BusinessDay 15 Oct 2020

businessday market monitor FMDQ Close Benchmark NTB* & CP*

Bitcoin

NSE Biggest Gainer N42.5

Foreign Reserve $35.7bn

Biggest Loser

Stanbic

Everdon Bureau De Change

GBP-$:1.29 YUANY - 56.85

Commodities

Guaranty

3.53 pc N30.3

Cross Rates

-2.48 pc

28344.04

Cocoa US$2397.00

Gold $1891.45

news you can trust ** thursday 15 october 2020 I vol. 19, no 672

Crude Oil $42.28

I

N300

Buy

Sell

I&E FX Window CBN Official Rate as at October 13, 2020

ntb

www.

Dangote Cement plc

Axxela Nsp-spv Funding 1 (Natural Gas) PowerCorp plc plc

385.83

0.33

0.16

-0.04

0.07

0.06

0.00

379.00

1.65

4.21

6.31

6.93

7.81

9.44

$-N 450.00 466.00 1m £-N 600.00 616.00 Currency Futures 28-Oct-20 388.88 €-N 540.00 554.00 ($/N)

g

FGN

MTN Nigeria plc CP

Spot ($/N) 29-Apr-21 5-Mar-21 23-Jul-30 30-Apr-25 20-May-27 27-Feb-34

Market

₦5,357,061.20 +0.08

Foreign Exchange

Benchmark Sovereign & Corporate Bonds

3m 2m 25-nov-20 30-Dec-20 391.71 394.55

6m 12m 31-Mar-21 29-Sept-21 403.06

420.09

60m 36m 27-Sept-23 24- Sept-25 497.46

589.09

*NTB - Nigerian Treasury Bills; *CP - Commercial Paper

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Apapa gridlock: How corruption, vested interest ambush solution, hurt businesses (1) Chuka Uroko, Odinaka Anudu, Isaac Anyaogu, Amaka AnagorEwuzie & Temitayo Ayetoto

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f traffic gridlock in Apapa has remained intractable over the years, it is because

News Feature

corruption and vested interest in the premier

port city have ambushed solutions while systemic failure has persisted for far Continues on page 31

Nigerian banks need 4% - 5% growth to avoid bad-debt spike - EFG

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he Nigeria’s economy is poised to expand at less than half the pace needed by banks next

Gridlock caused by #ENDSARS protest by Nigerians youths in Abuja, yesterday.

Pic by Tunde Adeniyi

Inuwa Kashifu Abdullahi (r), DG, National Information Technology Development Agency (NITDA), with Bashir Ibrahim Hassan, GM, business development, North, BusinessDay Media Limited, after an exclusive meeting on the State of National Information Technology Development in Abuja.

Pic by Tunde Adeniyi

year to avoid a spike in unpaid loans.

The 2021 outlook for s u b -S a h a ra n A f r i c a’s Continues on page 30

Inside

Armed thugs attack #EndSARS protesters in Lagos

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news How police brutality poses threat to Nigeria’s tech industry, foreign exchange Endurance Okafor

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hile Nigeria is fast becoming a prime spot for technology startups and investment, police brutality on players of the young but growing industry makes Easy of Doing Business difficult, and thus poses threat to the growth of the sector.

The continuous harassment of Nigerian professionals who are riding on technology to make ends meet, either as software developers, content creators, podcasters, and online marketers could mean that Africa’s largest economy could be losing millions in salaries and investments.

“I lost an opportunity to raise funding for my tech company because I was illegally detained by Special Anti-Robbery Squad (SARS) for

almost one week,” a Lagosbased tech CEO lamented to BusinessDay at one of the protest centres in Lagos.

“They stopped me, went through my laptop and they didn’t understand most of the things on it. They were only able to establish the fact that I have had email conversations with foreigners and so I was asked to pay some ridiculous amount of money, I was detained when I refused to pay.

As a result, I lost the deal,” the tech entrepreneur, who simply identified himself as Peter, said.

Just like the Silicon Valley in the Southern San Francisco Bay Area of California, home to companies like Apple, Facebook and Google, Nigeria is said to have almost a replica in Lagos, home to the largest tech hub ecosys-

Continues on page 30

Commodity prices dropping since COVID-19 outbreak but cassava flour defies trend ... rice, maize prices drop over 20% CALEB OJEWALE

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ommodity prices in Nigeria soared across virtually every farm produce in the five months since Covid-19 outbreak gained traction across the country around March.

However, with new harvest coming from the farms (mostly in the Northern region where substantial food produce emanates), prices have started to reduce, although in some cases, still higher than pre-Covid-19 era.

Most significant, perhaps, are maize and rice, with prices

dropping well over 20 percent, depending on the market.

Other grains have mostly recorded the same trend in price decrease in recent weeks, following months of high prices that have put considerable strain on both consumers and processors.

At the Tsiga Market in Bakori LGA, Katsina State, New White maize sold for N14,000 for a 98kg bag while the Old White Maize sold for N17,000 for 100kg. New Paddy rice sold for N14,500 from as high as N23,000.

“Farmers are now harvesting and the likelihood is prices are going down,” Bello

Dogondaji, national general secretary, Federation of Agricultural Commodity Associations of Nigeria (FACAN), told BusinessDay. About 2-3 weeks ago, a ton of maize was sold for N180,000 but has now reduced to about N140,000 simply because new maize is coming, he explained.

All types of grains are trickling out from the farms, and with every new arrival in the markets, the law of demand and supply takes hold; prices adjust, in this case, downwards.

“Farmers are taking their produce to the markets which are (in turn) getting flooded.

So, automatically prices will go down,” Dogondaji reiterated.

Mohammed Augie, chairman, Rice Farmers Association of Nigeria (RIFAN), Kebbi State, also told BusinessDay the price of paddy rice, which sold for as much as N20,000 for a 75kg bag was now down to N14,000.

“It is natural for price of rice to increase along with that of other commodities because it is not only rice that has gone up in price,” said Augie, explaining the increase in price of rice when produc-

Continues on page 30

Egbin Power to spend $40m to improve electricity generation ... introduces electric buses to reduce carbon emission Olusola Bello & Daniel Obi

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anagement of Egbin Power plc has said the electricity generating company will spend about $40 million to overhaul its two units.

Each of the units, according to Temitope Shonubi, chairman of the company, will cost $20 million and this is in a bid to ensure continuous generation of electricity to consumers. The plant has six units with each generating 220 megawatts (mw) of electricity, with a total installed capacity of 1,320mw.

Speaking Tuesday on the unveiling of electric powered buses and bicycles as part of the company’s sustainability projects, Shonubi said the money would be generated from savings and borrowing from sources; but did not say whether the overhaul will affect its power generation.

Egbin currently has the capacity to evacuate 860mw of electricity but it now evacuates only 500mw, he said, attributing the challenge to gas problems and internal issues.

Presently, Nigeria generates about 5000mw on the average, a level far short of demand of over 20,000mw the country is expected to generate, at least to meet the needs of the almost 200 million people.

The idea behind the introduction of the electric buses and bicycles to serve its workforce within the facility is, in addition to enhancing movement, to promote clean energy, reduce carbon

emission, and enhance quality of life by making the environment safer for the entire workforce.

An electric bus is a bus that is powered by electricity. The buses can store the electricity in its battery for continuous usage for about 48 hours. Ordinarily, electric buses are highly efficient and have lower operating costs than diesel buses.

The whole essence of our existence is all about ensuring whatever we do we try and always do it better every time, the chairman said, celebrating the Egbin Power plant workers that have helped in ensuring that the company is contributing its own quota towards the sustainability of the environment and improving human lives.

For us in Sahara Group we always say we are bringing energy to live, and this is not just talking it but also doing it, he said.

Today, based on the reality of where we are going, the value of TESLA, an electric car manufacturer, is higher than the value of Shell that produces oil, he said.

“An electric car manufacturer that is pushing technology versus the company that is producing oil, which we use today. This simply means that the values of the future in today’s world are more appreciated. And this is the kind of drive Sahara Group is pushing for,” he said.

For the stakeholders in Egbin, he said, if we look at the whole essence of existence, it is all about whole essence of innovation. www.businessday.ng

L-R: Boss Mustapha, secretary to the government of the Federation; Vice President Yemi Osinbajo, and President Muhammadu Buhari, during a virtual meeting of the Federal Executive Council at the Presidential Villa in Abuja, yesterday.

Japan is pouring money into hydrogen fuel research to counter LNG … May shrink Asian gas market for Nigeria, others DIPO OLADEHINDE

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igeria’s revenue from Liquefied Natural Gas (LNG) sale may be impacted as Japan is pouring money into research and development of hydrogen fuel to secure energy independence.

Japan has emerged as a hot spot for the zeroemission hydrogen economy of the future, a vision shared both by the government and its leading automaker Toyota, who are betting on hydrogen, rather than batteries or fossil fuel, will power the emission-free cars of the future.

“None of us saw it coming but a countr y like Japan, which has no resources and relies on

LNG is today spending a lot of money to develop hydrogen and become independent,” Tony Attah, CEO, Nigeria Liquefied Natural Gas (NLNG), said at the last BusinessDay Energy conference.

Japan’s novel energy project researchers are “splitting” hydrogen gas from water by applying an electrical current sourced from wind power. They are also hosting a series of small-scale water splitters powered by rooftop solar.

“Hydrogen, as both a primary source and more importantly, a carrier of energy, must become cheaper and more easily affordable,” declared Japan’s Prime Minister Shinzo Abe in Davos. “My government is aiming

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to reduce the production cost of hydrogen by at least 90 percent by the year 2050, to make it cheaper than natural gas.”

Toyota plans to roll out 100 hydrogen fuel cell buses to shuttle visitors between venues, a stepping stone to a big rampup for the Beijing Winter Olympics, in 2022.

Hy d ro g e n i s “ v e r y much on the strategic agenda,” said Tim Buckley at the Institute for Energy Economics & Financial Analysis, a Sydney-based energy think tank. The postponement of the 2020 Olympics, he noted, gives Japan an extra year to make its hydrogen economy “more credible, rather than a show pony.”

Th e p o st p o n e m e nt @Businessdayng

of the Olympic Games, where Japan planned to make fuel-cell vehicles the official means of transport has done nothing to reduce the country’s quest to scale its budding hydrogen economy.

However, some analysts are sceptical given the huge cost involved and the lack of hydrogen infrastructure required sustaining the task ahead.

Prakash Sharma, Wood Mackenzie’s research director, said Japan’s hydrogen fuel cell vehicle target seems challenging to achieve in the time frame although the cost is the biggest challenge because green hydrogen currently costs two to four Continues on page 30

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NEWS

Top African brands could lose $60bn from COVID-19 BUNMI BAILEY

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frica’s 150 most valuable brands could lose up to 12 percent of brand value cumulatively, a drop of $60 billion compared to the original valuation as of January 1, 2020, the latest Brand Finance Africa report said.

The report, a ranking of Africa’s top 150 most valuable and strongest brands by Brand Finance, assessed the impact of Covid-19 based on the effect of the pandemic on enterprise value, compared to what it was on January 1, 2020.

Brand value is understood as the net economic benefit that a brand owner would achieve by licensing the brand in the open market. Brand strength is the efficacy of a brand’s performance on intangible measures relative to its competitors.

“There is no denying that the African market remains immature and fragmented in comparison to its global counterparts. The lack of connectedness between nations across the continent means that brands’ growth

is being stifled and they are unable to flourish beyond their home markets,” Jeremy Sampson, managing director, Brand Finance Africa said.

He further said that this presents opportunity for African brands to develop in a market ripe for consolidation and mergers and acquisitions (M&As).

Looking beyond Africa, the value of the 500 most valuable brands in the world, ranked in the Brand Finance Global 500 2020 league table, could fall by an estimated $1 trillion as a result of the coronavirus outbreak.

The entire top 10 African brands are South African brands, and a total of 87 brands feature with a cumulative brand value of $34.6 billion, equating to 76 percent of the total brand value in the ranking.

MTN, South Africa’s telco giant, is the continent’s most valuable brand, despite recording a one percent brand value loss to $3.3 billion, followed by Vodacom (brand value down 8 percent to $2.1 billion), First National Bank (down 6 percent to $1.6 billion), Absa (down 3

percent to $1.5 billion) and Old Mutual (up 16 percent to $1.4 billion).

Only 19 out of the 54 African countries are represented in the Brand Finance Africa 150 2020 ranking. Behind South Africa, Nigeria’s 16 brands account for seven percent of the total brand value in the ranking (cumulative brand value $3.2 billion) and Morocco’s eight brands account for five percent (cumulative brand value $2.2 billion).

This is the first time that Brand Finance has launched the Africa top 150 ranking.

According to Declan Ahern, valuation director, Brand Finance London, no truly PanAfrican brands exist, with even the highest performing brands in the ranking often only operating out of their home countries and therefore finding themselves a complete unknown across the continent and globally.

“It is no surprise that South Africa is by far the most represented economy in the ranking, with 87 brands featuring, which account for 76 percent of the total brand value,” Ahern further said.

Ezekwesili, Nweke, Sonaiya, others bemoan poor governance, seek reforms …as armed thugs attack #EndSARS protesters in Lagos INIOBONG IWOK

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minent Nigerians including Oby Ezekwesili, Frank Nweke (Jnr.), Remi Sonaiya, Aisha Yesufu among others yesterday warned that Nigeria must urgently restructure, institute electoral and constitutional reforms to save it from imminent collapse.

The leaders bemoaned failure of governance across Nigeria, saying only a holistic overhaul of the nation’s democracy could guarantee the needed change.

They stated this at a webinar organised to unveil the #FixPolitics initiative to Nigeria media.

In her research presentation, a candidate in the 2019 presidential election, Ezekwesili, said the nation’s democracy was faulty and could not deliver on expectations of Nigerians, saying that the current electoral and political system was tailored to favour a few who are self-serving.

The former minister further said for democracy to work in Nigeria there must be good politics, strong institutions, and effective priority, adding that current leaders place individual gains more than the interest of the nation. According to her, “Nothing in Nigeria can change until the transformation of our politics.

The long suffering people that need good governance are the one to change this narrative to deliver good governance.

“Only the Nigerian citizens working together can compel the three arms of government, the executive, the legislator, judiciary to respond urgently and avert the imminent collapse of Nigeria into a failed state.

Niger ia is cur rently the number 13 country on the global ranking of failed state countries,” she said.

Nweke, who is also the head of the Empowered Electorate Group said most Nigerians voters were ignorant of the hindrance to the nation’s democracy and how it impeded development of the country.

The former minister said the current protest in some states in Nigeria should be a warning to leaders that Nigerians could not be taken for granted forever.

Also speaking, Sonaiya, a member of the sub-theme of #FixPolitics bemoaned the nation’s electoral process, saying that Nigeria must restructure and institute holistic electoral reforms, while encouraging diaspora voting to make meaningful progress.

Au w a l Mu s a R a f s a n jani, who is the head of the Transparency International (TI) in Nigeria, welcomed www.businessday.ng

the #FixPolitics initiative, saying that Nigeria’s political process needs a surgical intervention to deliver good governance to Nigerians.

Meanwhile, suspected thugs armed with dangerous weapons, yesterday attacked #ENDSARS protesters in Lagos.

Thugs were seen chasing after the ENDSARS protesters, breaking side mirrors and windscreens of vehicles belonging to the protesters, leading to several persons sustaining varying degrees of injuries and machete cuts.

It was gathered that the thugs who brandished cutlasses, invaded the protest venue at Berger junction about an hour after the #EndSARS protesters had convened. The thugs destroyed cars numbering up to 7 and attacked several people who were on ground.

The armed thugs also harassed protesters, including passers-by, destroying vehicles parked in the area.

The protesters, however, regrouped and chased the thugs away; one of them was caught, and beaten to stupor, with his head gushing out blood.

One of the protesters who spoke on the condition of anonymity alleged that the thugs were paid to disrupt the protest. https://www.facebook.com/businessdayng

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Research&INSIGHT

In association with

A WEEKLY PUBLICATION OF BUSINESSDAY RESEARCH & INTELLIGENCE UNIT(BRIU)

briu@businessday.ng

08098710024

How electronic platform is boosting tax revenue generation in 2020 ADEMOLA ASUNLOYE

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he Federal Inland Revenue Service (FIRS) continues to engage stakeholders, especially the legislative arm of government, in order to gain invaluable support in assenting to laws and policies that will drive tax compliance and increase revenue generation for national development. As a result of this support, there has been an increase in the collection of revenue over the years while the cost of collection has gradually been decreasing, especially because of the adoption of electronic services (e-services) like eregistration, e-filing, e-tax payment, e-receipt and electronic Tax Clearance Certificate (e-TCC).

For instance, the number of tax clearance grew by 519.91 per cent from 9,574 to 59,350 within a year of introducing the e-TCC on the FIRS’ platform. With this, tax payers request for and process their Tax Clearance Certificates (TCC) from the

Source: FIRS, BRIU

comfort of their homes.

Likewise, in 2018, FIRS generated the highest tax revenue ever which amounted to the sum of N5.32 trillion, an increase of 32.09 per cent from N4.03 trillion in 2017, even though it dropped to N5.26 trillion in 2019.

Meanwhile, the cost of collection as a percentage of actual taxes collected has been reducing; in 2016 it was 2.6 per cent, in 2017 it was 2.49 per cent while in 2018 it was 2.14 per cent.

Although, the coronavirus pandemic disrupted commerce to almost a halt across the federation towards the end of the first quarter (Q1) of 2020 to the middle of second quarter (Q2) 2020, the Q1 and Q2 2020 data combined from the planning, research and statistics department of the FIRS showed that Nigeria generated N2.48 trillion from taxes. This represented 1.27 per cent rise on a year-on-year (YoY) ba-

sis from 2019 data (combined Q1 and Q2). This growth promises a good

ated in the corresponding quarter of 2019.

Prior to the Q2 2020 data, FIRS had not met or surpassed its revenue target in 19 different quarters since Q2 2015 where it surpassed its set target of N1.02 trillion as it generated N1.09 trillion as tax revenue. The full year data in the agency’s repository showed that Nigeria has not met or surpassed its revenue target in 5 years since it did in 2014 when it generated the sum of N4.71 trillion as against its target of N4.08 trillion.

A closer look at the Q2 2020 data showed that tax revenue from the oil sector alone represents 34.18 per cent of the total revenue generated while the revenue from the non-oil

the increase.

Within the non-oil sector, the tax revenue from the NITDEF increased by a whooping 1,571 per cent from N691 million to N11.55 billion within the same period, but it decreased by 12.16 per cent YoY from Q2 2019. Another significant increase that was recorded in the tax revenue was from Stamp Duty which increased by 1,217 per cent from N4.75 billion in Q1 2020 to N62.58 billion in Q2 2020, and by 1,582.93 per cent year on year.

Still within the nonoil sector, the agency recorded decreases in tax revenue of 4.12 per cent, 3.06 per cent and 23.03 per cent in Capital Gains Tax, Non-Import VAT, and

sector represents 65.82 per cent.

In comparison to the previous quarters, it showed that tax revenue that accrued from petroleum profits decreased by 17.84 per cent and even by 12.46 per cent YoY. This decrease between Q1 and Q2 2020 reflects the significant drop in oil prices as well as revenue by major oil companies between the two quarters as the coronavirus struck.

However, this story is expected to change in the remaining half of the year as oil prices are now on

Consolidated Account respectively.

Also, revenue from VAT (NCS-Import VAT and Non-Import VAT) for half year 2020 amounted to N653.11 billion, a decrease of 11.49 per cent compared to N737.92 billion generated in the corresponding period of 2019.

For the agency to meet its set target, it is necessary to consider broadening its tax base system and to also establish more strategic approach to collecting taxes especially by taking advantage of the digital economy.

Source: FIRS, BRIU

deal for the country.

In Q2 2020 alone, the agency responsible for assessing, collecting and accounting for tax and other revenues accruing to the Federal Government of Nigeria surpassed its tax revenue target of N1.270 trillion by 1.51 per cent (N19.15 billion). The Q2 2020 total revenue of N1.29 trillion represents an increase of 8.24 per cent compared with N1.9 trillion generated in the previous quarter; however, it represents a decrease of 8.01 per cent compared to the N1.4 trillion gener-

Source: FIRS, BRIU

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Golden tips for sales leaders in post COVID era LEADERSHIP SHEPHERD WITH BABS

BABS OLUGBEMI

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e cannot overemphasize what leaders are expected to do all the time. Leaders are to achieve results. Not one-off positive outcome but sustainable results. One of the essential functions that ensure the continuity of business organisations is the sales function. The sales function is crucial to any organisation without which the essence for existence is threatened. Without a capable sales force, no business entity will survive competition or meet the objective of the shareholders.

Sales as a function are pivotal to serving the customers with products or services and to gain market share that ensures positive returns on the shareholders’ investment.

However, an unplanned event like COVID-19 will no doubt impact negatively on the achievement of the sales target. The companies might structure to sell their goods; salespeople will obviously be in doubt as per the prospect of continuous patronage and priority their customers will give to their sales pitch. Customers at this time will change their preference and desire to consume what they don’t consider as essential for their survival. It is now more difficult to be a salesperson than in the previous normal.

The new normal post-COVID now calls new ways of engaging customers.

Nonetheless, sales and marketing are still an important part of any corporate success and sales leaders are preferred to lead companies ahead of the other leaders. In the 80’s the managing directors of companies are mostly subject matter experts. I have seen accountants, engineers and other experts becoming the chief executive officers of top companies. In today’s dispensation, you cannot lead any profit-oriented organisation successfully if you are not a salesperson. You

might not be a marketer by background, but your ability to organise the sales function, attract customers to your company’s products or services, and deepen the market share year-on-year is a sine qua non to success. In Practical sense, sales teams are vital because they affect the top and bottom lines of the company’s financial and performance outcome.

I discovered I was a natural salesperson when a leader deployed me to the sales functions after years of being in the middle and back-office roles. I am grateful to my past employers, where I earned my selling skills. I have since coached people who are desirous of improving their figures as salesmen and saleswomen. My coaching target is also people who are afraid to transition into the sales role for some reasons. Sales roles are not too feared but something to be embraced with the knowledge and desire to succeed. In life, you would one day sell for yourself either as a retiree, or a self-employed person. For employees, deploying your service to the sales function is, therefore, a training platform for what you will eventually do for yourself.

I was in an online coaching session with over 200 salespeople last week sharing my thoughts and experience on how to win the business and loyalty of customers as sales leaders. My audience are sales leaders having responsibility for sales figures of their territories and team members. I shared thoughts from my book, the value chain banking with this group, though they are not employees of banks.

Being a sales leader or a sales team member with budget responsibility is like riding at the back of a tiger. I got this from one of my Indian friends and mentors who rhetorically use the proverb to inspire the need to keep working hard. What will you do when you are at the back of a tiger? If you do anything outside to keep riding, the tiger will eat you for lunch, breakfast, or dinner, depending on the time of the day. As a sales leader, you must keep working with your team to drive the numbers using strategy to deepen your market share and increase the penetration of your products.

Your approach must, however, take cognizance of the customers’ preference and the current economic reality (the new normal like online engagement, social distancing

and working from home) to be effective. One way to ensure sales strategies are effective is to fully understand the customers both demographically and in the behavioural sense before making your products available and affordable. Any sales strategy not in alignment with the customer will fail. In order words, a sales strategy that is a product or service-oriented without the customer at the centre of its creation, will deliver a less than the desired outcome.

The customers of today are skilful and knowledgeable. They want salespeople to understand their unique situation and reflect that in the approach. Due to scarce resources and the need to maximise benefits from cost, customers are philosophers and higher degree holders in buying naturally.

All options are considered before parting with their money. A salesperson must, therefore, be aware of the customers’ sophistication. Every customer is assessing his salesperson using what I termed the trust and respect quadrant in the value chain banking book.

A customer like the CFO of an organisation is evaluating the banker if he or she can trust and respect the banker. The trust component is the customer’s perception of your ability to build a long-term mutual relationship with the company, your ability to keep confidential information and be a friend to his or her team. The respect component is your competence and integrity on the job. Your competence is, therefore, your ability to understand your products, the industry and be a sales consultant and adviser to your customers.

The trust and respect quadrant will determine if the salesperson will be in any of the four customer’s levels of acceptance for any company or product. It is your trust and respect level that will place you in the empathic or total or moderate or no acceptance level with the customers. A high level of trust and respect will enable your team to win the heart, the loyalty, and the unflinching patronage of your customers.

As a sales leader, you are leading a team that must be guided and mentored depending on whether the relationship is at the start-up, re-alignment, sustaining success or at the turn-around stage. The supervising strategy for engaging your team members

‘

Being a sales leader or a sales team member with budget responsibility is like riding at the back of a tiger

will be dependent on their current budget achievement and the level of engagement in the relationship they are managing.

