by INEC to stand at over 121,000. The electoral umpire therefore, declared that the number of can-
celled votes was higher than Ortom’s margin over Jime’s, as such, the election was inconclusive and a
re-run is to be conducted in the cancelled polling units within March 24. But the position of INEC has
Okowa to unveil roadmap anchored on prosperity, peace, progress Francis Sadhere, Warri
elta State G overnor, Ifeanyi Okowa on We d n e s d a y s a i d h e would soon unveil his roadmap for a stronger Delta anchored on three pillars of prosperity, peace and progress. Governor Okowa, who spoke during a state-wide broadcast on the occasion of his re-election for another four-year term, said his victory was a motivation for him to do more. The Delta State Governor-elect assured the people that his administration shall raise the bar of good governance even higher in his second tenure. “I am resolved to leave a legacy of a Delta State that will be the pacesetter in the federation,” he said. Governor Okowa commended the Independent National Electoral Commission and the law enforcement agencies for standing firm and resolute to deliver a free, fair and credible election, saying this was the pathway to sustainable democracy in Nigeria. “First, I enjoin all Deltans to
thank God for what was largely a peaceful and hitch free election except for one or two skirmishes that were quickly brought under control. Admittedly, there was palpable tension and apprehension in the days leading up to the election, instigated by the unguarded utterances of a few desperate politicians who threatened to make the election a do-or-die affair. “However, we put our trust in God who ‘frustrates the devices of the crafty, so that their hands cannot carry out their plans.’ And to God be the glory, peace reigned during the election and the will of God prevailed,” Okowa said. Okowa dedicated his victory to the good people of Delta, saying they were the true winners in the election. He said, “You are the true winaners for standing firm and unyielding in your support of my administration. You are the true winners for refusing to succumb to threats and intimidation. You are the true winners for not allowing yourselves to be blackmailed or manipulated by lies, deceit and propaganda. “The mandate you have given
me is very comforting, reassuring and liberating. It is a massive vote of confidence in the work we have done together in the last three years and nine months. While I may not need to catalogue our achievements here, there is no gainsaying the fact that under my leadership Delta State has witnessed huge developmental strides in road and physical infrastructure, health, education, ruralurban integration, human capital development and sports. These have been attested to by the multiple awards from various organisations in the last one year. “This renewed mandate is also a vote for unity. I won in all three senatorial districts with overwhelming majority, a clear indication that Deltans have recognised the oneness in us, as well as our shared values and aspirations. You voted decisively to reward excellence, hard work and performance.” Governor Okowa solicited the cooperation of Deltans, stressing that it was “time we reconcile, forget the things of the past, and contribute our individual quota to the development of the state, irrespective of our political inclinations.”
been roundly contradicted by legal experts who contend that while the number of registered voters in the effected polling units may be over 121 thousand as claimed by the electoral umpire, the number of PVCs collected by voters in those polling units is less than 50 thousand. Former Commissioner of Justice and Attorney-General in Benue State, Alex Ter Adum, who was the State Collation Agent/Returning Officer of PDP, registered strong protestation against the position of INEC that the election was inconclusive, and called for the declaration of Governor Ortom as winner of the election and duly elected governor of the state for a second term. Chairing a strategy meeting of the party yesterday at the Government House, Makurdi, Deputy Governor of the state, Benson Abounu, charged party members to be steadfast and vigilant going into the coming re-run. Abounu particularly called on
members of the party to be wary of the antics of APC which he said has already been defeated and stands no chance of overturning the huge deficit it has suffered against PDP. But the D eputy G overnor warned that the opposition might be planning on rigging the re-run election as well as perpetrating violence in the affected areas and party members must guard against this. Benue PDP State Chairman, John Ngbede, highlighted the areas where the re-run elections are to be held and the voters’ strength in the various polling units, and called on party members in those areas to leave no stone unturned to ensure the party emerges victorious in the coming polls. Far-reaching decisions were taken at the meeting preparatory to the coming polls which various speakers in attendance expressed strong optimism PDP has all it takes to win.
