BusinessDay 20 Nov 2019

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news you can trust I **WEDNESDAY 20 NOVEMBER 2019 I vol. 19, no 439

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Abuja DisCo to get new owners as core investor pulling out

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he core investor in Abuja Electricity Distribution Company, KANN Utility Company Limited, a 50 percent joint venture of the Copperbelt Energy Corporation plc (CEC), a leading Zambian energy company, is pulling out of the Abuja Electric and the new owner could be a logistics

firm that transports fertiliser for the Federal Government, sources tell BusinessDay. BusinessDay understands that KANN’s decision to sell its 60 percent stake in Abuja Electric is due to constant squabbles over shareholders’ debt. Electricity distribution companies (DisCos) are technically insolvent and unable to meet financial obligations including repaying loans that were

used to finance their purchase.

This is as Abuja Electric bankers seek to recover the debt, a decision industry analysts say may have been prompted by the threat of the regulator, the Nigerian Electricity Regulatory Commission (NERC), to cancel the licences of some DisCos for their failure to remit more money to other market operators. “ Th e b a n k s have a va l i d reason to be concerned,” said

L-R: Andrew Sordam, vice president, Oracle; Onyinye Ikenna-Emeka, general manager, enterprise marketing, MTN Nigeria; Agada Apochi, MD/CEO, Unified Payments; Adebayo Sanni, country managing director, Oracle Nigeria, and Abayomi Awobokun, MD/CEO, Enyo Retail and Supply Limited, all speakers at the BusinessDay CEO Breakfast Roundtable themed ‘CEO Suite: Digital Leadership Starts Here’, in Lagos.

Pic by Pius Okeosisi

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bankers seek to recover loan as NERC’s licence cancellation threat unsettles industry

ISAAC ANYAOGU

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BusinessDay 2019 States Competitiveness, Good Governance Awards holds today

Chuks Nwani, an energy lawyer. “If the assets they financed are being threatened, it is only normal that they should worry.”

Debts to DisCos constitute over 5 percent of non-performing loans of some of Nigeria’s top commercial banks.

On October 8, NERC issued a notice to cancel the distribution licences of eight DisCos for a breach

he 2019 States Competitiveness and Good Governance Awards will hold today at the Federal Capital Territory

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TELIAT SULE

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TAK Agro plc, Nigeria’s leading agro value chain operator, recently signed on to a N50 billion bond to enhance its plans in the nation’s agriculture industry. L-R: Tony Anonyai, co-CEO, Planet Capital Limited; Kenechi Ezezika, company secretary, TAK Group; Thomas Etuh, chairman, TAK Agro plc, and Chuma Maduekwe, MD/CEO, TAK Logistics Limited, at the signing ceremony held at the Federal Palace Hotel, Victoria Island, Lagos.

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news Crisis hits Setraco Nig. as Umoru sues Lebanese partner

L-R: Pierre Buyoya, former president of Burundi and representative of the African Union; Mohamed Ould Ghazouan, president of Mauritania; Macky Sall, president of Senegal; Florence Parly, minister of defence, France, and Tony. O. Elumelu, founder, Tony Elumelu Foundation/ chairman, United Bank for Africa Group (UBA), at a high-level panel on Peace and Security in Africa at the Dakar International Forum in Dakar Senegal.

…court fixes Dec 12 to unknot company’s legal representation Felix Omohomhion, Abuja

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Fallow deepwater fields hold opportunities for Nigeria’s oil exploration OLUSOLA BELLO & DIPO OLADEHINDE

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hen it comes to t h e p ro spects of its oil industry, Africa’s biggest oil-producing country is looking miles out to sea in untapped ultra-deepwater fields.

Nigeria’s deepwater assets hold huge potential in development of the country’s oil and gas sector, accounting for 40.47 percent of the total production of 2.1 million barrels per day (bpd). However, only seven out of the 87 deepwater oil blocks in Nigeria are producing, while six are at different phases of development.

Assets with 13 billion barrels of oil equivalent remain untapped in Nigeria’s deep offshore area, a development which has raised huge investment concerns for

…as Kyari expects bid round in 2020

stakeholders in the country’s oil and gas sector.

Mele Kyari, group managing director, Nigerian National Petroleum Corporation (NNPC), on Tuesday said the country would conduct bid rounds on oil assets within the ultra-deep waters next year.

“The ultra-deep waters are completely unexplored today. Before the end of this year or next year, God willing, I believe there will be some form of bid rounds in ultra-deep waters oil assets,” Kyari said at the ongoing 37th annual international conference of the Nigerian Association of Petroleum Explorarionists (NAPE) in Lagos.

“I do not have the time but I know there is a process that is going on,” he said.

In the oil and gas industry, deepwater oil fields are defined as oil fields within water depth greater than 1,000 feet while ultra-deepwater oil fields are greater than 5,000 feet.

When BusinessDay asked the NNPC boss on the sidelines of the event if Nigeria has enough ultra deepwater oil blocks for the bid rounds, he said, “I can assure you there will be enough blocks.”

Ahmadu-Musa Kida, deputy managing director, deepwater district, Total Exploration and Production, said at the pre-conference event that Nigeria’s untapped oil assets have hit an all-time high.

He also emphasised the need for the nation’s oil industry to encourage digital application in the deep

offshore assets, saying that the development would cut capital expenditure by 20 percent.

“Total would continually deploy technology and innovation in its deep offshore operations with a view to deepening its presence in the oil and gas sector,” he said.

Aside from Bonga field, other deepwater fields such as Chevron Agbami field, ExxonMobil Erha field, Nigerian Agip Exploration Aboh field, Total Exploration and Production Akpo and Usan fields, and the most recent, Egina field, have all started production in full swing, yet at least 80 other deepwater oil blocks are yet to begin operations.

Ni g e r i a i s c u r re nt l y pumping just over 2 million barrels of oil a day and it

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Fear of riling masses keeps Egypt’s reform message away from Nigeria LOLADE AKINMURELE & MICHAEL ANI

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gypt’s message to Nigeria is a simple one: Tough times don’t last, tough economies do.

But that message comes unstuck when Nigerian politicians weigh the political cost of forcing painful reforms on people whose votes they need to stay in power.

However, it’s the economy and the same masses that have come to bear the brunt of a conspicuous absence of economy-stimulating reforms on the evidence of rising poverty levels and weak economic growth.

Since the two countries travelled different paths in 2016, it is Egypt’s economy that has flourished and that has once again beamed the spotlight on Nigeria.

From GDP growth to inflation and the exchange rate, some macroeconomic

indicators suggest that Egypt did the right thing in 2016 when it kick-started a reform programme that allowed its currency float, reduced the budget deficit and gradually phased out energy subsidies.

Since follow ing that path which brought shortterm pain to Egyptians, the economy is now growing at over 5 percent and inflation has collapsed to a nineyear low of 3 percent in October from a peak of 30 percent when the Egyptian pound was first floated and energy subsidies reduced.

The Egyptian Central Bank cut interest rates again, by 1 percent this time to 12.25 percent from 16.75 percent a year ago.

Egypt’s remarkable turnaround has earned it global plaudits.

“The tough reforms of 2016-17 are paying off,” said Charles Robertson, chief www.businessday.ng

economist at Renaissance Capital, citing the country’s improved macro indicators.

Nigeria was in the same boat as Egypt in 2016 but shied away from the tough reforms Egypt undertook.

The central bank turned to an unsustainable currency peg which belatedly gave way while the Federal Government has continued to maintain an expensive petrol subsidy that deters investment.

Inflation accelerated by the most in 17 months in October, rising to 11.61 percent on the back of higher food prices, according to the National Bureau of Statistics (NBS).

The economy is growing at 2 percent, lower than population growth rate. What’s worse is that the tepid growth rate may worsen in the third quarter when the numbers are pub-

lished Nov. 25, as an abrupt border closure takes a toll on trade which contributes around 17 percent to GDP. Sources close to the Nigerian government argue that the fear of falling out with largely poor and uneducated masses hinders the government from going down the route of Egypt.

“Egypt does not practise democracy so the prime minister can do what he likes without recourse to the people,” a senior government source said.

“In Nigeria, it’s different.

The president relies on the people’s vote to govern and if you do things like end the petrol subsidy and float the currency, it would hurt the people and they can take power away from you,” said the source who did not want to be named to speak freely.

•Continues online at www.businessday.ng

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risis of confidence is rocking construction giant, Setraco Nig. Ltd. The crisis, which is between Setraco Nig. Ltd’s Nigerian partner, the family of the late Ini Umoru, and a Lebanese, Said Fayez Khalaf, has nudged both parties to the law court.

The family of late Umoru, the majority shareholder, plaintiff in the case, is suing the Lebanese partner for alleged fraudulent dealings.

At the resumed hearing of the case on Tuesday, Justice Ahmed Mohammed of a Federal High Court, Abuja, fixed December 12 to resolve the question of the true legal representation of the company.

Mike Ozekhome (SAN), counsel to the plaintiff, told the court that he represents Setraco Nigeria, by virtue of his client (Umoru) being the majority shareholder of the Nigerian company.

He was, however, opposed

by Khrushchev Ekwueme and one B. Nwapi who claimed to also represent the company.

Justice Mohammed, after taking submissions from the three lawyers, said the case suffered many adjournments and he needed to first resolve

the issue of legal representation before going ahead with the substantive matter.

He, therefore, adjourned to December 12 for a ruling on the true counsel to the company.

The Umoru family, in a suit marked HC/ABJ/PET/6/2018, is specifically challenging the alleged dubious process by which Khalaf acquired the majority stake in SNL and pressing claims against Khalaf for civil fraud and seeking declaratory and injunctive reliefs against some specific actions and transactions.

Following an interlocutory application filed by their lawyers, Justice Mohammed gave an interim order on February 22, 2018 directing parties to maintain status quo until the interlocutory application was heard.

Khalaf, who is said to be back in Lebanon, is alleged to be frustrating the smooth running of the company through his cronies holding some board and management positions in the company.

He is accused, among other things, of preventing important resolutions from being taken by not attending board meetings and voting against decisions required for

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Senate receives 6 aviation bills from Buhari for speedy passage …new bil empowers AIB to investigate marine, rail, road accidents …NCAT to be accorded status of tertiary institution Ifeoma Okeke & Solomon Ayado, Abuja

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resident Muhammadu Buhari on Tuesday sent to the Senate six bills on aviation sector, urging the senators to ensure their speedy passage into law.

The bills are Civil Aviation Bill, 2019; Federal Airports Authority of Nigeria Bill, 2019; Nigerian College of Airspace Management Agency (Establishment) Bill, 2019; Nigerian College of Aviation Technology (Establishment) Bill, 2019; Nigerian Meteorological Agency (Establishment) Bill, 2019, and Nigerian Safety Investigation Bureau (Establishment) Bill, 2019.

In a letter read during plenary by Senate President Ahmad Lawan who received the bills, Buhari explained that the request was “pursuant to Section 58 of the Constitution of the Federal Republic of Nigeria 1999 (as amended)” and requested that the 6 bills “be considered for passage into law by the Senate”.

Speaking on the Nigerian College of Aviation Technology (Establishment) Bill, 2019, Abdulsalam Mohammed, rector of Nigerian College of @Businessdayng

Aviation Technology (NCAT) Zaria, told BusinessDay that the Act establishing the college was signed in 1960s and since then it hasn’t been reviewed, despite the changes in the industry, and the amendment bill seeks to address all these.

“Over the years, the college has grown into what it is today; we are a regional training centre of excellence.

We award ND and Higher National Diploma (HND) as approved by the National Board of Technical Education. The Act establishing us doesn’t give us the status of a tertiary institution legally and because of that we cannot access Tertiary Education Trust Fund,” Mohammed said.

“These are some of the benefits we intend to get and it will also give us the opportunity to be able to conduct more courses and training programmes at a higher level. Aviation training organisations like the ones in the United States and Singapore are accorded the same status as tertiary institutions.

That is what we hope to get by the passage of the bill,” he explained.

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news

Nigerian ship owners back NPA on stoppage of controversial SAA operation AMAKA ANAGOR-EWUZIE

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he Nigerian ship owners have thrown their weight behind the Nigerian Ports Authority (NPA) for having the political will to terminate the operations of the private sector-managed controversial Secure Anchorage Area (SAA) in Lagos.

To them, Nigerian ship owners never supported the idea of having a private sectormanaged anchorage because securing the nation’s waters is the sole responsibility of the NPA, the Nigerian Maritime Administration and Safety Agency (NIMASA), and Nigerian Navy.

Speaking to newsmen in an interview in Lagos, Aminu Umar, president Nigerian Ship Owners Association (NISA), said there is nowhere in the world an anchorage is operated by a private sector company, and that was why Nigerian ship owners do not utilise the SAA. Stating that foreign ship owners that come to Lagos Ports assume that Nigerian waters are not safe, Umar said this was why foreign ships prefer to have a special anchorage that is frequently patrolled against pirate attacks.

“In other West African ports like Lome and Benin, anchorages are owned by their

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ports authorities. Though we do not want to question why government gave the private sector the right to operate the SAA, we think there is no need for such; rather all our waters should be made secured for shipping,” Umar stated.

An anchorage, according to the NPA Act, is as an integral part of a seaport, and is the responsibility of the NPA to chat, designate, own, operate and manage ports anchorage areas except where such responsibility is entrusted to a third party in accordance with section 9 of the Ports Act. BusinessDay investigation reveals that shipping companies patronising the SAA are charged $2,500 for

the first two days and $1,500 for subsequent days, as much as the vessel is anchored in the SAA. These charges at the SAA add up to the high port charges for vessels coming to Nigerian ports.

Recall that the NPA vide its letters dated 24th October 2017 and 25th October 2016, respectively sought the intervention of the Minister of Transportation to dismantle the facility due to its high cost on ships.

Also, the Authority vide a letter dated 9th October 2019 addressed to the Nigerian Navy, requested for stoppage of the operation of the SAA pending conclusion of a new framework, and this has gen-

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erated several controversies.

A source close to the NPA, who does not want his name on print, told our correspondent that the responsibility to oversee the maintenance of security in Nigerian maritime domain lies with the Nigerian Navy, Marine Police, NIMASA and NPA in accordance with their area of jurisdiction, as provided by relevant legislation.

The source further claimed the SAA was being operated

by Ocean Marine Services Ltd (OMSL), a private-sector entity but with logistical support from the Nigerian Navy.

He further added that in 2014, the NPA procured and handed over to the Navy, three new patrol boats for usage by the

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Nigerian Navy to safeguard the Lagos anchorage and offshore waters within the Lagos Pilotage District.

“The NPA investigation shows that the said SAA was authorised by NIMASA, and it published a marine notice on the existence of the SAA as an additional security service facility for the provision of dedicated 24/7 watch to vessels seeking extra protection while at the anchorage offshore Lagos,” the source claimed.

According to the source, it has become very worrisome that the revenue generated from the SAA operation from 2014 till date has not been remitted to the NPA or to the Federal Government since 2014.

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Government should use successful MFBs to push rural credit Small Business handbook

Emeka Osuji

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here are over one thousand microfinance banks (MFBs), currently operating in Nigeria. There are also three categories of operators in that segment of the finance industry – the Unit MFBs have authority to run only one branch in the state where they are located, while the State operators are allowed to open as many branches as the CBN may allow in the state in which they are licensed to operate. The third category is the National MFBs, which are the big ones allowed to operate in every state and may locate in any state of their choice in the country.

These institutions had carried on business with authorised capital funds of N20 million, N100 million and N1 billion, respectively for unit, state and national microfinance banks. However, that era came to an end on October 22, 2018, when a new regulation on capitalisation was released. Going forward, anyone wishing to operate in the subsector would have to provide a capital fund of N200 million, N1billion and N5 billion respectively for unit, state and national MFBs. This is a clear call for consolidation, which was however, not unexpected, given recent developments in the subsector.

The industry has grown very rapidly

and the things that go with maturity have begun to rare their heads, both ugly and pretty. As in humans, maturity and old age are good things but they bring with them, some not so-goodthings – nagging grey hair that pops out from the nostrils and eye brows, waist pain, swollen legs and weak sight, among others. The microfinance industry has been experiencing some of that.

There have been rising concerns over the health of many operators, and this, probably informed the recapitalisation program now underway.

Only last recently, the industry witnesses a lot of fatalities as the CBN revoked the licenses of about 154 microfinance banks, across the country, on grounds of sundry infractions and distress. According to the CBN, 62 of the failed operators had already closed shop while 74 of them had become insolvent. It added that 12 were terminally distressed; while six had been voluntarily liquidated. Over the years, the Nigerian Deposit Insurance Corporation has had to part with substantial parts of its deposit insurance fund in order to meet liabilities arising from failure of some operators. Evidently, the time has come for sweeping changes, if the industry is to meet the objectives of its designers and other stakeholders.

With the new capital requirement, the changes have begun to come, with a sign that more are in the offing.

But there should be no responsibility without empowerment. We can jack up the capital base of operators the much we want but that is not the only challenge. The poor creatures, ignore their frailties for a moment, operate in one of the harshest environments in the developing world. Undoubtedly, the idea of a strong microfinance industry is unassailable. We cannot continue to pretend that all is well. The dearth of

any kind of meaningful infrastructure in Nigeria, especially in the rural areas where microfinancing is a life-giver is shameful. It is the main cause of the systemic risk in the subsector.

We now have a national microfinance bank, which though sounds like another Peoples’ Bank of Nigeria – a good idea that was crucified on the altar of public ownership, the challenge of operating environment is not a respecter of ownership of financial institutions. That institution will have to overcome the same challenges as the privately owns operators. Certain problems are largely a product of ownership structure and will not go away until steps are taken to fix them.

Some of the recent policies implemented in the sector are yielding good fruits, and need to be given a chance to nurture. The Secured Transactions in Movable Assets Act, which my readers know am leading promoter, is a case in point. In my trips around the country interpreting the Act to operators in seminars and lectures, I found that, as expected, that Act is beginning to positively impact both microfinance banks and their clients. Reports have it that by April 2018, total credit to that sector was about N400 billion but by November, it had jumped to about N1.1 trillion. As at October 8, 2018, 560 financial institutions had responded to our campaign, registered and are now leveraging the infrastructure of the National Collateral Registry to advance credits to clients.

Several financing statements have been registered worth several billions of Naira. I believe this is making lending more secure and safer. Surely, there is virtue in de-risking lending to such risky sectors as a general benefit to all Nigerians, rich or poor. Among the over 560 institutions registered to use the Collateral Registry as at October 2018,

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Evidently, the time has come for sweeping changes, if the industry is to meet the objectives of its designers and other stakeholders.