One crucial pitfall in leading an effective sales team is the inability of the sales leaders to understand the psychology of the sales team. The average and experienced sales team members, including sales leaders with several years of experience, want to be held accountable for the result and be given independence for the process leading to the result. I will use my experience as a sales coach to an experienced business manager to illustrate the importance of being flexible and holding people accountable for the result.

A sales manager engaged me to investigate why his team wasn’t delivering on their numbers despite his toughness in supervising the team. I met with his team and observed that he is always on the necks of his team members. In the morning, he will want to know where the sales pitch will take the team to. At the close of the business, he will call to confirm from the customers if his team members visited or not. He wouldn’t tolerate any deviation from the call plan even if it were apparent that the day was the ‘world traffic day’ when all the roads were at a standstill.

In my conclusion, I told my client that his approach is stifling the initiatives of the experienced sales staff in his team. I positioned that the team members are not bothered about the results since he was entirely in charge of the process and where they are at any point in time. I encouraged him to be a bit flexible. In the next meeting, he told his team to take ownership of the process, including the sales calls. However, he will hold them accountable for the results which are to be reviewed twice a week. He stopped calling customers to test the integrity of his staff, and the atmosphere turned to relax, trusting and conducive one for the seed of results to be germinated.

Olugbemi FCCA, the Chief Responsibility Officer at Mentoras Leadership Limited and Founder, Positive Growth Africa. He can be reached on babs@babsolugbemi.org or 08025489396.

Sports and COVID-19: A global outlook (1)

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OVID-19 has taken its toll on every aspect of life globally, forcing people to either adapt or stop most social or business activities with the sport industry not left out.

Sports encompass business and social activities. It is recreation that generates huge resources - the global value of the sports industry is estimated at $756 billion annually.

In March 2020, sports activities were grounded to a halt as most countries restricted public gatherings and closed all non-essential industries indefinitely to prevent the spread of the coronavirus. Millions of jobs and source of livelihood attached to the sport industry such as athletes, coaches, instructors, administrators, sports officials; businesses producing sport wears, sports equipment or rendering sports related service; event organisers, marketing agencies, travel and tour companies, among others were all thrown into crisis as all sporting activities were put on hold.

Sport is a major contributor to economic and social development of several nations across the world, and its impact is well recognised by governments such that, it has been added to the United Nations’ Political Declaration of the 2030 Agenda, which reflects “the contribution Sports make to the empowerment of women, young people, individuals and communities, as well as to health, education and social inclusion objectives.”

Current outlook of sport activities Sporting activities are gradually resuming around the world, with a revamped mode of operation that ensures social distancing and safety.

For instance, games are played without fans watching live at the arena of action, while major events like the Olympics have been postponed.

The digital space is now used for sports analysis or commentary, fans engagement, and the likes; revenues have noticeably reduced. Sports that have resumed or planning to have similar safety measures like no fans in stadium or sport venues, testing of all officials, club members and everyone involved in the sport activity, in place.

Football is being played without fans, and only officials and club members who test negative to COVID-19 are allowed in the stadium.

The NBA for instance has put in place safety guidelines like: no fans in the stadium, self-isolation of officials and players in their hotel rooms for up 48 hours until they have two negative COVID-19 test results, only 37 people per team are allowed into the NBA campus, compulsory use of face mask by the audience and strict adherence to social distancing.

There are over 8,000 indigenous Sports and games around the world, with popular ones like, football, basketball, tennis, golf, volleyball, athletics, etc. The three most popular sports are football with an estimate of 3.5 billion fans, cricket 2.5 billion fans, and basketball 2.2 billion fans.

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Revenue and other challenges Businesses, whose sole activity is centred on the sport industry’s operations, including sport clubs and players (players in some sport represent their own brand) among others have had to lay off staff to cut down on expenditure.

Fans “in stadium” engagement has been halted in every sport, with revenue generation from ticketing and hospitality no longer available until it is safe enough to return to the stadium. This has affected the financial statistics of FIBA, FIFA, clubs and players, as little or no revenue is flowing in for sponsorship of sport leagues. Endorsement deals with players, before the pandemic was a leading marketing campaign strategy for major companies like Pepsi, Coca-Cola among others.

Liverpool, Tottenham and Bournemouth football clubs had plans to put their staffs on furlough but for intervention from players and another stakeholder. The management had to cancel such plans and continue payment of staff. Newcastle and Norwich football club, still in the English premier league, had their non-playing staff placed on leave of absence as players and managers from clubs in that football league voluntarily accepted pay cuts, an example is Bournemouth manager Eddie Howe and his assistant. Boston sport club had their training facility shut down and all their staff laid off due to COVID-19.

Upon recent resumption, these businesses

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GOKE IYIOLA are faced with novel challenges such as staff management - some staff are not ready to resume duty due to the fear of the virus. There is also the need for fresh revenue projection and analysis that will shape the taking of imminent business decisions.

The sport business has three main income avenues: Sales of media broadcasting rights; commercial sponsorship and advertising partnerships (this is the biggest revenue generating source); and match-day ticket sales and hospitality. In reality these three sources of income have been disrupted with ticketing totally closed. The other two avenues have been reduced but serves as the only functioning stream of income now.

The bid for media rights is in millions of dollars annually. For example, FIFA made about $1.4 billion from sponsorship deals with 20 major companies during the 2014 World Cup finals in Brazil. Also, during the suspension of the football league, each English Premier League game broadcast in Britain cost its host domestic network $16 million.

Dealing with stakeholders like their fans and sponsors was another major challenge for club owners as they had to manage and reassure sponsors as well as find ways to keep fans engaged and interested.

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The Nigerian police is a criminal enterprise

CHRISTOPHER AKOR

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hen the end SARS campaign gathered steam, I told a friend exactly what will happen: the Inspector General of Police and the government will promptly announce the disbandment of the unit and promise reforms so as to pacify protesters. But there is absolutely no intention to reform the police force. This has always been the pattern.

Since 1999 there has not been a police boss that has not hypocritically ordered the dismantling of the notorious police road-blocks in Nigeria. But till date, those road blocks still exist in all nooks and crannies of the country and serve as the medium for the extortion of, and killing of Nigerians and road users who refused to settle the policemen. What happens is that policemen withdraw from the roadblocks for some weeks and return when national focus and attention shifts to other pressing issues.

The End SARS campaign did not start now. In 2017, Nigerians on social media created a storm with a harsh tag #endSARS calling for the total scrapping of the unit that is particularly noted for its brutality, sexual harassment, extortion, theft, robbery and senseless

killings of Nigerians especially the youth. Also an online petition, with tens of thousands of signatories, was submitted to the National Assembly seeking the scrapping of the unit.

As the campaign on social media reached a crescendo, the then IG of police offered the usual tokenism: he purported to ban SARS from conducting stop and search operations on roads except when or where necessary and promised to restructure the unit. Of course, no restructuring took place and in a matter of weeks, SARS returned with a vengeance.

In a 2016 report titled: “Nigeria: ‘You have signed your death warrant’: Torture and other ill treatment in the special anti-robbery squad,” Amnesty International detailed the atrocities of the Special Anti-Robbery Squad (SARS) to include forceful demand for bribes, stealing and extortion of money from criminal suspects and their families. The report also detailed testimonies from former SARS detainees who said they were subjected to horrific torture methods, including hanging, starvation, beatings, shootings and mock executions at the hands of corrupt officers from the dreaded SARS unit.

But the problem does not end with the SARS unit alone. Virtually every report or study on corruption in Nigeria released since 1999 has listed the Nigerian police as the most corrupt institution in the country. An example is the September 2017 study done by the Nigerian Bureau of Statistics (NBS) in collaboration with the United Nations Office on Drugs and Crime and the European Union. So severe is the

corruption that they routinely waste innocent human lives in pursuit of illicit bribes.

In 2008, as an undergraduate of the University of Ibadan, I was privileged to interview a retired Assistant Inspector General of Police (AIG) for my long essay and his response to my question about corruption among the top brass of the police was shocking to me at the time. Hear him: “Corruption in the police comes right from the top.

It is customary that Commissioners of Police and others posted to ‘lucrative’ posts render returns to the IG. Similarly, DPOs also have to make returns to their commissioners and the rank and file are also expected to make returns. The IG and top police brass convert to personal use their security votes – which runs into millions of naira monthly. The average policeman on the road is thus emboldened to demand for money and extort motorists. The dismissal of policemen caught extorting money from motorists are all gimmicks and cover-up tactics.”

Sometime in 2003, the Guardian Newspaper ran a story of some courageous policemen in Oshogbo who sent an SOS to media houses over the ill-treatment they suffer at the hands of their superior officers who, they say, force them to extort money from motorist and other members of the public. They insist that policemen at roadblocks, bus stops, motor parks etc. are mere messengers. The big fish are their bosses who expect, as of 2003, N5000 from each policeman on duty at a checkpoint whether or not there is “market”.

Those not on checkpoints must

‘ In essence therefore, the policeman at the roadblock demanding for money; the SARS officers brutalising innocent citizens and extorting money from their families are all following orders and remit nearly all the money they extort from people to their bosses

pay their senior officers N2000 if they do not want to lose certain privileges and postings, while those on guard duties at banks receive only a fraction (in 2003, N700 out of the N2000) of the money meant for them. According to one of the policemen: “Whenever they extort money from motorists, they were carrying out ‘lawful orders.’” But many of them have been sacrificed and dismissed when caught but nobody touches their bosses in the offices who sent them on such duties and expect returns compulsorily.

A senior police officer I also interviewed in 2018 told me in confidence that heads of units are coerced into signing receipt of their statutory budgetary allocations which are subsequently not released to them. They are responsible for independently sourcing funds to run their units and are still expected to settle their bosses.

In essence therefore, the policeman at the roadblock demanding for money; the SARS officers brutalising innocent citizens and extorting money from their families are all following orders and remit nearly all the money they extort from people to their bosses.

Successive governments know this and are in possession of dozens of reports of special panels on the police since 1999. But they will never act on any of the reports. Truth is, they like the police the way it is. That is the only way they can continue to use the police to harass opponents, quell popular dissent and most especially, manipulate and rig elections.

Revisiting the African Continental Free Trade Area: Impact, challenges and opportunities

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rade is one of the key factors responsible for interaction among nation-states.

It involves goods and services, and connects communities, countries and continents. Essentially, a free trade area is a geographical area where there are no import tariffs between or among the countries that have signed a free trade agreement. The importance of a free trade agreement cannot be overemphasised – it enables resources to be pooled from where they are abundant to where they are mostly needed, encourages foreign direct investment and serves to cement regional integration.

There are a number of free trade agreements around the world - the North-American Free Trade Agreement (NAFTA) initially conceived between the USA, Mexico and Canada; the EUCanada Free Trade Agreement; the EU-Japanese Free Trade Agreement; the US-South Korea Free Trade Agreement and the European Free Trade Association. The popularity and global acceptance underscore the advantages of Free Trade Agreements... Apart from the removal of tariff and non-tariff barriers to trade, the advantages of free trade are enormous – significantly reduced cost of products and services which benefits countries with lower income, , improves the ability to compete, increases real consumer income, thus propelling increased demand and consumption.

Since attaining political independence, African countries have struggled with one challenge to another. These challenges see many countries in Africa dealing with high poverty levels and underdevelopment which continue to fuel conflict and reduced life expectancy on the continent.

Several initiatives have been taken to jumpstart the continent’s development – from the Lagos Plan of Action signed in 1980 to the New Partnership for Africa’s Development (NEPAD), which was adopted in 2001 at the 37th Summit of the Organization for African Unity and ratified by

the African Union (AU) in 2002. Several years after, NEPAD is still crawling and unable to walk its way to achieving the vision of its founders.

Africa leaders have however continued to be relentless in the pursuit of a cooperative economic model that would benefit member states and launch the continent on the path of economic advancement and sustainability. These efforts culminated in the drafting of the African Continental Free Trade Agreement (AfCFTA) by 44 African countries in Kigali, Rwanda on March 21, 2018. The AfCFTA required signatories to remove tariffs from 90 percent of goods, and allow the free flow of services, commodities, and food across Africa.

The general objectives of the agreement are to: create a single market, deepening the economic integration of the continent; establish a liberalised market through multiple rounds of negotiations; aid the movement of capital and people, facilitate investment; move towards the establishment of a future continental customs union; achieve sustainable and inclusive socio-economic development, gender equality and structural transformation within member states; enhance competitiveness of member states within Africa and in the global market; amongst others.

AfCFTA is definitely the largest free trade area established in terms of the number of participating countries since the formation of the World Trade Organization. If successfully implemented, the enormous market in African could make the continent a formidable force to be reckoned with in international trade negotiation, and enable the continent negotiate favourable terms of trade with the rest of the world on a continental as opposed to a single state level.

It is however uncertain that the disposition of some of the member countries would allow the free trade area to engender the much-

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needed economic development in Africa. The political instability in not a few African countries, insecurity arising from insurgency and the internal squabbles for power continue to undermine the ability to meet the objectives of AfCFTA. It is widely believed that Africans would depend much less on the rest of the world if they traded internally amongst themselves. However, the socio-political situation in some member countries creates undesired stumbling blocks to the achievement of this noble objective.

Another major drawback in the implementation of the AfCFTA is the challenges it would likely pose to indigenous industries, given the intensity of competition that would be occasioned by the removal of trade tariffs and the inflow of cheaper foreign goods and services.

Also, the absence of comparative advantage among African economies is bound to limit the impact of the Free Trade Area. For a free trade area to be effective, participating countries need to produce goods that have a lower opportunity cost than their trading partners and seek to trade other goods for which they lack opportunity cost.

As African economies are producers of raw materials and lack the industrial capacity to transform their mineral resources into manufactured goods– this poses a great challenge in the free trade area. Worthy of mention also is the likely threat from foreign companies who have access to better technology and the ability to produce goods cheaper, with possible adverse effect on local small, medium enterprise that would be most certainly unable to meet the ensuing competition.

To meet the desired objectives, it is important that the implementation of the AfCFTA is complemented by political stability in all African nations through the elimination of greed for power and enthroning truly democratic systems of government. Corruption should also

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CHINEDU OZOR be tackled internally by the respective member nations as its persistence poses a great danger to the realisation of the objectives of the free trade arrangement. The agreement itself should be implemented in a way that it would not stifle local SMEs which are the backbone of many national economies. Incentives should be put in place to enable such companies’ holdup against competition that is likely to ensue from wholesale implementation of the agreement.

No less important is the need for African nations to adequately prepare for stiff competition from the rest of the world as they seek to dispose of their goods and services. One sure way of preparing for this is for Africans to be resolute on affording preferential treatment to goods and services emanating from member countries and the pursuit of industrialisation to guarantee favourable economies of scale in the production value chain and thus cheaper goods and services for the citizens of the continent.

These measures should be complemented with the whole scale upgrades to infrastructural architecture of member countries to not only support competitive production of goods and services, but such infrastructure that will support ease of movement between participating countries.

Ozor is a Partner at DCSL Law. Kindly forward comments and reactions to cozor@dcsl.com.ng.

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Why Nigeria’s domestic institutional investors need to focus on infrastructure and blended finance LADÉ A. ARABA

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igeria’s domestic institutional investors, whose portfolios comprise a significant percentage of Nigerian government paper, are facing unprecedented losses as rising inflation creates negative real yields. To preserve capital, domestic institutional investors will need to diversify their portfolios and consider alternative asset classes.

Nigeria’s economy has encountered multiple hits in the recent past. Inflation stands high at 13.39 percent. Exacerbating an already difficult macroeconomic environment is the persisting COVID-19 pandemic, deep currency devaluation, declining levels of government revenues (reported as only 7 percent of GDP, and largely applied to servicing debt), and ballooning public debt currently estimated at $84 billion.

More diverse portfolios that leverage blended finance, the strategic use of concessional capital as a risk buffer, could help spread risk and create better performing portfolios.

Moreover, long-term yield-generating, inflation-linked asset classes such as infrastructure provide a viable alternative to government securities, with predictable and stable cash flows. Channeling larger volumes of institutional capital towards infrastructure and other asset classes can create positive externalities for the struggling Nigerian economy.

The IMF estimates Nigeria’s infrastructure stock at 25 percent of GDP, well below the global average of 70 percent. It will require annual fi-

nancing of $100 billion over the next 30 years to address this deficit. The multiplier effect created by robust and high quality infrastructure is well documented. The economic return averages 5-25 percent for every dollar spent, leading to inclusive economic growth, job creation, a stronger business enabling environment, and an improvement in living conditions given the provision of basic public services.

In addition, national productivity and competitiveness are often higher in countries with adequate infrastructure. Sustaining strategic infrastructure investment is therefore a critical and urgent requirement to transform Nigeria’s economic trajectory and to help it achieve its industrialization aspiration. However, it is clear that alternative sources of capital are required, given the already stressed public purse.

Pension assets alone account for N10.8 trillion (about $28 billion), but most of these funds are invested in government securities, whose yields have turned negative in real terms due to rising inflation. Given the inelasticity of demand for infrastructure and its stable cash flows, it is well aligned to the investment needs of pension funds.

The participation of other institutional investors, such as insurance companies (with assets valued at about $467 million for life insurance and about $648 million for non-life) and the Nigerian Sovereign Investment Authority (NSIA – the Sovereign Wealth Fund), are equally important. And, infrastructure facilitates the long-term asset-liability matching requirements of these investors.

In the immediate term, given the on-going portfolio losses of domestic

institutional investors in the country, focus should be placed on alternative products and instruments that can be underpinned by blended finance approaches to preserve capital. The following examples are illustrative of the multiple possibilities available: Infrastructure project syndications Overall, syndications enable risk sharing. Prior to the 2008 global financial crisis, when market conditions were favorable, infrastructure projects were largely financed by syndicates of commercial banks or with underwriters selling down a portion of the debt to other lenders.

However, with the 2008 financial crisis came stringent capital adequacy requirements, including Basel III, significantly constraining banks and declining bank syndications.

Infrastructure assets can provide banks and asset owners with higher yields through syndications. This is a more attractive investment option than government securities, which are diminished by rising inflation rates. Through infrastructure assets, banks can utilise their expertise in structuring and appraising infrastructure projects to syndicate loans with groups of domestic institutional investors who could provide longer tenors that match the overall project life, and additionally achieve better long-term asset-liability matching in their own balance sheets.

Qualified reputable banks and Development Finance Institutions (DFIs) can serve as the Mandated Lead Arranger (MLA) and lender of record (with preferred creditor status for the DFIs) to undertake the due diligence, appraisal, risk analysis and management, and ensure adequate pricing to generate attractive riskadjusted returns for all.

Blended finance can be applied

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Structured blended finance products can provide attractive investment opportunities to domestic institutional investors without altering their commercial mandates and objectives

through early stage project preparation grants and credit enhancement instruments where necessary. The International Finance Corporation’s (IFC) Managed Co-Lending Portfolio Program (MCPP) is an example of a blended finance syndications platform that creates diversified portfolios of emerging market private sector loans to grant investors exposure to this asset class. It has raised over $7 billion from eight investors; which has been channeled to 96 commercially structured projects (a quarter of which are infrastructure) in 37 countries (a quarter of which are African).

Through its A/B Loan program, it enables institutional investors to establish an investment vehicle and contract IFC to originate transactions. IFC is the lender of record, while investors participate through B Loans. This structure has raised USD 1.6 billion from Allianz, AXA, and Prudential. It has raised $1.5 billion from Munich RE, Swiss RE, and Liberty Mutual Insurance; which can use unfunded structures to provide IFC with credit insurance or risk guarantees. Again, IFC lends for its own account, with the insurers’ credit coverage on a portion of the portfolio.

Credit enhancement to improve the risk-return profile for investors is provided through IFC’s first-loss tranche; which is in turn backed by a guarantee from the Swedish International Development Cooperation Agency (Sida). This model can be adapted and replicated by local banks and regional DFIs to catalyse domestic institutional capital.

Araba is managing director, Africa at Convergence Blended Finance.

60 years of electricity deficiency – which way Nigeria?

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igerians just marked its 60 years postindependence with the now familiar celebrations – school children parading in open spaces across the nation, government officials doing their own bit of official celebration, etc. A cursory opinion poll of Nigerians from different walks of life across the country would most likely reveal many citizens do not even fully comprehend why we celebrate independence from colonial rule on October 1 each year, and what this means to each person as individuals and collectively as a nation. It may be more appropriate and productive for Nigerians in general to refrain from celebrating each year but rather use this day each year for sober reflection on where we truly are as a nation, where we should be if things were different, where we should be going, and most importantly, what we need to do differently to actualise the changes we need.

One does not need to be an activist to know that all is not well with our beloved country, the giant of Africa, the former pride and economic juggernaut of the continent. Several reasons have been adduced for the obvious underdevelopment of the country as well as the noticeably steady decline in basic infrastructure and services ranging from good roads, a robust national potable water system, well-equipped and properly staffed hospitals, good federal schools from primary through university level, well-trained well-equipped national security outfits, a national airline, etc.

A close inspection would reveal that at the heart of the decline is the glaring absence of a robust manufacturing/production base in Nigeria, which in turn keeps a large percentage of

the citizenry below the poverty line. This poverty indirectly translates to suppressed demand for “made in Nigeria products”. For the manufacturing sector to work, a robust and reliable power sector must be created and sustained to form the required foundation for industrialisation.

The required energy to power the economy has been the bane of industrial growth and development of the country. With the rapid increase in Nigeria’s population, the required investment and attention has not been given to the power sector post-independence, to the point that the sector has effectively been on the decline since then compared to the population growth. Many factories and manufacturers, from the small-scale ones to the very large are mostly powered by diesel generators. Some are not even on the national grid because of the sporadic electricity supply.

Nigeria’s electricity supply industry has metamorphosed over the years from the merger of the Electricity Corporation of Nigeria (ECN) and Niger Dams Authority (NDA) to form the Nigerian Electric Power Authority (NEPA) in 1972, all the way to unbundling of the sector into eighteen business units comprising eleven distribution companies, six generation companies and one transmission company under the Power Holding Company of Nigeria (PHCN).

Privatisation of PHCN should be completed by now, but it is unfortunately far from it. It is therefore not a surprise that the issues that caused the government to start down the path of privatisation still exist.

Sixty years post-independence, the country is still plagued by an unstable and unreliable electric power supply situation in the country

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with customers exposed to frequent power cuts and long period of power outages and an industry characterised by lack of maintenance of power infrastructure, outdated power plants, low revenues, high losses, power theft and noncost reflective tariffs.

Non-cost reflective tariff has been identified as one of the reasons why private companies in the Nigerian Electricity Supply Industry (NESI) power sector value chain cannot satisfy the power demands of Nigerians since investors are unable to recoup their investments. There are several other issues besides the low tariff, including the issue of inconsistent policies in the industry, a history of failure by the government to adhere to contracts, issues with the value chain to name a few.

Of all these, one can argue that the biggest challenge plaguing the NESI is the apparent reluctance of the Federal Government of Nigeria (FGN) to complete the privatisation which it begun earlier in the decade and effectively hand over the entire power sector value chain to private companies to make the required investments, operate and manage it. The FGN’s role would be to create and enforce regulations.

This approach worked very well in the telecommunications sector and is the reason why we have a working telecommunications sector in Nigeria today where every Nigerian can afford to be connected. It is also why Nigeria has the highest internet penetration in Africa, with over 46 percent of Nigerians having access to the internet.

Metaphorically speaking, at 60 years of age, if Nigeria was human she would be only a few years from retirement. Unfortunately, however,

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CHUKWUELOKA UMEH its infrastructure, especially the NESI, would still be considered a child. We are abysmally far behind acceptable standards in not only basic infrastructure, but also in industrialisation to the point that we still export oil, but import petroleum products to mention one.

When are we going to wake up and focus on developing Nigeria? How is it that a man’s house is burning, and rather than striving to get water to put it out, he is more focused on chasing the rats that were flushed out by the fire so he can have a bush meat meal? When will we realise that everything we need to grow Nigeria into a proper developed economy, natural resources, human resources and the knowledge is already here? When will the pursuit of personal aggrandizement or blaming others for our lack of development be replaced with a clear focus on national development for the good of the country? The sooner we start embracing excellence at all levels of government and institutions, the quicker we will rescue the country from the brink of failure and descent into further chaos.

Dr. Umeh is the Managing Director/CEO of Century Power Generation Ltd and the Group Chief Operating Officer at Nestoil Group.

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EDITORIAL PUBLISHER/EDITOR-IN-CHIEF

Frank Aigbogun EDITOR Patrick Atuanya

DEPUTY EDITORS John Osadolor, Abuja Lolade Akinmurele NEWS EDITOR Osa Victor Obayagbona NEWS EDITOR (Online) Chuks Oluigbo MANAGING DIRECTOR Dr. Ogho Okiti EXECUTIVE DIRECTOR, OPERATIONS Fabian Akagha ADVERT MANAGER Ijeoma Ude MANAGER, CONFERENCES & EVENTS Obiora Onyeaso BUSINESS DEVELOPMENT MANAGER (South East, South South) Patrick Ijegbai COPY SALES MANAGER Florence Kadiri DIGITAL SALES MANAGER Linda Ochugbua GM, BUSINESS DEVELOPMENT (North)

Negative economic implications of Apapa gridlock are too great to ignore Constructing a rail line is a good start point

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hallenges in Apapa and Tin Can ports have lingered for years now with severe implications on businesses, households and the Nigerian economy. Delay in addressing these issues will only worsen further the precarious state of the present economy with businesses and consumers bearing the ultimate brunt.