Monarch to politicians: Stop politicising Army …Decries high influx of fake soldiers during elections he Olowu of Kuta, Osun State, Hammed Adekunle Makama, has warned politicians to stop politicising activities and role of the Nigeria Army in ensuring the security of the nation. Olowu in a statement on Wednesday said the report from some states in the South-South indicated that military were used to perpetrate violence on innocent citizens and disrupte electoral process. He warned desperate politicians to stop dragging the military into politics because of its dire consequence on the nation’s stability and national cohesion. The monarch maintained that the army represents the nation’s symbols of unity, stressing that the onus is on them to remain apolitical. He decried a situation whereby some politicians armed their thugs in military fatigues to cause mayhem, saying this is not acceptable. According to him, “In the process of using the army to protect the will of the people, especially in Rivers
State, some of them were attacked and hospitalised. We owe our military high regards because of their oath to protect our territorial integrity and if the need arises, lay down their precious lives for the country. “We believe our military is apolitical and that explains why the Chief of Army Staff, Lt Gen. Tukur Yusuf Buratai promised to set a high powered investigative panel to unravel the level of culpability of any disgruntled army officer if any, before , during and after the election. “The international observers commended the Army for maintaining peace and displaying utmost professionalism during the presidential and National Assembly elections conducted a forthright ago. “I also want to sympathise with traditional rulers in the South-South and South-East and urge them to continue to be the symbol of peace and unity that the office of traditional institution has conferred on them,” the statement said. Olowu also canvassed for an endowment fund to take care of families of those who pay the supreme sacrifice while defending Nigeria.
Governor Ifeanyi Okowa is their choice. Down here in Warri South they have also spoken that Austin Oroye is also their choice. “The people of Delta South, including Warri South, have also shown that Senator James Manager is their choice. “We also voted massively for Atiku Abubakar and we believe that power belongs to God and he will give it to him in due time,” he said. “Today we are promising him (Okowa) more and more support
just to tell the world that Delta is a PDP state. “I want to assure everybody that is here that we will continually follow His Excellency, Governor Ifeanyi Okowa. We will do what he is doing right and replicate it here in Warri South Local Government Area.” The Warri South PDP chairman, Johnson Agbeyegbe, said the victory of Governor Okowa was a clear message to Nigerians that Delta State is a PDP state.
Okowa’s victory reflects people’s choice - Council Boss Francis Sadhere, Warri
arri South Council Chairman, Michael Tidi, on Wednesday said the victory of Delta State Governor, Ifeanyi Okowa after the just concluded gubernatorial and state Assembly elections was a reflection of the people’s choice. Tidi said this during a victory party/Thanksgiving organised to celebrate the victory of Governor
Okowa held at the Warri South Council Secretariat, Warri. The Warri South Council boss said Governor Okowa’s victory was as a result of hard work and his acceptance by the people of the state. While thanking the people of Delta and Warri South in particular, for voting Governor Okowa for a second time, Tidi said he was happy that the council gave Governor Okowa more votes unlike the last election in 2015.
“We are here to thank God for what he has done. If you can remember, in 2015, we were only able to give PDP 22,000 votes. But today, Warri South was able to give Governor Okowa over 34,000 votes,” Tidi said. Tidi said Warri South Council Area will continue to support Governor Okowa’s administration, adding that the governor deserved the victory. “Deltans, particularly Warri South have shown the world that
Thursday 14 March 2019
Politics & Policy
Okorocha and the political uncertainty ahead pulsion from the ruling APC.