With the new capital requirement, the changes have begun to come, with a sign that more are in the offing

Dr Osuji is head of the department of Economics at Pan Atlantic University Lagos. eosuji@ pau.edu.ng @Emekaosujii

Building global businesses by solving local problems

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ber CEO Dara Khosrowshahi recently identified the Middle East and Africa (MEA) as a key region for the future growth of the company.

Within Africa, Nigeria is a key economy, being home to half of West Africa’s population which amounts to more than 202 million people, as well as one of the most youthful populations globally, according to the World Bank.

Some of the stumbling blocks for the country when it comes to converting that potential into greater economic growth includes a high unemployment rate (23% as of the end of 2018), low levels of vehicle ownership as well as a high failure rate of start-ups at a reported 75 percent.

The latter is problematic because like many of its African neighbours, start-ups and SMEs account for the majority of jobs in Nigeria and besides being vital for job creation, these businesses, particularly in the technology sector, are adept at creating innovative solutions to community problems, such as inefficient mass transport systems. Many Nigerian entrepreneurs are already taking up this challenge and building sustainable businesses on the back of this need. These include tech companies such as Emerald Hills Digital, which provides digital marketing solutions for hyper-growth, as well as Haulr, a logistics company that help teams become more efficient, effective and profitable.

More is still needed though. This is where the co-creation of value by partners such as Uber becomes vital to cities and locals as its technology and platform is used to provide more affordable, safer and reliable transport for the citizens of the country, as well as to generate sustainable earnings for drivers and self-starter entrepreneurs.

I was recently in Nigeria to speak at a CoCreation Hub event around the theme of technology, entrepreneurs, and building a business for millions. With this speaking opportunity, I was given the chance to provide some guidance to prospective entrepreneurs around how to employ technology to help make their venture more efficient and reach a greater customer base amongst other tips. The first of these is making big bold bets, the majority of which paid off hugely at Uber due to the fact that we worked hand in hand with regulators.

We have also learnt from our experience in Nigeria and have adapted our strategy to better ensure that drivers continue to have paying passengers. Our support channels also create an avenue for drivers to provide critical feedback, a necessary factor in ensuring that the Uber app continues to work better for them.

Adapting to local needs Another key ingredient to our success has been our growth mindset. We value ideas over hierarchy. We believe that the best ideas can come from anywhere, both inside and outside our company. Our job is to seek out those ideas, to shape, improve and adapt them through candid debate, and to take them from concept to action.

Last but definitely not least is the need to remain customer focussed from the start of your business throughout its lifecycle. At Uber, we are customer-obsessed and work tirelessly to earn our customers’ trust and business. This is done through solving their problems by ensuring we adapt our business to the local demands.

For instance, launching a two-week boat service alongside the executive governor of Lagos, Babajide Sanwo Olu at Lagos State Waterways Authority complex in Falomo,

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provided travellers in the Lagos megacity of around 20 million people, with an easy and affordable form of transport to get in and out of the city’s business districts. In addition, we strive to localise our products while maximising the earnings of our driver-partners by assisting in lowering their costs.

Another example of adapting to the local market is the availability of Uber Lite. This version of our app enables users to make savings in terms of both storage space as well as data usage and consequently cost. Uber Lite has been specifically designed for easy learning with newbies, and also to work well within areas of low-connectivity and restricted data connectivity speeds, a common issue in many emerging economies like Nigeria.

Experiment, experiment, experiment Don’t be afraid to experiment. You will never know if something is going to work without trying. Pilot programmes are essential to your business, its continued success and growth, so take educated risks, collect data, look at competitors, define a strategy and go for it. Anytime you use technology to make something better, easier-, more costeffective- or seamless for your customers or simply to solve a real-world problem, then you are closer to success.

As already demonstrated by the launch of UberBoat, Nigeria holds a lot of potential for a diversified means of transportation, a feat already piloted with great success by Uber in other markets. Uber Bus, for example, has been tremendously successful in Cairo, the capital of Egypt, creating low-cost and reliable alternatives to public transportation and broadening avenues for wealth creation in the process. One can only look at Lagos’ current intercity transportation set-up 80 percent of

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MFBs are 483. It means that an increasing component of the loans booked by the participating microfinance banks will be secured with movable assets.

That tells us something about the future of lending and Performing Loans in the sector. It is bright.

As I have said elsewhere, despite the fact that a National microfinance bank has been established, we need to use the industry champions to push credit to the poor. It is not too late for CBN to use these industry champions, such as LAO, Grooming Centre and others, to disburse the N5 billion fund it has created. These industry champions are not hungry for business. Rather they will be doing the nation a favour to deploy their expertise to ensure that the economically active poor actually access the funds. These industry champions have distinguished themselves and can be trusted with government funds, have attracted multilateral funds and managed them well. Some of them are already accessing huge funds from even more discerning investors from abroad.

We could use them to disburse the AGSMEIS funds more productively, rather than the Deposit Money Banks, that are content with oil and gas revenues.

Similarly, the CBN can introduce new monitoring indices, as they did in Kenya, where economic and social indicators have been introduced, including employment generated and contribution to literacy, in evaluating MFB performance. There is a business case for using the big MFBs to push public policy that are intended to touch people in the remote parts of the country.

Taken largely from my new book “Leading Essays on Microfinance”

ALON LITS

which is dominated by buses – and see the enormous opportunity presented in that area. The enthusiasm and willingness of the government to reduce congestion and create a more efficient transportation system also provides room for long-term and sustainable engagement for players like Uber, and this can only mean great things for the state as it aspires to a true mega-city status.

Through these services, we continue to delight our customers while supporting our partners in their own ventures, leading to greater loyalty on both ends. This commitment to our partners and relentless focus on our mission to ignite opportunity by setting the world in motion, has resulted in tremendous growth, not only in Nigeria but across the continent.

Across the country of Nigeria, and indeed the African continent, we are helping to address public transportation problems for less, while building a business for thousands of entrepreneurs across the region.

Local start-ups and SMEs can achieve greater levels of success by maintaining a growth mindset that involves constant innovation with their business processes as well as offerings (products/services). They must also remain customer-focused from a product development and communications perspective, and employ technology to do things quicker, more economically and more effectively, whilst promoting experimentation and quickly learning from successes as well as failures.

Lits is the General Manager, Sub-Saharan Africa

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BUSINESS DAY

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comment Character Matters with Daps

Dapo Akande

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any of us have had reason to ask ourselves at one time or the other why people never resign from office in Nigeria. Before I attempt to answer this, let me digress a little.

Fiona Onasanya was a Nigerian born British Parliamentarian until December 2018, when she was recalled by members of her constituency (Peterborough) who got the requisite number of signatories to a petition for her removal.

What was her offence? Well, the initial offence for which she was charged was for driving 41 mph in a 30mph zone.

She was also found to be texting on the phone at the same time. The second offence was that she lied in an attempt to escape justice. She claimed that she was not the one driving on that day.

She was eventually found guilty by the courts for the initial driving offence and for perverting the course of justice. Now, the crux of the matter is that there were legal consequences for her actions. She was handed a 3 months jail sentence out of which she served four weeks.

Her constituency did not only remove her but she was also expelled from the Labour Party. Although this may not be an ideal reference point because the political offender in question didn’t resign on her own volition but there are lessons to be learned nevertheless; actions have consequences. Secondly, the society in which she lives enjoys

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We all pay for it eventually the consequences of laws being upheld and applied blindly across board. Such a society will always work.

Britain, like other advanced societies can boast of instances where political appointees have agreed to take the fall, even if reluctantly, just to save their government further embarrassment.

And in a system where investigations will always be taken to a logical conclusion and you will eventually be found culpable, what are you waiting for but to resign? It’s a far more honourable path to take when the end result is inevitable.

I read recently of a rape case here in Nigeria. The matter had already got to court when the father of the alleged victim, ever so disappointedly decided to withdraw the case. He said prominent members and elders of the community had approached him on behalf of the accused’s family and had pleaded that he drop the case. Upon informing the court of his decision, the Judge did the unusual. He refused to discontinue the case and went ahead to dress the alleged victim’s father down. He said he would consider the request only if it came from the mother’s mouth.

Great wisdom. I was so impressed with the Judge’s actions not because he did something that had never been done before but because he did it an environment where the right thing is seldom done. I put this simple question to you. What happens when parents repeatedly fail to reprimand or discipline their children for behaving badly? They do more of the same and even worse because they know they won’t face any consequences.

The civil suit brought by Busola Dakore against Pastor Biodun Fatoyinbo was thrown out a couple of days as it was deemed to be statute barred but we still await the findings of the police investigations, which I hope will lead to criminal

proceedings, so this case can truly run its course and come to a logical conclusion.

This is important not just for the alleged victim but for the good of the society at large. The Nigerian society didn’t degenerate overnight but gradually. When wrong is not condemned it will not be corrected. Left like that and over time, those found to still frown upon it will reduce to just a pocketful.

Eventually, the wrong will become a norm. As an aside, what happened to the issue of the “slapping senator”? Or has it died a natural death like so many before and even after it?

We live in a country where the government repeatedly flouts the rule of law with reckless abandon while not only preaching the sanctity of the law to the rest of us but comes down hard on those deemed to have broken it. I’m always incredulous when I read report upon report in the media about our President traversing the continents of the world, soliciting foreign investment. Why does this confound me? Because investors are very smart people who don’t lose their heads at the prospect of making stupendous gain in relatively green fields like Nigeria. They always place far more premium on safety and the security of their proposed investment.

No matter how attractive the potential returns might look, they’re more concerned about not running the risk of losing their investment altogether.

Other than the very pertinent issue of their personal safety, in a country where armed robbers, supposed herdsmen, bandits, cultists and ritualists run amok, the ordinary man in real terms, not just in theory, has little meaningful recourse when government decides to breach agreements. Try your luck and go to court; the case can be locked up there for the next 15 years. Lest I forget, with the attendant costs. Whichever way

‘

What happens when parents repeatedly fail to reprimand or discipline their children for behaving badly? They do more of the same and even worse because they know they won’t face any consequences

you look at it, you lose. And if the courts eventually rule in your favour, what makes you think government will pay?

We’re all too aware of Sowore’s current travails. Whether he erred or not by his actions or pronouncements, the simple fact is that the body constitutionally established to so decide has given a ruling that he be released once he satisfies the court’s bail conditions. He has done that, yet remains incarcerated.

Already, certain groups have started demonstrations in the United Kingdom protesting his continued detention, yet again portraying us as a lawless nation where government leads the way. And you expect investors to come? Come on. Unfortunately, when those who run afoul of the law continue to enjoy their freedom and privileges, without facing what should be the logical consequences, that in itself will have consequences.

The general populace will demand the right to normalise wrong and will then logically expect to get away with it. After all, what’s good for the goose is equally good for the gander. And it doesn’t take a genius to guess that because of this, it will take forever for things to change for the better.

Kindly permit me to end with this quote by Charles Reade which I know may sound a little cliché to many who have heard it many times over. It does however speak volumes to this discussion and it’s this: “Sow an act and you reap a habit. Sow a habit and you reap a character. Sow a character, and you reap a destiny.” We would be deceiving ourselves to think we got to this point by mistake.

Changing the nation... one mind at a time.

Akande is a graduate of the University of Surrey, UK, author of the acclaimed book: “The last fight: A personal journey to discovering values.” Contact: dapsakande25@gmail.com

Can Africa be the first to eliminate Hepatitis C

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e have a rare chance as a continent to send a message to the whole world: Africa is the first to eliminate Hepatitis C. This would also take the world one step closer to reach one of the targets of Goal 3 of the United Nations’ Sustainable Development Goals (SDGs) – “Good health and well-being” –and end the epidemics of AIDS, tuberculosis, malaria and combat hepatitis and other communicable diseases by 2030.

The 2030 Agenda for Sustainable Development, adopted by all United Nations (UN) Member States, is a “universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity by 2030”.

The 17 SDGs recognise that ending poverty must go hand-in-hand with strategies that improve health and education, reduce inequality, and spur economic growth. The 17 SDGs are integrated and therefore also recognise that action in one area will affect outcomes in others, and that development must balance social, economic and environmental sustainability.

According to the UN good health is essential to sustainable development and the 2030 Agenda reflects the complexity and interconnectedness of the two. It takes into account widening economic and social inequalities, rapid urbanisation, threats to the climate and the environment, the continuing burden of HIV and other infectious diseases, and emerging challenges such as non-communicable diseases.

Universal health coverage will be integral to achieving Goal 3, ending poverty and reducing inequalities.

However, the world is off-track to achieve the health-related goals and progress has been uneven.

In the case of hepatitis, viral hepatitis B and C affect 325 million people worldwide causing 1.4 million deaths a year. It is the second major killer infectious disease after tuberculosis, and nine times more people are infected with hepatitis than HIV. Data shows that viral Hepatitis B and C affect more than 71 million people in sub-Saharan Africa.

Hepatitis is preventable, treatable, and in the case of hepatitis C, curable. However, over 80 percent of people living with hepatitis are lacking prevention, testing and treatment services. Access to diagnosis and drug therapy is limited, particularly in low and middleincome countries where rising healthcare costs are a barrier, including Africa.

By locally producing medicine that could be used to treat patients at less than 1 percent of the cost in global markets, and in partnership with the government of Egypt, Pharco Pharmaceuticals successfully cured 1.5 million Hepatitis C patients by the end of 2017.

Due to the Egyptian government’s efforts, the treatment became available at an affordable price and massive awareness and screening campaigns were executed all over the country aiming at eliminating the virus.

Other African countries are also taking action. Uganda has started free nationwide

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hepatitis B treatment, and Rwanda is providing free treatment for both hepatitis B and C. These two countries are championing the regional response and are on track to reach targets for testing and community awareness.

Work still needs to be done. Deaths from hepatitis have been increasing over the past two decades, which points to a lack of global awareness and action, including among top decision-makers.

The Hepatitis Scorecard for the WHO Africa Region shows that 28 countries have developed a national hepatitis strategic plan for viral hepatitis; however, most are still in draft form with only 13 officially published and disseminated.

On World Hepatitis Day (28 July) the WHO called on countries to take advantage of recent reductions in the costs of diagnosing and treating viral hepatitis and scale up investments in disease elimination.

Every year more than 200 000 people in Africa are dying from complications of viral hepatitis B and C-related liver disease, including cirrhosis and liver cancer.

A new study by WHO found that investing $6 billion per year in eliminating hepatitis in 67 low- and middle-income countries would avert 4.5 million premature deaths by 2030, and more than 26 million deaths beyond that target date.

Africa’s development challenges need a swift, bold, and robust response, according to Akinwunmi Adesina, President of the African Development Bank, convener of the Forum.

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SHERINE HELMY

Africa’s health challenges also need a swift, bold, and robust response.

The World Health Organization (WHO) aims for 80 percent of people diagnosed with HCV to be put on treatment by 2030.

By creating awareness around hepatitis, and providing better prevention, testing and treatment, at affordable prices, Africa can be Hepatitis C free by 2030 in line with the WHO’s ambition.

By reaching our goal of “good health and well-being” we can also take one step closer at sustainable development, spurring on economic growth, and ensuring that all people enjoy peace and prosperity by 2030.

Dr. Helmy has 30 years of professional experience in the pharmaceutical industry. Throughout the years, he was appointed as vice CEO of Pharco Corporation, vice CEO of Batterjee Pharmaceuticals, KSA; and board member of Pharco Impex, Romania.

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Wednesday 20 November 2019

BUSINESS DAY

Editorial Digital is the future and beckons on Nigeria Publisher/CEO

Frank Aigbogun editor Patrick Atuanya

DEPUTY EDITOR John Osadolor, Abuja NEWS EDITOR Chuks Oluigbo EXECUTIVE DIRECTOR, OPERATIONS Fabian Akagha EXECUTIVE DIRECTOR, STRATEGY, INNOVATION & PARTNERSHIPS Oghenevwoke Ighure ADVERT MANAGER Ijeoma Ude FINANCE MANAGER Emeka Ifeanyi 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)

Bashir Ibrahim Hassan

GM, BUSINESS DEVELOPMENT (South) Ignatius Chukwu

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here is still palpable excitement in the digital and investment communities following the visit to Nigeria in the week of November 11-17 of two significant players in those ecosystems.

Twitter CEO Jack Dorsey and co-founder and former Chairman of the Alibaba Group of China Jack Ma were enthusiastic guests as they pumped hands and exchanged ideas with our people. The common thread was their interest in Nigeria’s digital ecosystem.

Nigeria ranks 8th among the top 20 global internet users.

Internet access is at 56 percent of the population translating to more than 100million users. The country gained $7 billion of the $20 billion Africa-wide investment in the digital/connectivity ecosystem as of 2015.

Nigeria hosts six submarine cables with direct connections to all major West African markets.

There is over 15MW of combined standard Data Centre capacity.

Equally significant, 58 new tech start-ups registered in 2018.

The ICT sector is playing a

catalytic role in economic growth.

The ICT sector contributed 12.4 percent to the nation’s GDP, reflecting an annual increase of 9.5 percent year-on-year. Nigeria has 172 million mobile lines and 112 million Internet subscriptions.

The preceding is the backdrop for the growing interest in the Nigerian digital and connectivity ecosystem that attracted the eminent guests. The office of the Vice President Prof Yemi Osinbajo claimed it facilitated Jack Ma’s visit to “promote technological innovation amongst young people”.

Jack Ma outlined the interest of the Alibaba Group, himself and the many investors that came along with him in the E-ecosystem of Nigeria. The four areas of interest are E-infrastructure, Entrepreneurship, Education and E-governance.

Demand is increasing for Nigerians with competences and skills to speak the language of the new digital world. Principally this revolves around programming and coding. Nigerian youngsters, entrepreneurs and start-ups have proven adept in this area.

Andela Limited made the case

and showed the quality of Nigerian programmers. It has been eminently successful in building engineering teams and software developers that companies across Africa. Global firms snap up those that Andela trains. Andela has now turned its model upside down.

Rather than train young future engineers, it is now in the market to hire 400 senior engineers.

If coding were a country, it would have the highest number of migrants. Coders are among the most sought-after professionals.

Our STEM ecosystem is rapidly developing despite Nigeria. The country needs now to support the visions and ambition of its young people in their drive to play significant roles and speak the language of today and tomorrow.

Nigeria now requires even more committed and sustained efforts to attain universal, affordable and suitable quality broadband access all over the country. We endorse the recommendation of industry player MainOne that Nigeria should “work towards ensuring that the cost of 1GB of internet data should not be more than 2 percent of average monthly income”.

Nigeria must do away with the impediments. They include policy frameworks that make infrastructure deployment difficult and expensive as well as constraining tax policies and multiple taxations.

Access to funding remains a challenge as is the cost.

Funke Opeke, the engineer who leads MainOne Cables, recently provided a template of solutions.

A foundational measure is the recognition of ICT and connectivity as critical national infrastructure.