In ensuring recovery and sustained development in Nigeria post COVID-19, it is expedient that policy makers critically identify fundamental factors that will inhibit these objectives; else, Nigeria risks factors such as challenges in our ports weighing on the supposed benefits of critical reforms currently underway in other sectors on economic growth.

In a recent publication, BusinessDay identified a well-organised racket going on in Apapa and Tin Can ports which has perpetuated the gridlock going on in the premier port city. As a result, businesses, lives suffocate as corruption perpetuates Apapa gridlock. According to the report, to “fast-track” speedy call-up

into the ports, truck drivers have to part away with N250,000 for a 20-foot truck and N350,000 for a 40-foot truck.

To put in context, the Lagos Chamber of Commerce and Industry (LCCI) states that 5,000 trucks seek access to Apapa and Tin Can ports daily, however, the ports can only accommodate 1,500 trucks.

This means corrupt security agents and government officials could make at least N375 million on 20foot trucks and N525 million on 40-foot trucks if 1,500 truck drivers decide to speed-up loading at the ports in one day.

These illegal monies are pocketed, hence, not recorded in the revenue books of the federal government. As a result, LCCI reported that Nigeria loses N600 billion in Custom revenue annually. Given the current revenue challenges and the need to diversify the revenue base of the federal government, losing so much in revenue annually to corrupt security and government officials isn’t the best option in a time like this.

More so, how does a country whose dollar reserve has been depleted given the COVID-19 induced

slump in crude oil price get scarce foreign exchange when challenges in Apapa and Tin Can ports are frustrating exporters? The rackets going on in Lagos ports will only continue to increase the cost exporters incur and many would be forced to exit the market if they cannot keep up with these unnecessary and avoidable costs. Some exporters have their products spend weeks on Apapa Bridge before getting to the ports, risking products going bad before reaching destination countries.

Nigeria loses at least $10 billion in the non-oil export sector and N2.3 trillion in corporate earnings across various sectors due to the poor state of the Nigerian port. When exporters incur much cost in getting their products into Nigeria and off the ports, it reflects in increased prices on those goods, pressuring inflation, hence, the final consumer bears the brunt. It is worse-off in given shrinking wallets of consumers/households, unemployment rate on the rise and lower purchasing power.

Many see Apapa as an aberration and a contradiction. It is a metaphor for suffering, stress and pain. Apapa is an unsafe, loathsome

destination and driving to the port city is a huge risk for which many – individuals, institutions and sundry businesses have chosen to avoid it as much as they can.

The congestion in Apapa and Tin Can ports is not a rocket science.

Over the years, the challenges in these ports have defied all solutions.

We suggest a different approach to permanently resolve these issues.

One taskforce after another has tried to bring sanity on its roads and bridges, to no avail. Also, engineers have warned that it is not healthy and safe for trucks to be packed on bridges for days and weeks, explaining that such actions affect the stability of the bridges.

To fix this, we need critical reforms in that space. The FG must prioritise the construction of a rail line that would convey containers out of ports to the terminal. To stop the corrupt practises of security and government officials extorting truck drivers on a daily basis, the FG must reduce human interface in call-up by encouraging and establishing ecall-up systems. The economic cost of these activities is far too great to be ignored.

Bashir Ibrahim Hassan

GM, BUSINESS DEVELOPMENT (South) Ignatius Chukwu HEAD, HUMAN RESOURCES Adeola Obisesan

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Thursday 15, October 2020

BUSINESS DAY

COMPANIES&MARKETS Shopagric to deepen Nigeria agribusiness value-chain

L-R: Funmi Adeniji, head, human resources, Egbin Power Plc; Paul Harriman, CEO; Egbin Power Plc; Pearl Uzokwe, director, governance and sustainability, Sahara Group; Kola Adesina, director, Egbin Power Plc; Tope Shonubi, chairman, board of directors, Egbin Power Plc, and Ade Odunsi, director, during the official launch of Egbin Electric Buggies and Bicycles held within the Egbin Power premises, IjedeIkorodu, Lagos.

SEYI JOHN SALAU

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NECA Network of Entrepreneurial Women to lift members with excellent business skills AMAKA ANAGOR-EWUZIE

…Celebrates 15 years of support women in business

he NECA Network of Entrepreneurial Women (NNEW) has perfected arrangement to hold the seventh edition of its annual summit and conference, themed ‘Moving to Mastery,’ scheduled for Thursday, October 22 and Friday 23rd, 2020.

NNEW, which is also celebrating the 15th anniversary of the Business Membership Organisation (BMO), said the summit is geared towards preparing women to master their businesses. Speaking during a media conference held in Lagos at the weekend, Funmilayo Arowoogun, president of NNEW, who noted that women have done well for themselves in their respective businesses, said there was need for them to do more in order to master their businesses and be on top of their games.

“Women have continued to hold their space in the world of business. NNEW’s

vision of being the preferred network for building generations of successful women entrepreneurs has continued to drive members and leadership of the network to achieve more by not just doing business, but to be the master of their businesses with excellence in focus,” she said.

According to her, the last 15 years of the Network has witnessed major transformation beginning from the pioneer members, who have grown their businesses to an enviable height within the business community.

She pointed out the major achievement of NNEW to include building a network of women who are doing well and making impact in their entrepreneurial journey. She however noted that NNEW has five chapters in four geographical zones and they include Lagos, FCT, Rivers, Ogun, and Kwara state.

“Some of the achievements of the Network include setting up of NNEW

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Cooperative Multipurpose Society Limited; NNEW Women Microfinance Bank; partnership with the credible organisations to commemorate the annual International Women’s Day; partnership with Lagos State Employment Trust Fund; and the recently launched Alive & Thrive Lactation Centre in LASUTH. Other programmes of the Network include business advisory services, capacity building programmes, network meetings, advocacy and policy engagements, mentoring, exhibitions/trade missions, and teenpreneurship,” she listed.

The President however acknowledged the efforts and commitment of past leaders who are still very supportive and dedicated to the vision of NNEW. On the summit, Bolanle Edwards, chairperson of the Planning Committee, said the annual event, which is targeted at the members of the Network as well as the larger community of women

entrepreneurs, will hold realtime and virtually, which is first of its kind.

According to her, every succeeding summit is always an improved version of the previous and this year edition will not be an exception despite the challenges of Covid-19. She however charged participants to prepare themselves to maximise the opportunity, the learning, and the exposure ‘Moving to Mastery,’ offers.

Edwards said speakers and panelists at the two-day events include Hadiza Bala Usman, managing director, Nigeria Port Authority (NPA); Idoroyen Enang, corporate Shepherd; Mary Laniyan, Ovilan Consulting UK; Kofoworola Olaosebikan, Kofsol Group; Lere Baale, chief executive, Business School Netherlands; Funke Nnenna Micheals from Kenya; Sinmi Sowemimo, Ope Farms; and Magarita Lalayan, International Labour Organisation trainer, Turin.

hopagric has been in operation for a year already with its Ranch and agro-processing plant located at Kuchiko-ijah, Niger state, Nigeria.

Shopagric, an agritech crowdfunding firm birthed with the mandate to help curb the raising issues of food insecurity in Nigeria, hence the vision of the company which is recreating the agro-value chain together, one sector per time.

Shopagric has been in operation for a year already with its Ranch and agro-processing plant located at Kuchiko-ijah, Niger state, Nigeria.

Since inception, Shopagric has completed six major poultry farm projects, which gave birth to a production capacity of 46,000 broiler birds, one fish farm project and one rice project.

Currently, they have a 4000 layer bird capacity farm with a view on expansion before the end of the year to a 20,000 layers bird capacity pen fully automated.

With a current catfish farm

In boost for pensioners, Chams Plc launches remote verification solution

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hams Plc, in a quest to solve the existing challenges with the tedious verification process for pensioners has developed a digital verification solution, called I’m Alive, to verify pensioners remotely in the comfort of their homes using a facial biometric mobile app. The app facilitates quick and easy verification for both Government and private pensioners, and provides Pension Administrators with comprehensive reporting to ultimately facilitate pension payments.

To fulfil the requirements of

periodic verification, Government and Private Pensioners are faced with the challenge of having to travel long distances from their villages and rural locations, often at great expense, discomfort & hardship to verify themselves, some are indisposed to physically attend the verification location and lots more.

On the other hand, the current verification process is not efficient to pension administrators as it comes with administrative bottlenecks which impedes Government and Private Pension Admin-

istrators from carrying out effective verification exercises.

The “I’m Alive” solution would go a long way towards solving a major process-intensive hurdle for the Pension Industry.

For both pensioners and pension payers, I’m Alive solution is convenient, saves time & money, easy-to-use, less administrative bottle neck and headaches. The Solution is fully equipped with features that will make life easy for pensioners as it is supported

by Artificial Intelligence which will detect liveliness and au-

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thenticate the Pensioner for payment processing.

The app and pensioner are not linked to a particular phone number or mobile handset. Any smartphone with a functionality that aides selfie alignment and lighting quality can be used, ensuring a higher success rate for pensioners using the app.

Through this product, Chams has continued to expand operations through strategic partnerships and innovative products and solutions that are tailored to the Nigerian and African Markets.

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production capacity of 22000, hence the need for a recent set up and functional hatchery to help increase the catfish production capacity to 100,000 by December 2020.

And with the increasing consumption of rice as a staple in Nigeria, a 60 ton per day full automatic rice milling plant is has been approved by the board of directors to be set up in the Ranch and agro-processing plant, in Niger state( Being one of the largest riceproducing states in Nigeria).

Shopagric also has a completed and fully functional meat processing house in the Ranch and Agro-processing plant for the processing of all produced birds in the farm, so as to increase the value of the agro-chain in the poultry broiler production sector.

With a view on further expansion of our production capacity on the various agrosectors, a formidable and smart team had to be built, shopagric has a staff strength of 37 young Nigerians in five different states in the country ( Kano, Edo state, Abuja, Niger state and Jos).

Thursday 15 October 2020

BUSINESS DAY

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ENERGYREPORT Oil & Gas

Power

Renewables

Environment

Egbin Power poised to reduce carbon emissions Nigeria pushes gas into fast lane for environmental sustainability, OLUSOLA BELLO

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gbin Power has started the promotion of environmental sustainability. The goal is to drastically reduce carbon emissions, for environmental sustainability, healthier lifestyles and productivity. The project involves promoting “going electric” and “clean energy” in Egbin.

The launch of the buggies and bicycles is perhaps one of the first of its kind by the largest privately run private power business in Africa. The themes driving the project also include “Power to Protect”, “Power to Serve”, “Power to Live”, “Power to Innovate”.

The inclusion of students in the project shows the fact that the ongoing electric and clean energy campaign is one that involves all constituents of the Egbin Ecosystem – it’s also generational.

The project also reinforces Sahara Power and Egbin’s commitment as global SDG promoters, with impressive Environment Employee Social and Governance (EESG) records. Here are some of the SDGs covered by the project: SDG 3: Good health, renewable energy, innovation and infrastructure, sustainable cities and communities, Climate Action and Life Below Water.

Speaking Tuesday on the unveiling of electricity powered buggies and bicycles and

bicycles, as part of the company’s sustainability projects, Temitope Shonubi said the money will be generated from savings and borrowing from sources.

The idea behind the introduction of the electric buses and bicycles to serve its workforce within the facility is, in addition to enhancing movement, it is to promote clean energy, reduce carbon emission, enhance quality of Life by making the environment safer for the entire workforce.

An electric bus is a bus that is powered by electricity. The buses can store the electricity in their battery for continuous usage for about 48 hours. Ordinarily, electric buses are highly efficient and have lower operating costs than diesel buses.

He said the whole essence of our existence is all about ensuring whatever we do we try

and always do it better every time. He said he celebrates all the workers of Egbin Power plant that have helped in ensuring that the company is contributing its own quota towards the sustainability of the environment and improving human lives.

“For us in Sahara Group we always say we are bringing energy to live and tod this is not just talking it but also doing it but walking the work and we deliver” Egbin Power plant is not just the first place where the drive of sustainability would commence not just a driver for energy conservation, not drive of good living, quality living, long living but a drive of ensuring that everybody stays alive and their quality of life is priceless.

He stated further that he rejoices and celebrate all those

that have battled COVID 19 and survive it saying that the pandemic has taught everybody that life is priceless and this has allowed us to step back, look back to see the true value of life. But more than anything he said, it has made us to also realise our preferences priorities and what matters to us.

He stated that today based on the reality of where we are going the value of TESLA, an electric car manufacturer is higher than the value of Shell that produces oil.

“An electric car manufacturer that is pushing technology versus the company that is producing oil which we use today. This simply means that the values of the future in today’s world is more appreciated. And this is the kind of drive Sahara Group is pushing for,” he said.

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buja turns to new gas promotion measures to ease the pain of removing unaffordable gasoline subsidies “Gas is Nigeria’s new petrol,” petroleum minister Timipre Sylva said of the oildependent nation’s attempt to diversify and overcome the crude oil price volatility that perennially afflicts its econ­ omic growth.

He said it way back in June 2017, when the Federal Executive Council had just approved the National Gas Policy. But measures announced in September mean this vision could at last become reality for the country’s nearly 200mn people.

The consumption of refined products in A ­ frica’s largest economy has declined more rapidly than in many other countries in the wake of the pandemic, and this trend appears set to continue. The total volume of refined products consumed in the country declined by 23.9pc in July compared with June, falling from 1.34bn litres to 1.02bn litres, according to NOC the Nigerian National Petroleum Corporation (NNPC). Shutdowns mean nearly all refined products are imported.

Consumption of refined products, particularly gasoline—known locally as premium motor spirit (PMS)—and aviation turbine kerosene, will decline from 28.1bn litres in 2019 to 27.2bn litres in 2020, according to credit ratings and research company Agusto & Co. This equates to revenue falling from NGN4.7tn ($12.3bn) to NGN4.3tn.

“The best the central bank can hope for is that making additional funds available accelerates investments in Nigeria’s gas value chain” Famoroti, Stears Plummeting crude oil prices were exacerbated by the coronavirus, as they were everywhere else. This “led Nigeria to lose about 60pc of its earnings”, says Samuel Segun, a Johannesburg-based Africa analyst at consultancy SBM Intelligence. “The country could no longer finance the subsidy it placed on petroleum products, which led it to completely deregulate the sector.

The immediate effect has been a spike in fuel prices.”

The government announced in September that it would no longer fix a price band for PMS/gasoline, leaving marketers to set the retail price. Prices increased from NGN145/litre to at least NGN160/litre, while electricity tariffs doubled from N30.23/kWh to as much as NGN62.33/kWh. Trade union group the Nigerian Labour Congress threatened a nationwide strike from 28 September to protest against the price hikes, despite a court injunction barring the action. President Muhammadu Buhari insisted the country could no longer afford subsidy payments. Nonetheless, on the day of planned action, the government agreed to push the electricity price hike back two weeks and the union duly postponed the strike for the same period.

Culled from Petroleum Economist

How sustainability boosts energy security – WEC … falling prices making cleaner sustainable technologies more affordable

OLUSOLA BELLO

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oosting the sustainability of energy systems goes hand-in-hand with improving energy security and equity, according to a World Energy Council and Oliver Wyman report.

The global energy system can be made more environmentally sustainable while simultaneously improving energy security, defined by the diversification of sources, and energy equity across nations’ populations, according to research launched Monday this week.

The 2020 World Energy Trilemma Index, created by the World Energy Council (WEC), a network of energy leaders and practitioners, in partnership with consultancy Oliver Wyman, was Olusola Bello, Team lead,

launched at the WEC’s World Energy Week virtual event.

Improving the sustainability of energy systems is often seen as a cost to the host country, or tradeoff with other factors. “The Trilemma Index actually tends to illustrate that the opposite is true,” says Martin Young, the WEC’s senior director, insights, to Petroleum Economist, based on the results of the 130-country policy development and performance index.

Energy security is based on the diversity and import dependence of a country’s energy system, among other things. Making that system more sustainable, by increasing its diversity and improving its efficiency, also improves its security. This is

Graphics: Joel Samson.

demonstrated by the highest overall scoring countries in the Trilemma, which have both high security and sustainability scores.

The energy equity component is based on a more complicated mix of factors, as the Trilemma Index tries to replicate the UN Sustainability Development Goal 7 (UNSDG7) by looking at energy access and cost.

“More diverse energy systems tend to be marketbased with efficient pricing, although the lowest prices tend to be subsidised either implicitly or explicitly within concentrated energy systems that are less sustainable,” says Young.

He stated that the poorest countries have focused on improving energy ac-

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cess. This can entail relying upon less sustainable energy systems. However, with an increasing uptake of renewables these can be cost-effective for remote areas and for some grids.

“Falling prices are making cleaner sustainable technologies more affordable and developing countries can also learn from the mistakes made by others” Young, World Energy Council.

Cambodia, Myanmar and Kenya improved the most since 2000 in the overall Trilemma, as a result of a focus on energy access, electrification, energy generation diversity, and infrastructure investment.

Some countries can improve sustainability without damaging equity and security but the challenge is

not equal for all countries.

“National and regional contexts can make this more complicated for some areas than others,” says Young.

Switzerland, Sweden and Denmark are the top three rated countries across all three Trilemma dimensions, having maintained consistent and balanced performance coupled with steady economic and population growth over a number of years.

“OECD countries have been particularly effective, but these richer countries have focused for a number of years on improving energy policies with competitive and diverse energy markets.

They have effectively decoupled GDP growth from increased emissions. The UK is a great example of this.

Email: energyreport@businessdayonline.com, Tel: +234-8023020011

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Countries can learn from one another by understanding which energy policies are effective. They can then consider how these policies may work in their own contexts in their search for optimal solutions. While the top environmental sustainability performers in 2020 are Switzerland, Sweden and Norway, somewhat less predictably Azerbaijan and Ukraine have since 2000 significantly improved their sustainability performance by decarbonising their energy systems.

“Cost is a key challenge, with oil producers reliant upon high export prices being particularly affected,” says Young. “These countries are challenged by the current low oil price environment, which makes it more difficult for them to broaden their economies and diversify their energy systems.”

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Thursday 15 October 2020

BUSINESS DAY

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Thursday 15 October 2020

BUSINESS DAY

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LegalBusiness BD Business Law Industry Report Practice Intelligence Partnerships

Nigerian Bar Association releases immediate, mid-term and long-term recommendations for Police reform Following the mass protests by Nigerian citizens, mostly the youth, against the Special Anti-Robbery Squad of the Nigerian Police Force (SARS), on Tuesday, 13th October 2020, the Nigerian Bar Association (NBA) in a statement by its president, Olumide Akpata released recommendations for police reform.

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he protests were precipitated by years of brutality and professional misconduct by operatives of this particular police unit who have for too long derailed from the core mandates of their establishment, and have become threats to the same citizens that they were meant to protect in line with the general mandate of the Police under the Nigerian Constitution.

In response to the protests, the Inspector General of Police, Mohammed Adamu had on Sunday, 5th October 2020 placed a ban on the operations of the Special Anti- Robbery Squad and other tactical squad of the Police force with “immediate effect”. He thereafter announced the disbandment of the controversial police unit across the 36 States of the Federation and the Federal Capital Territory, while promising the constitution of an Investigation Team which shall include Civil Society and Human Rights Organizations that will work in concert with the Nigerian Police in investigating cases of human rights violations by the Force, amongst other proposed reforms.

Olumide Apkata stated, “while these are admittedly welcome reforms, I would like to place it on record that the Nigerian Bar Association (NBA), in line with its core mandate of promoting the Rule of Law in Nigeria and deepening the democratic space in Nigeria, has been actively involved in, and monitoring, the ongoing #EndSARS protests across the country.

The protests have again brought to fore perennial issues affecting the Nigerian Police, our security agencies, their interface with the citizenry and the fundamental issues affecting our security system that can no longer be put off.

In the wake of the protests that have resurrected the consciousness of the Nigerian society and indeed the international community to these very

important and systemic issues, the NBA is convinced that a disbandment of SARS (or any other unit by whatever name called), re-posting or transferring officers of any disbanded unit and other knee-jerk reactions will only scratch the surface and not offer long-lasting solutions to the endemic issues bedevilling the Nigerian Police as currently constituted.”

Consequently, and in keeping with its mandate of acting as a watchdog of the society, the NBA has mapped out the following short, mid and long-term measures below: • Immediate/ ShortTerm Propositions The right of citizens to peaceful protest is an inalienable and fundamental right that is not only recognised by the Nigerian Constitution but has also been

Data Protection Conclave aims

INSIDE to set out Actions-Agenda for Africa

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consistently upheld by Nigerian courts at all levels. We therefore condemn in very strong terms any ban on the rights of citizens to peacefully assemble and protest in any part of the country.

We call on governments at all levels to protect the rights of all citizens participating in the peaceful protests across the country and direct the security agencies to cease assaulting, attacking, abusing or otherwise harassing or using force against citizens who seek to have their voices heard through the peaceful protests. Under no circumstances should the use of live arms and ammunition against peaceful and lawful protesters be tolerated and those found culpable must be apprehended and made examples of.

The NBA demands an unconditional release of all peaceful

Of what use is an award that cannot be enforced?

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protesters across different States, and also appeals to all protesters to remain non-violent and law abiding in expressing their grievances or embarking on the protests.

Various branches of the NBA across the country have set up teams that will provide legal support to peaceful protesters and victims of police harassment in their various regions. The NBA, working with other stakeholders, have already achieved results in this respect in Benin, Ekiti, Ile-Ife, Abeokuta and Lagos. In particular, we commend the Attorneys General of Ogun, Edo, Ekiti and Lagos States for responding to our calls, providing support and promptly ensuring the release of protesters arrested and detained by the Police. We will continue to play our part in protecting the rights of citizens across the country. In addition to the institutional efforts of our various branches, individual members of the Association and law firms have, in solidarity, volunteered their services. The NBA appreciates these individual efforts and welcomes more volunteers to this noble cause of defending the fundamental rights of the people and checking misuse of power.

The NBA has set up a central help desk to receive complaints from, and provide support to, members of the public on harassment by security agencies and other public interest matters that require the attention of the NBA. Complaints received will be dealt with either at the national level or passed on to an appropriate branch of the NBA (as the case may be). The platforms for submission of complaints arepublicinterest@nigerianbar. org.ng and 07062108806 (SMS and WhatsApp).

The Nigerian Police should immediately commence disciplinary action (including dismissal and public prosecution) against erring officers and those who have breached the rules of engagement in dealing with the citizenry. This is important on the part of the Nigerian Police

Law Crest LLP wins IFLR’s Restructuring Deal of the Year award

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to demonstrate good faith and commitment towards ensuring accountability, restoring confidence and sanitizing the system.

The NBA will make its human and other resources available to the independent investigation panel which is to be established by the Police and the National Human Rights Commission to investigate the violations of human rights by the disbanded SARS and other segments of the Nigerian Police.

• Mid-Term Propositions: The NBA will constantly monitor compliance with rules of engagement by security agencies and escalate cases of abuse to the highest authorities within the relevant security agencies. For this purpose, we will continue to expand our public interest channels and platforms to receive complaints from members of the public and liaise with the relevant authorities within the security agencies.

We demand an expedited audit of the various SARS detention centres across the country.

The most notorious of these centres are the SARS facilities in Awkuzu (Anambra State), the infamous “human abattoir” in Abuja and the notorious SARS detention facilities across Lagos, Port-Harcourt and other parts of the country. The NBA demands an immediate audit of the detainees in these and other facilities to ensure that those who are unjustly and unlawfully detained are immediately released while those against whom the Police have credible cases are promptly charged to court and prosecuted in accordance with the law.

The NBA will work with, and continue to prod, the Chief Magistrates or designated Magistrates across the country to pay monthly visits to police stations and other detention facilities within their territorial divisions to direct the arraignment of suspects or grant bail to them (as appropriate) in Continues on page 19

Outlining the role of patents and patent-information in business strategy

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Thursday 15 October 2020

BUSINESS DAY

INTERVIEW

Data Protection Conclave aims to set out Actions-Agenda for Africa

As the 1st Africa Data Protection (Virtual) Conclave holding today, 15th and tomorrow, 16th October 2020 commences, LEGAL BUSINESS sits with Bidemi Olumide, CEO Taxaide Technologies Limited, the chief conveners and Partner, AO2 Law, to discuss the conference. Excerpts:

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hat inspired the decision to hold a cybersecurity and data protection conference with Africa as the focus?