hen successful candidates in the j u s t- c o n c l u d e d 2019 National Assembly elections gather at the International Conference Centre, Abuja today, Thursday, March 14 to collect their certificates of return from the Independent National Electoral Commission (INEC), one man who would have wished to be there is Rochas Okorocha, the outgoing governor of Imo State. But barring any last-minute change of mind by the electoral umpire, Okorocha will not be among the recipients. INEC published the list of newlyelected federal lawmakers on its website ahead of the presentation of the certificates of return, but Okorocha’s name was not on the list of elected senators. In the slot for the three Imo Senatorial districts, only Senator-elect Onyewuchi Ezenwa Francis (Imo East), who won on the platform of the People’s Democratic Party (PDP), was listed. Imo North’s slot was empty except for a “Supplementary” remark. For Imo West Senatorial district, whose seat Governor Okorocha contested, it was blank except for an INEC remark, “Declaration made under duress.” Okorocha had contested the Imo West Senatorial seat on the platform of the All Progressives Congress (APC). He was declared winner by the returning officer for the Senatorial district, Innocent Ibeawuchi, who later said that he was made to announce Okorocha as winner “under duress”. The political atmosphere in Imo
State has never been as electrified as it was recently. Ahead of last weekend’s gubernatorial elections, the most typical discussion amongst groups in Imo State was the question of who wins the race. Interestingly, a former Deputy Speaker of the House of Representatives and candidate of the Peoples Democratic Party (PDP), Emeka Ihedioha, was on Monday declared winner of the governorship election in the state. Ihedioha polled 273,404 to defeat candidate of the Action Alliance (AA), Uche Nwosu, Governor Rochas Okorocha’s son-in-law who polled a total of 190,364. The candidate of the All Progressives Grand Alliance (APGA), Ifeanyi Ararume, came third with 114,676, while Hope Uzodinma of the APC polled 96,458. Uzodinma would have had it easy. He would have flown on the wings of President Muhammadu Buhari’s victory in the presiden-
RBM drums support for Buhari, winds up operations Iniobong Iwok
he Re-elect Buhari Movement (RBM), one of the support groups that rallied support for President Muhammadu Buhari’s re-election, has urged Nigerians to support President Muhammadu Buhari in his second term, while praising them for voting massively for the president in the just concluded presidential election. The group in a statement by its convener, Emmanuel Umohinyang, noted that Buhari was on a mission to re-invent the country, stressing that support of Nigerians would make the Buhari administration consolidate on its achievements in its second term, The group, which as formally ended its operation, however, expressed appreciation to volunteers for standing behind President Buhari’s re-election. According to the statement, “Sequel to the re-sounding victory of President Muhammadu Buhari in the February 23, 2019 Presidential election, the existence of Re-Elect Buhari Movement (RBM); one of the support groups that volunteered to work for the re-election of the President has officially come
to a close. “It has become expedient to dissolve membership of the Re-Elect Buhari Movement as currently constituted since the main objective of founding the Movement has come to a successful end. “It is no longer feasible to keep volunteers of the Movement as a functioning group in the face of the present reality, hence the need to formally dissolve same.” “On behalf of President Buhari, I therefore, extend a warm appreciation to every member of the Movement and wish them well in their various future endeavours. “I enjoin them to always count themselves as members of the progressive team that worked for the victory of President Buhari who is on mission to rebuild the country ravaged over the years by corrupt leadership that thrived much on primitive accumulation of wealth,” the group said. It would be recalled that about a year ago, the Re-Elect Buhari Movement was founded as a volunteer support group with strong interest and determination to work for the re-election of President Muhammadu Buhari who they considered as working assiduously for the greater interest of Nigeria.
tial election. However, the crisis within the APC in the state, caused by Okorocha’s ambition to choose h i s re p la c e m e nt b e ca m e t h e party’s Achilles heel. The race was to be a straight one between candidates of the APC and the PDP, but the controversy that trailed Uzodinma’s emergence disrupted that design. The decision of Okorocha to oppose his party for the governorship election after wielding massive support for President Buhari in the presidential polls became the wild storm that threatened his political career. The cunning politician who successfully slotted in the ‘iberiberism’ slogan into the Nigerian political lexicon is now in for an unwelcoming political future. He is currently stuck in murky waters of politics, a situation worsened by his suspension and recommendation for ex-