The government at all levels must encourage innovation hubs as well as skill development and job creation. Then reduce non-economic costs and risks of market entry and investment.

As the sector grows, we must work to ensure the availability of appropriate technical skills to operate and maintain digital infrastructure. Also, it is necessary to provide incentives or direct funding support to the providers to ensure the provision of affordable broadband access to areas of less commercial viability such as some of our states and the rural regions. The future is digital and beckons Nigeria. Let’s go there, surefootedly.

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Border closure, import substitution and Nigeria’s denial of its structural challenge

SEUN ONIGBINDE

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he pronouncement by the government directing the CBN to stop providing Foreign Exchange (FX) for importation of food should require rigorous interrogation. What is unfortunate is the worn-out narrative that removing the importers from the “official” FX list will spur domestic production and also conserve foreign currency. This is partly untrue. We have also taken this further with border closure, fully expanding the import substitution policy of the current government.

We must dig deep to understand the real issues. What sucks Nigerian currency and what constitutes Nigeria’s external reserves? In the 2018 trade report as presented by the Nigeria Bureau of Statistics, Nigeria’s imports were put N13.17 trillion ($43.18 billion). Compare these imports to African peers such as Egypt (2017: $64 billion) and South Africa (2017: $82 billion), Nigeria’s imports are relatively low. However, what makes the bulk of Nigeria’s import? It is not food. According to NBS, in 2018, 30.16 percent of Nigeria import is fuel.

Nigeria mostly operates a trade surplus (exports higher than imports) and between 2015 and 2018, it only experienced trade deficit thrice, mainly during the difficult period of recession, especially when oil prices tanked across the globe.

When oil prices dropped in 1981, 2009 and 2014, we were witnesses to how the economy ran aground. The currency weakened, growth slumped, and we faced FX shortage except in 2009 when we had excess crude reserves to intervene.

The current policy of the federal gov-

ernment as directed to the CBN points back to the existential issue that Nigeria tries to run away from. Nigeria’s external reserves vulnerability is largely linked to two elements - the continuous dependence of foreign exchange earnings from oil exports and a surge in portfolio investments, which are taking advantage of Nigeria’s equity and bond offerings.

In 2018, 96.2 percent of Nigeria’s official exports was linked to oil. In 2016, where Nigeria faced severe FX challenges that finally resulted in devaluation, it was because oil prices tanked.

Why is Nigeria not focusing on the core issues of balancing its export portfolio?

What will the removal of agricultural imports (raw and processed) valued at $4.9 billion, being 11.34 percent of the entire import bill do when oil prices slip?

Nigeria external reserves are also vulnerable to sudden repatriation of funds by portfolio investors. In 2018, out of the $16.8 billion capital imported into Nigeria, $11.8 billion (70 percent) was linked to portfolio investments, largely invested in money market instruments.

As analysts continue to point out that the US might largely land itself in recession in Q4 2019, there is a tendency for the huge outflow of funds as capital managers will request a recall in an era of panic. While Nigeria could do better to seek more Foreign Direct Investments, pronouncements such as a political entity, openly influencing monetary policy will not sit well with long-term investors.

In fact, this might be more dangerous to the narrative of seeking more FX into the country. While FG might have other motives of boosting using such policies to boost domestic production and provide employment, the continuous over-reach of thinking it can use import substitution to fix its structural issues around oil dependence is wrong.

Nigeria has agricultural exports that are currently on the incredible upward swing. For example, Nigeria’s agricultural exports have grown from N60 billion in 2016 to N170 billion in 2017 to N302 billion in 2018, showing huge potential with such rapid scale despite its smallness. Why is the Nige-

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It is a dangerous approach for a country to push agenda on import substitution as most countries that tried this methodology found that expanding exports and seeking new markets is sustainable to keep the economy afloat, import foreign capital and provide jobs on a massive scale

rian government not doubling its effort on smoothening the process of exports which improves standardisation, ports, business registration, packaging and other value-added processing? For example, Nigeria exports N33 billion worth of sesame seed in Q4 2018 and while there is a continuous demand for this in light of the recent spat between US and China, isn’t this a space that Nigeria with improved agriculture practices can take advantage of?

It is a dangerous approach for a country to push agenda on import substitution as most countries that tried this methodology found that expanding exports and seeking new markets is sustainable to keep the economy afloat, import foreign capital and provide jobs on a massive scale. China, South Korea, Japan and so on have seen that autarky that comes with import restriction does not scale the income level of countries, neither does it raise standards. China became the global economic superpower because of its export status and title as “workshop of the world”.

I have maintained that the extreme poverty you see in Nigeria is because its people do too little to sell to the world.

Vietnam, China India are doing their all to plug into the global marketplace because after China shut its border for years, it found out that export-led growth in a diversified manner is most sustainable way out of extreme poverty.

I am not for smuggling and practices of unfair trade but if we look deeply, have our own institutions not failed?

Is the answer to smuggling solely the closure of borders? We need to get our neighbours to act right, but this is an indictment on our institutions and failure of our infrastructure. We deserve to have varied trade practices but our obsession around rice is just comical. There’s no compulsion about why we should eat the rice we produce. Every country chooses to protect certain products but that’s in the context of a larger strategy around exports. If the comparative advantage of our land is to export sesame seed, soybean or cow milk, why not give this intense focus?

There is a more important reason why we aren’t aggressively targeting exports and we are excited in this frenzy of import substitution. We have wasted our years of growth and right now, we aren’t ready to accelerate our reform.

An export-led economy is extremely competitive, so you have to get the infrastructure (ports & access roads), processing, business registration and standardization, education, the skilled economy right. We aren’t ready for that hard work with all the elements moving at the same pace.

So, in the end, we hope for $40 billion exports (still dominated by oil) and maybe $25 billion in imports (less food and refined crude imports), that’s what I mean by playing and thinking small.

Analysts would say I am asking us to walk before we crawl but targeting exports as a policy is not sudden work but the signalling must be clear.

However, we can continue to drag with the Benin Republic with 11 million population and a $10 billion economy or just learn how China’s boat lifted smaller economies around it such as Vietnam (with over $200 billion in exports). The world is aggregating towards the influence of large economies. This is not our time to think small, but we are playing on a short-term strategy that packs emotive nationalist arguments.

What Nigeria needs is the discipline that export systems bring along in terms of skills development, operational excellence and product development.

Managing imports keeps Nigeria’s fry small and circles resources around a country with poor and disparate income levels. Nigeria has an export problem with its immense dependence on oil and without solving this existential issue through rigorous thinking, it will continue to wonder how development keeps eluding it. Just because it continuously seeks quick exits rather than confronting its existential problem- the severe dependence of its economy on oil, a volatile commodity.

Seun Onigbinde is the co-Founder and Director of BudgIT

The survival budget irritation

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magine a time in your business when you will never have to think about how much you are spending.

Is that even possible?

I’m glad you asked, because the truth is, no matter how much you generate in revenue, if you are truly vested in your business, you will want to know that you are conserving much more than you spend. This means that you will definitely be watching spending.

It therefore stands to reason that as a growing business, you cannot keep excusing bad spending decisions as a function of insufficient revenues. Whether you are a big business or an emerging business, there will always be lots of things great to spend on, but you will need to exercise great caution and discipline.

Let me go on further to say that in running your business, you as the business owner must ascertain your survival budget and then you also have to work out the survival budget for the business.

Your personal survival budget is what should translate to the salary the business pays out to you.

Now this very idea is a source of great irritation to many entrepreneurs. It really, really hits a sore spot. This comes as no sur-

prise, because characteristically, it is more convenient for them to transfer money out of the business account to meet their personal needs as the needs arise. What this eventually results to is excessive spending by the business owner, and in many cases, the ultimate erosion of business capital.

Why survival budget?

It is a methodical process that ensures that the business owner gets to think through those necessities he must incur in a year for himself and his dependents. It does not take luxuries into account. The derivation of this amount will become a business cost known as his salary. This, the company can decide to pay out to him monthly or quarterly, depending on the cash flow pattern of the business.

If the survival budget far exceeds anything his business can pay out, then it means that he needs to seek alternate sources of income; for example, a part-time job.

This initial analysis of determining a survival budget has been ignored by many people when starting their business. So, what we see is that the business never really takes off, because the business owner attempted to meet his needs from insufficient revenues generated by the business.

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Let us consider this illustration. Johnson Audu Chukwuma is a business man selling phones in computer village. He has a wife and two children. How should he go about deriving his survival budget?

He will need to pay attention to the cost of taking care of himself, his wife and his children in arriving at this figure. If he spends N40,000.00 monthly on feeding his family, N600,000.00 three times a year on school fees, N200,000.00 a year on medicals and another N700,000.00 a year on house rent, it then means that he needs a total of N3,180,000.00 (Three Million One Hundred and Eighty Thousand Naira) a year to survive. This means that the business needs to pay him a net monthly salary of N265,000.00.

The question now is, can Johnson’s business afford to pay him N265,000.00 monthly.

Does he have sufficient gross margins from his sales to cover this salary as well as other business overheads and still turn a decent net profit?

This here is the analysis many budding entrepreneurs fail to engage in. Granted, it is painstaking, and may be a bit of a turn off, but it is very essential in planning your target revenue and your net profit goals as well.

In concluding, let me also say that you

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JOVITA MADOJEMU need to find out what it costs to run your business monthly. Knock off those things that the business can do without, and make sure everyone in the business understands that there is no endless well of money in the business. Expenses will need to be planned for in advance before they are incurred. Of course, the plan will include a provision for contingencies.

When you have set your business and personal survival budget in motion, remember to monitor performance at least monthly, so you can course correct where necessary.

Here’s to making your business immortal!

Madojemu is the Managing Director of Pundit Bookkeeping Services; a company bridging the gap between emerging businesses and professionally prepared accounts.

Jovita seeks to empower young businesses with financial intelligence, for business growth and sustainability.

Email – jmadojemu@punditbookkeeping.com

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Wednesday 20 November 2019

BUSINESS DAY

AGRIBUSINESS

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TAK Agro raises N15bn in bond to enhance yield, reduce wastages …with book building by Planet Capital Limited Josephine Okojie

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AK Agro Plc, a key player in Nigeria’s agricultural value chain, has raised N15 billion senior secured bonds to finance the acquisition of key infrastructure that will enable it to advance its role in enhancing yield and reduce wastages in the Country’s agricultural industry.

The bonds were issued through book building by the Issuing House, Planet Capital Limited, with a clearing price of 16.49 percent payable semiannually in arrears.

Senior Secured Bond means a debt security that is issued by a limited liability company, partnership or trust and secured by a valid priority perfected security interest on specified collateral.

The bond issuance which is the first agricultural value chain finance in the Nigerian Capital Market has a tenor of 7 years and will be due by 2026. Proceeds of the bond will be used by TAK Logistics Limited, sponsors of the Issuer, to purchase 250 trucks out of its over 1,000 truck requirements.

“Our logistics operation is central to the operations of the TAK Agro Group,” said Chuma Henry Maduekwe, Managing Director of TAK Logistics Limited at the signing ceremony on Friday last week at the Annex Explorers, Federal Palace Hotel & Casino, Victoria Island Lagos.

Ma d u e kw e s a i d t h e company engages in the movement of fertiliser raw materials, such as phosphate, potash, limestone, and urea from ports and local locations to various fertiliser blending plants under the Presidential Fertiliser Initiative (PFI).

The blended fertilisers are delivered to agro-dealers, farm gates, and distribution/ aggregation centres. “ TAK logistics move grains/farm produces from aggregation centres to silos and warehouses and helps in the distribution of silos-processed farm produce to food processors, manufacturers or end-users,” he said.

Maduekwe added that the logistic arm of the business had transported over 30,000 truck trips of fertiliser which was a huge logistics

Efe Akhigbe, co-CEO/director, Planet Capital Limited (Issuing House); Tony Anonyai, co-CEO/director, Planet Capital Limited; Thomas Etuh, chairman, TAK Agro Plc; China Maduekwe, managing director, TAK Logistics Limited during the TAK Agro bond signing ceremony in Lagos recently.

undertaking and a scenario with very many challenges.

He noted that the company currently owns no trucks and has been engaging third party transporters to meet its logistics requirements.

However, the company has suffered from low cycle-time due to the limited availability of trucks and challenges within the transport logistics

sector in Nigeria.

“For instance, any fertiliser that does not get to the farmer before the planting season is too late for that season,” he further said.

He explained that the fertiliser will have to be stored till the next planting season and that comes with huge carrying costs and risks.

He explained that truck-

Stakeholders seek Buhari, N/Assembly attention on food security challenges REMI FEYISIPO, Ibadan

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takeholders in the forestry subsector have called for an urgent platform to interface with President Muhammadu Buhari and the National Assembly on providing solutions to the country’s nagging problems bedevilling food security in the country.

Speaking at a workshop with the theme ‘Economic Recovery and Food Security: Green Economy and Environmental Approach’ the forestry and agricultural researchers from all over the countr y, lamente d the mounting effects of environmental degradation across the country as an aftermath of the rampaging climate change.

They resolved to curtail the menace of deforestation, desertification, and erosion in Nigeria through the promotion of agroforestry as an effective tool towards achieving sustainable forest management and environmental amelioration.

The eminent researchers a n d f a r m e r s w h o ro s e

from the 2019 Agroforestry Farming Systems Workshop in Ibadan, Oyo State capital, expressed commitment to planting 25million trees by 2020 to minimize further environmental degradation.

The workshop hosted by the Forestry Research Institute of Nigeria (FRIN), Jericho, had participants who reiterated the necessity for the proposed interface with President Buhari and the National Assembly on the issue of food security in Nigeria.

They also mooted the idea of a similar parley with the Governors’ Forum to facilitate the signing of a Memorandum of Understanding (MOU) for the tree planting on their land with agreed sharing formula.

A communiqué issued at the end of the workshop also resolved to checkmate the culture of post-harvest losses in Nigeria by mandating FRIN to train farmers on waste management and production of compost manure from agricultural and household waste as well as value addition and sourcing of stable market for www.businessday.ng

farm produce.

To this end, farmers were urged to submit their proposal in line with their choice of trees to achieve the planting of 25million trees by next year.

The communiqué further disclosed that efforts would be intensified in establishing more plantations of indigenous tree species especially vitellaria paradoxa and parkia biglobosa because of their economic and nutrition importance.

On the capital intensive n a t u re o f d e s i g n i n g a greenhouse, the workshop advised FRIN to come up with other ways of improving greenhouse for upcoming farmers to use.

FRIN was also urged to acquire motorized climbers for harvesting tall oil palm trees and consequently design locally-fabricated ones thus making the facility ma s s i v e l y ava i l ab l e t o farmers in no distant future.

The stakeholders expressed appreciation to the Tertiary Education Fund (TETFUND) for spearheading increased c o l l ab o rat i o n b e t w e e n research institutes and

the nation’s ivory towers as a means of providing an effective solution to problems bedeviling the country.

Adesola Adepoju, director-general of FRIN, had earlier remarked that the Workshop was part of efforts of the institute to showcase its research breakthroughs over the years for farmers and stakeholders to adopt, to alleviate poverty, combat environmental challenges especially in this period of the adverse effect of climate change, to reduce food insecurity, and also to promote a green economy and economic recovery.

Suleiman Bogoro, executive secretary, TETFUND, who was the keynote speaker, to give FRIN positive consideration in its request for professorial research grants from TETFUND. B o g o ro, a p ro f e s s o r lamented that Nigeria’s tertiary institutions have, for too long, been laying too much emphasis on publications at the expense of research outputs and called for positive ways forward.

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hiring cost keeps increasing every month because the transporters know that users such as TAK are at their mercy as there are no alternatives.

To foster efficiency in its delivery system, he said the company is raising funds through the bonds to purchase 250 trucks to help control a portion of the total transport logistics requirements.

The acquisition of trucks, according to him, would see performance improvements in the coming years, as well as a hedge against overdependence on third party transporters.

Speaking also during the bond signing ceremony, Thomas Etuh, chairman, TA K A g ro G rou p, sa i d the company went into agricultural transportation to improve the storage and transportation of food grains across the country.

According to him, the company’s silo capacity for storing grains is 261,000 metric tons, while warehouse capacity is 150,000 metric tons.

This brings the cumulative to 411,000 metric tons.

“This enables it to handle thousands of tonnes of food grain from farmers and agrobusinesses,” he said.

T h e c o m p a n y ’s s i l o structures, he explained, follows a scientific method of storing grains, which enables bulk preservation of produce for longer periods.

Etuh said that investors gave impressive reception to the bond issuance as they oversubscribed the bonds by 13%

Kwara, AgroNigeria, others collaborate to host Farm2Fork Dialogue …to unveil a proactive partnership Josephine okojie

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h e Kw a r a s t a t e g ov e r n m e n t a n d AgroNigeria have collaborated to hold the ‘Farm2Fork Dialogue’ to fashion modalities to address issues limiting the sector.

The event with the theme ‘Eliminating the Impediments to a Prosperous Commodity Agribusiness’ is scheduled to hold on the 3rd and 4th of December, 2019 at the main auditorium of government house, Ilorin, Kwara State.

Richard Mark-Mbaram, co-convener of the Dialogue and CEO of Agro Nigeria said the dialogue conference is imperative to facilitate the needed solutions to challenges bedeviling agribusiness in the country.

The event which is also being organised in conjunction with the National Association of Chambers of Commerce, Industries Mines & Agriculture (NACCIMA), Organised Private Sector Exporters Association (OPEXA), and the Federation of Agriculture Commodity Associations of Nigeria @Businessdayng

(FACAN), will among other things leverage on the positive momentum generated by recent economic actions of the government with a view to ensure that the Nigerian economy and its critical stakeholders benefit thereof.

“The dialogue will hinge on the key narrative that the Nigerian private sector in agriculture is keen on fostering a Proactive Partnership for Prosperity (PPP) with the public sector,” Mark-Mbaram said.

“Right from local production to processing, logistics, consumption, and exports, there exists cross-cutting challenges which can only be comprehensively addressed by having all stakeholders around the table,” he further said.

“This is what the Farm2Fork Dialogue seeks to achieve.

In essence, the dialogue is designed not only to interrogate the causative issues resulting in the current reality of agro-commodity deficits in the country but to evolve a trajectory for short-medium and long-term solutions – this premised on an inclusive template”, he added.

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How Nigeria can tackle malnutrition with fertiliser fortification, plant breeding Josephine Okojie

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igeria’s capacity to tackle its high rate of micronutrient deficiencies among its population depends on the country’s ability to ensure the usage of fortified fertilisers and bio-fortified seeds in the production of farm produce.

In Nigeria and the rest of Sub Saharan Afr ica, micronutrient deficiencies are common among its people due to over farmed, depleted and nutrient lacking soils as well as high acidity problem among others.