The global conversations and development in the cybersecurity and data protection (together, Data Security) largely informed the decision. With 55 African countries, +30 of which have one form of Data Security legislation, a continental Convention (the Malabo Convention) on Data Security that has only been ratified by less 10 countries, and several other regional agreements on Data Security, it is just important that we have a continental conversation on Data Security. What are the challenges with the Malabo Convention which has not seen it significantly progress in 6 years?

What rules apply in the different African jurisdictions on Data Security? Is there a possibility for harmonization with Agenda 2063 in view? What institutions, regulations, administrative machineries and judicial reforms need to be put in place for effective Data Security

There have been agitations and initiatives for the emergence of a uniform framework for data protection and cybersecurity in

on the continent? These and more were the questions that birthed the

Africa. What quantifiable effects will the emergence of a uniform framework for data protection and cybersecurity have on Nigeria and Africa?

Immense effect. For one, the personal data interchange market continues to grow as the volume of electronic transactions between and among African countries rise.

Also, the presence of multi-national companies with varied branches across African countries continue to necessitate the need for more certainty on the Data Security laws and rules in the different jurisdictions. The homogeneity of these laws, especially on their principles, can only further engender data and related trade. With a population of 1.3billion, a population that is less than each of China and India, Africa can as well coordinate certain aspects of its business landscape to ensure greater ease for domestic and foreign investments. need for the Africa Data Protection Conclave.

Tech, cybersecurity, and

data protection have increasingly become hot topics in business and legal practice, especially, in the” new normal”. What do you consider to be the essentials of a legal practitioner in this sector?

That rather rare ability to unlearn and relearn, especially from complimentary disciplines. The multi-disciplinary lawyer is the future (nay, reality) of the legal profession.

What sort of engagement should we look forward to, from the lineup of speakers and panelists at this event?

Impactful, audacious, visionary and actions-focused.

This is the 1st Africa Data Protection (Virtual) Conclave. Can we expect this to be a reoccurring event?

Yes; it is designed as an annual conversation that sets the actions-agenda for the next plus/ minus 365 days. It is a knowledgeto-action initiative driven by Africans for the good of Africa and global commerce in the Data Security space.

INDUSTRYFILE

Of what use is an award that cannot be enforced?

…Legal Luminaries discuss Nigeria as an enforcing state for Foreign International Commercial Arbitration Uzoamaka Nwaiwu

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n 8thOctober 2020, during the virtual book launch of “Foreign International Commercial Arbitration Awards (FICAA): Recognition and enforcement, the Nigerian situation, challenges and proposed solutions”

by Chinwe Odigboegwu, FCIArb, a group of distinguished panellists explored the success of enforcing FICAA in Nigeria.

In his keynote address, Seni Adio, SAN, partner, Copley Partners, and immediate past president, Nigerian Bar Association, said the book was both topical and practical; the former because Nigeria has become a poster sovereign in a recent number of international arbitral procedures, the latter because it identifies problems concerning enforcement of awards, offers solutions to them and presents an opportunity to discuss “a burning issue which has divided arbitration practitioners”.

Tunde Busari, SAN, partner, Akinwunmi & Busari commending the author on behalf of the Chartered Institute of Arbitrators, Nigeria said.

“Challenges facing the recognition and enforcement of awards in Nigeria includes the delay in courts, the willingness of Nigerian courts to enforce foreign arbitration awards, the ease or difficulty

of doing so and the likely timescale of the process of enforcement, all great concerns to any foreign investors intending to enforce arbitral awards in Nigeria.”

Abimbola Akeredolu, SAN, partner, Banwo & Ighodalo in her review, said of the book, “It looked at the different factors that could influence the recognition and enforcement of FICAA and the attitudes and reaction of the Nigerian courts to examine whether they actually understand the objective of arbitration and roles in ensuring that the objectives of arbitration is achieved. The author also delved into the question of whether the applicable legal instruments and procedures provide an effective framework for enforcement. Finally, the author proposed solutions to the challenges being experienced in the area of recognition and enforcement of FICAA. She examined what obtains in the UK as a model, the competent courts for enforcement, grounds for refusal, the thought that perhaps the right of appeal should be www.businessday.ng

restricted, the proposal whether the establishment of specialized or commercial courts would assist in resolving the problems.

In recommending it, she said, “I identified that in a certain area, the author went into a very interesting topic, itemized a number of things but discussed only a few of them and left the audience high and dry. She should consider writing a second edition and do justice to the itemized areas.”

The panel themed, “International Arbitration: Nigeria as an Enforcing State” comprised of Funke Adekoya, SAN, partner, AELEX; Uche Uwechia, Company Secretary & Director of Legal, GlaxoSmithKline, Nigeria; Dr. Khrushchev Ekwueme, partner, Olaniwun Ajayi and Deborah Chukwuedo, partner, AccendoLaw. Deborah Chukwuedo introducing the panel said, “One of the advantages of arbitration as dispute resolution mechanism especially in Nigeria where the dockets are overflowing with cases is that the parties get to choose the arbiter of their dispute from outside the court system.

However, armed with an award, a successful party must resort to the court for enforcement of the awards” which in itself is likely to negate the benefits obtained from arbitration.

Funke Adekoya, SAN, speaking on whether Nigeria is a safe seat for

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arbitration said, “The idea of the centenary principles of the Chartered Institutes is that any nation that fulfils those 10 principles will be considered as a safe seat for international arbitration. For us, our judiciary still needs more training, more exposure and a greater understanding of the relationship between the arbitration process and the judicial system.

They are to enforce or to set aside an award based on the limited scope provided in the arbitration Acts or in the relevant legislature.

They aren’t to open up the award, to review or second guess the decision of the arbitrators.”

Dr. Khrushchev Ekwueme agreed that Nigeria is not yet there in relation to being a safe place for arbitration but as a destination for arbitration. He believes that the Nigerian courts have moved from ‘judicial hostility’ to ‘judicial hospitality’. He mentioned that Nigeria is well equipped to handle arbitration with its world class arbitrators for commercial disputes and good arbitration institutions. He also mentioned that in determining which of the courts have the jurisdiction to entertain an arbitration relating to the enforcement of setting aside an award that reference has to be made to the constitution regarding the court with the regional jurisdiction to determine the matter that gave rise to the award. @Businessdayng

In view of the difficulties experienced at the court, during the enforcement stage, Uche Uwechia, noted that, “arbitration in summary offers a very good opportunity for businesses to control dispute resolution risks, however, I encourage businesses to anticipate disputes when engaging with third parties from outside the country and to consider how they will be resolved.”

The author, Chinwe Odigboegwu pinned her inspiration for the book to her past experience in enforcement of arbitration, dispute resolution and her passion for changes.

Quoting from the book she said.

“Nigeria may not be ranked as a top arbitration friendly country at this time due to the current position of enforcement of foreign awards but certainly cannot be described as one that is anti-arbitration. The challenges though fundamental are not unsurmountable. What is required by the government and other stakeholders identified and is already in view is a radical change in attitude, followed by bold and proactive demonstration of the willpower to do what is required to change Nigeria’s reputation internationally in this regard.”

The event, which was compered

by Wale Oshunde, Senior Manager, Legal & PAC-Chi Limited concluded with a goodwill message from Rotimi Odusola, Legal Director/ Company Secretary, Guinness Nigeria Plc.

Thursday 15 October 2020

BUSINESS DAY

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LegalBusiness

Legal Obligations of Online Entrepreneurs/Retailers in a Virtual World Continued from last week 2. Intellectual property issues he company’s website images, product descriptions, logos, videos, music, as well as its products, could be copied by other businesses or violate someone else’s intellectual property. The company should therefore take note of the following intellectual property issues: a. Trademark protection Owners of e-commerce platforms should ensure that the trademarks that represent their businesses online are protected.

Failure to do so may lead to another platform eventually using a similar name and passing off their platform as that of the entrepreneur. b. Copyright Protection While publishing content for your e-commerce website, one should be careful not to use another company’s content without permission. Even if a platform unintentionally used copyrighted content, the holder of the copyright can still sue the business.

The owner of the e-commerce platform should therefore ensure that it uses only images and content that it has the rights to use or are in the public domain.

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3. Terms of Sale Terms and conditions of sale are necessary as they set out the legal basis on which the goods or services are supplied to the consumer and include impor-

tant information (e.g. delivery, pricing, and payment terms).

These terms also enable ecommerce platforms protect themselves by limiting liability. Entrepreneurs should engage a lawyer that will ensure they avoid including any terms that would be considered ‘unfair’ under the applicable laws regulating consumer contracts.

4. Terms of Use of the platform These terms apply to all users of the platform, rather than just customers, and set out the terms and conditions on which the user may use the business’ website/app. These terms should be as comprehensive as possible as they enable businesses limit their liability and assert intellectual property ownership over their website or app content.

5. Consumer Rights Information Retailers have an obligation to provide information to consumers before the goods or services are purchased. Consumers must be informed of

6. Tax With a lot of attention being paid towards the digital economy in recent times, it becomes easier for tax authorities to track sales and services of business when they transition online. Companies will therefore need to seek advice from lawyers/tax practitioners on issues such as withholding tax, value added tax and company income tax which may apply to their business. Smaller businesses may also seek advice on how they can qualify for tax exemptions and other incentives.

7. Anti-money laundering (AML) issues With cryptocurrency and other virtual assets now being used to make online purchases, ecommerce platforms can easily be vehicles for money laundering. It is therefore necessary for the business owners to be aware of AML issues or engage specialists to assist with compliance and put mechanisms in place to prevent such occurrences.

8. Managing fraud and securing electronic transactions There has been a steady increase in payment fraud and other issues related to online security over the last few years. There are a range of security threats which include malware, phishing attacks, hacking and spam emails.

Issues could also arise where a customer uses a stolen credit card to make an online purchase, or a hacker uses stolen credit data from other customers.

A recent report projects that card-not-present (CNP) fraud will grow by 14% annu-

CONCLUSION Running a successful e-commerce platform requires that the business remains compliant on several fronts. It is therefore advisable that the business consults a competent law firm when setting up its platform. The company should also conduct periodic checks on its compliance level. This may end up being crucial to the success of the business.

ALEX is a full service Commercial & Dispute Resolution law firm with offices in Nigeria and Ghana.

Contact us: https://www. aelex.com/. LinkedIn. Twitter. Instagram. Facebook. info@ aelex.com

Nigerian Bar Association releases immediate, mid-term and long-term...

INDUSTRYFILE Law Crest LLP wins IFLR’s Restructuring Deal of the Year award

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t its inaugural award for Sub-Saharan Africa, IFLR awarded Law Crest LLP the Restructuring Deal of the Year Award for their representation of Savannah Petroleum on the restructuring and acquisition of Seven Energy Group.

The financial law publication acknowledged this as a groundbreaking transaction that tested Nigeria’s Legal framework and practice to its limits.

The leading firm advised Savannah Petroleum, while the takeover was pending, on crucial aspects of Seven’s restructuring.

A notable element was a novel joint operating agreement with Seven’s local partner, Frontier, that allowed Savannah to remain as a joint licensee of the Uquo Block while splitting the oil and gas operation between itself and Frontier.

According to James Wilson, a commercial editor, IFLR, “there

the identity and address of the retailer, the characteristics of the goods, the price or manner in which the price is calculated, and any applicable delivery charges. They should also be informed if they can cancel an order after it has been placed but before the goods have been delivered.

The business should equally ensure that its advertisements are not false or misleading as this could give rise to liability under consumer protection laws.

ally up to 2023, which is a significant figure for e-commerce platforms that accept onsite payments. Thus, while this may not be strictly legal solutions, owners of these platforms need to take steps to protect their platforms and prevent fraud.

To defend against different cyber threats, the business should ensure it updates its platform’s operating system regularly and use a strong Secure Sockets Layer (SSL).

It can also deploy an application performance management (APM) which is a software suite that helps retailers identify and fix vulnerabilities within their system and reduces the possibility of being hacked.

were several layers of debt in the Seven group spread across different entities and involving a variety of creditor groups, creating a complex cashflow governed by highly bespoke intercreditor arrangements. Savannah, alongside the other Seven stakeholders, had to negotiate with the creditors. There were also significant local law issues, especially relating to regulatory approvals, currency conversion and commercial agreements.

The Law Crest LLP conducted due diligence for Savannah on the acquisition and prepared documentation for the transfer of Seven’s properties and pipeline rights of way to Savannah.

The restructuring sets a benchmark in the Nigerian market and beyond.” www.businessday.ng

Continued from page 17 line with the newly enacted Police Act. We expect that this will, in the long run, not only decongest these facilities but also discourage unnecessary detention of citizens for largely unfounded and unjustifiable reasons.

We demand that the Police Service Commission should live up to its responsibilities by speedily and constantly looking into complaints against the Police for abuse or misuse of power. This is important to ensure that the relationship between the public and the police is one of trust and confidence instead of suspicion and indifference.

The NBA will collaborate with the National Assembly on its proposed initiatives to provide legislative intervention on issues affecting the Police. The NBA has in the last week been in touch with the leadership of the National Assembly on the proposed legislative interventions, details of which the National Assembly will make public in due course.

Long Term Propositions: We demand, and will continue

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to advocate for, a complete reform and overhaul of the Nigerian Police into a modern and responsible and responsive law enforcement establishment. This includes, among other things, increased funding and better working conditions for the men and officers. Information available to us show that that the current working conditions are atrocious and incapable of boosting morale.

The NBA will set up an NBA Police Reform Team that will work with the Police and other institutions and organisations in developing or refining a Comprehensive Blueprint for Police Reform in Nigeria and continuously advocating for an implementation of the Blueprint.

The NBA, working through its Human Rights Institute will team up with the Police and other security agencies to provide continuing education, enlightenment and sensitisation to members of the Nigerian Police and other agencies on respect for civil law, human rights, rules of engagement, compliance with rulings and/or judgment of courts, @Businessdayng

etc., in the discharge of their duties.

Our findings show that in many cases the problem is one of lack of proper orientation and re-training of officers on how to engage or relate with citizens in a democratic society.

• The NBA president concluded by saying, “Our Nation is at a crossroads, and the ongoing nationwide protest is in many respects emblematic of the larger problems that bedevil us as a nation. But if there is one thing we must do, it is to make the best of this crisis. The NBA believes that the only way this can be done, is to enlist in a thorough and holistic reform of not just the Nigerian Police, but the entire security architecture in the country. I believe that with the daunting security challenges across different parts of the country, this should not just be our collective responsibility, but a national obligation.

The NBA remains committed to its core mandate of promoting the rights and interests of the citizenry and advocating for a better society. We will not shirk this responsibility.”

20

Thursday 15 October 2020

BUSINESS DAY

LEGALINSIGHT

BD

LegalBusiness

Outlining the role of patents and patent-information in business strategy Afolabi Caxton-Martins and Uzoamaka Emerole

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ntellectual property is important to businesses, and its effective use can contribute heavily to success.

Not only should a business procure the requisite protection for its intellectual property, it is expected that such a business should understand its significance, identify its niche markets and adopt a strategic approach that will enable it obtain value from its intellectual property while minimising costs.

The Patents and Designs Act (“The Act”) which governs the registration of patents in Nigeria confers on a patent owner, a legal right to prevent others from making, using, offering for sale, selling or importing the patented invention without his permission i.e. the commercial exploitation of an invention by a third party. Inventions may include products, processes and methods.

When looking at the role of patents in businesses, we observe that not all businesses develop patentable inventions. However, with the changing times and the constant increase in competition in the industry, patents appear to have become a key factor for most businesses, mainly because it is obtainable for any area of technology.

Patents do not only protect innovative technology, but it also helps to expand market share.

To be competitive, an individual inventor, large or small businesses ought to have a set plan or commercialisation strategy that can help increase their value inclusive of their product or processes.

In developing a patent business strategy, a business must consider

some or all of the following questions: • How do we maintain market or product dominance?

• What steps can be taken to prevent counterfeits or copying?

• How do we hedge against competition lawsuit?

• How do we attract investment and valuation?

• How do we increase our negotiating power?

Savvy Patent Business Strategies In-depth knowledge of the invention: Understanding the invention’s significance is vital; what problems it intends to solve, its commercial potentials and ultimately, whether the product or process may be worth protecting as a patent.

Proprietary strategy: If

the invention is remarkably viable and meets with the eligibility requirements, then a business may consider registering the invention in Nigeria and in other countries where they plan on doing business. This is because by obtaining the legal right as an owner, commercial value and advantage are achievable, and this will ultimately lead to an expansion of their market share and profit margin after having invested a considerable amount of money and time in developing such an innovative product or process.

Potential business partners, investors or shareholders would also usually perceive a portfolio of patented inventions within a target business, to be a demonstration of its level of skill and technological capacity. This may prove useful for raising funds finding business partners and raising the business’s

market value.

Please note that while registration of an invention is important, there may arise situations whereby disclosure of an invention prior to filing a patent application is inevitable, especially in cases where a patent owner will be required to disclose relevant details of his invention to a potential investor or a business partner. In this case, a confidentiality or non-disclosure agreement should be executed prior to any discussions between the parties.

Commercialization/Monetization: Commercialising patents is about getting a business’s products or services into the market and earning revenue from it. So, a business’s commercialisation strategy will depend on many variables such as a business’s specific circumstances, its organisaional type, business capabilities,

benefits.

If a business lacks the requisite resources or experience to develop and market a patented product or process, licensing can be an effective strategy. Licensing as an option, presents such a business with an opportunity to grant consent to a more established brand to use its patented invention in exchange for royalties which can be paid by the licensee at regular intervals. A number of international technology companies no longer manufacture products but focus more on innovating and licensing.

For start-up businesses, licensing is typically the fastest way to generate cash flow. We find that Start-ups are often preferred targets for interested venture capitalists who will want to invest in the development of patented inventions created by the organisation.

Licensing may enable such startups to reinvest in further research and development and use revenues earned from monetising their patent to finance further research and development, while the licensor also gains rapid expansion of business with minimal capital expenditure. It then becomes a win-win for both parties.

The relevance of patents in business cannot be over-emphasised. Individual inventors, small and large businesses are provided with an opportunity to generate significant value and returns on the investment that must have gone into developing new technology and obtaining a patent over it. However, an intelligent strategy has to be adopted in an effort to actualise this; one that can lead to an increase in the overall performance of the business and favourably react to unexpected developments and new market conditions.

THEBAR Eight new Supreme Court Justices confirmed by Senate

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he Senate on Tuesday approved and confirmed the appointments of eight Supreme Court justices.

The President, Major General Muhammadu Buhari (retd.) had through a letter read by the President of the Senate, Ahmad Lawan, in the penultimate week, asked the Senate to approve the appointment of the eight justices. Buhari had said the appointments were based on the recommendations of the National Judicial Council.

Buhari had also said his ac-

tion was “in pursuant to Section 231 (2) of the 1999 Constitution as amended and upon the advice of the National Judicial Council according to their ranking and seniority in the Court of Appeal.”

The nominees are, Lawal Garba, (North West), Helen Ogunwumiju (South West), Abdu Aboki (North West), and M M Saulawa (North West).

Others are, Adamu Jauro (North East), Samuel Oseji (South South), Tijani Abubakar (North East), and Emmanuel Agim (South South). www.businessday.ng

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@Businessdayng

In his panel’s screening exercise for senators’ consideration on Tuesday, Chairman of the Senate Committee on Judiciary, Senator Opeyemi Bamidele, presented the report confirming the new Supreme Court Justices. He stated that his committee found that all the judges are eminently qualified for the exalted positions and that there was no petition against any of them.

The Senate subsequently confirmed their appointment at plenary.

Thursday 15 October 2020

BUSINESS DAY

21

Markets + Finance

‘Providing proprietary research, commentary, analysis and financial news coverage unmatched in today’s market. Published weekly, Markets & Finance provides all the key intelligence you need.’

Analysts maintain Buy Ratings on Dangote Cement BALA AUGIE

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slew of analysts have retained and maintained their Buy recommendation on the shares of Dangote Cement, thanks to attractive valuations and strong balance sheet.

Analysts at research house CSL Stock Limited in a recent note to clients retained its target price of N182.40/share; also, United Capital Research has maintained a target price of N175/share, which gives an upside of 26.50 percent at the current price of N150 as of October 10.

With the new bull market, it is not impossible for Dangote’s stock to go vertical on sustained improvement in market sentiments.

Clearly the recent rally is driven by the low-interest rates environment which dawned on the market amid the surprise rate cut by the Monetary Policy Committee of during its September policy meeting.

Listed on the Nigerian Stock Exchange Main Board, Dangote Cement has a market capitalization of N2.55 trillion, which makes it the most valuable company in Nigeria.

Interestingly, analysts are optimistic that the company’s planned share back, which has been ap-

Source: Company Financials; MF

Source: Company Financials; MF

proved by the Securities and Exchange Commission (SEC), remains a catalyst for upward reprising of its shares.

Trading at FY 2020e, EV/EBITDA of 7.0x, analysts at CSL Stock Brokers Limited believe the cement giant’s valuations re/ain attractive.

With cement production and bagging capacity of 48.55 million metric tonnes as at June 2020, Dangote Cement is the largest producer of the building materials in Africa’s largest oil producer.

Despite the whirlwind of Covid-19 pandemic that led to restriction on movements of in its markets across Africa, Dangote Cement

recorded an uptick in at the bottom line (sales) The group revenue was up 2 percent to N476.75 billion as at June 2020 from N467.73 billion the previous year.

Analysts say the surprised increase in revenue was buoyed by the better average net prices realised in Nigeria and the Pan Africa market as well as the increase in volumes sold across the Pan Africa market.

The Pan Africa business saw Earnings before Interest, Taxation, Depreciation, and Amortization (EBITDA) spike by 31.50 percent to N31.5 billion, supported by strong performance in Senegal and Ethiopia United Capital Limited maintains their expectation for Revenue as they expect it to grow by 2.4 percent to N912.8 billion.

The investment house believes the company is on course, having achieved 52.2 percent (N476.9 billion) of our full year revenue target as at June (H1-2020) despite the COVID-19 pandemic that obstructed economic activities.

“Our optimism is buoyed by the commencement of Apapa and Onne export terminals which we believe will continue to enable the business export cement via waterways rather than land which is likely to remain closed for a better part of H2-2020,” said analysts at United Capital Limited.

“Also, we expect to see further the benefit of promotional campaigns embarked on in Q2-2020 on FY-2020 performance, especially as the majority of Federal Government capital projects are scheduled to take place in H2-2020,” said analysts at United Capital.

Moderation in cost adds impetus to profit During the period, manufacturing cost rose due to unfavourable fuel mix which also resulted in the use of more gas whose price increased

compared to half-year (H1-2019).

Also, general increase in material consumed contributed to rising manufacturing cost.

Cost of sales was up 4.78 percent to N202.24 billion in the period under review from N193.17 billion as at June 2019. The company’s cost of sales ratio increased to 42.44 percent in June 2020 from 41.29 percent the previous year.

The manufacturing cost is however lower than the 14.15 percent July inflation figure, which means the cement giant’s cost optimization strategy has paid off.

To validate the effectiveness of the company’s cost control mechanism put in place by management, total operating expenses (administrative and distribution expenses) declined by 1.50 percent to N103.75 billion as at June 2020.

A sub-component analysis of the selling and Distribution expenses showed that Haulage costs saw a significant reduction, down 9.2 percent year on year (y/y) to settle at N50.7 billion, and the management attributed the decline to the reduced haulage costs seen in their Tanzania and Zambia operation due to the reduced volumes when compared to half-year 2019.

As a result of an uptick in revenue and reduction in operating expenses combined in lower tax rate, profit after tax (PAT) increased by 5.78 percent to N126.14 billion from N119.24 billion the previous year.

Overall, Analysts at United Capital estimate a 26.1 percent year on year (y/y) jump in the company’s PAT to N252.3 billion in full year (FY) 2020, buoyed by moderation in operating expenses (OPEX) and finance charges growth as seen in half year (H1-2020), exchange rate translation gains.

Track record of accessing the local debt market Dangote Cement has tapped the

BD MARKETS + FINANCE Analyst: BALA AUGIE www.businessday.ng

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@Businessdayng

debt market more than any other manufacturer as it seeks to take advantage of the favourable interest rates to raise capital to bolster working capital and fund future expansion plans.

Despite the Covid-19 crisis, the company completed the issuance of N100 billion series 1 fixed rate 5 year bond at a rate of 12.5 percent. It also successfully completed the issuance of N100 billion series 15 and 16 Commercial Paper Notes.

Notably, Dangote Cement is the largest corporate and commercial paper bond issuer in Nigeria’s debt capital market.

On 23 January 2020, Global Credit Ratings Moody’s affirmed the long term and short-term national scale issuer ratings of AA+(NG) andA1+(NG) respectively, assigned to DCP, with the outlook accorded as stable.

On 24 March 2020, Moody’s assigned a (P)B2 local currency rating and Aa3.ng national scale rating (NSR) to the N300 billion domestic medium term note program issued

by DCP. Strong balance sheet with available liquidity Dangote Cement’s diversified capital structure (DCP) has limited foreign currency debt exposure, with just 14 percent of total debt exposed to the dollar; also, only 25 percent of total dollar debt is for the Nigerian business.