How it all started Nwosu had won a controversial governorship primary organised by his father-in-law Okorocha and other stakeholders, but a presidential panel conducted a separate primary which produced Uzodinma as the candidate. Since then, the Imo State APC’s house of hullabaloo has not found peace. The dispute set the outgoing Governor Okorocha against the national leadership of the party, represented by Adams Oshiomhole, the party chairman. It also saw several breakaways and realignments of major actors within the Imo APC fold. Okorocha had after the primaries asked Nwosu to contest the governorship seat under the AA, a party he (Okorocha) formed in 2005, while he (Okorocha) contested the Imo West Senate seat under APC. Though Okorocha was declared “winner” of the senatorial seat “under duress”, the governor’s victory was short-lived by the crisis that followed – as evidenced in the INEC decisions. Okorocha should have been smarter to read the handwriting on the wall regarding his unwelcoming political future when INEC said it will not issue certificate of return to any candidate declared winner of an election under duress. There were widespread intimidation and harassment of the commission’s staff during the last presidential and national assembly elections. “The commission will not tolerate the act of holding our officials hostage and forcing them to declare winners under duress. Where such occurs, the commission will
not reward bad behaviour by issuing them certificates of return,” Mahmood Yakubu, INEC chairman, told participants at an inter-agency consultative committee on election security held in Abuja. Okorocha, who through his Chief Press Secretary, Sam Onwuemeodo, reacted to the governor’s suspension notice from the APC, alleged that APC National Chairman Oshiomhole was determined right from the outset to destroy the party in the South-East. The governor had accused Oshiomhole of having a hand in “all the crisis in the South-East states” arising from what he described as the fraudulent manner the national chairman conducted the party primaries. “And when the APC members across the nation are still celebrating the success of the party in the presidential and National Assembly elections, Oshiomhole in his wisdom or lack of it, felt that the best action in the circumstance is to suspend two governors who did well in the election, even when he played safe in 2015 and 2019 in Edo State without any known pressure. “Again, Oshiomhole coming up with the purported expulsion this time was only acting out of the fear that God in his infinite mercy could give Governor Okorocha a role to play in the Senate, in the overall interest of the nation. “Men like him hardly sleep with their two eyes closed. They always sleep with their eyes open because they have murdered sleep with their actions and inactions. And unfortunately for him, the purported expulsion can’t stand because the law has taken care of it even long before now,” Okorocha said.
Nigerian polls: Anxiety grips politicians as US compiles reports on election violence, irregularities Innocent Odoh, Abuja
ome Nigerian politicians are said to be gripped by anxiety over their alleged roles in the irregularities and violence that marred the 2019 general election in Nigeria especially the Governorship and State Houses of Assembly election in Rivers State and other places held on March 9, 2019. A source disclosed to BusinessDay on Wednesday that the US has been gathering information on these individuals whose actions have led to the death of dozens of people before, during and after the elections, adding that the US would slam appropriate sanctions on them as it had earlier threatened. “The US intelligence network has beamed its searchlight on certain individuals, who have shown desperation during the election and their actions have led to loss of lives. As I am talking to you now, they are jittery because of the US threats but they will not escape from it,” the source said. Nigeria held Presidential and National Assembly elections on February 23 and the Governorship and State House of Assembly elections on
March 9. However, the US on Tuesday, March 12, said that it is compiling reports on the elections that were marred by irregularities and violence, especially during the March 9 Governorship and state Houses of Assembly elections across the country. Assistant Secretary of State, Bureau of African Affairs, Tibor Nagy, said this during a telephone conference in Abuja on Tuesday, stressing that the US Government will give appropriate response to the issues surrounding the elections. He said that the US Embassy in Abuja and the Consulate in Lagos led by Ambassador, Stuart Symington, have been active in providing “phenomenal guidance” to Washington on how the government should and should not respond to the election-related matter. “So just rest assured that the US Embassy in Abuja and Consulate in Lagos are actively involved and are doing absolutely superb job to monitor events there and provide guides on how Washington should react on whatever events there,” he said. This response was coming on the heels of reported cases of violence allegedly perpetrated by some security agents to rig elections in parts of
the country especially in Rivers State and other parts of the country, where elections have been declared inconclusive by the Independent National Electoral Commission (INEC). The US and the British Government had before the polls issued a joint statement, threatening to impose visa restrictions and other forms of punishment on those who perpetrate election related-violence. “We and other democratic nations will be paying closer attention to action of individuals who interfere with the democratic process or instigate violence against the civilian population before, during or after the election. “We will not hesitate to consider consequences including visa restrictions for those found to be responsible for election -related violence,” the US had warned. The United Kingdom had also condemned the alleged action of the military in disrupting elections in Rivers State and called on the army authorities to fish out the culprits. However, the army in a statement by its spokesman, Sagir Musa, denied military involvement in the alleged violence, stressing that the hoodlums were thugs in military uniforms.