This has put adults and children at risks from infection and developmental p r o b l e m s. E x p e r t s s a y micronutrient-deficient in the population could lead to weakened immune systems and thyroid problems.

“Nigeria is the country w i t h t h e t h i rd h i g h e s t absolute number of children

who are stunted globally.

The root cause of this is soil deficiency of micronutrients and inadequate dietar y intake,” said Ismail Cakmak, a professor of Plant Nutrition, Sabanci University, Istanbul,

Turkey at training organised

by OCP Africa for Agricultural reporters in the country few months ago.

“For Nigeria to re a c h t a rg e t s l e v e l s o f micronutrients in food, the

country needs to combine fertiliser fortification with plant breeding. This approach is sustainable and the most effective solution to micronutrient deficiency in food,” Sabanci said.

Ani Charles Bassey-Eyo, co-founder of Axiom learning solutions Ltd closing the Education Reform Stakeholders Engagement in conjunction with the Lagos State Ministry of Education Commissioner held recently in Lagos.

African ministers strategise on climate change adaptation Josephine Okojie

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inisters of agriculture from across 30 African countries, including Nigeria recently gathered to endorse an urgent declaration on actions needed to tackle head-on, the issue of adapting African agriculture to climate change.

Extreme weather events h av e c o n t i n u e d t o p u t pressure on the ecosystem that African smallholder farmers depend on for their livelihood.

This has made it imperative for African agricultural ministers to hold its second annual ministerial conference of the Adapting African Agriculture (AAA) Initiative with the themed ‘ F o o d S e c u r i t y Fa c i n g Climate Change,’ to tackle threats posed by changing climate.

The conference which was held recently at the Mohammed VI Polytechnic University in Benguerir, Morocco, in partnership with OCP Africa, also

had representatives of International and regional funding organisations and institutions in attendance.

Central to the Benguerir Declaration was the deeply unsettling realisation of looming food insecurity on the continent due to the impacts of climate change, w h i c h t h e c o n t i n e n t ’s agricultural practice and production needs to quickly adapt to forestall a deleterious situation that could deepen numerous challenges.

The ministerial declaration had several pronouncements.

As framed by the declaration, “we encourage the foundation to maintain and expand its country-level support, in such a way as to help formulate National Climate-Smart Agriculture Investments Plans.”

“We also invite partner funding institutions to back this effort and to contribute t o t h e f i na n c i ng o f t h e implementation of these plans within the framework of national agr icultural development strategies.

“In particular, through the strategic partnership with the AAI - especially www.businessday.ng

the advent of the on-going Pan African Climate Finance Access Program with the Green Climate Fund Th e d e c l a rat i o n a l s o states: “We agree to reinforce agricultural research and innovation and to support AAA-focused research for development, through our national agricultural-research systems and by involving the Consultative Group for International Agricultural Research (CGIAR). We also insist on the necessity to improve technology transfers to farmers to ensure that research activities respond to their needs and concerns in the face of climate-change challenges”.

Fu r t h e r t o t h i s, “ w e invite the AAA Foundation to promote and support technology transfers, knowledge sharing, and capacity building through South-South and triangular cooperation”.

Th e d e c l a rat i o n a l s o encourages the AAA Foundation to pursue its advocac y efforts for the adaptation of African Agriculture in the upcoming ‘Conference of the Parties’

(COP) and the UNFCCC’s specialized bodies and committees.

Speaking at the meeting, Mohammed Sabo Nanono, N i g e r i a’s M i n i s t e r f o r Agriculture, acknowledged the need for immediate actions to solve the threats of climate change, while calling for interstate and inter-regional cooperation to confront the problem.

He cited the example of Lake Chad which is experiencing reduced productivity as a result of climate change.

“We have to see how we can collaborate to address the Lake Chad issue because it is affecting all countries within the region. We need to be less territorial in our thinking so that we do not continue to face this challenge in Africa,” Nanono said.

“We also need to think of how we can manage the other resources that are available to us and maximize them. This will also require inter-regional cooperation between African countries and will enable us to great deal with the challenges of global warming,” he added.

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He estimated the yearly loss of nutrients on Africa soil to worth about $4 billion annually.

“The soil is depleted at every plant cycle and nutrients removed by crop plants must be replaced annually, otherwise, a serious depletion problem will occur on agricultural soils,” he said.

He defined hidden hunger as the inability for people to get all the vitamins and minerals their body requires over a period of time despite consuming sufficient calories.

Hidden hunger occurs when people do not get all the vitamins and minerals they need over a time, despite consuming sufficient calories.

He identified that low nitrogen in most African s o i l i s re s p o n s i b l e f o r micronutrient deficiencies, while also saying that most countries on the continent have acidity problem with is soil which is responsible for low phosphorus retention.

The plant nutrition said

that good soil nutrition for plants will help address issues of heat stress on plants and climate change.

Also, he noted good plant nutrition helps in pest and disease resistance, adding that high plant nutrition resist high pathogenic attacks on crops.

“By adding agronomy compound to the breeding process in plant, it will help double the micronutrients requirement for human consumption,” he said.

He stated that low fertiliser usage on the continent has limited yield gaps in Africa, while calling for increase in fertiliser application in Nigeria to increase farm yields per hectare.

He states that Nigeria and Africa at larges have to adopt a holistic approach that is sustainable and efficient in increasing its farm yields, saying the country cannot afford to wait any longer as its population keeps growing at a faster rate.

SADTS initiative will boost food security, says Argungu Udoka Agwu, Umuahia

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asir Argungu, director-general, N a t i o n a l Directorate of Employment (NDE) has said that Sustainable Agricultural Development Training Scheme (SADTS) is a nationwide programme geared towards the rural people to boost food production in the country in order to reduce hunger.

Argungu who was represented by Chijioke Uzoatuegwu, state c o o rd i n a t o r, N D E A b i a chapter, said during the opening and orientation course for the commencement of the training of 50 unemployed persons through the SADTS initiative, that the programme was in line with the vision of President Buhari’s administration to promote agriculture and ensure food security.

He p o i n t e d o u t t h a t there was the need to train people in new agricultural technologies to enhance food production, adding that the Rural Employment Promotion (REP) department of the @Businessdayng

directorate would through the programme engage the people in more susceptible agricultural training.

He noted that the nation-wide programme was intended to boost the productivity of smallholder farmers in rural communities in order to reduce hunger and improve their livelihood.

Michael Mbata, director of REP department at the National Headquarters said it was important to train people who were interested in agribusiness.

Mbata disclosed that the directorate had an extension service mechanism where the trainees would be monitored to evaluate their progress during and after the training sessions.

He said that the training will last for three months, including two weeks of theory and 10 weeks of practical in crop production and animal husbandry.

Mbata, who was represented by Blessing Owan, said the training would equip them with the technical know-how on basic farming in livestock and crop productions.

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BUSINESS DAY

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Wednesday 20 November 2019

BUSINESS DAY

COMPANIES & MARKETS

17

Company news analysis insight

TECHNOLOGY

Opera-backed Opay raises $120m in series B funding OLUFIKAYO OWOEYE

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till basking in the euphoria of Visa’s $200million investment in Nigeria’s fintech company, Interswitch and a $40million raise by Lagos based payment startup, PalmPay by China’s Transsion, Africa focused fintech startup OPay has raised a $120 million Series B round backed

by Chinese investors, less than 6 months after it announced its last funding round of $50 million in June.

Opay, incubated by Norwegian based, global consumer Internet company Opera, is already Nigeria’s leading mobile wallet and motorbike ridesharing provider, and is rapidly expanding.

Series B investors included Meituan-Dianping, DragonBall Capital (The Investment fund backed by Meituan-Dianping), GaoRong Capital, Source Code Capital, SoftBank Ventures Asia, Bertelsmann Asia Investments (BAI), Redpoint China, IDG Capital, Sequoia Capital China and GSR Ventures.

OPay launched its mobile payment service in August 2018,

creating an infrastructure on which the company is now adding new services. The agent-centric mobile payment operation focused on reaching the massive unbanked population of Nigeria.

Since its Series A funding, OPay tripled its active agents

to over 140,000 and saw daily transaction volumes doubling to exceed $10 million per day, furthering the company’s position as the largest mobile transaction provider in the country.

Additionally, OPay’s motorbike ridesharing service has

become the largest of its kind in Nigeria, more than tripling daily rides over the past three months, and the company recently launched additional services around food delivery and cashless payments for offline businesses. While still focusing

on Nigeria, OPay has the ambition to expand across the African continent.

According to the company, it would deploy the $120 million across Opera’s Africa network as it looks to capture volume around bill payments and airtime purchase.

L-R: Thelma Okoh, general secretary, Lagos NIPR; Yomi Badejo Okusanya, president, Africa Public Relations Association; Olusegun McMedal, chairman, Lagos NIPR; Eniola Mayowa, vice chairman, Lagos NIPR, and Comfort Nwankwo, ex-officio, Lagos NIPR, at the press briefing unveiling plans for the 2019 Lagos PR Industry Gala and Awards (LaPRIGA), themed: PROVATION, in Lagos

INSURANCE

Inflation rate accelerates to highest level in 17months on surging food prices OLUFIKAYO OWOEYE

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eadline inflation has risen for two consecutive months in Nigeria after the index hit 11.61 percent in October 2019, the highest in 17 months, on the back of surging food prices.

Despite the full-blown harvest season in October, food inflation surged by 58bps to 14.09percent, the highest since April 2018, as the impact of all land borders closure continued to take a toll on food price.

Against the surprised uptick recorded in the prior month, core inflation tapered by 7bps to 8.88percent, on account of the subdued energy prices.

Energy inflation dipped by 42bps from a year ago, as food inflation widened by 3bps to 1.33percent month-onmonth, while core inflation dipped significantly by 15bps

to 0.74% m/m.

Given the recent decision to extend border closure till early next year, together with the festive induced demand,

analysts expect food inflation to widened in November.

Despite CBN’s hard stance on the currency and muted energy pressure, analysts

at Cordros Securities expect core inflation to increase marginally, given the low base from the corresponding period in the prior year.

“Overall, we now expect headline inflation to sustain its upward trajectory, expanding to 11.87% y/y (1.04% m/m),”

L-R: Jide Adeyemi, adviser, Africa and Middle East, Junior Chamber International (JCI); Babajide Agbeja, senior adviser, Africa and Middle East, JCI; Adetola Juyitan, national president, JCI Nigeria, and Basile Djossouvi, JCI adviser for Africa and Middle East, at the JCI World Congress in Estonia.

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Wednesday 20 November 2019

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COMPANIES&MARKETS

Business Event

Kirusa konnect enables businesses in Ghana, Nigeria reach customers effectively, Mumick says MICHAEL ANI

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i r u sa, a g l o b a l leader in communication solutions over data networks for consumers and enterprises, has reiterated that one of its key products, Kirusa Konnect, a cloud-based Communications Platform as a Service (CPaaS) is poised to bolster customer engagement for enterprises in Ghana and Nigeria.

The solution which was developed to support businesses with the most appropriate communication tools would enable them to connect and reach more customers effectively, Inderpal Mumick, CEO of the value-added service providing firm said.

“The main objective of Kirusa Konnect is to make it easier for businesses to connect and interact with their existing customers and reach

new customers, in efficient and highly cost-effective ways,” he said Kirusa Konnect, a self-serve portal, provides businesses with capabilities to engage with their customers over mobile channels through messaging, voice and rich media tools.

The platform enables instant, two-way and interactive communication.

According to Mumick, the Omnichannel framework of Kirusa Konnect allows businesses to conceive, execute and monitor customized communication campaigns.

By using the solution, businesses can mix and match from the following channels supported by Kirusa Konnect: IP Messaging and Chatbots, SMS, SnapCall, Interactive Voice Response (IVR), Outbound Calls, REST APIs. Mumick explained that large, medium and small-scale enterprises including, financial institutions, telecom operators,

hospitals, travel companies, educational institutions, ecommerce companies, retailers, religious organisations, NGOs, and government organisations in Ghana and Nigeria are using Kirusa Konnect to to engage with customers using chatbots over RCS and OTT messaging apps, to send OTPs, appointment and payment reminders, alerts, and important announcements, to collect feedback, educate users, provide access to content, do surveys, manage voting, and much more.

Kirusa provides communication solutions over data networks across the African continent, serving the needs of thousands of brands, in partnership with over 50 mobile operators. It has more than 100 million monthly active users with over 3 billion monthly transactions. Kirusa is at the forefront of leveraging data networks to transform messaging and voice.

L-R: Iyabo Phillips, guest of honour; Bamidele Koleowo, former national chairman, SOEHPON; Folashade Omokhodion of University of Ibadan; Effiem Abbah, national president, SOEHPON, and Musa Shaibu, MD, NNPC medical services, at the annual conference and AGM 2019 in Lagos. Pic by Pius Okeosisi

LSFPR becomes first Nigerian PR Agency listed on Holmes Report Global Creative Index IFEOMA OKEKE

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eading public relations agency, LSF|PR has risen above its global counterparts to emerge pound for pound, the 11th most creative PR agency in the world, according to The Holmes Report’s Global Creative Index 2019.

This annual global measure of creativity – now in its eight edition - evaluates award entries and winners from more than 25 PR, digital and marketing awards programs from around the world over a 12-month period. The index formula takes into account the expansion of public relations work across multiple categories at advertising-oriented shows such as the Cannes Lions, with a methodology that favors agencies designated for idea-creation.

In this edition of the index, LSFPR ranks 11th on a points per head table that identifies agencies which are, ‘pound for pound’, the most creative PR agencies in the world.

The overall agency table is dominated by global PR networks such as Weber Shandwick, BCW, Ketchum and Edelman owing to their volume of awards, while this alternative measure of agency creativity comes from weighting agency scores according to their staff size.

Speaking on the achievement, Bidemi Zakariyau Akande, Founder & CEO of LSF|PR said, “We are delighted and extremely proud to have been listed on this distinguished index. Being a result-driven agency, LSF|PR continually strives to create and execute ground-breaking campaigns that deliver impactful outcomes for our clients and

stakeholders.”

She went on to say, “We’re the first Nigerian Agency to make this list and the 2nd in Africa since the creation of this index 8 years ago, our ranking validates the hard work and dedication of the whole team. We are also inspired to demonstrate that there is really no limit to what can be achieved with hard work and resilience.”

LSF|PR’s ranking is attributed to the agency’s recent wins at the world’s largest PR awards programme, the SABRE Awards. Earlier this year, at the 2019 SABRE awards (AFRICA) LSF|PR won in the Diamond category for superior achievement in brandbuilding, received a certificate of excellence in the Gold category, and emerged a finalist; second runner up in the Platinum category for Best PR campaign in Africa.

COMPANY RELEASE

VocalScript, Nigeria’s first digital transcription platform, debuts in Nigeria

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ocalScript, Nigeria’s first online digital transcription company that specializes in providing transcription, translation and closedcaption services to individuals as well as diverse business sectors has commenced operations in Nigeria.

The company uses state of the art technology to provide an easy to use web platform and a handy mobile application to provide service to customers.

For instance, users can make recordings on the mobile app or upload previous recordings and have accurate transcripts delivered within minutes to hours. In addition, the company has an in-house transcription team who are vetted for quality, to meet transcription demands and requests from companies and individuals.

The innovative service has proven to be extremely useful for corporate entities, law firms, journalists and even across the

educational sector.

For instance, students find the application useful for notetaking while organizations use the service for minutes, and accurate record-keeping purposes.

An important issue is also the pricing. The service has an automated plan starting at N50 per audio minute with the most expensive plan billed at N300 per minute for transcripts handled by its team. Members of the public can currently test the service for free by using coupons provided on the website.

Speaking on the market potential and use, Kola Olanipekun, VocalScript CEO said “We are only trying to use the technology to make life easier across different sectors that need the service especially because most of them do not know of its existence. We have tailored the service for diverse sectors.

“Lawyers for example, can have a standard record of pro-

ceeding; students can have accurate lecture notes without missing a word, companies can have detailed minutes of meetings and even discussions in seminars can be transcribed to aid productivity.

“We are currently using machine learning to understand even the thickest Nigerian accents to aid in local speech recognition so the turnaround time will definitely improve. We are positive that people will see the value in time.”

Statistics show that journalists spend up to six hours a week transcribing audio which adds up to two lost business months in a year. While transcription companies are still yet to become established in Nigeria, outsourcing transcripts to companies like VocalScript provide flexibility, guaranteed superior quality, timely delivery, customized delivery, reliability while freeing up journalists and your workers for other more important work.

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L-R: Reginald Okeya, director, MTN Foundation; Dennis Okoro, director, MTN Foundation; Ifeanyi Ugwuanyi, executive governor of Enugu State, and Abasi-Ekong Udobang, senior manager, Program Implementation, at the grand finale of the MTN Foundation sponsored Life in My City Art Festival 2019 at the International Conference Centre, IMT, Enugu

L-R: Sobowale Temiloluwa, lead consultant, Intelligent Interactive Limited; Gogo Anyanwu Jr, Employee Voice Rights Advocate; Nduneche Ezurike, convener Of Employee Marketplace Initiative, and Chioma Okpala, deputy head of programmes, Inspiration FM, at the who really cares about workplace motivation & a leadership engagement session on workplace innovation, in Lagos.

L-R: Nneka Onwuegbuche, product manager, card services, Zenith Bank Plc; Lanre Oladimeji, group head, retail banking, Zenith Bank Plc; Cherry Eromosele, group chief marketing officer, Interswitch Group, and Mike Ogbalu III, CEO, Verve International, at the Verve Global Card launch and First Transaction, at Emperor Retail Outlet in Dubai, UAE.

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Managing

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Wednesday 20 November 2019

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GOVERNMENT

BUSINESS

Interview with Public Sector Leaders

Ekiti is adopting NLNG model for Ekiti State Governor Kayode Fayemi recently sat down with our Editorial Board member, Chido Nwakanma, to speak on various issues in the economic management of the state, including the philosophy and practices.

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et me start with AkureAdo Road. What is the challenge of fixing it?

There is really no challenge in fixing it. We have secured support from the African Development Bank to fix the Ado-Akure Road.

We have had difficulties in getting the approval of the owner. It is a road that belongs to the federal government. So, when we got a nod from the African Development Bank that they would support us to build the road and dualise it, I approached the president. He, of course, asked the minister for advice.

The minister advised that they were not opposed as long as we were not going to seek a refund for reconstructing and dualising the road. We found it awkward because it is their road. If we are fixing it for you, I cannot use Ekiti funds without justification. Yes, my people would really like this road to be fixed, but they would also like me to account for it by getting a refund for the expenditure incurred. What we are getting from the African Development Bank is a loan; a long-term loan that would be relatively easier for us to manage in terms of repayment, but it is still a loan.