The cement giant has defered all non-strategic capital expenditures but it paid dividends to shareholders.

As a result of effective working capital management, net operating cash flow from operations rose by 19.43 percent to N254.65 billion as at June 2020 from N213.22 billion.

Validating consistent acceleration in revenue is a 26.0 percent surge in trade receivables to N17.60 billion as at June 2020.

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Thursday 15 October 2020

BUSINESS DAY

BUSINESS TRAVEL

Amid COVID-19, multiple taxation, FX, others compound airlines’ woes

IFEOMA OKEKE

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s airline operators struggle to stay afloat amid the impact of COVID-19, their troubles are being compounded by lack of access to foreign exchange, multiple taxation, high interest rates, multiple entries for foreign carriers, unreciprocated BASAs and poor airport infrastructure, among others, BusinessDay has found.

Domestic airline operators who have been seeking the government’s urgent support to cushion the effect of COVID-19 have disclosed that thousands may lose their jobs if the government fails to review some of its policies that have continued to have adverse effects on their operations.

While governments in other countries have rendered some level of support to airlines through palliatives in a bid to keep them alive and sustain jobs, Nigeria’s case is still uncertain. This may be due to the fiscal challenges faced by the country in the wake of low prices of crude oil, which provide over 70 percent of government revenue and foreign exchange inflows.

However, worthy of commendation is the new signed Bilateral Air Service Agreement (BASA) between Nigeria on one hand, and the USA, India, Morocco and Rwanda on the other hand.

Stakeholders in the aviation sector have said that BASA agreements with these countries are yet another testimony of the commitment of the government to the growth of the domestic aviation industry.

Allen Onyema, chairman of Air Peace, stated that this couldn’t have happened at a better time than now that the domestic industry requires all the support to stay afloat.

“It is most commendable and I promise Mr. President that the gains thereof shall be fully harnessed.

With this, the President has effectively pushed the ball in the court of domestic airline operators and I want to use this opportunity to call on my colleagues to rally to savour the full benefits of these agreements,” Onyema said.

Before now, there had been lop-sidedness against Nigerian airlines in international aviation circle. For instance, the denial of landing permit to Air Peace by the UK and Canada governments were demonstrations of ‘obnoxious’ aero politics.

However, experts have said with the new BASA, Nigeria airlines are given an opportunity to reciprocate air services with these countries.

This policy is, however, one among many others that need to be reviewed. Experts say the government must do more with regard to policy review to support airlines and keep them afloat.

Olumide Ohunayo, an aviation

analyst, told BusinessDay that it is time Nigeria began to take its BASA seriously and look for reciprocity because countries are looking to take advantage of BASA through their own carriers.

“Once they stop you, they provide their own carriers that will do it. We need to use this period to learn our lessons, strengthen our BASA agreements, and on no basis should we allow our flag carriers to go unprotected and unassisted. You don’t have to own the carrier to give it support,” Ohunayo said.

Experts have called on the Airline Operators of Nigeria, (AON), which recently elected new executives, to put forward these myriads of issues facing the airline industry to the government to avoid airlines going under.

High foreign exchange rate Obi Mbanuzuo, the accountable manager of Dana Air, told BusinessDay that exchange rate is a big factor when it comes to increase in losses incurred by airlines.

“The naira was about N360 to a dollar before the lockdown, but now it is about N450 to a dollar.

Our tickets are sold in naira but the spare parts, the leased airplanes, the insurance and many more are paid in foreign currency.

“We don’t have access to foreign exchange at the official rate. When we get foreign exchange, there is limitation on how much can be paid on a daily basis.

“There was a time the Central Bank of Nigeria (CBN) mandated us to pay a maximum of $10,000 a day.

For instance, if I have one spare part that costs $40,000, it would take four days to spend for just one spare part.

That means I can’t pay for anything else during the four-day period. The people abroad do not understand these things,” he explained.

Multiple taxations Domestic airlines, on the average, pay about 35 to 40 percent of ticket cost as taxes and charges that come under the guise of statutory levies, in addition to others.

These include 5 percent Ticket Sales Charge, 5 percent Cargo Sales Charge, 5 percent Value Added Tax www.businessday.ng

(VAT), Passenger Service Charge, Charter Sales Charge, Aircraft Inspection Fees, Simulator Inspection Fees, Landing Charges and Parking Charges.

Others are Terminal Navigation Charge, Enroute Charge, Fuel Surcharge, Airport Space Rent, Electricity Charges, and Apron Pass, Ramp Access Charges, ODC and a newly imposed Registration Fee, all of which are paid to government agencies.

Poor airport infrastructures Despite the charges paid by airlines, the airport authorities have failed to fix infrastructures across the airports to aid seamless operations for airlines.

Many of the airports in the country do not have runway lights and navigational landing aids, meaning that such airports are only open between 7 a.m. and 6 p.m. daily.

AON urged to step up its game Seyi Adewale, chief executive officer of Mainstream Cargo Limited, stated that the newly inaugurated AON executive is the reawakening of the association because this leadership is current, relevant and incorporates major stakeholders in this sub-sector.

Adewale said Abdulmunaf Yunusa, the new President of the association who is founder of Azman Airline and the President of Azman Group and Allen Onyema, the Chairman/CEO of Air Peace, who is now the Vice-President of the association have over 30 passenger aircrafts and constituting over 50% of the entire domestic (scheduled flight) aircraft fleet.

He said Air Peace, Azman and other airlines are directly and most significantly impacted by Covid 19 pandemic, taxation, maintenance, exchange rate, aviation fuel cost etc.

He further explained that the new executives have enough ‘weight and stature’ to influence policy and pressure the government to consider their charge.

He added that also of benefit is the cultural diversity seen in these new executives.

“For me, I believe the agenda that could be considered as top

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priority may include: immediate release and access to palliatives, grants, waivers and incentives as indicated by the federal government.

“The commercial domestic airlines need funding support for their operations post COVID lockdown.

This will ensure they don’t go under.

There is a need to sustain pressure on the federal government to disallow foreign airlines from multiple entries into the country.

“The federal government should encourage and incentivize these foreign airlines to partner local airlines through Code-Sharing and/ or be their feeder and encourage joint training that lower their high overall training costs,” he explained.

John Ojikutu, member of the aviation industry think tank group, Aviation Round Table (ART) and chief executive of Centurion Securities, told BusinessDay what he thinks AON should do first is to collectively demand that the foreign airlines should be restricted to two international airports out of the five airports so classified.

Ojikutu said no foreign airline should be cleared to Lagos and Abuja but Lagos or Abuja and any other from alternate geographical zone, adding that the aim is to ensure that the domestic routes and market benefits are not infringed upon by the foreign airlines.

Why unreciprocated BASAs must be reviewed Experts in the aviation sector have again called on the federal government to review its unreciprocated BASAs or else local carriers may be pushed out of the skies soon.

Some stakeholders had earlier argued that Nigerian carriers did not have the capacity to reciprocate flights into other countries, but this argument has been debunked by operators and stakeholders, especially after Nigeria’s largest carrier, Air Peace, acquired and registered its Boeing 777 aircraft in the country.

Three of the four wide-body aircraft it acquired for its longhaul operations to Dubai, Sharjah, Johannesburg, London, Houston, Guangzhou and Mumbai had so far been delivered. @Businessdayng

The airline had, in 2019, commenced the Dubai route but was awaiting landing permits from other international countries before the compulsory lockdown, making it impossible for airlines to continue scheduled international operations.

Since the lockdown, Air Peace has been operating a series of ‘special flights’ to and from different countries, including China, Turkey, India, Israel and South Africa. Experts say the airline has demonstrated its vibrancy and capacity to fly to any destination across the globe.

Air Peace evacuated 327 Nigerians from London in the wake of Covid-19. However, after this flight, the UK government refused it landing permit to operate other evacuation flights, while its carriers operate freely in and out of Nigeria.

Support for local carriers key to economic development Stakeholders in the sector have also stated that support for local carriers is important to the economy as they provide thousands of jobs for Nigerians, thereby contributing to the economy.

For instance, during the lockdown, Air Peace was the only domestic airline still creating job opportunities for Nigerians in the aviation sector.

Through the evacuation flights, it engaged Nigerian pilots, engineers, crew members, ground handlers, government agencies, air traffic controllers and security officials, among others.

Before the pandemic, Air Peace had employed over 3,000 direct employees and created over 6,000 indirect jobs for Nigerians. It has continued to call back its staff as airlines build passengers confidence to fly again.

Onyema said he was motivated to establish an airline because he wanted to create jobs and help in national development.

“I went into aviation to create jobs. I love touching lives,” Onyema noted.

The airline has provided jobs to Nigerians from different parts of the country as pilots, engineers, members of cabin crew, ground staff, administrative personnel and many others.

It maintains a robust financial status and has, over time, built integrity in international aviation circles because it always pays its bills whether to suppliers, insurers, aircraft maintenance companies and others.

Conclusion Policies are meant for the regulation of the industry, not strangulation of operators. It is important that the federal government urgently reviews some of its policies, otherwise, there may be ripple effect which could lead to thousands of job losses and airlines going under, experts say.

Thursday 15 October 2020

23

BUSINESS DAY

Investor Helping you to build wealth & make wise decisions

Market capitalisation

NSE Premium Index

The NSE-Main Board

N14.105 trillion

2,387.68

N14.852 trillion

2,565.99

NSE All Share Index

Week open (02- 10–20)

26,985.77

Week close (09- 10–20)

28,415.31

Percentage change (WoW)

5.30

Percentage change (YTD)

7.47 21.253

5.86

NSE ASeM Index

NSE 30 Index

NSE Banking Index

NSE Insurance Index NSE Consumer Goods Index

1,126.96

728.51

136.45

1,163.98

1,156.24 1,215.54

315.33

728.51

139.12

3.28 1.06

0.00 -0.88

5.13 3.20

340.01

NSE Oil/Gas Index

NSE Lotus II

455.27

195.43

1,944.34

1,199.19

1,059.65

464.46

199.36

2,018.15

1,231.85

1,130.73

7.83

1.96

2.02

-4.72

10.57

-21.66

2.01 -24.06

3.80 10.00

NSE Ind. Goods Index

NSE Pension Index

2.72 14.53

6.71 7.27

United Capital: Strong growth in funds under management signposts high level of investor confidence Storeis by Iheanyi Nwachukwu

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utual funds p r o v i d e investors access to investment markets by pooling their money with the money of several other individuals with similar investment goals.

By diversifying your investments, mutual funds are meant to assist with minimising the potential risks typically associated with investing.

Mutual Funds are growing much more quickly that anyone could have predicted a year ago, and with more money coming into the system there will be demand for more fund products as well as fund managers managing existing ones that are willing to help an investor achieve financial freedom.

Amid this development, Odiri Oginni, Managing Director/CEO, United Capital Asset Management said the company has constantly supported its clients on their journey to financial freedom through our mutual funds.

As at the week ended October 2, the Net Asset Value (NAV) data for Collective Investment Schemes (CIS) regulated by the Securities and Exchange Commission (SEC) shows remarkable growth across

Odiri Oginni

the mutual funds managed by the United Capital Asset Management.

“Our mutual funds growth has been on a steady increase in the last nine months while returns on the funds consistently outperformed benchmarks, placing us amongst the top 3 Asset Managers by mutual funds size in the market. This represents a significant achievement for not just United Capital Asset

Management but the entire mutual fund industry as we see investors confidence grow among Fund Managers,” Oginni said.

Als o commenting, Sunny Anene, Group Executive Director, United Capital Plc stated: “the strong grow th in the funds under management of our Asset Management business points to a high level of investor confidence

World Investor Week spurs investor protection, education during COVID-19

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embers and stakeholders of the International Organisation of Securities Commissions (IOSCO) concluded the fourth World Investor Week on October 11. While the week may have concluded, the participants efforts to promote investor education and protection will have a lasting effect.

From October 5 to 11, securities regulators, stock exchanges, international organisations, investor associations and other IOSCO stakeholders from more than 100 jurisdictions participated in the campaign in favour of financial literacy and investor education and protection.

Jurisdictions may also have the opportunity to organise events during October or November depending on the local circumstances and o t h e r cha l l e ng e s cau s e d by the pandemic. With more participants than ever, World

Investor Week 2020 underscored the growing importance of investor education and protection, particularly amidst the COVID-19 pandemic.

This year ’s WIW provided key messages about the risk of investing in volatile markets caused by the pandemic. The campaign also focused on the basics of smart investing, such as the need to assess the impact of fees on returns and understand t h e r i s k s o f i nv e s t i n g . T h e campaign reiterates the previous year’s messages regarding online investments and digital assets.

Ashley Alder, Chair of the IOSCO Board and the Chief Executive Officer of the Hong Kong Securities and Futures Commission, said, “ This campaign was a great success thanks to the continuous efforts and commitment of our members to investor education and protection, particularly during these challenging times.

Higher participation levels and the growing variety of investorwww.businessday.ng

focused activities this year means World Investor Week has a growing impact. ” Paul Andrews, IOSCO Secretary General, said, “I am very pleased t hat m o re I O S C O m e m b e r s and interested stakeholders participated actively through virtual and online tools to overcome the challenges posed by the Covid-19 pandemic. Given the growing importance of investor protection as financial markets continue to evolve, this campaign should continue to expand.”

José Alexandre Vasco, Chair of IOSCO´s Committee on Retail Investors, said, “I wanted to take a moment to thank all WIW participants and supporters for their tremendous efforts to raise awareness about the importance of investor education and protection.

I am looking forward to reporting on the outcomes of the campaign and believe the outcomes will provide valuable inspiration for the work in this very important field.”

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in our brand as we continue to reward our clients with investment diversification and above-market returns regardless of challenges in the market.”

“With an investment grade credit rating, asset under management in excess of N180billion, cutting across privately managed funds and 6 collective investment schemes, we remain positioned as a fund manager of choice in Nigeria today. We would like to encourage i n d i v i d u a l s s av i n g t o w a rd s different goals and targets to take advantage of the professional fund management and superior returns offered through our mutual funds”, he said.

Facts behind the growth Facts that lead to the mutual funds growth despite the negative impact of the pandemic include: robust distribution network with strategic focus on the retail segment of the economy; superior returns relative to industry average and benchmarks, which allowed the fund manager to satisfy investors search for yields; and low interest rates on savings and money market instruments that have led to significant increase in the level of subscription to United Capital Asset Management Fixed Income Fund.

For its Eurobond Fund, another key driver of the growth was investors demand for

foreign currency due to the weak outlook for the naira, currency diversification in addition to devaluation concerns.

The Fund Managers have also maintained a strong A credit rating for their Money Market Fund, which gives investors comfort in investing in the funds.

Market realities and how United Capital Asset Management surpassed them to beat the benchmark “All our funds are actively management to generate alpha regardless of the market conditions.

The current return on the Money Market Fund is 4.45percent, better than 1.07percent yield on the 91 day Treasury Bill in the secondary market.

“Also, the Bond Fund and Eurobond Funds’ yields stand at 8.1percent and 7percent compared to Benchmark returns of 3.1percent and 3.9percent respectively. The benchmark for the two funds are 3year Sovereign FGN Bond yields and composite index comprising of 70percent of the 3-year Nigeria sovereign Eurobond and 30percent of 3/6-month US Treasury Bill”, adding to the fund manager.

United Capital Asset Management mutual funds are actively managed to generate alpha returns for the unit holders regardless of the market conditions.

Meristem market review, preview

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ixed sentiments dominated the Nigerian bourse last week. Although the market closed up in the first two (2) trading days, profit-taking activities halted the rally and held on for the rest of the week.

Week on Week, the All-Share Index advanced by 5.30percent to 28,415.31points, driving the year-to-date (YtD) return to 5.86percent. All sectoral indices closed in positive territory, with the NSEBK10 (+7.83percent) and the NSEIND (+2.7percent) recording the most gains. ETERNA topped the gainers’ list having advanced by 32.48percent, while UAC-PROP emerged as the biggest loser, shedding 11.96percent off its share price.

So far, the negative real returns in the fixed income market and increased system liquidity have contributed to stirring the uptick in the equites market.

Preview for the week commencing October 12, 2020, @Businessdayng

we anticipate lingering bullish sentiments to fuel market performance this week.

Although we do not rule out profit taking activities which kicked in last week, we expect that the bulls would have the upper hand. In making a case for buying interest in the equities market, we identify elevated system liquidity supported by incoming OMO maturities, depressed fixed income yields and a dearth of attractive alternative investment options to dictate market direction this week. Ultimately, we expect that the market would close positive this week.

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Thursday 15 October 2020

BUSINESS DAY

Corporate Social Impact

Onuwa Lucky Joseph Editor, (08023314782)

#ENDSARS:

This is a Different Generation, and a Different Time!

Onuwa Lucky Joseph

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he Special Anti-Robbery Squad (SARS) has been in the eye of the storm many times. But something always happens to get them back to sailing like nothing really happened. They are used to toughing out the storm of public opprobrium and wading right back to their regular beat, which are the streets of Nigeria, to pick up anybody, but especially young Nigerians who ‘look like’ criminals. Usually, these ‘suspects’ are individuals with tattoos, piercings, dreadlocks, hair plaits, sag pants, or who drive cars considered flashy, or are simply seen casually handling their laptops and mobile phones.

When, from time to time, the good men of SARS can’t find enough of their stereotypical criminal types, they descend on just anyone who happens to be nearby, and haul them off to be ‘interrogated’ SARS style.

‘You look like Yahoo-yahoo’, they bark. Stories abound of SARS operatives emptying suspects’ bank accounts and this after brutalizing them.

There are too many stories of barefaced intimidation that led sometimes to young Nigerians being ‘wasted’, disappearing, or badly injured.

Now, these young people have had enough. The EndSARS campaign is yet gathering steam especially in the South of Nigeria and in Abuja. As at the

Aisha Yesufu: Power to the young people of Nigeria!

time of this writing (13/10/20), more Nigerians had come out to reveal their experiences with SARS. Omobola Johnson, erstwhile Minister of Communications told of how SARS harassed her son, who was standing right in front of the family house, accusing him of loitering. The Ooni of Ife also came out to detail how her daughter was stopped on her way to board a flight. She was detained for about 30 minutes while her luggage was searched top to bottom, all because they saw a laptop with her.

It is a shame when your country that does precious little for you goes out of its way to prevent you from making a life for yourself. What the SARS set

up is saying essentially is that you no right to anything but the poverty that pervades Nigeria.

You have to look like Nigeria.

The poverty mentality is from a psychically deep place, and it’s one that says ‘Don’t look good.

Don’t be different. Nigeria is hard. If you aren’t looking haggard, there’s something you’re hiding.’

What was set up to rid the country of armed robbers has turned on its own citizens, on its posterity, so to speak. While the tribe of armed robbers flourish and sire new children called bandits, kidnappers, rustlers, ritualists, etc., trigger happy SARS is profiling young Nigerians and making their lives miserable, and that’s when they

don’t take their life altogether.

“Stop Killing Us!” What’s too hard to understand about that? Just let young Nigerians be! Allow them the room to be themselves: creative, brilliant, inventive, hardworking. There are criminals amongst them, sure, but there are even more criminals amongst SARS. For those young people who are legit criminals, let the law take its course. You can’t just kill them because you think they are criminals. Even the criminals amongst them need be reformed, not killed. They are citizens of this country. They have every right to live and thrive here. No government should get in the way of that.

We all know that when the Nigerian Police sets its mind to work, they can amaze, yes. But they also are bedeviled with the myriad issues of Nigeria. And clearly, those issues have been steadily robbing them of their humanity. The places where they are quartered look more like a pigsty than where human beings ought to live. And who

can forget that Channels TV documentary of a few years ago, where an investigative journalist accessed the police training school in Ikeja? Terrible sight.

Not a place fit even for criminals, not to talk of for training civil minded police officers.

Their salaries are pitiable.

Just like what the pitiable mass of Nigerians earn. And so, although some of them are really good cops despite all that Nigeria throws at them, it’s time to get rid of SARS. Their operational mindset is too set for reform of any sort. Government should do the hard job of coming up with a new unit properly prepared to tackle armed robbery and all the other violent crimes prevalent in the country.

These young men and women one sees on the streets are different. They are not passive like the generations before them who bore and still bear every ill with resigned equanimity, leaving it to the Almighty whose wheel of justice turns even slower than that of secular

justice. These young ones are angry and are not afraid to bare their minds and where they deem necessary, their fist.

They cannot be harassed abroad on account of their green passport, and then harassed at home on account of their work tools or how they look. What happened to the constitutional provision for freedom of movement in Nigeria?! And despite all the noise about Yahoo-Yahoo, haven’t well-known Yahoo boys and girls been walking about, including with police escort, while innocent young Nigerians are harassed no end?

The president and his government must see in #EndSars an opportunity for reset with the young people of this country.

There has to be an active effort at dialogue, at understanding the issues and remediating them as soon as possible. Make no mistake about it, the furious lash out at SARS by the deeply unhappy youth of Nigeria is but one layer of their multi layered discontent.

And just like we saw in the United State recently, when George Floyd was kneed to death by a police officer, Corporate America was not afraid to get into the fray. They extended support in various ways to the Black Lives Matter Movement and its spin offs. It’s a little different in Nigeria, but yes, corporate Nigeria, without seeming to be adversarial, can get on board and be agents of mollification and, yes, change.

Coca Cola unveils “Project Revive” on World Clean Up Day: Rewards Environmental Champions Samuel Popo

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n 2018, The Coca-Cola Company launched a WorldWithoutWaste Campaign with a simple focused purpose to make the world’s packaging waste problem a thing of the past.

The WorldWithoutWaste drive was built on three fundamental goals: • Make all consumer packaging 100% recyclable by 2025 and aspire to create packaging that is at least 50% recycled material by 2030; • Collect and recycle a bottle or can for each one the company sells by 2030; • Work together with various partners to support a healthy, debris-free environment.

To drive home this global mandate, Coca-Cola Nigeria Limited have partnered with RecyclePoints, a waste recycling and social enterprise to actualize a corporate recycling program. The program implores the company’s associates to weekly drop-off the recyclables they recovered from their homes or neighborhood at designated point at the company’s official car park where its program partners, Recycle

Points, picks the recyclables up for onward processing.

This program which started with Coca-Cola associates soon attracted keen observers within the Ikoyi community where Coca-Cola Head office is located. Street sweepers, facility cleaners, domestic helps and lots of other resiwww.businessday.ng

dents within Ikoyi axis quickly subscribed to participate and earn rewards following the recycling rewards program facilitated by Recycle Points recycling model. This scheme has attracted over 75 registered subscribers who have so far deposited over 10,000 kilograms of plastic bottles/

cans.

At an official ceremony held on Wednesday, September 30, 2020, at the Coca Cola parking lot in Ikoyi to duly reward participants with exciting gifts, ranging from home appliances to foodstuff, the Public Affairs, Communications & Sustainability Manager, Coca-Cola Nigeria Limited, Nwamaka Onyemelukwe said, “We have always remained committed to ensuring we achieve our environmental goals and this initiative is one of the many ways we aim to do so. We all have the collective responsibility of keeping our environment clean and Coca-Cola is committed to promoting a sustainable environment through its plastic recycling and recovery activities.”

She further noted that as part of Coca-Cola’s efforts to support communities recover from the economic challenges posed by the pandemic, a post-Covid economic empowerment programme tagged “Project Revive” has been launched. “The Project Revive will support the economic recovery and empowerment of women and youths who have been most impacted by the pandemic.

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They will be equipped with recyclables collection materials, training and access to drop-off points or recycling banks where they can exchange their recyclables for cash or household supplies.

We’re resolutely focused on how we can create value and contribute best to our collective recovery like never before”.

As part of the event, a recycling bank was commissioned to aid the gathering and processing of the collected materials. Commenting on the recycling bank, Permanent Secretary, Lagos State Ministry of Environment, Aderonke Oduneye, said, “With this site, we’re making sure that the collection and onward processing of recycled materials is made seamless and easy. We’re very optimistic about the project as we’re working on making this a first of many. ​” “As partners, we are delighted to work with CocaCola to invest in the environment while in turn increasing the livelihood of our workers and Lagosians in general. We hope that we can inspire more residents to make a conscious effort to impact our environment positively” ​said Man@Businessdayng

aging Director, Lagos Waste Management Authority, Ibrahim Adejuwon Odumboni.

The Executive Director of RecyclePoints, Mr. Taiwo Adewole announced that their partnership with Coca-Cola will inform the setting up of more Recycling Banks and Drop-off Points in the country to make recycling very accessible and convenient for postconsumers to dispose their waste responsibly. He stated that the target is to engage and empower 5,000 women before the end of the year under the Project Revive program and this will further strengthen Coca-Cola’s 5 by 20 ambition of empowering 5 million women entrepreneurs across its value change by 2020.