Thursday 14 March 2019
MADE IN ABA
What Ikpeazu can do for Aba leather industry GBEMI FAMINU
kezie Ikpeazu, governor of Abia State, was re-elected on March 9, 2019. The governor has for the past three years paid attention to Aba and has highlighted various policies to develop the commercial hub. Despite this, Aba is still in need of facilities and tools to achieve its potential. As a returning governor, his aim should continue with policies that will further develop the Aba, particularly its leather industry. Infrastructure is very important for any business to thrive. Making footwear can be easy with the use of sophisticated machines and production tools. Absence of infrastructure, however, makes production difficult and hurts capacity to create jobs and boost the gross domestic product (GDP). Aba shoe makers are hindered by lack of infrastructure and sophisticated tools. Roads in Aba are still poor while power is not readily available. The impact of this is that the majority of Aba shoe makers are using energy generating sets to power their factories. Furthermore,
the industry lacks tools to foster more productivity at a faster rate. Despite the lack of sophisticated tools, one million pairs of shoes are produced by more than 80,000 leather makers in Aba each week. With 48 million pairs
produced each year at an average price of N2,500 a pair, the industry is estimated at N120 billion. With the right machines and constant power, the industry has a potential to produce more than this. “We can double the
output if we have sophisticated machinery,” said Ikechukwu Anim, one of the shoemakers in Aba. Ikpeazu is expected to work on infrastructure deficit in the state in order to improve production and reduce the cost of produc-
tion of players. Likewise, Geometric Power may be supported with funds to enable them to kickstart power generation for those in Aba. Accessing loans and financial aids is quite difficult for those in the industry. Most of the artisans and business owners are not registered, neither do they have acceptable business plans, therefore, they cannot access loans from banks. Most of the artisans do not have adequate training, especially in the area of handling sophisticated machines. Artisans and business owners should be given adequate training to improve their handiwork and help them gain recognition in the global market. They should also be given business management trainings that will make them have a corporate outlook. This will grant them easy access to loans and financial aids. The Aba industry needs more patronage, even from the locals. Some people are of the belief that Aba-made products are of lower quality than foreign goods. But the export of various items made in Aba to other countries negates that belief. Furthermore the industry is in need of inves-
tors and partners that will inject funds, knowledge, experience and innovations into the business. Nigeria’s shoe hub, Aba, needs to partner with international companies in order to foster the desired growth and development needed. In 2017, Ikpeazu, signed a $1.5 billion deal with Huaijan Group, a Chinese shoe manufacturing firm. This was in a bid to improve the industry. More of this should be recorded in this second tenure. Ken Anyanwu, national secretary, Association of Leather and Allied Industrialists of Nigeria (ALAIN), told BusinessDay in Aba that entrance of foreign investors and partners would enable the industry to compete globally and make funds for expansion easily accessible. Analysts also say Aba getting more investors and foreign partners could reduce its infrastructure deficit as new investors will throw in money to improve this area. They add that it will attract funding to small-scale players. These are key things the industry needs in order to realise its goal of becoming a renowned industry with international standards.