Where we are at right now is that we have said, okay, we are ready to foreclose the option of securing a refund.

What we would like is for the minister to give us the right to toll the road. And I got my colleague on the other side, Governor Rotimi Akeredolu of Ondo State, to also subscribe to my original request and he did. He has said we are with Ekiti on this. We are ready to manage it. Give the road to us. Unfortunately, people will not know this back and forth. All they know is that the road is terrible.

What is the next step?

This is going on now. We are still at it.

The African Development Bank cannot move unless we get a clear approval from the federal government. We are not a sovereign. I think it is a matter for discussion over the longer term, the structure of the federation. The fact that we could even engage in this kind of conversation is unfortunate and problematic for me. And this is happening across the board. Ekiti is not unique.

My people are abusing me that I have not fixed the road, but they do not know what I am going through.

They say, did he not go to school? He passes that road more than most of us.

He should do something. Most people who get into public office want to do something. But when they get there, they are overwhelmed by the gridlock.

And some give up because they can’t fight this battle.

What is the update on the collaboration between the Ekiti State government and Promasidor?

We are doing very well with that. We have formed a joint venture company with Promasidor to manage the moribund Ikun Dairy Factory. It is a factory

that has been there since 1987 but was not put to use. The equipment has gone bad. Now we are clearing the land.

Promasidor has shown a lot of enthusiasm. We believe that this is going to be a model of the kind of partnerships that states and private sector operators should get into. Credit must also go to the Central Bank for encouraging Promasidor through policy initiatives to support companies that want to improve on local content rather than bringing in imported materials. The estimation that Promasidor has given us is that within the next 18-24 months, they would be producing 9000 litres of milk from the factory.

What is the name of the joint venture company?

Ikun Dairy Farms. Majority of the shareholding belongs to Promasidor because we think it should be private sectordriven. Promasidor has 76 percent of the shares and Ekiti State Government 24 percent. We are using our land as equity and some of the other things that we are putting on the table.

Which other projects would you consider concessions? Is privatisation a strategic fit for the economic philosophy of the state?

It is, but not privatisation for its own sake. We have also learnt lessons. In my first term in office, I spent a lot of resources putting in place the Ikogosi Warm Spring Retreat to work. It became a popular destination. Equally, the

Gossy Water Works was thriving. But I left office, and these things went belly up. The lesson I have drawn from that is not so much that government has no business in business but that there are just some businesses that are better off in the hands of private owners so that regardless of whatever happens in office the risk is limited.

We have put in place a transition law in Ekiti that speaks to our belief in continuity and treating government as a continuum. We know that it is only the citizens that can make that happen by putting pressure on the government not to abandon projects that were already in place by the predecessors of an incoming administration only because they were not the ones who put the project in place. There has to be a better and stronger justification for that to happen.

What we are doing now is looking for core investors. You would have seen an advert for transaction advisers from Ekiti looking at the possibility of having a core investor that can then help look for the best fit in the private sector for some of these facilities. We have successfully worked with the private sector to revive Gossy Water which also collapsed under the previous administration but has now come back to life and is doing relatively well. We have our responsibility to ensure that the access road is reconstructed so that the products can be taken out. Our burnt bricks factory that we revived during my last time in office is also an example of a firm that requires a core investor from

the private sector.

We have also seen many other players that are desirous of coming into the state. We have seen interest expressed to establish a rice mill

by Dangote Farms. We have seen the same thing from the Vaswani guys. Increasingly that is the way we should go.

Is this model like the NLNG model?

Absolutely. The NLNG model. The private sector has the majority shareholding and management. We provide the enabling environment, and we have a token representation on the board and equity for the state.

Marx says the economic conditions of man affect other conditions. What are your plans for boosting the economy of the state, direct and indirect?

For me that is an area where we need to do a significant amount of work. If you go by National Bureau of Statistics records, almost one in two of our people in Ekiti State lives below the poverty line. Whether that figure is accurate or not is neither here nor there. The critical point is that people have been poorly served before now. Before you get them to start thinking about entrepreneurial activity, you have to secure their immediate expectations not only for thriving but for surviving. Which is why we are doing a lot of social investments; social security benefits for the elderly, school feeding programme for the young ones, support for pregnant and vulnerable women. We have all of these initiatives.

As a social democratic party ideologically speaking, even though Nigerians will tell you there is no ideology in our politics, I do believe we need a pragmatic ideology, an interven-

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the Executive Governor of the Nigeria’s eastern State of Taraba

Kayode Fayemi

Ekiti State Governor

investments – Fayemi tionist strategy that enables deployment of the creativity and energies of our people. Get people to a sufficient condition of living that can then allow them to start exploring opportunities and providing them with the tools to engage.

Let me use Promasidor as an example. We are clearing 600 hectares of land that Promasidor would use for planting what becomes feed for the animals. We have also worked with them to develop an out-grower scheme which is local and belongs to our people. That way you don’t just have an oasis of success in the middle of a poverty-stricken environment. If you have an out-grower scheme and Promasidor is an off-taker, with minimum pricing that has been agreed, the people keep producing as they know there is a market. Inevitably there is a thriving industry in that local environment that is bound to percolate down. The money is circulating locally.

That is a model that we think can work across the board. As Dangote and others come on stream, we don’t want just to have a big farm that has no ancillary out-grower scheme that can support our people. We would have an ecosystem supporting the central unit. It is a wealth creation strategy.

Your Ministry of Justice has codified many laws in the area of sexual offences and other areas such as palace laws. What did you do to have such an activist justice bureaucracy?

I think there is a place for establishing procedures, processes and rules if you are going to deepen democracy. You cannot have a democracy without the rule of law. If you do not have very clearly defined and legislated enactment of laws, then it becomes a problem. From the outset, we were very clear that we would run a government driven by a very clearly defined set of rules. Then we would sensitise our people while also working with the traditional sector concerning access to justice. We believe in legal dualism. The customary. That is where the people are.

The people are not bringing the cases, the majority of them, to this prim and proper British Common Law system that we practice. If access is the critical component of the rule of law, then it cannot just be access to the High Court where the ordinary people do not go and cannot afford it. It is why we are promoting the Palace Court judgments. The penalty coming out of those palace courts may not be what we are familiar with, but the sanctions are more enduring because in the community they know how to hold you accountable without necessarily sentencing you to jail in a manner that your family will feel the impact.

We have borrowed from some of that as part of our gender-based violence prohibition and sex offenders register. We concluded that it is not just enough to establish a registry. We had to extend it to naming and shaming. That is what we have done. Before we did that we sought the buy-in of our traditional rulers; they, too, said we would work with you on this.

Once it is done, in our traditional society, if you are known to have committed a sacrilege, you become a pariah in that community. The pariah status is not just limited to you. Even generations in your family that come after you will still carry the stigma.

Social sanctions. It is a combination that we are looking at because we have a fragile criminal justice system and pending the time we can strengthen it, we will do the combination.

I have a very activist Attorney General who is also from the human rights sector as I am. I

things. To the average worker in Ekiti, that is a big deal.

I also think some people are coming round to the idea that maybe Governor Fayemi is right. The bulk of our population is youthful. Some of the things he is talking about -digital economy, entrepreneurial spirit, focusing on broadening the opportunities available in tourism, agriculture, education – is not such a bad idea. Change is something that we all resist, but there is a sense in which I think a lot more people are receptive to these ideas.

You still have a debate about what does Ekiti State need an airport for, what is this smart city/knowledge city idea? We want to eat three square meals. Such pedestrian arguments are always going to be there. A lot of people also believe that governance is not just about now. It is also about the future. We have to prepare for the future now so that we don’t get caught up in a mess later on in life.

don’t have to do complicated explanations. He gets it and is putting in place a robust regime of laws to help drive our agenda in these areas.

Could you explain the transition law?

Based on our experiences when we came into office, we had difficulty with the departing administration in even understanding the basics. What is on the ground? What information should we have from you to prepare ourselves?

This is important in Nigeria, where we have a long transition period of at least three months between the departing administration and the incoming winner of an election. In most places, such as the United States, Kenya or South Africa, there is a transition process where it is institutionalised. They have laws that codify transition arrangements, but we don’t have any such system in place.

You could argue that we are testing the waters. The expectation is that this will catch on even at the national level. What it does is to outline the terms and conditions for disengagement and engagement in the aftermath of elections. It is not everyone that will be reasonable.

We want to provide legal basis for the transition. We want to take this away from the realm of personal initiative to the field of law and sanctions if need be. It is the first transition law in the country.

It is one year of your second term. What has been your experience with the Ekiti people?

In the first instance, even though I conceded the election in 2014, I do not want to blame our people. In fairness to them, they voted in the way they wanted

the election to go, my way. But we had an overwhelming federal force in place at the time. There was also an element of some resentment; this man was too fast for us. He had set ideas on where he wanted to take Ekiti. Whether we were carried along or not, he wasn’t budging.

They probably wanted a slower pace of development. There was that sense.

Four years down the line, with a governor who saw things from a different perspective; policies on the hoof; gut-feeling governance; I hate to say the words “stomach infrastructure” handouts to people, not institutionalised social security and empowerment schemes. The people have tasted two different worlds, and they have come to certain conclusions about it.

Given the suffering that accompanied that, particularly lack of salary payment in a local service-oriented state, it was a particularly painful experience for our people. I think that was something that worked in my favour when I expressed an interest in coming back to office. They said we had tested these two. At least we know that whatever resources are available, the people will be prioritised over every other thing even if we had different ideas that they do not necessarily share. The fact that salary is regular today is a big deal. I may say it is not a big deal, and indeed I am on record as saying so. This is not really what we should celebrate; people worked, and so they should be paid. But then, if you have not been paid for ten months in your experience and somebody pays you on the dot of a particular day, you know your money is coming, you can plan your life. There may be other things you want, but at least in the immediate you don’t have to worry about some

For the benefit of citizens and stakeholders, what is the rationale for the Ekiti Airport project?

Thank you for this question. The proposed Ekiti Cargo airport initiative is a project that has been in gestation for at least twelve years. Initially, I was a sceptic, but I became convinced of its necessity after the Committee that I set up to examine its viability submitted their report and gave an options appraisal. I then took it to the African Development Bank, and they saw the strategic fit with our other initiatives and this led to their keen interest in the project. The airport is a critical component of our growth strategy to make Ekiti a knowledge hub, a medical tourism destination, an agro cargo vehicle and an Infotech hub as well as a regional hub serving neighbouring states like Kogi, Osun, southern part of Kwara and Akoko part of Ondo State.

While taking on board the concerns of those who think this is a prestige project, I want to assure them that it forms part of an integrated plan for accelerated development. Very few people know, for example, that Ekiti has the most modern, state of the art hospital in Nigeria where open-heart surgery and kidney transplant have become routine. With an airport, it’s far easier and cheaper to bring a patient to Ekiti than to go to India. Two, we are working hard on our Agric Processing Zone and already attracting companies like Dangote and Stallion to put rice mills in Ekiti. Promasidor is also making progress with Ikun Dairy Farm. Many more are coming on stream. Air and Rail transportation will be central to evacuating products to markets outside our shores. Third, we are planning a knowledge city right next to the airport, and we are convinced that all of these initiatives make a case for the airport a viable one. Finally, it’s also important to stress that it’s not a trade-off with other critical projects on road infrastructure, social investments and rural development. If anything, it is complementary.

The challenge of leadership is always to see beyond the present and work for the future.

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Wednesday 20 November 2019

BUSINESS DAY

MARITIMEBUSINESS Shipping

Logistics

Maritime e-Commerce

Concerns as Customs fails to ustilise multi-million-dollar EU acquired scanner …Machine wastes away at Seme-Krake border months after amaka Anagor-Ewuzie

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hippers are presently worried that the multimillion dollars scanning machine acquired by the European Union (EU) and handed over to the Nigeria Customs Service (NCS), Seme Border Command, has been idling away following the failure of Customs to put the equipment into use, several months after it was handed over.

Speaking at a stakeholders’ engagement on Border Closure organised by the Nigerian Shippers’ Council (NSC) in Lagos recently, Bello Jibo, head, Revenue for Seme Customs, confirmed that Customs presently has two functional scanners at the Seme border command.

According to him, “One scanner was provided by the Economic Community of West African States (ECOWAS) to us but we have not started using it. We are making use of the old scanner that we have. Though, just recently, the old scanner had a downtime, but we are currently working on it,” Jibo said.

Jibo, who did not give reasons for the inability of Nigeria Customs to put the scanning machine into use for trade facilitation, spoke in response to stakeholders’ de-

L-R: Idris Abubakar, executive director, Engineering & Tech Services; Hadiza Bala Usman, MD NPA; Ahmed Lawan, Senate President of Nigeria and Mohammed Bello-Koko, executive director, Finance & Administration of NPA, during a courtesy visit to the Senate President in his office at the National Assembly Complex in Abuja recently.

mand for the Nigeria Customs to also ensure the availability of processes, procedure, infrastructure, security and protocol for international trade, in addition to closing the border.

Earlier, Hassan Bello, executive secretary of the NSC said there are expectations that the nation’s seaports, would witness rise in business activities following the closure of land borders to international trade, import and export.

“We are having longer waiting days in the anchorage, and

we need to put other ports into use. Customs needs to ensure that equipment like scanners are put into use as well to fast trade through quicker cargo clearance,” he advised.

Jibo however disclosed that when the scanner at Seme border was functional, once the goods are scanned and no problem was detected in line with trade guidelines, the cargo would be allowed to go without having to undergo physical examination.

It would be recalled that as part of efforts to enhance seamless cargo inspection as

well as trade across borders, the EU acquired and handed over new cargo scanning machines to the NCS and Togolese Customs, before the end of 2018.

Findings show that importance of scanning machines to cargo clearance at ports and other entry points cannot be over-emphasised as businesses in Nigeria including importers that depend on the seaports and borders for the importation of raw materials and other critical production inputs, are currently under cost-driven pressure, follow-

ing the delays and high cost associated with the manual cargo inspection procedure used by the Customs.

This was why EU acquired two scanners and allocated them to Togo, and NigeriaBenin Republic border posts with the sole aim of aiding trade along the West African trade corridors.

Also, the scanner was acquired at completion of the newly built Seme-Krake Joint Border Post, which was funded by the EU for the ECOWAS and the West African Economic and Monetary Union (UEMOA). The new border post was handed over to the governments of Nigeria and Benin in October, 2018.

President Muhammadu Buhari and his Benin counterpart, Patrice Talon, inaugurated the facility in the presence of Ketil Karlsen, head of the EU delegation to Nigeria and ECOWAS as well as his colleague in Benin.

The Joint Border Post (JBP) of Sèmè-Kraké was built in the framework of the ECOWAS Road Transport and Transit Facilitation Programme, an integral part of the regional strategy for implementing a comprehensive action programme on infrastructure and road transport.

It was a modern border, built according to international standards to meet the expectations of the ECOWAS

people within one of the busiest boundary lines in both West African region and Africa as a whole, due to the huge movement of persons, goods and services daily. In addition to the scanner, every facility in the new border post was provided by the EU, including the chairs.

Aside from having functional scanner at the border, it has become worrisome that five years after the Destination Inspection (DI) service providers handed over some set of fixed and mobile scanning machines worth over $120 million, built and situated in different port locations and border stations, to the management of Customs, the Customs has also failed to fully make use of these machines in clearing cargo.

Currently, over 90 percent of all the containers and general cargoes imported through the nation’s seaports and borders undergo manual inspection process popularly known as 100 percent physical examination.

“This was why the process of clearing imported cargo at the Nigerian ports is currently the longest compared to clearing from other seaports in neigbouring West African ports,” said Tony Anakebe, managing director of GoldLink Investments Limited, a clearing and forwarding company.

Why NPA stopped ship owners from using controversial Secure Anchorage Area amaka Anagor-Ewuzie

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he Nigerian Ports Authority (NPA) recently dismantled and stopped ship owners from using the facility at the controversial Secure Anchorage Area (SAA) operated by a private sector firm known as Ocean Marine Services Ltd (OMSL).

An anchorage is an area created within the Pilotage Districts for the purpose of providing shelter for vessels calling at or departing from the ports.

It is an integral part of a seaport, and is the responsibility of the NPA, according to the NPA Act to chat, designate, own, operate and manage ports anchorage areas except where such responsibility is entrusted to a third party in accordance with the Act. Recall that the Nigerian Maritime Administration and Safety Agency (NIMASA) had

through a marine notice issued in 2014, authorised the existence of the SAA as an additional security service facilities for the provision of 24/7 watch to vessels seeking extra protection while at the anchorage offshore Lagos.

The SAA is being operated

by OMSL, a private sector entity but with logistical support from the Nigerian Navy, part of which was the three new patrol boats, acquired and handed over to the Navy by the NPA in 2014, to safeguard the Lagos anchorage and offshore waters within the Lagos Pilotage District.

Subsequently, the existence of SAA became worrisome when the NPA found out that the Nigerian Navy in collaboration with the United Kingdom Hydrographic Office (UKHO) published the SAA in its Admiralty chart No.1381 of Lagos Ports Limits and Approaches dated 10th March 2011.

It was observed that there www.businessday.ng

was some false information in the charts, which indicated that the anchorage that was operated by the NPA was illequipped; giving an impression that Nigerian water was not secured.

This was contrary to the assessment of the same facility by the International Maritime Organisation (IMO), which commended NPA for the standard of facilities and security at the location.

Following these controversies, the NPA vide its letters dated 24th October 2017 and 25th October 2016 respectively, sought the intervention of the Minister of Transportation to dismantle the facility due to its high cost on ships.

In terms of cost, BusinessDay investigation reveals that shipping companies patronising the SAA are charged $2,500 for the first two days and $1,500 for subsequent days that the vessel is anchored in the SAA. These charges at the SAA add up to

the high port charges for vessels coming to Nigerian ports.

Consequently, the NPA vide letter dated 9th October 2019 and addressed to the Nigerian Navy, requested for stoppage of the operation of the SAA pending the conclusion of a new framework, and this has generated several controversies.

According to a petition letter written by the NPA and sent to National Assembly, a copy of which was sighted by BusinessDay, the authority said that the responsibility to oversee the maintenance of security in Nigerian maritime domain lies with the Nigerian Navy, Marine Police, NIMASA and NPA in accordance to their area of jurisdictions as provided by relevant legislation.

The letter stated that it has become very worrisome that the revenue generated from the SAA operation from 2014 till date, has not been remitted to the NPA or to the Federal

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Government since 2014.

“By virtue of section 7 (d) and (e) of the NPA Act, it is the responsibility of the Authority to: (d) ‘provide for the approaches to all ports and the territorial waters of Nigeria such pilotage services and lights, marks and other navigational services and aids, including cleaning, deepening and improving of all waterways.’ (e) ‘Provide facilities for berthing, towing, mooring or dry-docking of ships in entering or leaving a port or its approaches,” the letter stated.