With grants of over $800,000 from the Coca-Cola Foundation to multiple local NGOs, several recycling and women empowerment programs are being implemented to address the issue of environmental protection while empowering women who are significant pillars of the environment.

(Kindly send feedback to 08023314782 / csrmomentum@gmail.com)

Thursday 15 October 2020

BUSINESS DAY

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Garden City Business Digest RivCoMiS: Rivers becomes first with automated judicial system e-Affidavits knocks off touts e-Filing of cases begins as judges, lawyers trained e-Probate and e-Letter of administration now a reality Ignatius Chukwu

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he judiciar y in Rivers State has been automated.

By this, all cases would be filed by litigating lawyers by electronic system called e-filing. The cases would be recorded electronically while proceedings are on in the court sessions.

When hearing is over, the lawyers will wait behind for about an hour to review the recordings and walk away with the ruling. This is RicCoMiS in operation. This transformation is expected to enhance court processes and make it easy and effective.

The most striking aspect is the crowd opposite the high court where touts make a killing by helping people to obtain affidavits may disappear because e-affidavits system has emerged whereby persons can file and obtain an affidavit right from their homes through e-affidavits system.

Cataloguing of all lands has been done such that any land anyone wants to purchase, the system would give the status of the land especially to help buyers know if a parcel of land is encumbered.

The e-Probate system would make letter of administration to be digital and would be handled electronically.

Nyesom Wike

Ibifuro Asawo, CEO of Cinfores

The automation scheme is being executed by Cinfores, the group making waves in ICT in Nigeria, pushing Nigeria on the global IT map with some of the most scintillating innovations such as a software (BrainFriend) that now brings schools to homes through 70,000 solved questions with answers and working scheme, class-work, games, and other features that make a child learn like in a classroom.

The CEO of Cinfores, Ibifuro Asawo, who is also the special adviser to Gov Nyesom Wike on ICT, explained at the unveiling of the Rivers State Judiciary Automation programme that Rivers State is the first to hit this level of automation in the delivery of justice in Nigeria.

The unveiling took place at the Chief Judge’s court (Court One) in Port Harcourt last week Friday, October 9, 2020, where the Chief Judge, Adama Lamikanra, led in the review of the instant recording of proceedings to test-run the new system.

She led some other judges and top lawyers including OCJ Okocha (SAN) in asking questions to enable Cinfores get it right. It was agreed that the typed work be shielded from the open court on the screen.

Some lawyers wondered if the review of typed work by both parties would not cause delay. The designers responded to all questions and solutions were reached.

Explaining details to newsmen, the Cinfores CEO said proceedings of a going case would be typed realtime as proceedings went. “As soon as the hearing is over, both lawyers can go through the typed proceedings and get copies of a ruling in an hour. It is graduation to a digital system. The needed band wave to carry the connectivity is available and the Rivers State government has provided the requirements. All payments will be done electronically”.

He said all courts are connected in the e-filing.

He told BusinessDay later: “What we tried to demonstrate is the pilot court room technology, which is to help judges have verbatim report-

ing to ease the long hand they currently use for recording proceedings in the court. The issues raised by the lawyers and judges after the demo is how it can be deployed to give the most effective desired impact. That has been addressed and we have moved on to deploy the pilot to run in the two pilot courts.”

He said the deployment would rather reduce burdens and drudgery on judges and the judicial system in recording the proceedings of counsels and their witnesses. He said training has been done for all the lawyers, judges, registrars, and others to enable them to handle all the required eprocesses as introduced by the automation of processes.

He made it clear that there are no experts from Nigeria or abroad serving as consultants to the Rivers State government on RivCoMiS, saying the platform is a Nigerian solution for the improvement of justice administration. “We have professionals who have seen the best outside the country including some of the judges and judicial officers who are working with the ICT committee to ensure the effective implementation of the platform.”

He said touts no longer have a place to manipulate people. “The touts no longer have a place. The biggest gainers are the citizens, and the biggest losers are the touts.”

The designing of processes for any organization seems to require deep understanding of the operations of that organization or agency. It thus makes for deep understudy.

Asawo said; “This is part of our profession. We must understudy any sector before we delve into implementation of any automated service to support the sector. It is not a load or burden. It is what makes us come alive. We are wired to be solution-providers and we enjoy doing just that.”

He said RivCoMiS would deliver higher number of treated cases per year, improve accuracy of justice or verdicts, and boost revenue tremendously.

Energy theft, dwindling revenue: PHED won’t spare you anymore One arrest already Port Harcourt

by Boat

IGNATIUS CHUKWU

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he Port Harcourt Electricity Company (PHED) will issue N5Bn bills in a month and watch its accounts record just N2.2Bn payments which it would use to pay to the Genco, Transmission Company of Nigeria, internal costs such as salaries and operations, and still hope to post profit for the investors. This has been very difficult. The present management led by a PhD holder in accounting, Henry Ajagbawa, has been trying out many innovations, some of which have pitched him against the union, but he has been able to move the dial to N2.7Bn of recent.

Now, the PHED management said they won’t spare anyone trying to tamper with their facilities or do anything that would harm its revenue. Management has thus made an arrest to prove its determination.

In a statement signed by our friend, John

Onyi, the image maker, PHED has warned members of the public in its franchise area [Akwa Ibom, Bayelsa, Cross River and Rivers states] not to access its network without authorisation.

Onyi said the management has set up surveillance teams across the four states to ensure that no unauthorised individual infiltrates into its network without following the due process.

The warning is coming on the heels of established/witnessed cases of unauthorized access to PHED’s network by some individuals claiming to be electrical contractors without recourse to safety standards/ implications and in addition overloading the existing infrastructure. “Henceforth, anyone caught in our network shall be prosecuted”, the statement warned.

He talked of a sample case of the arrest of Friday Ogbonna who was allegddly carrying out an illegal activity on PHED’s network at G .U. Ake Road, near Pearl Garden Estate along Eneka Road, Port Harcourt. The arrest is seen as a strong signal that PHED meant the warning.

He said PHED has been facing immeasurable business challenges stemming from vandalism, energy theft, staff brutality, nonpayment of electricity bill by some customers who erroneously believe that electricity is free, illegal connection to the network, among others.

But in all these challenges, PHED is determined in delivering safe and reliable power

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supply to customers in its franchise area.

Meanwhile, PHED is about to disgrace some persons who want to fiddle with light.

It is in the spate of energy theft and other associated infractions by some customers in the system. They call it naming and shaming of offenders (if Nigerians still knew shame).

Ajagbawa made this known in a public forum recently in Port Harcourt, the Rivers State capital where he decried the negative impact of energy theft on the business continuity of the company said that aside naming and shaming, the offenders would be made to face the wrath of law.

The CEO warned the offenders to desist

Henry Ajagbawa, CEO, PHED

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from such an unholy and wicked act capable of threatening the sustainability of the company noting that no stone shall be left unturned until every offender is brought to book.

“We are determined to eradicate energy theft in the system and that’s why we are collaborating with the security agencies. Any customer caught by passing or tampering with our meter will not only be named and shamed but shall in addition face the full weight of law and thereafter made to pay loss of revenue arising from the unwholesome act”, Ajagbawa said.

He had in a previous media parley stated that PHED was losing over N2.5billion on monthly basis due to energy theft. During the parley, the MD/CEO had explained that energy theft should not only be the concerns of Distribution Companies, but the concerns of all Nigerians, as curbing it remains one of the ways through which services can be improved in the power sector.

“One of the ways that we can survive and improve on our services is when customers pay their bill and stop meter bypass. We are coming after those who are involved in meter bypass and we will get back what belongs to us. Those sabotaging the system must be brought to book. ” We need a legislation to criminalize energy theft and vandalism of electricity facilities. If you criminalize it and make the consequences severe definitely, we will have it better. Nigerians should learn to pay for energy consumed”, Ajagbawa concluded.

@Businessdayng

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INSIGHT 2021 budget estimates Boniface Chizea

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were duly informed as should be expected that all the assumptions in the Budget were embedded in the MTEF. But the closeness of the approval of the MTEF and FSP to the presentation of the Budget is problematic. Ordinarily the Budget preparation should have followed well after these approvals were received to give credence to the fact that we observed due procedures in the Budget preparation.

Budget 2021 has aggregate expenditure of an amount the equivalent of 13.08 trillion Naira up from the initial estimate of 10.523 trillion Naira for Budget 2020 before the revisions which were undertaken consequent upon the onset of the pandemic.

This Budget size was based on the assumption of oil price of 40 dollars per barrel with volume sales of 1.86 million barrels per day projected. We hope that this assumption of volume per day lifting is aligned with the Organization of Petroleum Exporting Countries (OPEC) quota for us because as a leading member of OPEC we should lead from the front with good example of compliance for others to follow.

We must however empathize as we undertake this discussion to appreciate the dilemma of those charged with the responsibility of the preparation of the Budget at this particular point in time.

Sometimes we permit wishful thinking as the matter in hand is rather problematic to handle otherwise. We have encountered comments to the effect that the assumed benchmark price is ambitious, that it is better to err on the side of caution. What must be cold comfort for us is that we survived the worst ever drop in the price of oil in 2020 and we were none the worse for it.

An inflation rate of 11.95% has been assumed as well as an www.businessday.ng

exchange rate of 379 Naira to the dollar. The Central Bank we would all appreciate has to walk the tight rope of managing the psychology of the market as well as the pressure from the multilateral financial institutions for a harmonization of the exchange rates in the economy. But the projections which I consider really off in spite of the apparent agreement with the World Bank from where I stand is that of growing the economy by 3 per cent in 2021! How is that possible as I stand to be pleasantly surprised? The economy contracted by 6.1 per cent in the second quarter of this year and

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But it is difficult to believe the report that government has established fifty new additional agencies in an era when we bemoan the skewed structure of the budget in favour of recurrent expenditure crowding out in the process growth inducing Capital Expenditure

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he President as was projected presented the 2021 Budget of Economic Recovery and Resilience to a joint session of the National Assembly on Thursday October 08, 2020. We must applaud as well as commend the timing of this presentation as it lays the foundation for the muchdesired January to December Budget fiscal year. We were also similarly able to discharge this feat last year after a long spell of inability to do so and there were great expectations about the impact of that development on our record of Budget performance particularly capital budget implementation.

It would be recalled that in the recent past when the Budget was routinely approved after the second half of the year that the record of performance of Budget implementation was abysmal.

We reaped the benefits of this development as was reported by the President in the text of his Budget presentation; in spite of the impact of the pandemic, we were for the first time in recent memory able to commence the implementation of the Capital Budget from the first quarter of the fiscal year with a whopping aggregate expenditure amounting to 1.2 trillion Naira as at September 15, 2020 with all Ministries, Departments and Agencies attaining at least 50% of their Capital Expenditures. Capital Expenditure accounts for the growth and development in any economy. We are therefore most certainly on course for record Budget implementation.

We must also point out that there is still some slack to cover with regard to the timing of the presentation of the National Budget to the National Assembly if we wish to guarantee that we keep fidelity to the preferred Budget year of January to December. The Fiscal Responsibility Act gives a date of end of August for the Budget to be laid before the National Assembly. But we remain confident that this goal will be achieved as it has been reported that the Budget implementation was collaborative between the Executive and the Legislature. The expectation therefore is that the review and approval would be seamless mindful of the fact that the President had also instructed that all heads of government should be on standby and on the ready for Budget defense before the National Assembly committees. While we are at this it is also in order to observe that the Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) were approved just the day before the Budget presentation and we

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it does not take much to predict that we are very likely to end the year with the economic growth in the negative territory. It would therefore take some doing for us to attain a growth of 3 per cent in 2021. It is also in order to observe that even if we did so we might not even be seeing much development with that level of growth considering the fact that the population growth in the country averages 3 per cent per annum.

A deficit of 5.20 trillion Naira has been estimated representing 3.64% of GDP contrary to the threshold of 3 per cent included in the Fiscal Responsibility Act. As the President observed during his presentation, we have to accommodate this breach considering the pandemic environment we find ourselves in with the need to offer palliatives and various forms of incentives to enable businesses get back on their feet. One of the pleasant surprises we found with the implementation of Budget 2020 is the fact that it was reported that we were up to date with our debt servicing obligations including statutory transfers, the payment of staff salaries while overheads were significantly covered despite the outcry regarding debt sustainability. A total amount of borrowing of 4.28 trillion Naira has been projected for 2021 with the debt service obligation estimated at 3.124 trillion Naira.

We commend the government for not making budgetary allocations for the payment of subsidy on petroleum products in the Budget making definitive statement about its resolve on the matter and for the initiatives regarding aggressive mobilization of resources to help bridge the fiscal gap. As it remains a fact that for most progressive economies that recurrent expenditure is covered from proceeds from sundry @Businessdayng

taxation. We note and support the innovative stance of giving revenue targets to Government owned enterprises, Ministries, Departments and Agencies to help balance the prevalent mindset in budgeting which is overly focused on expenditure. Also, the resolve to provide additional safety nets to cushion the negative impacts of the reforms and to make provisions for domestic legacy debts which often accounted for the bad debts in the books of banks. And the requirement that recipients of statutory transfers are to make quarterly reports to be included in quarterly reports on Budget implementation is salutary as it aids accountability.

We note the approval for the establishment of infrastructural company as promoted by the Central Bank to help bridge the yawning infrastructural gap in the country. But it is difficult to believe the report that government has established fifty new additional agencies in an era when we bemoan the skewed structure of the budget in favour of recurrent expenditure crowding out in the process growth inducing Capital Expenditure. We just celebrated as reported that Capital expenditure in the 2021 Budget at 39% is wee bit shy of the desired target of 40 per cent. We note with satisfaction the aggressive expansion of rail network across the length and breadth of this country and find particularly cheering the news that the Itakpe Ajaokuta rail line which has been moribund for thirty years now has received a breath of life.

We look forward to the budget details to be subsequently presented by the Honorable Minister of Finance for as the saying goes; ‘’The enemy is in the details.’’

Dr. Boniface Chizea is the CEO, BIC Consultancy Services.

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Commodity prices dropping since...

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tion should be increasing and prices coming down.

He explained that with the Covid-19 outbreak that grounded almost all businesses, some businessmen who wanted to save their money decided to buy paddy and hoard. Also, rice merchants laid siege on farm gates to buy from farmers, and naturally also making prices go up as demand appeared to be overwhelming.

The exchange rate also contributed to initial spike in prices, as increase in price of other goods meant rice farmers had to charge higher so that they could afford other things they needed. From N12,000 per bag before Covid-19, to N20,000 at its peaks, the price has now reduced to N14,000 although it is unclear what the future holds in stable pricing.

While commodity prices appear to be generally coming down, that of cassava flour is proving to be an exception. A ton of the product was sold for about N150,000 around March before Covid-19 outbreak, but now sells up to N300,000, doubling the old price.

“Price of cassava flour is not likely to come down anytime soon, at least not with this season,” said Nike Tinubu, immediate past president, Industrial Cassava Stakeholders Association of Nigeria, in a phone interview.

While the cassava flour is itself a by-product of the tuber crop that is a source of widely consumed staple foods in Nigeria, its defiance to reducing commodity prices BusinessDay learns is attributable to a cycle that started with some floods last year.

The resulting scarcity meant production for this year was to be affected, while this year’s production that has already

been challenged is the only hope for prices to come down next year.

Availability of cassava for processing was also worsened this year because of the Covid-19 pandemic, Tinubu explained that a lot of the cassava that processors would have utilised was being converted into garri for use as palliatives. This meant that where a farmer would have sold 100 tons of cassava to a processor, they are selling less than that because they are making garri to sell as Covid-19 relief.

“This has made this year exceptionally different,” said Tinubu, who is also MD of Eagleson Cassava. “I don’t know if prices will increase next year, because cassava prices are supposed to be coming down now (which is not), but it most likely will not decrease and I don’t know how stable it will be.”

One of the main solutions, which she said, already showing a high positive impact is the anchoring of farmers to processors where the processors and farmers go into partnership and the farmer knows that there is an outlet for their produce, likewise, the processors are assured where their raw materials will come from.

As equally explained by Dogondajii, most industrial users buy from their aggregators and some have signed off-taking arrangement with the producers who are in clusters. They engage in anchor borrowing, which ensures farmers must have an off taker that will be purchasing from them at harvest. If the model is strengthened and made even more widespread across the country, stakeholders see it as a way of stabilising prices, and giving farmers the confidence to scale up production.

Japan is pouring money into hydrogen...

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times more than fossilfuel hydrogen.

“Japan aims to lower its green hydrogen price to $3/kg by 2030. As a result, we expect Japan to pursue all options to procure clean hydrogen, including import of green a n d b l u e h y d ro g e n ,” Sharma said in a report.

If Japan succeeds in scaling production and achieving wider adoption of the energy source, it may shrink a significant global LNG market thus signalling fiscal challenges for gas-producers like Nigeria.

The Federal Government earned $3.102 billion from its 49 percent stake in NLNG between 2015 and 2018. Over the last 20 years, the company has paid Nigeria about $18 billion in dividends.

Hence, analysts are

urging the government to move speedily to harness its over 202TCF of gas reserves before the world shifts away from gas.

“Gas can be Nigeria’s saving grace if we take huge advantage at the right time,” Ademuyiwa Adegun, an Abuja-based gas commercial advisor, said. “The world will not wait for Nigeria.”

Japan’s quest for energy independence is coming at a time when Nigeria, the world’s ninth top LNG producer, sorely needs gas revenues to stimulate its struggling economy and increase its depleting foreign exchange reserves.

Th e N L N G e x p o r t s around 300 cargoes of liquefied natural gas annually from the Bonny plant, representing about 40 percent of the global LNG supply. www.businessday.ng

Mogaji Aliyu (r), chairman, House of Representatives Committee on Power, and Joseph Ugbo, managing director, Niger Delta Power Holding Company, during the visit of the committee to Ogorode Power Plant, Sapele in Delta State, yesterday.

NAN

Nigerian banks need 4% - 5%...

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largest economy was cut to growth of 1.7 percent by the International Monetary Fund on Tuesday, compared with a June forecast of 2.6 percent. That’ll make Nigeria the fourth-worst performer among nations measured by the Washington-based lender in the region.

Lenders need the economy to accelerate after restructuring about 40 percent of loans on their books that would’ve soured and should have been booked as nonperforming loans. As growth lags, the risk of these reorganised loans going unpaid rises.

“There’s no real sense the

economy will bounce back to 4% to 5% growth,” Ronak Gadhia, director for sub-Saharan African banks research at EFG-Hermes, said by phone.

“We expect banks’ credit quality to remain under pressure.”

Nigeria’s gross domestic product will probably shrink 4.3% for this year, the IMF said, as a lockdown to contain the Covid-19 outbreak, lower oil prices and rampant dollar shortages weigh on output.

GDP last expanded by more than 3% in 2014.

“We won’t have as much money to drive the infrastructure plans that the government intends to implement to open up activities in different sectors of the economy,”

How police brutality poses threat to...

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tem in Africa.

Located in the suburb of Lagos is the Yabacon Valley, the high-tech innovation hub, which started life in 2010 with one building earmarked as an incubator for talent and has since spread across different parts of the city and states.

Exacerbated by the Covid-19 pandemic, people around the world are moving to a service-driven digital economy, and Nigeria is not left behind as the obvious rise in unemployment in Africa’s most populous nation has pushed more young people into finding innovative ways to generate revenue while leveraging technology for remote work.

From trading cryptocurrencies, running online advertisements, making comedy skits, copywriting, content creation, graphic designs, to working remotely as software developers, a geopolitical intelligence platform, SB Morgen (SBM) says young Nigerians have created a service economy that appears independent of government patronage.

Isa Ali Ibrahim Pantami, Nigeria’s minister of communications and digital economy, believes Nigeria’s tech industry that currently contributes about 13.8 percent to the nation’s GDP will in the next two to three years, double

the 8.8 percent contribution of the oil and gas sector.

“The recent statistics by NBS shows that the future is indeed in ICT. This is a clear indication that at the pace ICT is growing in Nigeria, most probably in the next two or three years, the contribution of the ICT to the GDP will at least double that of the oil sector,” Pantami said.

But, according to industry players, the incessant harassment from the police and especially the SARS unit is one of the reasons why the sector is yet to attain its full potential.

“In many reported cases, persons found with laptops or ‘expensive phones’ are arrested and bogus charges slammed on them even after they show their ID cards and proof of legitimate sources of income.

They are often forced to enter unmarked vehicles, are driven to unknown locations, have their phones seized, and are given no opportunity to call friends or family for help,” SB Morgen said, adding, “These are scare tactics, and continuous police brutality undermines this service economy currently being championed by young Nigerians.”

While the reported cases of some young Nigerians who are involved in cybercrime and internet fraud cannot be swept under the carpet,

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Mosope Arubayi, chief economist at Lagos-based Vetiva Capital said by phone. “We’re not seeing a situation whereby oil prices will be significantly stronger next year.”

The central bank anticipates that almost two-thirds of credit in the economy will be reorganized this year to help borrowers cope with the economic fallout from the pandemic. EFG expects NPLs will rise to 7.6% of total credit at the end of the year, as the economy deteriorates, increasingimpairmentcharges, Gadhia said.

Cairo-based EFG predicts that Nigeria’s GDP will increase by 1% to 2% in 2021, “which is very low, and doesn’t help the banks from an asset-quality perspective,” the analyst said.

Earnings per share at Nigerian banks could decline 65% this

year, Gadhia said.

The government doesn’t have the financial resources to support the economy, said Yvonne Mhango, the subSaharan Africa economist for Renaissance Capital.

“Nigeria’s recovery will be undermined by a consumer who was already in recession pre-Covid-19,” she said, adding that wholesale and retail trade has contracted for four straight quarters. A drop in remittances from Nigerians living abroad, which account for 6% of GDP, will further weigh on the consumers.

“Nigeria’s deteriorating fiscal position also implies a weak and slow recovery,” Mhango said. “Nigeria’s government revenue is peculiarly low. This significantly constrains spending.”

the police brutality of the few professionals in Nigeria’s technology industry is bringing a huge loss to Nigeria in form of foreign earnings.

Narrating his ordeal with SARS, Yele Bademosi, founder, Bundle, a social payment app for cash or crypto, said he was kidnapped by SARS on October 2019, at a location less than two minutes from his home.

“They took my phones, wallet, house key, my Apple Watch, didn’t care about my ID cards and claimed I was a Yahoo Boy because I had messages on telegram with foreigners. They demanded N1 million from me, made a “fake” phone call to their commander, and said I would sleep in prison,” he lamented.

Whereas, Nigeria’s unemployment rate is at a record high of 27.1 percent in the second quarter of 2020, tech companies have continuously lamented over the scarcity of IT professionals and lack of graduate that fit today’s job roles, which require a high level of soft skills, a problem resulting from Nigerian universities teaching students how to use a computer on the blackboard.

According to Jessica Akano, recruiting manager for Africa at Andela, a company that offers software engineering as a service, one of the major challenges of her role has been “scarcity of very solid talent due to pay competition and multiple opportunities at home and abroad for software

engineers. There is always another company willing to pay more or do more.”

Instead of relying on the export of crude oil for over 90 percent of Nigeria’s foreign earnings, industry analysts have advised that Nigeria should train most of its young population for IT export and in exchange, attract more foreign earnings and investments.

To the analysts, export of services is a major contributor to the GDP of some of the world’s biggest economies.

Startuplist Africa, a datadriven platform that focuses on African start-ups, shows that Nigerian tech start-ups attracted over $85 million in the first 10 months of 2020 with over 80 percent from foreign investors, a source of foreign earnings for a country that has been suffering from dollar shortage since the collapse of oil price.

Meanwhile, the protest by predominantly young Nigerians for the reform of the police force has entered its sixth consecutive days even after the Inspector General of Police announced that SARS has been dissolved, the firth dissolution in four years.

“At this point, this goes beyond the tech sector and cuts across all aspects of life.

As a young Nigerian living in Nigeria, we should not live in fear of people who are supposed to be the one protecting us against harm,” Bademosi said.

@Businessdayng

Thursday 15 October 2020

BUSINESS DAY

31

News feature Apapa gridlock: How corruption...

Continued from page 1

too long.

Based on several interviews with port officials, importers and agents, it was discovered that, truly, in Nigeria, corruption has assumed the status of an emperor, occupying prime positions in governments, businesses and, as in the case of Apapa, on roads and bridges.

Apapa, Nigeria’s premier port city, is home to the country’s two busiest seaports Apapa and Tin Can. These, according to records, account for about 75 percent of export and import activities in the country.

The port city is said to be a N20 billion-a-day economy.

But the port city has become a byword for chaos and rampant corruption. An inability to match exports with the volume of containers imported into the country means that the beleaguered ports will continue to suffer congestion, and roads leading to the port city will also continue to be a nightmare.

Hundreds of trucks, some bearing containers, queue up for months to get access into the ports and companies hard pressed for time pay a premium to get ahead, creating a ‘racket’ for security agencies tasked with orderly movement into the ports.