NEXIM partners NIBRA Designs to automate shoemaking in Aba GODFREY OFURUM
igerian ExportImport Bank (NEXIM) says it will support NIBRA Designs Limited, a shoe production initiative in Aba, Abia State that intends to automate local shoe production. Abubakar Bello, managing director, NEXIM Bank, who revealed this at the ground-breaking ceremony of NIBRA Leather City Park, situated at Ogbuaku in Ukwa West Local Government Area of Abia State, explained that the bank would invest in the importation or manufacturing/local fabrication of machines that would make footwear production effective. Bello explained that NEXIIM wants to create a leather works cluster that would be marked for excellence in Nigeria, starting from Aba. “We’ve seen the potential in the leather sector of the economy and this has been further enhanced by
the National Leather Policy that the government recently established. What we want to do is to create a cluster and excellence in leather production in Nigeria. And we recognise that Aba is the place to start it from. So, when NIBRA came, we naturally and immediately
keyed into it. “Our intervention is going to be in two parts; first, is going to be direct to major investments that are coming and we are discussing how we will effectively do that. But there’s also a second part, where the stakeholders that are already in
this industry, will benefit from us. “At the National Economic Council, we made a presentation on state export development fund, where we intend to lend out as much as N1 billion to MSMEs and we have seen where we are going to inject
Abia State’s own. “Now with the capacity we believe will be created, we will invest in technology and processing in various clusters. We were in the market this morning and identified that most of the processes are manual. So, we also have the facilities in clusters like this. We can finance the importation or manufacturing/local fabrication of machine that will make their production effective. “By the grace of God, we are in partnership with NIBRA, the state and all other entrepreneurs, because the whole ecosystem is going to be built around it and NEXIM is here to support it and we are hundred percent behind you”. NIBRA shoe factory will be the largest in sub-Saharan Africa, leveraging world class Brazilian technology. The NIBRA facility will launch with an initial capacity of 10,000 pairs per day, growing to 100,000 in 5 years. The project is scheduled to be commissioned by the
fourth quarter of 2019 and NIBRA will employ 1,000 people for a start, growing to over 5,000 in the medium term. Under secured off-take arrangements for 100 percent of its initial installed capacity, NIBRA will serve domestic and international markets. Leather City, on the other hand, will provide opportunities to increase productivity and product quality for a significant number of the 120,000 individuals currently in Aba. For private enterprises, Leather City will offer infrastructure as a shared service and skills development training to the growing population of Nigerian entrepreneurs in the leather-related goods space. This will form part of a broader strategy to leverage the National Leather Policy of the Federal Government of Nigeria and develop the local supply chain to reduce dependence on imports as stakeholders improve the perception of made in Nigeria products.
Thursday 14 March 2019
news you can trust I THURSDAY 14 MARCH 2019
The morning after the elections The Public Sphere
here is a positive buzz in parts of the country over the outcome of the local elections of March 9. Wherever you are in Nigeria and around the Nigerian social media world, the excitement in Imo State grabs your attention. Folks in Imo State are the most satisfied with the outcome of 2019 gubernatorial elections. Imo State prepared a meal for their eze onye agwalam. He lived up to the wise saying that one man alone cannot eat up the food prepared by the community. Salutations, once again, to Ndi Imo for showing that they understand the score and upholding the culture of the people. Ndi Igbo do not do monarchy, particularly not so within a democracy. Next door in Abia State, Governor Okezie Victor Ikpeazu returned for a second term. His folks proved resilient,
formed alliances with their neighbours and ensured they did not drop the baton on their watch. Returning Ikpeazu is the easy part. Ikpeazu now must battle with himself. It is now a matter of legacy. What would stand against his name in 2023? The perception today is that he promised much but delivered very little. Senior civil servant Chudi Uwandu is from Mkpa. He is a decent man who travels Abuja to Mkpa in pursuit of community development. His remarks pre-election should inform Ikpeazu. Uwandu responded to my reminder about the Abia Charter of Equity and the imperative of returning Ikpeazu for a second term. “I am aware of the charter and had subscribed to it. But Chido, what vexes my Nkpa people is that our Governor, OVI, couldn’t do one km out of our major Nkpa road he started in over one year now. The road will get worse than it was before he began it when the rains return this year. My people see that road beyond the charter. Today, the portion done by Dr Orji Uzor Kalu, while he was Governor, stares us in the face and asks:”How market.” Although my stance on the performance of OVI has been, the devil you know is better than the angel you don’t, I suffer the pain of praising the Governor when the project started and being jeered by those who did not believe him