Meanwhile, the Nigerian ship owners have thrown their weight behind the NPA for having the political will to terminate the operation of the private sector-managed SAA in Lagos.

To them, Nigerian ship owners never supported the idea of having a private sector managed anchorage because securing the nation’s waters supposed to be the sole re@Businessdayng

sponsibility of the NPA, NIMASA and Nigerian Navy.

Speaking to newsmen in an interview in Lagos, Aminu Umar, president Nigerian Shipowners Association (NISA), said there is nowhere in the world an anchorage is operated by a private sector company, and that was why Nigerian ship owners do not utilise the SAA. Stating that foreign ship owners that come to Lagos Ports assume that Nigerian waters are not safe, Umar said this was why foreign ships prefer to have a special anchorage that is frequently patrolled against pirate attacks.

“In other West African ports like Lome and Benin, anchorages are owned by their ports authorities. Though, we do not want to question why government gave the private sector the right to operate the SAA but we think there is no need for such rather, all our waters should be made secured for safe shipping,” Umar stated.

Wednesday 20 November 2019

BUSINESS DAY

PENSION today

25

In Association With

Who you are in the Contributory Pension Scheme…

I

vor Takor, director, Centre for Pension Right Advocacy in this article captures the right of the worker under the contributory Pension Scheme, and why all stakeholders should give the scheme all the attention it requires to succeed.

On July 1, 2014 the Pension Reform Act 2014 or “the Act” was enacted into law commencing from July 1, 2014. The Act, which repealed the Pension Reform Act No 2 of 2004, governs and regulates the administration of the Contributory Pension Scheme in Nigeria.

The Act confers on workers certain legal rights. The Black’s law dictionary defines a right as something that is due to a person by just claim, legal guarantee, or moral principle; a legally enforceable claim that another will do or will not do a given act; a recognized and protected interest the violation of which is a wrong, a breach of duty that infringes one’s right.

The first right, is the right to pension. Section 3 of the Act, established a Contributory Pension Scheme for all employees of Public Services of the Federation, the Federal Capital Territory, States, local government and the Private Sector.

The worker also has a right to the employer’s contribution towards his/her pension. Section 4(1) of the Act provides that the rate of contribution to the Scheme shall be a minimum of ten percent of monthly total emolument of the employee by the employer, while the employee shall contribute a minimum of eight percent.

The next right is the right to life insurance.

Section 4(5) provides that in addition to the rates of contributions, every employer shall maintain a Group Life Insurance Policy in Favour of each employee for a minimum of three times the annual total emolument of the employee and that premium shall be paid not later than the date of commencement of the cover. For the enforcement of this right, the Act in Section 4(6) provides that where the employer failed, refused or omitted to make payment as and when due, the employer shall make arrangement to effect the payment of claims arising from the death of any staff in its employment during such period.

The right to determine how to access retirement benefits under the Act. Section 7(1) provides that a holder of a retirement savings account shall, upon retirement or attaining the age of 50 years, whichever is later, utilize the amount credited to his retirement savings account for the following benefits: withdraw a lump sum from the total amount credited to his retirement savings account provided that the amount left after the lump sum withdrawals shall be sufficient to procure a programmed monthly or quarterly withdrawals calculated on the basis of an expected

L-R: Bayo Yusuf, treasurer of Pension Fund Operators Association of Nigeria (PenOp); Ifeanyi Abraham, clerk of the Committee; Ronke Adedeji, president of PenOp; Alhassan Rurum, honourable member and chairman of Committee; Bamidele Salam, honourable member and deputy chairman; Hamza Wuro-Bokki, head, PenOp Committee on Legal and Regulatory; and Wilson Ideva, CEO of High Street Consulting Ltd, consultant to PenOp during a courtesy visit of Members the House Committee on Pensions recently.

life span or annuity for life purchased from a Life Insurance Company licensed by the National Insurance Commission with monthly or quarterly payment. The decision to access benefits either through programmed withdrawal or annuity is the sole right of the employees.

The right to contributions to the Scheme forming part of tax deductible expenses in computation of tax payment as well as retirement benefits, being exempted from taxation.

Section 10 of the Act provides that notwithstanding the provisions of any other law, contributions to the Scheme under the Act shall form part of tax deductible expenses in the computation of tax payable by an employer and employee under the relevant Income Tax Law; moreover, all interests, dividends, profits, investment and other income accruable to pension funds and assets under the Act, as well as any amount payable as a retirement benefit under this Act shall not be taxable.

The other right is the right to choose a Pension Fund Administrator (PFA). Section 11(2) provides that an employee to whom the Act applies shall notify his employer of the Pension Fund Administrator chosen by him. This means that the worker has the sole right to choose a PFA, with no interference by the employer.

The worker has a right to timely remittance of contributions into his/her retirement savings account (RSA). Section 11(3)(b) of the Act provides that not later than 7 working days from the day the employee is paid his salary, remit an amount comprising the employee’s and employer’s contributions to the Pension Fund Custodian (PFC) specified by the Pension Fund Administrator of the employee.

As penalty for non compliance, Section 11(6) provides that an employer who fails to deduct or remit the contributions within the stipulated time frame, shall in addition to making the remittance already due, be liable to a penalty to be stipulated by the National Pension Commission (PenCom).

Section 13 confers on the worker, the right to transfer his/her RSA from one PFA to another. This section provides that subject to the guidelines issued by the Commission, a holder of a retirement savings account maintained under the Act may not more than once in a year, transfer his account from one Pension Fund Administrator to another.

There is also the right to transfer an RSA from one employer to another. Section 14 of the Act provides that where an employee transfers his employment from one employer or Organisation to another, the same retirement savings account shall continue to be

maintained by the employee or be transferred.

Section 15 protects pension rights of employees in the Public Service of the Federation and the Federal Capital Territory accrued under the defined Benefits Scheme. The section provides that as from June 25, 2004, being the commencement of the Pension Reform Act 2004, the accrued pension right to retirement benefits of any employee in the Public Service of the Federation and the Federal Capital Territory who is already under any pension scheme existing before the commencement of that Act and has over 3 years to retire shall be recognized in the form of amount acknowledged through the issuance of Federal Government Retirement Benefits Bonds by the Debt Management Office, which shall be redeemed upon retirement of the employee.

The Act grants a worker, the right to regular information. Section 55 provides among other duties of the Pension Fund Administrator, the duty to provide regular information on investment strategy, market returns and other performance indicators to employees or beneficiaries of the retirement savings account. The PFA shall also provide customer service support to employee including access to employee account balances and statements on demand.

IS NOW RC634453

Diamond Pension Fund Custodian Limited 1A, Tiamiyu Savage Street, Victoria Island, Lagos State.

Tel: 01-4613753, 2713680, 2713954 Fax: 01-2713955 Email: info@accesspfc.com Website: www.accesspfc.com

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@Businessdayng

This section is created to increase awareness and deepen knowledge about the Contributory Pension Scheme.

If you have enquiries or contributions, send to this e-mail: accesspfcbusday@yahoo.com

26

Wednesday 20 November 2019

BUSINESS DAY

insurance today

E-mail: insurancetoday@businessdayonline.com

Marine insurers call for safety actions as containership fire incident rises Modestus Anaesoronye

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his year has already seen an alarming number of container ship fires including Yantian Express, APL Vancouver, Grande America, E.R. Kobe and KMTC Hong Kong. The escalation is of growing concern to the International Union of Marine Insurance (IUMI) who used a recent forum to call for an urgent improvement to onboard firefighting systems. Nigerians’ are members of IUMI At a conference in Arendal, Norway, organised by marine insurer and P&I Club, Gard, and attended by IMO, flag states, shipowners, salvors, class, and insurers, IUMI strengthened its position on this global issue.

Helle Hammer, Chair of IUMI’s Policy Forum explains: “Fire-fighting capabilities onboard containerships are deficient and we need to see more headway to improve the safety of the crew, the environment, the cargo and the ships themselves. Mis and non-declaration of cargo has serious safety implications and is the root cause behind these tragic incidents. There is agreement among experts that the current means of controlling a fire in the cargo hold are of little effect. The safety objectives set out in SOLAS do not seem to be met, and in light of the various recent casualties the time for action is now.”

During the IMO’s 101st Maritime Safety Committee (MSC) meeting in June 2019, IUMI raised its concerns and received support from various quarters, including IACS. Now, in partnership with the German flag state, IUMI is calling for additional support from flag administrations and other stakeholders to bring this issue to IMO’s agenda in 2020.

In 2017 IUMI published a position paper to raise a variety of concerns including inadequate fire detection and onboard firefighting systems both on deck and under deck; and the need to revise SOLAS. This position paper will provide the foundation for the

L-R: Ugochi Odemelam, executive director, Marketing and Business Development; Jude Modilim, executive director, Technical Operations; Olaotan Soyinka, MD/CEO and Kayode Adigun, GM, Finance and Corporate Services, Sovereign Trust Insurance Plc at the Company’s 2020 Strategy and Budget Session held in Lagos over the weekend.

IMO proposal.

“Our position paper recommends that firefighting systems should be arranged to segregate the ship into fire compartments where the fire can be isolated to prevent it from spreading. Onboard systems could then cool the containers and allow them to burn out in a controlled manner. Fixed monitors to adequately attack the fire and improved fire detection system are further measures proposed to allow for an appropriate response mechanism. Better prevention measures must also address the concerning rise in cargo misdeclaration. We are encouraged to see larger carriers already

beginning to crack down on this problem”, says Hammer.

“The sad reality is that we can no longer sit idle. Containerships are increasing in size and complexity and this will only exacerbate the problem. This is an issue that affects the entire maritime industry and IUMI is calling for all stakeholders to work together and encourage IMO to: strengthen fire protection in the cargo area of container vessels; amend SOLAS by explicitly including active and/or passive fire protection on board new container vessels; and consider the need to address the firefighting equipment of existing container vessels.”

The International Union of Marine Insurance (IUMI) represents 43 national and marine market insurance and reinsurance associations. Operating at the forefront of marine risk, it gives a unified voice to the global marine insurance market through effective representation and lobbying activities.

As a forum for the exchange of ideas and best practice, IUMI works to raise standards across the industry and provides opportunities for education and the collection and publication of industry statistics. IUMI is headquartered in Hamburg and traces its roots back to 1874.

NAICOM approves Ademola Abidogun as MD/CEO for Guinea Insurance Modestus Anaesoronye

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ational Insurance Commission (NAICOM) has approved the appointment of Ademola A. Abidogun as the substantive managing director/CEO of Guinea Insurance Plc. The approval came in a letter dated 8th November 2019, captioned “Final Approval to Appoint Ademola A. Abidogun as the Substantive Managing Director/ CEO of Guinea Insurance PLC. In a statement by the Chairman, Board of Directors of the company, Godson Ugochukwu“ Abidogun brings to Guinea Insurance Plc 24 years experience in pro-

Ademola Abidogun, MD/CEO, Guinea Insurance www.businessday.ng

viding strategic and operations leadership in uniquely challenging situations in the insurance industry.”

He is a seasoned professional with inestimable depth and wealth of technical experience acknowledged industry-wide.

His combined expertise in marketing, insurance broking, underwriting/claims administration, oil and gas, banking, telecoms, reinsurance, product development, business risk advisory, special risks and strategic planning, offer a formidable springboard for relaunching the Company’s propensity to act and hence, develop and implement sustainable plans for longterm growth and shareholder value creation. Prior to his appointment, Ademola

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had championed the affairs of many companies in the insurance industry; the most recent being: Fin Insurance Company Limited, where he served as Executive Director, Technical/Operations and Ag. Managing Director. In Cornerstone Insurance PLC, he pioneered the Bancassurance/Retail team as Assistant General Manager. He holds a Master of Science degree in Business Administration from Rivers State College of Science and Technology (2007); He is an alumnus of the prestigious London and Lagos Business Schools as well as the University of Texas. As an erudite insurance professional; he has attended numerous management courses and seminars both locally and internationally.

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Wednesday 20 November 2019

BUSINESS DAY

27

insurance today E-mail: insurancetoday@businessdayonline.com

NAICOM, other supervisors adopt global frameworks for supervision of international insurers Modestus Anaesoronye

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he International Association of Insurance Supervisors (IAIS) to which the Nigeria National Insurance Commission (NAICOM) have adopted a comprehensive set of reforms that will enable effective cross-border supervision of insurance groups and contribute to global financial stability. The International Association of Insurance Supervisors (IAIS) has adopted a comprehensive set of reforms that will enable effective cross-border supervision of insurance groups and contribute to global financial stability.

These significant achievements were made possible by a shared commitment from the world’s insurance supervisors to the maintenance of fair, safe and stable insurance markets for the benefit and protection of policyholders. The adopted reforms include: The Common Framework (ComFrame) establishes supervisory standards and guidance focusing on the effective group-wide supervision of Internationally Active Insurance Groups (IAIGs). ComFrame is a comprehensive and outcomefocused framework that provides supervisory minimum requirements tailored to the international activity and size of IAIGs. It will provide supervisors with a common language for the supervision of IAIGs. The implementation of ComFrame should result in more efficient su-

L-R: Folasade Shotomide, Kola Oyekanmi, Archana Bhart, Olapeju Paraiso, and Addeola Olatunbosun, during Lion Quest Interaction with their foreign Trainer in Lagos

pervisory processes, for the benefit of both supervisors and IAIGs. ComFrame builds on the revised set of Insurance Core Principles (ICPs), that are applicable to the supervision of all insurers and which were adopted after extensive review.

The Insurance Capital Standard (ICS) is being developed with the purpose of creating a common language for supervisory discussions of group solvency of IAIGs to enhance global convergence among group capital standards. The newly agreed ICS Version 2.0 for the five-year monitoring period, starting in January 2020, was developed through a structured and evidence-based ap-

proach, which included six quantitative Field Testing exercises over the course of 2014 to 2019, extensive stakeholder engagement and comprehensive discussion among IAIS Members.

During the monitoring period, ICS Version 2.0 will not trigger any supervisory action but will be used for confidential reporting and discussion in supervisory colleges to provide feedback to the IAIS on the ICS design and performance.

The IAIS has agreed to a detailed plan for the operationalisation of the monitoring period, including a work plan and timeline for the period 2020-2024 and a collective effort to

make participation by IAIGs in the monitoring period as large as possible across different jurisdictions and business models. Feedback from supervisors, ongoing data analysis, public consultations and an economic impact assessment during the monitoring period will aid the further refinement of the ICS prior to its implementation as a group-wide prescribed capital requirement (PCR).

At the same time, the IAIS agreed on a definition of comparable outcomes and an overarching approach for the development of criteria to assess whether the Aggregation Method (AM), being developed by the United

States and other interested jurisdictions, provides comparable outcomes, ie substantially the same, to the ICS. The assessment will take place according to the timeline published today and if the AM is deemed to provide comparable outcomes to the ICS, it will be considered an outcome-equivalent approach for implementation of ICS as a PCR. Lastly, in delivering its commitment to contribute to global financial stability, the IAIS adopted the Holistic Framework for the assessment and mitigation of systemic risk in the insurance sector, for implementation from the beginning of 2020. This framework recog-

nises that systemic risk can arise both from sector-wide trends with regard to specific activities and exposures, as well as from a concentration of these activities and exposures in individual insurers.

The Holistic Framework consists of an enhanced set of supervisory policy measures and powers of intervention, an annual IAIS global monitoring exercise and collective discussion on the outcomes and appropriate supervisory responses, and a robust implementation assessment.

In recognition of the fact that the Holistic Framework, consistently implemented, provides an Enhanced approach to assessing and mitigating systemic risk in the global insurance sector, the FSB has decided to suspend the identification of global systemically important insurers (G-SIIs) from 2020. In November 2022, the FSB will, based on the initial years of Implementation of the Holistic Framework, review the need to either discontinue or re-establish an annual identification of G-SIIs. “This has been a week of major achievements for the IAIS”, stated Victoria Saporta, IAIS executive committee chair at its Annual General Meeting in Abu Dhabi.

“The reforms adopted by our Members mark a big step forward as a global community of supervisors in the pursuit of our mission to support the stability and sustainability of the insurance sector, protect policyholders and promote global financial stability.”

NNPC bases selection of insurers on track records, service excellence Modestus Anaesoronye

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he Nigerian Nat i o n a l Pe t r o l e um Corporation (NNPC) said selection of brokers and insurance companies for coverage of its assets and non-assets risks for the 2020/2021 business year will be strictly based on track record and service excellence.

M e l e Ky a r i , g r o u p m a n a g i n g d i re c t o r o f NNPC made the disclosure during the during

a public opening of bids for insurance broker for NNPC Oil/Non-Oli Assets and Liability for the Year 2020/2021.

Kyari said that the evaluation and selection process would be transparent and accountable in keeping with the corporation’s Transparency, Accountability, and Performance Excellence (TAPE) agenda.

He said there would be a level playing field for all the bidders to guarantee the emergence of the best among them based on their respective track record and commitment to excellence. www.businessday.ng

He stated that NNPC was desirous of engaging reputable and competent professional brokers that could provide unparalleled and exceptional valuation and insurance services to sustain its drive for excellence service delivery.

He also called on insurance brokerage firms that participated in the expression of interest to insure NNPC’s oil and non-oil assets to be wary o f a n yo n e who wo u l d promise to help them win the bid as the corporation does not operate in such a shady manner.

Ayo Bameke, NNPC group general manager, risk management and insurance, said the bidding is also a requirement of the Bureau of Public Procurement (BPP).“The essence of this public bid opening is to ensure that the Corporation complies strictly with the provisions of the Bureau of Public Procurement Act (BPP),” the statement read.

“All the bids will be opened in the presence of everybody to ensure that all entries are properly captured in line with the transparency principle of

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the NNPC.” Shehu Liman, group general manager, supply chain management, said the public opening bids measure is aimed at providing a level playing field for all bidding companies.

“The idea is to select broking and insurance companies that are credible and capable with track records of performance.

What this means is that we are going to eliminate all those transactions that are not necessary,” he said.

Mustapha Muhammed, group general manager, Risk Management and In@Businessdayng

surance Division, noted that the bid opening was conducted in the full glare of representatives of the bidding companies and other stakeholders to demonstrate NNPC’s commitment to transparency and due process in all its operations.

Some representatives of the bidding firms also expressed their satisfaction with the conduct of the exercise.

A total of 251 firms submitted bids for insurance broker for oil assets while 253 firm’s submitted bids for non-oil assets.