A survey by Nigerian Shippers’ Council estimates that

But this is just one out of many reasons why the gridlock has defied solutions from Lagos State and Federal Government.

“If you want the Fast-track system, you will spend between N250,000 and N350,000 to get your way through for 20-foot and 40-foot containers, respectively,” a clearing and forwarding agent, who spoke in an interview with BusinessDay, said.

“If you pay that money by 2pm, your container will be at the ports by 8pm and by 9pm10pm, you shall have loaded your container. That is the fasttrack.Butifyouchoosetoqueue, it takes a minimum of four to six weeks to enter the ports.”

In many cases, truck drivers hide N500 or N1000 note in a piece of folded paper for security officers in Apapa.

The agent recalled that about six years ago, a 40-foot container could move from Tin Can Island Port to Point Road also in Apapa for between N70,000 and N80,000.

But today, that is not the case, saying that to lift a 40-foot container from Tin Can Port to the same destination would take N220,000 to N240,000. “Even at this, the situation has improved because in December 2019, it cost about N750,000.”

Remi Ogungbemi, chairman, Association of Maritime

Bad road leading to the premier port.

7,000 trucks ply Apapa Wharf Road on a daily basis and only about 2,500 of them have genuine business at the ports.

The rest, whose movements are largely uncontrolled or aided by rent-seekers, constitute not just the cause of the gridlock, but also the source of corruption.

Corruption There is a well-organised racket going on in Apapa and Tin Can Island ports, Lagos, which has perpetuated the gridlock going on in the premier port city. The malfeasance involves trucks drivers, security agencies and government officials operating in the port city.

Known as ‘Fastrack,’ this racket ensures that truck drivers who part with N250,000 to N350,000 get speedy callup, entering the ports before others on queue. Because money is involved, the trucks of drivers who are able to pay come into the ports at the same time, resulting in total lockdown of the premier port city, BusinessDay has found.

Truck Owners (AMATO), confirmed to BusinessDay that these developments were true, noting that Apapa bridges had become market places while check points on the roads had become tollgates.

“The system presently being used to administer trucks into terminals, factories and jetties in Apapa has become obsolete and there is need for a change.

There is need to create another system that is devoid of human interference and cannot be compromised to benefit people’s personal interest,” he said.

He said it was sad that many people were benefiting from the chaotic system, which had become bread and butter for them.

“S ome p e ople have grouped themselves into a cabal and if you are not a member of that cabal, your trucks would not be allowed to go. Every morning and night, monies exchange hands but the money cannot be seen physically because they are very smart in doing it, and if you are not a member of that www.businessday.ng

A chaotic scene at the Nigerian Ports Authority, Apapa.

caucus, your trucks cannot go,” he said in a phone interview.

The Federal Government few years ago set up the Presidential Task Team (PTT) led

by Kayode Opeifa. Many players at the port city say the task force has not been as effective as they ought to.

One major player at the ports told BusinessDay that that the Apapa problem could be solved if vested interests including government agencies wanted to get it solved, dismissing the taskforce by whatever name called. According to him, any new taskforce for traffic control meant increase in the cost and level of bribery on the road.

“If police, FRSC and LASTMA are now collecting N200,000 from you for 20-foot container, they will now tell you to make it N300,000 and if it is 40-foot, they will ask you to make it N400,000 because of the new taskforce team,” he said, stressing that “as long as these corrupt security agencies and others profit from this system, there is no incentive to fix the mess in Apapa.”

One importer, who pleaded not to be quoted, said he paid between N250,000 and N300,000 to shunt the long queues to pick up his container containing machines for a critical manufacturing concern.

Economic losses This comes with a lot of costs on the economy. A report by the Lagos Chamber of Commerce and Industry (LCCI) notes Nigeria loses N600 bil-

Pix by Olawale Amoo

technical barriers, rejection of relevant documents by officers of the agency that approved import documents, multiple agencies with duplicated functions and other rent-seeking activities of vested interests at the port that excessively fleece operators,” they said.

Tola Faseru, former president of Cashew Association of Nigeria, said it costs N25,000 to transport a metric ton of cashew from anywhere in Lagos to the ports because of the difficulty in accessing the terminals.

“The situation is bad,” he said. “Although government has improved the roads leading to the ports, accessing the ports is still difficult. It takes two weeks to get your container cleared even with barges.

We need better structure and easy access to the ports to make ease of doing business a reality,” he further said.

Jon Tudy Kachikwu, CEO of Jon Tudy Interbix, exporter of packaged foods to the United States via Apapa, loses most of his products on Apapa bridge. He spends N650,000 to move his foods from Iddo in Lagos to the port city as against N350,000 in November 2019. This represents 86 percent increase in the cost of moving from Iddo to Apapa, both in Lagos.

His products spend three weeks on Apapa bridge before getting to the ports, but they often get bad before reaching the destination country.

“Security agencies are the

A driver brandishing his clearance permit before a security agent to gain pass on to the Apapa port.

lion in Customs revenue annually, including $10 billion in non-oil export sector and N2.5 trillion in corporate earnings across various sectors due to the poor state of Nigerian ports.

In an interview conducted by the Manufacturers Association of Nigeria (MAN) on critical challenges facing the sector in Q1 2020, 94 percent of the CEOs said that congestion at the ports had a significantly negative effect on their productivity and cost of production.

“Most worrisome are the issues of deliberate delay in cargo clearing time, raising of

biggest problems we have in Nigeria. Our logistics costs have doubled in the last one year because security agencies are asking for money at each junction. We cannot talk about development and food security, but continue to pay lip service to corruption by security agents, which is killing businesses. How will Nigeria have the scarce foreign exchange when Apapa and Tin Can are frustrating exporters,” he asked.

Another businessman said while he spent about N500,000 to bring a container

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from China to the Apapa Port, he spent over N1.2 million to take the same container out of Apapa to Sagamu.

According to CEOs of manufacturing firms earlier quoted, government must deliberately conduct a comprehensive review of all the contributory factors and consciously implement ongoing reforms in a manner that all port-related challenges that seemingly appear to have defied all solutions are permanently resolved.

Empty containers There are several empty containers in Apapa, constituting nuisance to the port city. Inside the ports, there are thousands of containers that delivered goods into Nigeria but are stuck at the ports because of lack of corresponding goods to export. The reason is that exports of finished products always pale into insignificance when compared with import counterparts.

In the second quarter of

demurrage daily and rentage fees. Any importer who has a time-sensitive order has no choice but to pay corrupt government officials including police, LASTMA and Customs officials to move him further along the line.

Paradise lost Ayo Vaughan, chairman, Apapa GRA Residents Association, told BusinessDay that he left Ikoyi for Apapa because, as of the time he came here, Apapa was a paradise. This was 30 years ago when Apapa and Ikoyi were the same.

“Today, Apapa is paradise lost. In those days, it took only 15 minutes to get to Awolowo Road from Apapa. Now, I am afraid to go out. It has happened in some cases that residents, including me, have had cause to turn back and sleep elsewhere because the road is impenetrable. During the day, the roads are better, but in the night when no one is in control, it is as bad as it can be. At this time, the trailer

Another scene of the state of rot that the Apapa port route is lying.

2020, exports (including crude oil and minerals) amounted to 36 percent of total trade estimated at N6.242 trillion. Finished and agricultural products comprised merely N347 billion, representing just 5.6 percent of the total trade, according to National Bureau of Statistics’ (NBS) Foreign Trade Statistics data. This explains why empty containers stay on Apapa bridges for months.

Bad roads This situation is worsened by bad roads to the port city.

Though the major roads into the ports are under rehabilitation, delay getting into the port has created room for corrupt security officials, including the police, the Lagos State Traffic Management Authority (LATSMA), FRSC and customs officials who are profiting from the mayhem.

Tony Anakebe, managing director of Gold-Link Investment Limited, told our correspondent that the traffic congestion in Apapa had become bad, and was caused by the security operatives managing traffic in that area, who now took the job as a lucrative venture.

According to Anakebe, any of the officers redeployed to other parts of the city must bribe their way back to Apapa due to the money generated from the checkpoints mounted along the roads leading to ports.

Trucks spend two months on a queue inside Apapa to get into the port city to lift cleared containers, attracting @Businessdayng

drivers are in control,” he said.

Empty Houses Vaughan further said many houses in Apapa were already empty. “You do not expect somebody to come and live in a house of N5 million per annum and right in front of his house, somebody is frying akara or doing any other form of business. So, we have houses that are not rentable, not leasable nor even sellable,” he said.

He said a woman in one of the streets in the port city put up her house for sale at N65 million, but nobody wanted to buy. Just a few days ago, he said, the woman, in anger, sold the house for N40 million and left the area for good.

He said in spite of this ugly situation, Lagos State government still collected tenement rates from the residents and expected them to pay same as payable in Ikoyi and Ikeja GRA, though some houses in the area had been empty for three to five years.

“And don’t forget, it is the same government’s policy that is preventing you from renting out those houses. On one street alone, there are many houses, up to 10, that are empty because nobody wants to live in Apapa anymore. That is as a result of environmental degradation,” he explained.

He disclosed there could be up to 40 percent of all the houses in the GRA that were empty, with many retirees depending on rental income from homes for their daily living.

Thursday 15 October 2020

BUSINESS DAY

A1

NEWS

Electricity customers accuse DisCos of charging increased tariff despite suspension

Sanwo-Olu, Oyetola preach women empowerment DESMOND OKON

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overnors of Lagos and Osun States, Babajide SanwoOlu and Gboyega Oyetola respectively, have urged Nigerians and corporate bodies to support women empowerment so as to strengthen Nigeria’s socioeconomic development.

The governors spoke at the 20th National Women’s conference organised by the Committee of Wives of Lagos State Government Officials (COWLSO) which commenced virtually in Lagos on Wednesday. The theme of the conference this year is “exploring the possibilities in a new world.”

Sanwo-Olu said, ‘’I am proud to say that COWLSO’s annual women’s conference has had a positive impact on our women as I see how confident they have become in contributing to the political and socio-economic growth of our country.”

Addressing the women, he said “ I urge you all to immerse yourselves in this conference over the next two days so that you can

become better equipped to take your place in the world. ‘’I want you to be inspired by the life of ano t h e r Ni g e r i a n , Ng oz i Okonjo-Iweala, who is one of the last two contenders for the position of director-general of the World Trade Organisation. Her nomination and eventual advancement to the final round of the selection process should tell you that the global stage is ready for Nigerian women, the question is: are you ready to make history by exploring the possibilities in a New World?

Governor Oyetola, who was the guest of honour at the event, called for adequate supported for women as this would promote strong family mental wellbeing and economic growth.

Chairman of COWLSO and wife of the Lagos State governor, Ibijoke Sanwo-Olu said the committe e was a strate gic community-based gender organisation established to support officials of the Lagos State government to fast-track growth and development, with the aim of improving the welfare of Lagosians.

DIPO OLADEHINDE

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lectricity customers have accused power distribution companies (DisCos) of charging increased tariff despite its suspension by the Nigerian Electricity Regulatory Commission (NERC).

Following pressure from organised labour unions, the Nigerian government had extended suspension of electricity tariff hike till October 18, after an initial two weeks suspension ended midnight on October 11.

But a number of consumers, who commented on the NERC’s extension of the tariff hike suspension, complained that they still bought electricity at the old tariffs.

A Tw i t t e r u s e r, S o l a Olaniyi, said, “For a test on the update, I recharged N500 this morning, but I get hiked tariff.”

A copy of the receipt he posted showed that he got

7.46 kilowatts per hour, translating to N67 per KWh, from Ibadan Electricity Distribution Company.

A consumer with the name Giwa Raphael questioned why Ikeja Electic billed him the new tariff for prepaid credit he got on October 1, despite the suspension of the electricity tariff hike.

Another Twitter user, with the handle @vller, in a message to Abuja Electricity Distribution Company, said, “Hello, AEDC, I bought power this morning 30/09/20 via @ buypowerng but noticed that the unit received was half what I should get considering @NERCNG had already put a halt in tariff hike as at 29/09/20.”

“Kindly give to me the exact unit that I should get based on the previous tariff,” he asked.

A consumer, Oyinkro Omukoro, said he bought electricity units worth N10,000 from Port Harcourt Electricity Distribution Com-

pany on Tuesday but got 169.80 units as against the over 320 units he would have got if the tariff hike was reversed.

Another Twitter user, Eleojo Emmanuel, said, “Hi @ IkejaElectric, I bought units at 9am today (September 30, 2020). I paid N5,000 and got 94.4 units. When do I get the balance of my units per this @NERCNG order?”

In Disco’s reply, Kaduna Electricity Distribution Company said it had fully complied with NERC’s directive on tariff hike suspension.

“Prepaid customers who purchase electricity tokens from October 1 will therefore see the value of the old tariff reflected in their tokens while post-paid customers will also see the old tariff reflected on their next bill,” its head of corporate communication, Abdulazeez Abdullahi, said early this month.

Ikeja Disco also said its current bill has been computed on a pro-rated basis to

reflect the 27 days (September 1- 27) of the new tariff and the three days (September 28-30) of the previous tariff.

“Our prepaid meter customers that purchase electricity token from September 28 will receive the value of their purchases on the old tariff rates while post-paid customers will also have the old tariff reflected in their next billing cycle,” Eko Disco said in a statement.

NERC had directed all DisCos that “all tariffs for end-use and market obligations of the DisCos during the 14-day suspension shall be computed on the basis of rates applicable as of August 31, 2020.

The decision to extend the tariff hike by another week was taken during a meeting between the FG team led by the secretary to the government of the federation, Boss Mustapha, and the leadership of the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC).

COVID-19: Stakeholders urge partnership to tackle poverty BUNMI BAILEY

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takeholders have stated the need for private sector players to align efforts with the government in tackling the effects of the Coronavirus (Covid-19) pandemic in order to reduce the level of poverty in Nigeria.

This was the resolution at the recent cross-sector roundtable organised by State Craft Inc, a full-service governance consulting firm.

The roundtable held in Lagos had Sadiya Umar Faruq, minister of humanitarian affairs, disaster management and social development and other leaders in the business and development sector, in attendance.

The roundtable was convened with the aim of rallying stakeholder support to boost efforts of the Federal Government in addressing the myriad of challenges emanating from the global Covid-19 pandemic.

The minister impressed upon guests the importance of “re-imagining approaches to solving new and older challenges in the wake of the pandem-

ic.” She also assured that the meeting will lead to a “renewed vigour in the ongoing efforts to find better ways to collaborate as we help those most vulnerable in society.”

Adebola Williams, CEO, State Craft Inc., commended the effort of the public and private actors in Nigeria’s fight against hunger.

M o h a m m e d Ya h y a , resident representative of the United Nations Development Programme in Nigeria, who was also at the forum, emphasised the importance of collaboration and partnership in development. He noted that public-private partnership has been instrumental in the projects the United Nations Development Programme (UNDP) has successfully executed in Nigeria.

Attendees at the roundtable resolved to better align their efforts with those of the government of Nigeria towards cushioning the impact of the Covid-19 pandemic on Nigerians, especially regarding the increasing number of people at risk from hunger, with inadequate access to health and educational facilities.

L-R, Obi Elochukwu, Ikeja Electric (IE) customer from Olumayowa, Ketu; Folake Soetan, chief executive officer, IE; Jonathan Oyewo, IE customer from Unity Estate Egbeda and Emmanuel Hanna from Irawo, Ketu, Lagos, during the celebration of customer service week in Ikeja Electric’s headquarters, Alausa, Ikeja Lagos.

CBN to sanction shipping lines for non-compliance with directive on export proceeds numbers AMAKA ANAGOR-EWUZIE & GIFT WADA

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he Central Bank of Nigeria (CBN) said it would sanction international shipping companies for not complying with its directive that all export goods leaving the country must carry Nigerian Export Proceeds (NXP) numbers.

Speaking during a virtual meeting recently convened by the CBN on the issue, Godwin Emefiele, CBN governor, stated that an audit of shipping companies by the apex bank showed that several shipping companies were not complying with the directive.

On his part, Hassan Bello, executive secretary/CEO,

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Nigerian Shippers’ Council (NSC), said the Council in partnership with the central bank has carried out three sensitisation meetings in Lagos and Port Harcourt to educate shipping companies and exporters on the need to implement the directive on the NXP. According to a statement

by Rakiya Zubairu, head, public relations of NSC, Bello added that the Council would work with other agencies of government to ensure full compliance, so that export without the NXP would be discontinued.

“We are going to set up an auto system, where if someone wants to send cargo, copies of the NXP form would be

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sent directly so that if agencies in charge do not have the number on their system, the cargo would be turned back,” he explained.

Re s p o n d i ng , A n d re w Lynch, managing director, MSC Nigeria Limited, stated that his company receives NXP forms on all major agro commodities like cashew, cocoa and sesame, but not for commodities like charcoal and timber.

According to him, items such as charcoal and timber usually do not have NXP forms after they have already arrived at the port, and once cargo gets to the port and has gotten clearance from the Nigeria Customs Services (NCS), there would be pres@Businessdayng

sure on shipping companies to ship immediately, due to space constraints at the port.

He added that one of their challenges also lies in their inability to verify the authenticity of an NXP Form.

Ascanio Russo, managing director, Grimaldi Nigeria Ltd, stated that in addition to not being able to verify the authenticity of the NXP Form, his company is unable to access CBN’s online portal.

The CBN governor, however, assured that a circular outlining the procedure to verify the NXP would be sent out to shipping lines and relevant agencies like the NSC, ministry of finance, Nigeria Customs Service and security agencies among others.

A2 BUSINESS DAY

Thursday 15 October 2020

NEWS

Nigeria needs 50,000mw p/d to meet electricity demand …as Ikeja Electric signs N11.4bn metering contract OLUSOLA BELLO

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igeria should be producing about 50,000mw of electricity every day to meet the country’s demand gap, Kola Adesina, chairman, Ikeja Electric, has said.

Adesina stated this during the launch of buggies and bicycles at the Egbin Power Plant, Lagos, Tuesday, describing as ‘shameful’ Nigeria’s current unstable 5, 700mw for its 200 million population.

Meanwhile, in a desperate move to ensure steady supply of electricity to customers, Ikeja Electric has signed N11.4 billion metering contract. Adesina said that the company signed the contract for the purpose of metering customers.

The company, he said, was also investing massively in network expansion and entering into additional contracts for meter production.

“We have signed service contracts with all our customers and we will ensure that we supply to them,” he said, adding that $44 million has been invested

in metering infrastructure, improved technology and innovation to boost Ikeja Electric’s operation.

Commenting on the power sector, he said the performance of the sector since the privatisation in 2013, has witnessed a significant progress but that a lot of ground still needed to cover.

“Nigeria was doing about 3,000MW in 2013 but today it is doing about 5, 700MW averagely. In terms of generation and distribution, we are way behind.

We are moving forward but not moving as fast as we should,” he said.

Continuing, he said “we should actually leapfrog achievements than these incremental achievements we are making.

The reason this is so is because electricity analysis is not done using economic principles that required.”

On the premium customers innovation introduced by the company, Adesina said customers that keyed into the scheme at Ogudu, Magodo, Ikeja and other areas where it has bilateral power supply agreements have witnessed improved supply.

Omo-Agege queries N5bn Zamfara gold bar ownership KAMARUDEEN OGUNDELE, Abuja

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eputy senate president, Ovie Omo-Agege, has expressed discontentment over Zamfara gold bar worth N5 billion sold to the Central Bank of Nigeria.

He queried why the monies made from crude oil from the Niger Delta goes to the federation account while Zamfara lays claim to the ownership of the gold mined in the state.

Omo-Agege made the observation during a plenary on Wednesday while defending the 2021 appropriation bill presented by President Muhammadu Buhari.

According to him, the Federal Government would be able to tackle budget deficit if resources

from the solid mineral sector are effectively controlled.

He said, “We often talk of leakages in the system but why even go into leakages when we can go directly to the solid mineral sector?

“Mr. President of the senate, not too long ago, we saw the governor of Zamfara State, Bello Matawalle come before the CBN to present a gold bar worth close to about N5 billion.

The gold bar was presented for sale to the CBN. Mr. President, our people are beginning to wonder who owns this gold that is being sold to the CBN. “They don’t sell oil in any of the Niger Delta states. I am wondering why a governor of a state should be selling gold bar from Zamfara to the CBN.”

‘Unlawful land seizure’: Court dismisses N8.1bn suit against Lagos, NJC FELIX OMOHOMHION, Abuja

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Federal High Court in Abuja on Wednesday dismissed a N8.1billion suit instituted by a retired army general AbdulRauf Tijani against Lagos State government and six others over an alleged unlawful land seizure.

Justice Inyang Ekwo while delivering the judgment dismissed the suit on the ground that it constituted a gross abuse of court process. The judge also held that the suit was defective in nature and contents.

Justice Ekwo held that the case of the plaintiff ran foul of section 63 of the Federal High Court Act having been instituted against a serving judge of the court in the discharge of his judicial duties. The judge held that immunity granted a serving judge in the course of judicial function was not ambiguous,

adding when such judge erred, the appropriate place for remedy was not a law court.

Tijjani had dragged the Lagos State government, National Judicial Council (NJC), the Federal High Court, Justice Ayokunle Faji and other respondents to court challenging the alleged injustice perpetrated against him by officials of Lagos State and the serving judge of the Federal High Court.

The plaintiff specifically challenged the alleged sabotage of the execution of a court judgment which returned his landed property in Lagos State to him.

In arguing his case, the retired army general urged the court to intervene in the matter because a judgment entered in his favour has been criminally sabotaged allegedly by the Lagos authorities in connivance with the Federal High Court judge. www.businessday.ng

Onome Adewuyi (l), president/chairman of council, Institute of Chartered Accountants of Nigeria (ICAN), presenting a copy of the reviewed curriculum of the accounting programmes of Nigerian universities conducted by ICAN, to Abubakar Rasheed, executive secretary of National Universities Commission, in Abuja, yesterday.

Escaping bad loans is about to get harder for Nigerian banks

...IMF expects economy to expand at below-average 1.7% next year ...Lenders need 4%-5% growth to avoid bad-debt spike, EFG says BLOOMBERG

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igeria’s economy is poised to expand at less than half the pace needed by banks next year to avoid a spike in unpaid loans.

The 2021 outlook for sub-Saharan Africa’s largest economy was cut to growth of 1.7% by the International Monetary Fund on Tuesday, compared with a June forecast of 2.6%. That will make Nigeria the fourthworst performer among nations measured by the Washington-based lender in the region.

Lenders need the economy to accelerate after restructuring about 40% of loans on their books that would’ve soured and should have been booked as non-performing

loans. As growth lags, the risk of these reorganized loans going unpaid rises.

“There’s no real sense the economy will bounce back to 4% to 5% growth,” Ronak Gadhia, director for subSaharan African banks research at EFG-Hermes, said by phone. “We expect banks’ credit quality to remain under pressure.”

Nigeria’s gross domestic product will probably shrink 4.3% for this year, the IMF said, as a lockdown to contain the Covid-19 outbreak, lower oil prices and rampant dollar shortages weighon output.

GDP last expanded by more than 3% in 2014.

“We won’t have as much money to drive the infrastructure plans that the government intends to implement to open up activities in different sectors of the

economy,” Mosope Arubayi, chief economist at Lagosbased Vetiva Capital said by phone. “We’re not seeing a situation whereby oil prices will be significantly stronger next year.”

The central bank anticipates that almost two-thirds of credit in the economy will be reorganized this year to help borrowers cope with the economic fallout from the pandemic. EFG expects NPLs will rise to 7.6% of total credit at the end of the year, as the economy deteriorates, increasing impairment charges, Gadhia said.

Cairo-based EFG predicts that Nigeria’s GDP will increase by 1% to 2% in 2021, “which is ver y low, and doesn’t help the banks from an asset-quality perspective,” the analyst said. Earnings per share at Nigerian banks

could decline 65% this year, Gadhia said.

The government doesn’t have the financial resources to support the economy, said Yvonne Mhango, the subSaharan Africa economist for Renaissance Capital.

“Nigeria’s recovery will be undermined by a consumer who was already in recession pre-Covid-19,” she said, adding that wholesale and retail trade has contracted for four straight quarters. A drop in remittances from Nigerians living abroad, which accounts for 6% of GDP, will further weigh on the consumers.

“Nigeria’s deteriorating fiscal position also implies a weak and slow recovery,” Mhango said. “Nigeria’s government revenue is peculiarly low. This significantly constrains spending.”

Nigeria may benefit as IMF/World Bank plan debt reduction for IDA countries HOPE MOSES-ASHIKE

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iven the urgency of the debt crisis, Nigeria may benefit as the International Monetary Fund (IMF) and World Bank have proposed to undertake a joint action plan on debt reduction for the most indebted International Development Association (IDA) countries.