at the onset. Our Governor may be a good man and may be operating under unimagined circumstances, but nobody is explaining anything to us. Politics is about people’s welfare and caring for their feelings. However, methinks it is better to negotiate with a debtor than a new customer within this context.” Someone should tell Ikpeazu that people suspended their doubts to vote for him because of higher ideals and not as a reflection of approval. While he may not need their votes anymore, he should pay serious attention to the mirror. Does he like what he sees? He should listen more to the voices on the streets, from his UkwaNgwa territories to other parts of Abia State. Then he should strive for a positive legacy. The perception is that Abia State is the laggard of the South East. He can change this perception with action and not rhetoric. Congratulations and welcome to no excuses, Dr Ikpeazu. Ohanaeze’s Feedback This column received an important feedback just before the elections. I share with permission. It was a great delight to read your write-up on the Igbo Wars 3, as published in BusinessDay newspaper of 14th February, 2019. I assume there are two others before this one but I am yet to lay hands on them. Hence this mail. The articles are of interest to me: for the
He lived up to the wise saying that one man alone cannot eat up the food prepared by the community
education and the rich opinions contained therein and for their timing, in the context of where we are as Igbo people in the Nigerian nation. My other interest in the articles is institutional. I am the Secretary of the Strategy and Planning Committee of Ohanaeze Ndigbo. In my view, you speak eloquently to our situation, our needs and challenges as a people. I humbly request that you to kindly send me the full series i.e. Igbo Wars 1, 2 and 3; and, I crave your indulgence to permit me to circulate same to the members of our Committee for their information, education and appreciation. Obviously, we all may not agree on every point butcertainly we can agree on this: you made a very thought-provoking analysis and we can all benefit by learning from it. Thank you very much, Sir and remain blessed. Ferdinand N. Agu, MFR Secretary, Strategy and Planning Committee, Ohanaeze Ndigbo. Nwakanma is a Visiting Member of the BusinessDay Editorial Board and serves on the Adjunct Faculty at the School of Media and Communication, Pan Atlantic University, Lagos. Email chidonwakanma@ gmail.com.
2019 state-level elections and the Demola effect
he last has not been heard about the 2019 presidential elections but it appears that the governorship and state assembly elections have obviously exposed the anus of the foul to a greater extent than the earlier one. As things continue to unfold, it is indubitable that two issues characterised the elections of 9/3/19: militarization of the entire process and voter apathy. People have been wondering what led to these two anti-democratic developments. Well, I have the answer; it is the Demola effect! The election of 23/3/19 was characterized by signs and wonders. Those who blame Buhari, Oshiomhole and APC are right but they are not totally right! It has always been like this. The late Yinka Craig was on one occasion described as an aviation watcher in one TV programme even though we all knew him as a veteran broadcaster. In that same vein, I am an election watcher and I have been watching our elections for the past 20 years. The 2003 election was so bad that I saw it as a harvest of signs and wonders, holding among other things that’ this “fictional landslide” (Madunagu, Guardian, 8/5/03) was made possible by “performance enhancing drugs” (Adio, Thisday, 4/5/03); it was built upon sand! What happened during the last elections –especially that of 4-19 (April, Nineteen) was so pervasive and have been so discussed that the blind have seen, the deaf have heard and even the proverbial “visitor in Jerusalem” is fully aware of it. It was so swift that the “professionals” in the field were caught napping and our versatile wordsmiths are still at a loss on how to clas-
sify it. Several political miracles took place all over the land and the testimonies are still pouring in from the overawed witnesses, the stupefied victims and the gloating conquerors. The signs and wonders were so numerous that people did not have to search for them; they were three-for-a-penny’( Ik Muo: Election 2003: A harvest of signs and wonders, BusinessDay, 4/6/03ff ). That of 2007 was also bad and I saw it as full of business as usual and unusual, cataloguing some of the strange occurrences ‘In Imo state, (The same Imo!) governorship election was cancelled because of violence or whatever. But the State assembly election held on the same day and at the same time was upheld and released…. When it was rescheduled, the result was announced before the elections. Newspapers on 28th April reported the meeting between President Obasanjo, Iwu and Udenwa where Iwu was allowed to give it to Ohakim from Okigwe Zone .