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Wednesday 20 November 2019

BUSINESS DAY

Harvard Business Review

ManagementDigest

The secrets of successful female networkers FOUR BEHAVIORS SET THEM APART. ne oft-cited reason why more female executives don’t advance to top management jobs is their lack of access to informal organizational and industry networks. Some people blame unconscious bias: High-ranking men connect more easily with other men. Others cite professional and personal obligations, from office housekeeping to child-rearing, that disproportionately fall to women, leaving them less time to develop professional relationships.

But some female leaders do establish strong networks — and they win greater influence and more-senior positions as a result. What are they doing differently?

A new study sheds light on their strategies. “I was talking with many women about how to improve their networks, the challenges they face and what they and their organizations could do better, and I realized that all the studies on the issue were pretty old and narrow,” explains Inga Carboni, a professor at William & Mary’s Mason School of Business and the study’s lead author. “I couldn’t answer their questions.”

The researchers analyzed data collected from 16,500 men and women in more than 30 organizations across a range of industries over the past 15 years. Then they interviewed hundreds of female executives. This led them to identify four characteristics that distinguish the networking behaviors of more-successful women from those of their peers. In some cases those matched the behaviors of high-performing men; in others there were subtle but important differences.

When shaping their professional networks, top women were: EFFICIENT. Studies, including the new one, show that women generally absorb more collaborative demands in the workplace than their male peers do. But the female managers with the strongest networks “recognize that every ‘yes’ means a ‘no’ to something else,” says Babson College’s Rob Cross, one of Carboni’s co-authors. He notes that one Silicon Valley executive he knows has adopted that idea as her mantra. Although these successful

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female networkers might feel an identity-driven desire and a stereotype-influenced pressure to help colleagues out and be a team player, they try to resist. They prune nonessential appointments from their calendars, deflect low-priority decisions and requests, run streamlined meetings, insist on efficient email norms and set aside time for reflection and high-level thinking. At the same time, they make the most of their collaborative strengths and inclinations by working with others in a way that establishes or enhances key relationships and ups their visibility.

“At every level in organizations, women are more likely to be sought out for advice,” Carboni says. “And when asked about the downsides of saying no, every woman I interviewed said they’d feel bad.” But she emphasizes that the research is clear: The female executives who rise to the top are “more strategic and thoughtful” about how they spend their time. Organizations can do their part by tracking unseen collaborative work, ensuring that it’s evenly spread among male and female employees, and pushing all leaders, but especially women, to unabashedly prioritize their most important tasks.

NIMBLE. The researchers’ data shows that most women’s relationships, particularly www.businessday.ng

those with female peers, are stickier than men’s, growing stronger, more mutual and more interwoven over time.

Carboni and Cross note that this can occasionally be a positive — for example, an old contact might offer a new opportunity or employment prospect. But if you work in a dynamic organization that requires rapid adjustments to changing demands (and who doesn’t nowadays?), always relying on the same people can hurt your performance.

Successful female networks are more fluid. High-ranking women know when to deemphasize old connections in favor of new ones (whether by cutting ties or by failing to maintain contact). For example, says Cross, “when you’re at an inflection point at work or are embarking on a new project, you want to think about your goals and who will help you reach them — whether those goals are political (gaining early access to opinion leaders), developmental (supplementing skills gaps), innovation-oriented (searching for new insights) or related to best practices (finding people who know efficiencies).”

He acknowledges that some women find this inauthentic, even Machiavellian, but notes that men interpret the same behavior as putting the work first. He says it’s OK to have a “tenure bell curve” in professional relationships. Women

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should, of course, maintain some long-known advisers.

But they should consistently initiate new connections, and organizations can help them by instituting processes such as network reviews at the start of new assignments or during performance evaluations.

BOUNDARY-SPANNING. The highest-ranking, bestnetworked women connect with people in a wide variety of functions, geographies and business units. Again, less successful female networkers tend to shy away from the tactic because it feels uncomfortable or overly promotional.

“We heard from women that they liked their own communities,” Carboni says, whereas spanning boundaries made them wary of “backlash” and “stressed out.” But that behavior is critical to accessing new information, leading innovation, and pursuing advancement, for both women and men. Cross suggests periodically considering the leaders in your organization and asking yourself, “Who isn’t in my network but should be?” He advises approaching them “not with ‘Here’s what I need’ but with ‘Could we grab a coffee and explore ways of working together?’” Companies including Ford and Booz Allen Hamilton have tried to institutionalize the practice by setting up cross-functional groups of female high potentials who meet regularly with @Businessdayng

C-suite executives.

E N E R G Y- B A L A N C E D .

More than two decades’ worth of research shows, perhaps not surprisingly, that the highest performers are seen as the most energizing people in their networks — as the type of colleague who makes the work more engaging, which then drives better performance. But men and women are expected to bring different energy to relationships, and this is where effective female networkers set themselves apart from less successful women: They demonstrate both competence and warmth, both intelligence and emotional intelligence, as studies — the researchers’ and others — suggest they must to build trust. “The most successful women don’t downplay their knowledge, skills and accomplishments; they show evidence that they can do things,” Cross says. “But they also use humor, presence and small gestures to signal caring and positivity, and they employ listening skills to spur creative thinking among their colleagues.”

The researchers say they hope more women will adapt their networking behaviors in keeping with these four characteristics. They add that organizations have a big role to play too. “The goal is to embed these behaviors and practices so that they’re the norm for everybody,” Cross says.

Wednesday 20 November 2019

Harvard Business Review

BUSINESS DAY

29

ManagementDigest

How Doctors can help prevent gun violence Megan L. Ranney and Marian E. Betz

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year ago, the National Rifle Association tweeted that “selfimportant anti-gun doctors” should “stay in their lane.” Thousands of physicians and other health care professionals responded with graphic pictures and stories that underscored why the prevention and treatment of firearm injury is very much “in our lane.”

In the week after the tweet, the hashtag #ThisIsOurLane went viral, an open letter in response to the NRA from physicians and their colleagues with the American Foundation for Firearm Injury Reduction in Medicine (Affirm Research) attracted over 40,000 signatures, and physician leaders of the movement — including the two of us — found themselves with an unexpected platform to advocate for change. Our work to reframe the debate about firearm injury prevention has accelerated. But there is still far to go.

Last fall, the American College of Physicians — one of the country’s largest physician organizations — updated a position paper outlining its recommendations for firearm injury prevention. It was this new paper that provoked the NRA tweet.

And when the NRA tweeted, the doctors and nurses and medics who had been working to restart the public health approach were ready.

We were already tired of taking care of victims and of being told that there was nothing we could do to stop their coming through our doors. We were already tired of seeing our communities caught in endless cycles of violence. We were already tired of seeing our own colleagues injured and killed, be it by suicide or domestic violence or as first responders.

We were already tired of the emotional toll of this epidemic.

And this tweet reminded us just how much our experiences mattered. We responded en masse with impassioned speeches and op-eds, and with unified fundraising efforts in honor of our patients and colleagues.

Given new energy by the #ThisIsOurLane hashtag in the past year, many of these efforts have grown in strength and power. The American College of Surgeons held an interdisciplinary summit of more than 40 medical and public health organizations, in which they restated their joint commitment to the public health approach. In the glaring absence of substantial federal funding, private funding for firearm injury research has

increased by more than 300%, with the National Collaborative on Gun Violence Research, Kaiser Permanente and Affirm Research together creating dozens of new projects that would not have been possible without it.

Physician education and guideline development has also accelerated: The American Medical Association launched a free online program, UC Davis developed the “What You Can Do” initiative and the National Institutes of Health-funded Facts consortium and Johns Hopkins both launched online curricula.

Hospital systems and states are also taking action: New Jersey funded a major research consortium, the governors of several states have committed to collaborative research, California is slated to fund a statewide medical education curriculum and Washington State has funded a new research program at the University of WashingtonHarborview. In the past year, approximately $15 million has been newly committed.

We’re also seeing an important new development: These efforts are being welcomed beyond the medical community.

Staying true to the public health approach, this work is engaging all of those affected by the epidemic, including gun owners, minority youth, domestic violence survivors and school administrators. New initiatives such as the Colorado Firearm Safety Coalition’s online map showing where people can legally store guns outside of the home if any occupants are at risk of injury and Affirm’s colwww.businessday.ng

laboration with firearm-training instructors are two of dozens of examples. Other efforts — like the Health Alliance for Violence Intervention — have gained in strength. And the American College of Surgeons’ Stop the Bleed program for out-of-hospital bleeding control has been adopted and delivered to over a million people nationwide.

Finally, the firearm injury prevention movement is increasingly collaborating with business and military to decrease risk. These groups understandably resist initiatives that seem partisan or political. But through the transformative, big-tent approaches outlined above, they have begun to appreciate that we can, indeed, address firearm injury prevention while also respecting the culture of our communities. This movement — which includes but is not limited to the #ThisIsOurLane hashtag — is not Democratic or Republican, and it’s not anti-gun. It’s anti-firearm-injury. Many of the physicians involved own guns.

The focus is on stopping shootings before they happen and on saving lives.

Although we applaud private funders and individual donors, we need a much greater investment to address this epidemic.

Traditionally, the public health response has been led by the federal government, including the Centers for Disease Control and Prevention and the NIH. While the NIH is now funding firearm research (albeit without dedicated funds or programs), the CDC is still silenced. In September the Senate declined to

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include the House’s request for $50 million to fund firearm injury prevention research in their health appropriations bill.

In the meantime, we and our organizations will work collaboratively with private groups to jump-start the necessary response. We draw parallels to our work from the early HIV/AIDS response. Long before the NIH dedicated funds to researching the prevention and treatment of HIV/AIDS, private groups like the Ryan White Foundation and the Rock Hudson Foundation provided funding. Health care groups are now doing the same, supporting private initiatives while we push the government to act.

There is no single solution to this epidemic, and there is much work to be done. But without continued commitment to implementing what we already know works — and to researching what we don’t yet know — we will not make further progress. Critical next steps include health care systems working with those of us with firearm injury prevention expertise to teach best practices to health care providers; continuing to pressure the federal government to provide funding; and continuing to work closely with affected communities to staunch the frequency of and impact of shootings. It also includes working with electronic health record companies, the technology and insurance industries, and the larger business community to collect and analyze data. Our patients and our communities deserve better than a haphazard @Businessdayng

approach to the epidemic. We need data-driven solutions.

If we have learned anything over the past year, it’s the power of the “white coat” to encourage good science, adequate funding and a sustained, comprehensive public health approach to firearm injury prevention. We are enthused by the medical community’s acceleration, but we need the support of the private community and of government to ensure that we don’t run out of gas before we reach the finish line.

Megan L. Ranney is an associate professor of emergency medicine at Rhode Island Hospital/ Alpert Medical School of Brown University. She is also chief research officer for the American Foundation for Firearm Injury Reduction in Medicine. Marian E. Betz is an associate professor of emergency medicine at the University of Colorado School of Medicine. She also co-founded and leads the Colorado Firearm Safety Coalition.

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Wednesday 20 November 2019

BUSINESS DAY

TRANSPORTation Motoring

RailBusiness

ModernTravel

Roads

‘Nigeria key African market for Ashok Leyland’ … As Stallion group recharges LCVs segment

Trailers, tankers slowing down Lagos-Badagry road project MIKE OCHONMA

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MIKE OCHONMA Transport Editor

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ussinesses in Nigeria are guaranteed positive returns on their investments following last week’s successful introductionof Ashok Leyland Partner and Boss truck light commercial trucks described as the flagship of the Hinduja Group, along with Stallion Motors, the automaker’s distributor in Nigeria for over a decade.

Anant Badjatya, the group chief executive officer of Stallion group in his keynote address reiterated that, the launch of the light commercial vehicles from Ashok Leyland adds to the range and shows the company’s renewed commitment towards bringing tough dependable and durable vehicles for logistics use in affordable range to the Nigerian customers.

With massive investments in state-of-thepart central autoparts and service center at Orile in Lagos to support the distribution of genuine parts across the nation for

the upkeep of these vehicles, Stallion has sales and service outlets in Lagos, Abuja, Ibadan and Port Harcourt.

In terms of model by model lineup description, the key strengths and attributes of the Partner lies in the vehicle performance, customer profitability and driver comfort.

Packed with superior mileage, load carrying ability, stability and maneuverability, the Partner helps run the business with better return on investment.

Partner is powered by the advanced ZD30 common rail diesel engine offering more power and Pick-up advantage, and can navigate with full load through any tough terrain with ease.

The heavy-duty parabolic leaf springs in the front, superior braking system and frontal crash protection that offers the driver and passengers a safe and smooth ride.

With Euro III compliance, bestin-class aggregate life and longer service maintenance intervals, the Partner keeps the business profitable and competitive with low fuel

and maintenance costs.The Partner sports a modern ergonomic cab with spacious car-like interiors, putting the driver comfortably in command.

Its power steering with tilt-able adjustment and a cable-operated gear shift mechanism with a 5 speed overdrive synchromesh gear box (OSGB) make gear shifting effortless and driving stress free.

The Boss model on its part offers class-leading comfort that sets the benchmark in the commercial vehicle industry. The dashboard is ergonomically designed with the controls placed intelligently, even as the vehicle comes with multiangle adjustable seats. The steering column comes with tilt-able and telescopic movements, while the 2-point suspended cabin offers comfort and convenience.

The Boss 914 is equipped with powerful ‘H’ Series Inline Engine tuned for delivering power & torque, rugged overdrive gearbox and bestin-class turning radius.

It offers superior payload and needs fewer maintenance brakes, delivering a superior up time with

lower operating costs making the business more profitable.

Besides the in-line engine with lowest maintenance cost, it has longer service intervals, lifetime lubricated bearings, tubeless radial tyres and organic clutch for longer-life.

Leading the Ashok Leyland team to Nigeria for the historic launch was O, Satishan, zonal head in charge of Africa and the Commonwealth of Independent States (CIS) Commenting on the launch, Nitin Seth, chief operating office, Ashok Leyland, said, “Nigeria is an important African market for Ashok Leyland. The new range of fully built trucks will sport contemporary design, a new-generation platform and will offer best-in-class efficiency, performance and comfort. Reinforcing our brand promise of ‘Aapki Jeet, Hamari Jeet’ we are offering two products that will provide the best total cost of ownership to our customers.”

The Ashok Leyland chief operating officer said that, the of the truck manufacturer in the international markets is to add more products

s the current Lagos state government battles to fulfil one of its cardinal campaign promises of completing the 10-lane multimodal Lagos-Badagry expressway, movement of passengers is being hampered by the menace of tankers and other articulated vehicles along the corridor.

Almost on regular basis, there are reported cases of fallen tankers and trailers along axis that is not even enough to contain other commercial vehicles, private car owners and commercial motorcycles popularly called okada which has suddenly become the fastest means of commuting, even at there are not enough traffic managers to control the traffic menace.

In July this year, the new governor Babajide Sanwo-Olu administration resumed the construction of the ten-lane Lagos-Badagry Expressway ten years after its commencement.

During the flag-off ceremony, the deputy governor; Obafemi Hamzat, stated that the return to the road not only marks the fulfillment of a promise made during a recent visit on June 2, 2019, to the people of the state by the Sanwo-Olu Administration but is also designed to bring relief to commuters who experience hardship daily on the road.

Hamzat noted that, the Sanwo-Olu administration would honour all the promises made to Lagosians. He further stated that the project covers specifically the Agboju to Trade Fair segment as well as the rehabilitation of the Eric Moore-Mile 2 stretch.

Commuters comfort upscale as Weststar increases Mercedes Sprinter fleet size the daytime and the electric sliding door on the side which enables comfortable boarding and exit for passengers.

It puts great emphasis on comfort in its interior with features like the highperformance roof air conditioner, seating with adjustable backrest, interior LED illumination, wood flooring and interior design with

MIKE OCHONMA

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or many years, the MercedesBenz Sprinter has remained the flagship model of MercedesBenz vans and the model has become a bestseller in major markets around the world with over 20 years since its first production at the Düsseldorf plant in Germany in 1995.

In response to the growing and diverse needs of the Nigeria’s transport industry today, and in an attempt to provide value suited for passengers, drivers and fleet owners, Weststar Associates Limited, authorized general distributors of Mercedes-Benz passenger cars and commercial vehicles in Nigeria has taken the delivery of more units of Mercedes-Benz Sprinters.

Already selling fast, the Sprinter 324 KA comes with features like fuel efficient petrol engines, high-performance roof air conditioners, electrical sliding doors, and reverse camera and

14-19 seats depending on customers’ preference.

The exterior comes with a radiator grille frame in the vehicle body colour, 16-inch steel wheels with 18-hole design, daytime running lamps which make it possible for other road users to identify the vehicle faster in www.businessday.ng

black Tunja fabric.

Other features are the 14-19 seats depending on customers’ preference, audio 15 multimedia system, instrument cluster with pixel-matrix display, 3-point seat belt and a locking glove compartment with considerable stowage space.

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With regards to performance, it is equipped with a M272 petrol engine with 190 kW (258hp) power output and 5900 rpm torque. The engine is also coupled with automatic transmission that is perfectly suitable to the road conditions.

Other key features include crosswind assist which detects track offset caused by strong crosswinds on-time and helps the driver to remain in their lane.

The adaptive brake lights with their conspicuous flashing which help significantly to prevent the threat of rear-end collisions, ABS-the antilocking brake system which ensures that a vehicle remains steerable even in the event of emergency braking including the electronic stability programme (ESP) which stabilizes the speed and movement during bends by selectively braking one or more wheels and reducing engine torque if required. @Businessdayng

There is also the parktronic system which through a series of ultrasonic sensors strategically placed around the vehicle, accurately measures the distance between the vehicle and other objects during parking to prevent collisions.

Speaking on the new units of the Mercedes-Benz Sprinter, Mirko Plath, CEO, Weststar Associates Limited commented; “The Mercedes-Benz Sprinter’s global appeal is one that is recognized by businesses and transporters in the local market’’.

Plath said it is the utmost goal of Weststar to ensure that its customers get a product that is able to meet the challenges they face on Nigerian roads and most importantly add significant value to their businesses.

Building on its success and global appeal, the Sprinter continues to dominate the vans segment and it is the choice vehicle for the transportation industry in Nigeria.

Wednesday 20 November 2019

BUSINESS DAY

31

TRANSPORTation Motoring

RailBusiness

ModernTravel

Roads

Abuja Motorfair ends amid Toyota positive outlook

How to sell that your car for profit (1)- Cheki.com

MIKE OCHONMA Transport Editor

f you’re trying to make the most money from selling your car, you need to plan carefully, especially if you’re not an auto expert. Selling your car consists of several things including cleaning up the car, making it visible to potential buyers and then negotiating the price with people you’re probably meeting for the first time.

Depending on the kind of time and attention you dedicate to preparing your car for a rewarding sale, you can either get a buyer faster than you ever imagined you would or you might end up struggling to find a decent buyer. Remember that it isn’t just about finding a buyer. Rather, what matters is finding a buyer who is willing to cover your asking price.