“We’ll discuss it this week with governors during our annual meetings. It’s urgent to make rapid progress on a framework because the risk of disorderly defaults is rising,” David Malpass, World Bank Group president said in his remarks at the G20 Finance Ministers and Central Bank Governors Meeting in Washington D.C. Nigeria is a member of IDA. The IDA has 173 member

countries which pay contributions every three years as replenishments of its capital.

The association assesses countries based on their per capita income, lack of access to private capital markets, and policy performance in implementing pro-growth and anti-poverty economic or social reforms.

Malpass said with the strong support of its shareholders, IDA has frontloaded IDA19 resources to the fullest possible extent as a key part of the surge in our commitments this fiscal year. However, IDA lending would have to decline in the next two years even though the latest forecasts, including those just announced by the IMF, suggest that the reduction in economic activity will extend well into subsequent years.

“We are proposing to IDA deputies later this month a $25

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billion supplemental Covid-19 Emergency Financing Package,” he said.

He also announced the board’s approval of a package of up to $12 billion to expand its fast-track Covid-19 response for the purchase and distribution of Covid-19 vaccines, tests and treatments.

According to him, the tendency in past debt crises is for countries in debt distress to go through a series of ineffective debt reschedulings that leaves them weaker. Creditors may eventually allow them to get to a debt reduction process, but at a tremendous cost to the poor.

He noted that soon after the Spring meetings in April, the bank was able to launch health emergency programs in 111 countries and begin a surge in its grants and highly concessional lending that will @Businessdayng

reach the limits of its capital structure and commitment authority.

“As part of this effort, we expect to provide over $50 billion in grants or highly concessional credits by June 2021, helping provide large net positive flows to the poorest and most fragile countries and people,” Malpass said.

Also in March, he said the G20 endorsed a vital debt relief program for the poorest countries, giving people a ray of hope. The Debt Service Suspension Initiative (DSSI) helped increase fiscal resources for over 40 countries and created more transparency on the overwhelming debt burden. “This week, we published more granular data on debtors and creditors which will help identify problems and work toward sustainability”.

Thursday 15 October 2020

BUSINESS DAY

Live @ The Exchanges Market Statistics as at Wednesday 14 October 2020

Top Gainers/Losers as at Wednesday 14 October 2020 LOSERS

GAINERS Company

ASI (Points)

Opening

Closing

Change

GUARANTY

N29.55

N30

0.45

ETERNA

N4.38

N4.81

0.43

ETRANZACT

N2.12

N1.91

-0.21

WAPCO

N17

N17.3

0.3

FCMB

N2.35

N2.26

-0.09

VOLUME (Numbers)

N13.5

N13.7

0.2

FBNH

N6.25

N6.2

-0.05

VALUE (N billion)

N4

N4.2

0.2

CAVERTON

N1.8

N1.75

-0.05

DANGSUGAR

PZ

Company

Opening

Closing

Change

N44

N42.5

-1.5

STANBIC

DEALS (Numbers)

MARKET CAP (N Trn)

28,348.08 3,478.00 163,844,637.00 2.402 14.817

Stock market closes flat as investors watch Nigeria’s social protests Iheanyi Nwachukwu

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he Nigerian stock market closed flat on Wednesday October 14 as the recent social protests across the country against police brutality is being closely watched by the investing public.

The market could not sustain preceding day’s gains despite record rally by equities like Guinness Nigeria Plc (+3.33percent); Eterna Plc (+9.82percent); GTBank Plc (+1.35percent); Africa Prudential Plc (+5.75percent); and Lafarge Africa Plc (+1.47percent).

“It must be noted that the recent rally remained driven by influx of liquidity in the system amid limited investment outlets and abnormally low yield environment”, said Lagosbased analysts at United Capital Plc. The analysts maintain that while the protest against police brutality may trigger some panic sales, if not de-escalated, amid recent realities in the econo-

L-R: Lamido Yuguda, director general, Securities and Exchange Commission; Reginald Karawusa, executive commissioner, Legal and Enforcement SEC and Sunday Thomas, commissioner for Insurance, National Insurance Commission, during a Meeting between The SEC and NAICOM in Abuja yesterday

my which is yet to get over the devastating impact of the Covid-19 shock.

The Nigerian Stock Exchange All Share Index (ASI) stood flat at 28,336.12 points while value of listed equities stood at N14.810trillion. In

3,779 deals, investors exchanged 199,999,710 units valued at N2.749billion. Zenith Bank Plc, UBA Plc, GTBank Plc, FBN Holdings Plc and Wema Bank Plc were actively traded stocks.

“Sustained low yield en-

NSE to host industry leaders at oil and gas sector webinar

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he Nigerian Stock Exchange (NSE) will host an Oil and Gas sector webinar on Tuesday October 20, 2020.

With the theme, Perspectives of Operators and Industry Experts PostCOVID-19, the webinar will bring together key players across the entire oil and gas value chain to discuss the impact of the COVID-19 pandemic on the sector as well as its reactions to global trends, government policies, funding dynamics, key challenges and potential shifts.

The event will be headlined by the Honourable Minister for State for Petroleum Resources, Chief Timipre Marlin Sylva; the Director General, Securi-

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ties and Exchange Commission (SEC), Lamido Yuguda; and the Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Mele Kolo Kyari. It will feature a stellar line-up of global speakers across the public and private sector who will analyse global trends and insights that will shape the future of the Nigerian oil & gas sector, provide recommendations for policy makers, and identify opportunities for long-term growth and expansion.

Speaking about the webinar, the Chief Executive Officer, NSE, Oscar N. Onyema, noted that, “The impact of the COVID-19 pandemic continues to be felt across diverse industries globally and the oil and gas www.businessday.ng

industry is no exception.

Today, the COVID-19 crisis has accelerated what was already shaping up to be one of the industry’s most transformative moments, the impacts of which will likely be felt throughout oil’s global supply chains and ripple into other parts of the energy sector. Nonetheless, oil and gas will remain a multi-trilliondollar market for decades given its role in supplying affordable energy. The question of how to create value in the new normal is therefore fundamental and one that we hope to discuss in this webinar. We envision that the insights gathered at the forum will lead to actionable solutions that can chart a more sustainable future for the oil and gas sector.”

vironment vis-a-vis massive system liquidity which will remain the case till year end as well as attractive dividend yields, implies that the investment case for equities remain compelling”, United Capital analysts added.

Global market indicators FTSE 100 Index 5,935.06GBP -34.65-0.58%

Nikkei 225 23,626.73JPY +24.95+0.11%

S&P 500 Index 3,483.49USD -28.44-0.81%

Deutsche Boerse AG German Stock Index DAX 13,028.06EUR +9.07+0.07%

Generic 1st ‘DM’ Future 28,367.00USD -218.00-0.76%

Shanghai Stock Exchange Composite Index 3,340.78CNY -18.97-0.56%

Federal High Court arraigns promoters of Dantata Success over N2bn investment fraud

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he Federal High Court sitting in Abuja has arraigned the promoters of Dantata Success and Profitable Company for investment fraud amounting to over N2billion. Those charged along with the company are Basira Ibrahim Dantata, Lawan Sanni and Gaji Ibrahim Dantata.

The defendants who were arraigned before Justice A. I. Chikere of Federal High Court 3 were alleged to have between 2018 and 2019 within the jurisdiction of the court with intent to defraud about 7,250 investing public to subscribe and invest in an unregistered investment scheme amounting to over N2 billion.

According to the charge, they committed an offence contrary to Section 54 of the Investments and Securities Act 2007 and punishable under same section.

When the matter came up in court, one of the defendants Gaji Ibrahim Dantata was not available due to health reasons.

Justice Chikere thereby adjourned the matter to November 5, 2020 for plea and motion filed by the defendants.

Recall that the Securities and Exchange Commission pursuant to its powers under

Section 13 (w) of the Investments and Securities Act (ISA), 2007, on 6 February 2019 sealed up the business premises of Dantata Success & Profitable Company (DSPC), a company that had been engaging in illegal activities in the Nigerian capital market. In addition, the Commission obtained court orders to freeze the bank accounts of the company to preserve the funds of investors in line with Section 13 (x) of the ISA 2007.

The company was not registered or authorized by the Commission to engage in any activity in the capital markets, however it targeted and reached Nigerian investors through radio programs in the Kano area of Nigeria and collected large sums of money from investors under the guise of a “structured investment”. The activities of the company contravene the provisions of Section 38(1) and 67(1) of the Investments and Securities Act which respectively, prohibit unregistered and unauthorized entities/persons from operating any investment business or making any invitation to the public to acquire or dispose of any securities of a body corporate or to deposit money with anybody corporate for a fixed period or payable at call.

FPCC partners with NIMR to launch SIMA Covid-19 test kit

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ATE Philanthropy Coalition for COVID-19 (FPCC) Support Fund, a Philanthropy unit of FATE Foundation in partnership with Nigerian Institute of Medical Research (NIMR) has announced the launch of the first SARS-CoV-2 Isothermal Molecular Assay (SIMA).

The SARS-CoV-2 Isothermal Molecular Assay is a Point-of-Care molecular test kit that can detect COVID-19 in real-time in less than 40 minutes, compared to at least 2 hours that it takes the current testing protocols.

SIMA is the first of its kind and was fully funded by the FATE Philanthropy Coalition for COVID-19 Support Fund (PFCC).

This test kit has been designed and developed by the Nigerian Institute of Medical

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Research (NIMR) to ease the challenges posed by the current method of testing which requires very heavy laboratory and expensive equipment to function. An added advantage of SIMA kit is that low-skilled personnel can be trained to perform this assay in tertiary health facilities where it can be used to diagnose COVID-19 in hospitalised patients. This will be particularly advantageous in remote areas with disadvantaged populations.

Speaking about the Launch, Coordinator of the FPPC Support Fund, Fola Adeola, said that “pioneering this research work led by some of our nation’s leading public health researchers at NIMR exemplifies the potentials of health innovation in Nigeria when effectively supported and enabled.

“We are proud to have @Businessdayng

provided the grant which helped NIMR to design and develop the SIMA and we are excited about the possibilities of this innovation in containing the COVID-19 spread and identifying people infected.”

He also noted that the FPCC Support Fund was set up in March 23, 2020 to support ongoing national and community efforts to ameliorate the impact of the COVID-19 pandemic on Nigeria by keying into local and national government’s efforts to properly equip public health facilities and front-line personnel.

“Till date, the investment funds have supported other public health institutions including the Lagos University Teaching Hospital and the National Ortheopeadic Hospital, Igbobi, Lagos,” he added.

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Thursday 15 October 2020

BUSINESS DAY

POLITICS & POLICY

#EndSARS protesters beam light on NASS’ huge salaries, allowances

Edo Assembly commutes Okiye’s impeachment to resignation

dvocates of #EndSARS have taken their campaign to another level, by beaming searchlight on the often-talked-about huge salaries of senators and members of the House of Representatives in the nation’s National Assembly.

The #EndSARS campaign began a week ago following the killing of a young man by a team of the now disbanded Special Anti-Robbery Squad of the Nigeria Police in front of Wetland Hotel, Ughelli in Delta State.

The ugly episode, the footage of which still trends on social media, shows the armed officers speeding off in the victim’s vehicle – a white Lexus SUV. Although, following the massive protests across the country, the Federal Government through the InspectorGeneral of Police, Mohammed

do State House of Assembly on Wednesday commuted the impeachment of its former speaker, Frank Okiye to resignation.

The former speaker was impeached on Monday by nine members of the house out of ten members for alleged financial impropriety and high-handedness.

The House also lifted the earlier suspension on the former speaker. The reversal of the impeachment of the former speaker was sequel to a motion moved by the leader of the House, Henry Okhuarobo, representing Ikpoba Okha constituency.

Okhuarobo said the need for the reversal of the impeachment to resignation became imperative due to appeals from their various constituents. The motion seconded by Emmanuel Okoduwa, representing Esan North East constituency 11 was unanimously adopted by the House.

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Adamu, disbanded the SARS, and President Muhammadu Buhari has also made a statement to that effect, as demanded by the protesters, the agitators have continued to demand other things.

Latest on the list of fresh demands is that government must “End Senators and Reps’ salaries.”

For many years, the huge salaries and sundry allowances of members of the National Assembly have continued to resent many citizens with majority calling for part time legislative work, to save the country from the needless financial hemorrhage.

In August 2015, shortly after he took over power from Goodluck Jonathan, President Muhammadu Buhari had issued an order directing the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) to address public outcry over huge salaries and

allowances of members of the National Assembly.

At that time, reports had it that the chairman of the commission, Elias Mbam had promised that senators and members of the House of Representatives would earn less than N1million by the end of next month (September of that year).

It was not certain if there were significant reduction following the President’s directive. But what is not contestable is that the huge takings by members of the nation’s bicameral legislature have continued to elicit anger in a country where majority of the citizens live below poverty line.

Following the presentation last Thursday of the 2021 Budget by President Buhari, many Nigerians heavily condemned the N128 billion earmarked for the National Assembly.

Recall that Buhari had presented a record N13 trillion

budget for 2021 to members of the National Assembly.

The spending plan is about 21percent rise from the revised 2020 spending plan of 10.8 trillion naira. The budget assumes crude production of 1.86 million barrels a day and an oil price of $40 per barrel with the exchange rate at N379 to $1, Buhari said.

Nigeria’s National Assembly – House of Representatives and the Senate got N128 billion in the 2021 budget in the plan, while N380.21billion was proposed for the health ministry.

He also proposed N127billion for capital expenditure in Education. N3.8 trillion was allocated to all ministries, departments and agencies for the execution of capital projects.

Observers told BusinessDay that going by the unfortunate state of affairs in the country, the #EndSARS protest could snowball into a long campaign of the kind of the Arab Spring.

IDRIS UMAR MOMOH, Benin

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Frank Okiye

Addressing newsmen after the plenary session, the speaker of the house, Marcus Onobn said the house was one and there was no rift between the executive and the legislature of the state.

On his part, the immediate past speaker, Francis Okiye said he was pleased with the decision of the house.

He expressed his readiness to work with the present leadership of the house for the good of his constituency.

Meanwhile, Emmanuel Okoduwa, representing Esan North East 11, has been appointed the chief whip of the house.

Nasarawa Assembly to assess governor’s 2020 Budget implementation SOLOMON ATTAH, Lafia

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L-R: Bayelsa State Head of Service, Biobelemoye Charles-Onyema; Speaker of the House of House, Abraham Ingobere; Deputy Governor, Senator Lawrence Ewhrudjakpo; Governor Douye Diri; Secretary to the State Government, Konboye Benson, and two of the newly sworn in Commissioners at Government House, Yenagoa, on Monday.

Makinde has redefined governance by being practical in leadership position, says Alaafin of Oyo REMI FEYISIPO, Ibadan

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he Alaafin of Oyo, Oba Lamidi Adeyemi has described Governor Seyi Makinde as a practical politician, who has used leadership position to redefine governance in the pacesetter state.

The monarch said Makinde has succeeded since the inception of his administration to fulfill many promises made during the electioneering period in the areas of free education, health, urbanisation, agricultural promotion among others, which he maintained the state needed to excel among others in the nation.

He saluted the state administration’s efforts at turning around the tourism sector by

partnering with international and local interests so as to create wealth and employment for the youths.

The foremost monarch said this when he was visited by the France Ambassador, Pasquier Jerome who had earlier visited the state governor and major tourist sites alongside his entourage before arriving in the ancient town of Oyo. According to Oba Adeyemi, the governor has shown enough evidence that he is for the people, this is indicated in his people-based programmes and his efforts at fulfilling promises made during the campaign period where he vowed to make a change that will truly benefit the people.

“Everywhere you go, the www.businessday.ng

state government is embarking on urbanisation projects that will serve the people and promote commerce, I commend him and advise that he does not rest on his oars.

“The cultural and tourism sectors are already experiencing positive changes that which has attracted foreign and local tourism experts and professionals to come and do business with Oyo State, this is an indication that Oyo State will soon be counted as one above others in Nigeria in the areas of ease of doing business, tourism destination and the true home of African culture.”

While appreciating Oba Adeyemi for maintaining the pride of Africans abroad and at home in the Yoruba culture, the France Ambassador, Pas-

quier Jerome was full of praise for the monarch for creating time to host the delegation.

He said France was working towards cooperation with Oyo State to boost partnership in research in archaeology, social sciences, humanities, education and promotion of culture and tourism, which he said arrangements were already in place to build on the relationship the country already had with the University of Ibadan.

“We already had archaeological research involving forty archaeologists in Ogun State in 2019, we want to enter into a new one with the Oyo State government to catalogue their archives and look into the possibility of exploring for new raw materials.

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head of the 2021 budget presentation by Governor Abdullahi Sule, the leadership of Nasarawa State House of Assembly said it was going to assess the budget performance of 2020 fiscal year to ascertain the level of its implementation.

The house has also finalised plans to commence a three-week oversight function on government Ministries, Departments and Agencies (MDAs).

The Speaker of the House, Ibrahim, Balarabe-Abdullahi stated this Wednesday during the House proceedings in Lafia.

He said that assessing the 2020 budget performance of the state would guide the house when Governor Sule would present the 2021 budget to the House.

Balarabe-Abdullahi urged the House standing committees to begin oversight function to the MDAs today, Thursday, with the aim of assessing the 2020 budget performance of the state for the year under review.

“As House, the constitution empowered us to make laws and to also embark on an oversight functions to check the activities of Ministries, Departments and Agencies (MDAs) in the state. @Businessdayng

Governor Abdullahi Sule

“We are commencing oversight function to MDAs on Thursday, 15th October, 2020 as His Excellency, Governor Abdullahi Sule will present the 2021 budget to the House very soon.

“Commencing the oversight function to MDAs will help us assess the 2020 budget performance of the state, as oversight function is key to legislative duties,” he said. The speaker posited that the exercise was not to witch hunt anybody but was to ensure that the right things are done in the interest of development.

“Most people misconstrue the work of the House.

Oversight function is not to witch-hunt anybody but is to ensure good governance,” he stressed.

He urged the House committees to do thorough job while on an oversight functions to ensure accountability and transparency for development to thrive.

industry Insight

BUSINESS DAY Thursday 15 October 2020 www.businessday.ng

Backward integration: One big step to beating FX crunch Odinaka Anudu

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ackward integration has become a popular topic in Nigeria in the last decade. Its popularity has been fuelled by crude oil lows, which have adversely affected foreign exchange (FX) inflows into the country, causing severe FX scarcity and disrupting production activities and supply chains.

Backward integration occurs when a company buys or merges with its suppliers, or internally produces segments of its inputs. A brewer, for example, can acquire part or whole of its sorghum supplier or sets up subsidiaries producing some of its sorghum, barley or hops.

“Companies often complete backward integration by acquiring or merging with these other businesses, but they can also establish their own subsidiary to accomplish the task,” Investopedia says.

A typical example of a backward integration success story is the Tyson Foods. In 2001, Tyson Foods based in the United States and China went into joint ventures (JVs) with Shandong Tyson Dalong Food Co Ltd, Jiangsu Tyson Foods Co Ltd and Tyson Shandong Food Co. According to a researcher Rajan Shah, the JVs propelled Tyson Foods into becoming a meat giant. During the outbreak of avian influenza in early 2013 in China, there was a big challenge for poultry products, but the food firm decided to win back the confidence of consumers by taking food safety seriously. Instead of sourcing birds from different farmers, it established its own poultry farm, controlling the entire value chain and production activities.

As of the end of 2015, the food company had planned to set up 90 farms in China compared to 20 in 2013.

“To achieve this milieu, Tyson Foods had decided to control the complete production supply chain in China through the backward integration strategy,” Shah said in a research entitled, ‘Tyson Foods in China: Growth Plans Through Backward Integration.’

Backward integration is an important strategy that can help Nigerian manufacturers protect themselves against FX volatility. Depending on the sector, exposure to the FX market in the Nigerian manufacturing sector averages about 40 percent, according to the Manufacturers Association of Nigeria (MAN). But

it differs from sector to sector.

Food and beverages sector had an average of 64 percent local input or 36 percent FX exposure in 2019, according to MAN. Sectors like pharmaceuticals and chemicals would naturally have higher FX exposure because most of their inputs are imported owing to lack of functional petrochemical industry in Africa’s most populous nation.

Customs officials confirm that manufacturers are the biggest importers. Products from inputs to machineries are imported into the country on weekly basis by manufacturers.

The fact that manufacturers are biggest importers is, however, ironical given that the sector should naturally be at the forefront of export and repatriating FX into the economy. Manufacturers’ reasons for not meeting up with these expectations are well-known, but the realities of the times say now is time to look inwardly.

Backward integration saves costs and reduces exposure to the FX, which has continued to stall production activities across board.

Today, many firms are struggling because they cannot find greenback needed to import

inputs.

“We wanted $60,000, but we could only get $5,000 from one of our banks. It is now much worse than the 2016/17 situation, and some of our members are thinking of moving to ECOWAS in January when the continental free trade starts,” a director at a manufacturing firm told BusinessDay recently.

Nigeria’s monoproduct economy has become a punishing reality, which is now hurting the economy badly. For manufacturers, sourcing raw materials locally by way of backward integration is looking inevitable. Apart from saving costs and reducing FX exposure, it gives a competitive advantage and enables firms to control the value chain.

However, backward integration requires huge and expensive investments. Doing backward integration in the palm oil industry, for example, costs PZ Wilmar about $150 million. This cannot be afforded by most medium and small manufacturing outfits, which explains why experts are calling for more support from the CBN and other funding agencies to boost this segment of the economy. Apart from the benefits it brings to manufacturers, backward integration also

‘‘

We wanted $60,000, but we could only get $5,000 from one of our banks. It is now much worse than the 2016/17 situation, and some of our members are thinking of moving to ECOWAS in January when the continental free trade starts

boosts jobs, rural development and reduce pressure on the FX market. It can also lead to the springing up of millions of small businesses working with large firms.

Several backward integration projects in the country are hurt by land tenure system and community tussles. This is stalling investments in this sector.

A lot of companies have, however, done considerably well in this area. PZ Wilmar, a subsidiary of PZ Cussons, has bought 26,500 hectares of palm oil plantations in Cross River State. About 5,549 hectares (ha) of oil palm plantation are located in Calaro Estate, while 2,369 ha are in an area known as Calaro Extension. The firm also acquired Ibiae plantations with 5,595 ha; Ibad plantations in Akampa with 7,805 ha; Kwa Falls in Akampa Akpabuyo with 2,014 ha, and Oban plantations, also in Akampa, with 2,986 ha.

PZ Wilmar has likewise acquired palm oil mill (POM) and kernel crushing plant (KCP), investing around N20 billion in an oil palm refinery in Lagos.

“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,” Santosh Pillai, managing director of PZ Wilmar, told BusinessDay. FrieslandCampina WAMCO, producer of Peak Milk and Crown Milk, currently has several locations in Oyo State and Niger State where it houses and supports local herdsmen who provide milk from local cows.

The milk is used for the production of the popular Peak and Three Crown today.

There are several of Dangote Group’s backward integration

projects in sugar, cement, and foods.

Apart from BUA’s nursery plantation in Kwara State, BUA’s Sokoto Cement is also doing a lot of backward integration work.

The ultramodern plant Kalambaina cement plant in Sokoto State, which gulped $350 million to build, is blessed with huge limestone deposits and the company has leveraged the opportunity.

Olam Nigeria is also doing a lot of backward integration projects in the country, including with its subsidiary Caraway Foods International Nigeria Limited, in the tomato industry.

To achieve the backward integration plan, Caraway started a pilot project in September 2019 on 20 hectares of farmland across three locations in Kano and Jigawa states, which are being expanded to 500 hectares. This is followed by the commencement of a larger out growers programme to engage 1,000 farmers to be trained and provided with seeds that will deliver the same kind of output the pilot farms are recording.

“This is complete end-to-end production and backward integration,” said Prashant Thakur, the regulatory head for Caraway Africa Nigeria limited, who is also heading the tomato backward integration project, recently. He explained that existing brands, Tasty Tom and De Rica, would continue to be produced except they would now be 100 percent local content.

Many other firms such as Flour Mills are also in this. Others like Unilever and Guinness are aggressively sourcing some of their inputs locally.

Guinness Nigeria is working with 30,000 farmers to realise this objective.

“We assure them of the market. As you are aware, African farmers have issues with predictable market. So, being able to assure them of the market gives them confidence. The other thing is diversification.

This encourages manufacturers in Nigeria to take the Guinness example, source locally, involve the communities, and get the banks to access banking services,” Baker Magunda, chief executive officer of Guinness Nigeria, told BusinessDay earlier in the year.

As the FX scarcity continues to hit firms, backward integration promises to be a game changer. But it requires more funding support and the right environment to thrive.

Published by BusinessDAY Media Ltd., The Brook, 6 Point Road, GRA, Apapa, Lagos. Advert Hotline: 08033225506. Subscriptions 01-2950687, 07045792677. Newsroom: 08169609331 Editor: Patrick Atuanya. All correspondence to BusinessDAY Media Ltd., Box 1002, Festac Lagos. ISSN 1595 - 8590.