(see Saturday Independent, 28/4/07,p1). In Anambra, some National Assembly elections were rescheduled for Thursday, then Saturday then Sunday and suddenly, the results were announced! Results were submitted, substituted and counter-substituted depending on whether the person came with the ordinary police, mobile police or soldiers. In the same Anambra, it was also alleged that the initial scores allotted to the ‘anointed one’ was more than the total number of registered voters in the state and there had to be some ‘structural adjustment’( Ik Muo: 2007 elections; business as usual and business unusual. BusinessDay, 2/5/07. It ran for 5 weeks!) In 2011 the sitrep before the elections foreshadowed what would come as ‘murders, kidnappings and arsons have become the order and the police is apparently helpless and overwhelmed. The PDP governments-in particular- have connived with the police to frustrate the opposition parties on issues like use of venue, police permit and even arrest of key opposition figures, especially in the north. Buhari’s campaign in Niger and Plateau states were contentious while the same party was nearly locked out of Ebonyi State. ACN officials have been arrested, one for being accused
It was because of the Demola Effect that people refused to turn out for the election of 9/2/19
of likelihood of breaching the peace and another for an offence that allegedly occurred 4 years ago. (The same Buhari who has brought our electoral fortunes to such an embarrassing mess). The politicians have formed an unholy alliance with the judges and injunctions and counter injunctions are flying right, left and centre. Two weeks to the election, there were about 300 pending cases, 80% of them, PDP-related. (Prof Yakubu should have known this!) So, while the president has pledged credible elections, his party colleagues and some public officials are not behaving as if they share that dream with him’( Ik Muo, 2011 elections: the die is cast. BusinessDay,29/3/11) That of 2015 moderated some of these unsavory elements but the elections of 23/3/19 took us way back by quintupling all the evils of the previous elections since 1999. It was also obvious that in states where APC was not in power, the ruling parties tried to perform their own electoral magic and it then became a terror-balancing act and invariably, those in control of official instruments of violence had their way. There were over-voting, deliberate manipulation of numbers, deliberate bypassing of card leaders, ballot box snatching, intimidation of voters and every imaginable electoral malfeasance. And then, when the numbers started rolling in, some people clapped but some also asked ‘how can’? This was more so in the war-torn axis of Kebi Yobe and Borno, which apart from the miraculous PVC collection rates, also witnessed intimidating voter turn-out and actual votes. Somebody actually quipped that it is easier to vote in Yobe than to live or work there and that was even when the BH operatives paid them some deadly visits that morning and those who did these magical things did not bother about the efficiency of their methods and believability of the outcomes But the poster-boy of all that was wrong with the 23/2/19 election was the activities of Demola, an accredited dealer in violence, who scattered the ballot boxes, set some on fire, assaulted some voters, all in Okote and like PMB had authorized, nearly paid with his life. So, Demola effect describes
everything that was wrong with the elections of 23/2/19: the obvious rigging, manipulation, burning of INEC offices and materials, breaking of limbs and heads and other criminalities perpetrated by brothers against brothers (None of the perpetrators came from Abdijan!) and the outcome that was disappointing to many right-thinking members of the society. It was because of the Demola Effect that people refused to turn out for the election of 9/2/19. In the first instance, they lost their presumed ownership of the electoral process in a very crude manner and as such, found no reason to keep on voting. If the one they voted did not mater, why worry to vote again? Thus my beloved, who roughed it out from Okota to Amuwo –Odofi for the voting exercise reported that those who came for the state elections were not up to 5% of those who came for the national election. That was confirmed by the figures. At Amuwo-Odofin Lagos, accredited voters were 38553 out of 312450 registered while in Ikeja, 38000 were accredited, out of 3286000 registered. As our people say, they decided to allow those who had seized the fofo to also take the soup! Secondly, to check the rascality of people like Demola, the military was unleashed on the environment with fighter jets, attack helicopters, and 2019 models of APC. Consequently, many people decided to stay away for their own safety, except in places like Kebbi and Yobe, where, perhaps the people are used to such sights(???). And of course, the army lost their innocence in the PH axis where Wike was competing with the APC, FGN, army, police, thugs and some INEC officials. Soldiers were busy trading in ballot boxes and taking over ordinary police duties, supported by people in military uniforms. After all as Fela would say: uniform na cloth, na tailor dey sow am! Of course I am sure that Wike at least has his own thugs! Other matters: one step forward, 3 steps backwards and 10 steps inside the Bush Continues online at www.businessday.ng
Ik Muo, PhD. Department of Business Administration, OOU, Ago-Iwoye 08033026625; email@example.com, muo. firstname.lastname@example.org
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