We had a chat with an auto expert to help you sell your car for as much money as possible with minimal stress and here’s what they had to say.

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oyota Nigeria Limited say the just concluded annual Abuja Motorfair held last month inside the International Conference Centre, Abuja provided another platform for the Japanese manufacturers representatives in the country to appreciate its teeming customer base both at the corporate, fleet and high-net worth customers levels.

In an electronic mail sent to BusinessDay motoring editor, company sources stated that, the 2019 Abuja Motorfair was as usual marked with a beehive of activities from the Japanese brand as different visitors that came to exhibition ground took quality time to visit the the Toyota pavillion.

While the event lasted, the brand’s imposing and beautifully decorated arena caught the eye of every visitor to the exhibition ground to touch and feel the array of Toyota vehicles on display.

Specifically, the night of Thursday, October 31, 2019 was a night to remember as invited high ranking personalities visited the Toyota stand. Tagged ‘Special Night With The Managing Director’, Kunle Ade-Ojo, managing director Toyota (Nigeria) Limited hosted captains of

Industries, government and corporate organisations, personally showing them the features of the vehicles, where and how the vehicles can be deployed and why each one is value for money.

Top shots from the armed forces, the Federal Roads Safety Commission, the Police and the diplomatic community were present. It was a night of glitz and glamour as the full spec leather seat Hilux in glowing white and black colour and the latest wonder on wheels in the Toyota range and the Toyota Rush, were beauties to behold.

Both vehicles caught the eye of visitors and their interest. Other vehicles on display

include the Land Cruiser Prado, the Hiace Luxury for leisure and travelling in absolute comfort with reclining seats that become flat as a bed, the elegant and sophisticated Camry, the Yaris, Avensis, LC70, Corolla and many more.

A saxophonist dished out sonorous music in the background while the night came to a crescendo with Jelani Aliyu, the director-general of National Automotive Design & Development Council (NADDC) in company of some of his officials. The NADDC boss went round all the vehicles on stand to touch and feel them while the the TNL managing director was

on hand to talk about the vehicles.

Customers to the Toyota stand enjoyed attractive fair prices while the motorfair lasted and some of them took the advantage of the discounted fair price to strike some purchase deals. It was a rewarding and fun night for all visitors and Toyota alike.

Visitors went home with branded gifts.

Representatives of Toyota Japan that visited the stand earlier in the day were quite pleased with the presentation and quality of display put up

by Toyota at the event. The exhibition stands at the stood out in its size, decor and welcoming ambiance.

Nigeria targeted as tank wagon export hub- CCECC MIKE OCHONMA

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s moves at repositioning the country’s rail transportation system gathers traction, efforts are also in the pipeline to make Nigeria as a hub for the exportation of train wagons to other countries.

Jiang Yigao, managing director, CCECC Nigeria Limited, the Chinese contractors handling the LagosIbadan standard guage rail project said this during the last ground breaking ceremony of Kajola Wagon assembly plant in Kajola, Ogun State by Vice president Yemi Osinbajo.

The CCECC manaing director said that, the concept of the Wagon Assembly plant in Kajola, Ogun state is to grow local technology and ultimately make Nigeria not only self-sufficient in certain components of locomotive stock, but also an exporter.

He expressed optimism that, with the completion and operation of the Abuja to Kaduna railway, Abuja

rail mass transit and work on other railway projects, the plant will play a pivotal role in ensuring that provision of wagons.

The plant has the capacity to produce 500 wagons per year and will undertake key production processes like welding, assembly, and painting, dying and testing. It has the capacity to produce open, container, flat, and tank and box wagons.

Nigeria according to him is surely marching towars greater development and CCECC will continue to partner with the country in ensuring the technological development of the economy. ‘’Strides with Nigeria is the creed of CCECC’’ CCECC www.businessday.ng

is working with the relevant agencies to ensure the development of the railway system. This is not only in building and rehabilitating railway tracks and stations, but also in training indigenous personnel to operate and maintain them’’.

In his submission, ‘’Today, we are commissioning one of the projects that underline the commitment of CCECC towards the industrial and economic development of Nigeria. We are indeed very proud to be part of the making of history today’’.

He said that, during the past years, CCECC was impressed by the federal government of Nigeria and the ministry of transportation

for their determination and efforts on modernising the railway system as a very viable and alternative means of transportation, noting that, the CCECC will spare no effort to cooperate with the Nigeria government.

The socio-economic benefits of the plant cannot be over-emphasised. A number of youths will be employed and it will stimulate the creation of other ancillairy jobs and bring developmentnot only to Kajola community, but the South West in general.

CCECC has in place a professional railway operation team to assist the ministry of transporattion in operating and maintaining the railway, training the local staff and establishing a modern railway operation and maintenance system. ‘’Today, the construction of the wagon assembly plant will open a new chapter of railway construction in Nigeria, which will help a new chapter of railway industrialization chain’’. The managing director noted.

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Ensure the car looks attractive One thing that might come as a surprise to you is that people generally prefer to buy clean and presentable cars. Little details like stains, crumbs and dirt can make your car appear

cheap in the estimation of the buyer. What this tells the potential buyer is that you have a poor car maintenance culture.

It is important that you give the potential buyer the impression that the car has enjoyed a good spell of maintenance under its existing owner. No matter how long you have had the car for, there are a number of interesting things you can do to make the car attractive.

Your goal should be to make the car look as nicelooking as you possibly can because a good car should actually look good.

Get the car detailed You need to get your mind working like a dealer by getting your car detailed in order to get more money from its sale.

Auto detailing is the act of carrying out a thorough cleaning, restoration and finishing of a car. Auto detailing helps you achieve an extra level of shine and polish for your car. Detailing can be performed on a car’s exterior or interior.

Getting your car detailed in Nigeria can cost you between N36,000 and N70,000 depending on where you get it done.

Victor Iyagin, the quality control manager, Cheki Nigeria, explained that in detailing, @Businessdayng

your car can add N200,000 or more to your car’s resale value.

The essence of detailing is to give your car a heightened level of visual appeal by removing light scratches, paint imperfections, buffing the car, shampooing the carpets, degreasing the engine, and so much more.

You have the option of detailing your car yourself but it requires a lot of time and effort, which a professional detailer can actually do more efficiently and faster.

Replace the Floor Mats As simple as this might sound, it is an inexpensive way to make your car worth more in the eyes of the buyer. Most people tend to forget about the floor mat. Don’t make this mistake; a dirty or worn floor mat will not do your car any favour.

Review all car modifications Any modification or upgrade that you previously added to your car should be reviewed.

This should be based on whether such modifications expertly are done and more importantly, whether they contribute to the value of the car.

Iyagin explains that you

need to put yourself in the shoes of your potential buyer.

“If you add blacked out rims to your car and you find a buyer who is shopping for a car with dark rims, then you’re heading in the direction of a sweet deal.

In the same vein, if you add a spoiler and you are unfortunate enough to attract buyers who refer to such cars as cans, you might find yourself stuck.

It might even be the neon light bulbs you added to the car that a potential buyer might find unappealing.

You can remove these modifications; you could also mention it to the buyer and offer to give them away with the car if the buyer is interested in it.

Just take a good look at all the car modifications and make decisions on what someone interested in buying your car might like.

Get the car serviced and carry out repairs If you are not completely sure whether your car is in good condition or not, ask a trusted mechanic to inspect it, Iyagin recommends. This is the point where you want to ensure you check the oil level, and top it up if there is a need for that because informed buyers will check for burnt oil.

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Wednesday 20 November 2019

BUSINESS DAY

Corporate governance Forgotten and overlooked: The company secretary to corporate governance Olayimika Phillips

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n evaluating the adherence of companies to sound corporate governance, attention is often centred on the roles, conducts and attitudes of the directors. The roles of a company secretary in corporate governance are often overlooked. Whilst it is undeniable that directors are the most important subject of corporate governance, the company secretary also occupies an indispensable position in the management of a company.

Indeed, there has been a shift from an era where the company secretary is only seen as a notetaker at company’s meetings and an administrative servant of the Board. In this age and time, the company secretary is a strategic advisor on important matters that affect the governance of a company. In recent times, the compliance requirements of running a company have dramatically increased. Companies are now required to comply with different statutory and regulatory standards and these have made the utility of the company secretary pivotal to successful corporate governance.

Undoubtedly - as recent experience shows, the company secretary is indeed strategic to the day-to-day running and management of a Company not only in terms of ensuring compliance with relevant statutory filing and disclosure requirements but also in relation to entrenching sound corporate practices and effective board processes.

As a matter of sound corporate governance practices, the company secretary plays an important role in supporting the effectiveness of the Board by assisting the Board and management to develop good corporate practices and culture within the company. In addition, the company secretary is responsible for amongst other functions: providing the board of directors with detailed guidance on the proper discharge of their duties; assisting the Chairman in the co-ordination of the activities of the Board and plan other strategic issues; notifying Board members of upcoming meetings of the Board and other commit-

tee’s meetings; being a steady source of guidance and advice to the Board on matters of ethics, conflict of interest and ensuring free information flow within the Board and its committees and between senior management and the Non-Executive Directors. In its nominal capacity, the company secretary is expected to advise and effectively liaise with the Board members and key company’s officials on compliance with statutory requirements.

Let us consider a case study to drive home the fundamental role of a company secretary to the company. As required by law, Company A is only permitted to increase its share capital by way of a shareholder resolution passed at the annual general meeting.

Company A intending to do this instructed its company secretary to implement the process. The company secretary not only wrongly advised that a Board resolution is required, but also failed to make the consequential regulatory filings. As a result of this failure, no certificate of increase evidencing the new share capital was ever issued. Whilst Company A’s corporate records still reflected its initial share capital, Company A proceeded to allot shares to new shareholders and even updated its financial statements with the new share capital on the erroneous assumpwww.businessday.ng

tion that the new share capital is now effective in law. Many years after, the Company A discovered the error through the diligence and proactivity of another company secretary.

As things stand now, the company is required to undertake the process afresh, even though it had speciously purportedly created proprietary interests by allotment and paid dividends on the allotted shares. Company A is effectively compelled to undertake this gruelling process as a result of company secretary’s incompetence and negligence.

Company A’s current situation could have been entirely avoided only if the company secretary had been competent and diligent.

As the case study above shows, companies often struggle with their corporate compliance system compounded by an in-

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The company secretary not only wrongly advised that a Board resolution is required, but also failed to make the consequential regulatory filings

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dolent, lacklustre and unprofessional company secretary- the consequence of which is the exposure of the company to payment of huge fines and penalties. Undoubtedly, this situation necessitates the need to engage a versatile company secretary - either as an employee of the company or an external professional services firm - possessing the requisite qualifications and professional experience.

In selecting a company secretary, much importance must be attached to the professional qualifications, proactivity and experience of the individual.

In the case of professional services firm, a key consideration should be the professional track record and years of experience in providing similar company secretarial services to other companies in Nigeria. Rather sadly, the general trend for most private companies is appointment by reference to long-term friendship and affiliation. Whilst this may be so in the case of emerging private companies still in its early years of operation, the stark commercial realities of the 21st century market calls for a fundamentally global shift in this regard with respect to well established private companies.

Treating the role of the company secretary as unimportant and un-integral may spell doom @Businessdayng

for the company in terms of operational and administrative costs. Any company desirous of long term and sustainable corporate success must treat the appointment of company secretary as a matter of top priority and as integral to the overall success of the company. Although companies are often than not aware of the negative effect of having an unprofessional company secretary, they often sometimes fail to see the self-created enemy - absence of a professional company secretary.

Olayimika is a Partner in the law firm of Olaniwun Ajayi LP and has over 34 years of professional experience. She specializes in corporate governance, providing pragmatic solutions to the diverse challenges which confront corporates at different growth stages and serves on the board of several companies (listed and privately held).”

Wednesday 20 November 2019

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BANKING Fidelity Bank leads as Tier-2 banks’ LDR averages 68.3% Stories by HOPE MOSES-ASHIKE

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ier-2 banks recorded average Loan to Deposit Ratio (LDR) of 68.3 percent in the first half of 2019 with Fidelity Bank Plc leading with a record 95.7 percent LDR. This was followed by FCMB 80.5 percent LDR, Sterling Bank plc 78.4 percent, Stanbic IBTC 69.2 percent, and Wema Bank Plc 65.1 percent.

Union Bank Plc and Unity Bank Plc recorded 59.2 percent and 29.7 percent respectively, which is below the 65 percent minimum ratio pegged by the Central Bank of Nigeria (CBN).

The CBN had raised the LDR to 65 percent and set December 2019 as deadline for compliance by deposit money banks.

The banking sector report by Afrinvest West Africa, revealed that tier-1 banks recorded 58.0 percent average LDR in the first half of the year with Access Bank leading with 68.1 percent LDR.

This is followed by Zenith Bank 62.7 percent, Ecobank 58.0 percent, GTB 57.9 percent, FBNHolding Company 52.6 percent, and United Bank for Africa (UBA) 48.5 percent.

Non-Performing Loans (NPL) for the tier-2 banks averaged 5.5 percent in the first half of 2019 from average of 6.2 percent in full year 2018.

NPLs of tier-1 banks

stood at an average of 8.9 percent in the first half of 2019 from 10.1 percent in the full year 2018.

Industry gross earnings projected to recover strongly in 2019 to N4.9 trillion from N4.1 trillion in 2018.

The industry turnover stood at N2.4 trillion in the first half of the year.

The banking sector total assets is expected to hit N44.2 trillion by the end of

Sterling Bank, iCreate, bring Africa’s biggest skills Olympics to Lagos

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terling Bank Plc in collaboration with iCreate Africa, organiser of the iCreate Africa Skills Festival, is addressing the youth unemployment challenges in the country.

Consequently, Nigeria’s best artisans will converge on Lagos from December 4 -5 to compete for laurels at the grand finale of the festival following the conclusion of the regional finals in Kaduna and Enugu.

The festival which is the biggest of its kind in Africa is in its second edition. Sponsored by Sterling Bank Plc, from inception, the festival also enjoys support from

Bosch Nigeria Limited, GIZ, Trace TV, Siemens, Lagos State Employment Trust Fund (LSETF), and Universal Learn Direct Academia Limited (ULDA), among others.

Speaking in Lagos recently, Moronfolu Fasinro, Chief Client Engagement Officer of Sterling Bank, said the bank is partnering with iCreate Africa to boost acquisition of technical skills because it is committed to solving the unemployment challenge among young people on the African continent.

He said the way to resolve the unemployment challenge going forward is

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through skills acquisition by young men and women rather than focusing on whitecollar jobs, adding that “We know that youth employment is a key part of creating a society that is harmonious and productive.”

Fasinro noted that vocational jobs are what move an economy in its day-today operations and Icreate was bringing various people together to work on how to change the narrative about the labour market.

“We are very happy to partner with iCreate to produce this sort of opportunity so that these people could change the face of employment on the continent in the future,” Fasinro said.

Also speaking, Chief Marketing Officer of Sterling Bank, Dapo Martins, said Nigeria needs to also focus on the export of skills instead of concentrating on the export of crude oil and agricultural products alone. He noted that most Nigerian graduates who travel abroad either find themselves washing plates in restaurants or doing other menial jobs.

2019, which is 7.8 percent compared with N41.0 trillion in 2018.

At the end of the first half of 2019, the sector recorded N43.7 trillion in total asset, according the banking sector report by Afrinvest West Africa which was launched on Monday.

“Total asset remain strong,” said Ike Chioke, group managing director, while presenting the report

with the theme, ‘Beyond the Precipice…Pulling Back from the Brink’, in Lagos.

The industry’s total deposits is expected to reach N29.1 trillion by the end of 2019, growing at 25.4 percent as against N23.2 trillion in 2018. Total deposits stood at N25.6 trillion in the first half of 2019.

The report showed that the total loan of the banking sector stood at N15.7 trillion in the first half of 2019 and is expected to hit N16.1 trillion by the end of the year.

Charles Soludo, former governor of the Central Bank of Nigeria (CBN) and current member of the economic advisory council to the President expects the subsequent Afrinvest banking sector report to show the kind of banking sector to be seen in the next five to 10 years.

“I think it might be one way of pushing us in the direction of the further reforms and further changes especially disruptive changes. I like the concept of disruptive changes. You can’t repeat the same thing over and over and expect a

different outcome,” Soludo said.

“I urge this particular public issue which I think as authoritative as it is become a flagship publication of the banking sector and I look forward to get a full copy and read it. I strongly recommend it to everyone”.

He noted there was massive transformation compared with the numbers before banking sector consolidation.

However, he said, “Banking total asset without a say about their size and so on, is just too minuscule”.

“In subsequent once let us look at where we are in terms of the depth of the banking relative to, even in comparison to Africa. I checked banking by asset size, percentage of GDP, and I was shocked as to how low we are even by African standard. Countries like Mauritius, Kenya, Senegal, Ghana and several others were much high. That might have some implication about saving the banking and financial system and the kind of economy we want to empower,” Soludo said.

Access Bank’s Womenpreneur campaign empowers 50 female entrepreneurs

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n a bid to fulfil its purpose of inspiring, connecting and empowering women from all works of life, the W Initiative of Access Bank through its W Academy has empowered 50 women entrepreneurs with a mini MBA program. The MBA program was provided by the International Finance Corporation of the World Bank.

The 50 women entrepreneurs emerged from a pool of 36,000 applicants after a competitive, rigorous pitching and selection process.

This maiden edition of the Womenpreneur Pitcha-ton has been designed to contribute to women’s economic empowerment by upscaling Nigerian womenowned businesses through capacity building and finan-

Herbert Wigwe, Access Bank, group managing director/CEO

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@Businessdayng

cial support. The certified programme is devised to strengthen their business management skills for sustainable business growth.

Sp e a k i n g o n Ac c e s s Bank’s interest in empowering female owned SMEs, Victor Etuokwu, executive director, retail banking division, said, “The Womenpreneur pitch-a-ton was introduced by the W Initiative to enhance management and leadership skills through core managerial modules designed especially for female entrepreneurs. We love to see SMEs who have great ambition and passion to grow their businesses.”

According to him, Access Bank is committed to strengthening SME core offerings while propping them up to define their footmark in trade.

Access Bank’s commitment to empower these female owned businesses has contributed significantly to the development of many SMEs in Nigeria with direct impact on the socio-economic growth of the country.

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Wednesday 20 November 2019

BUSINESS DAY

PrivateEquity &fundraising

New data privacy compliance considerations in cross border M&A /private equity transactions facing Africa

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erhaps, one of the most defining developments in global data privacy enforcement which also speaks to how increasingly important, data privacy compliance issues, will be for private equity investors, is the recent announcement by the ICO, (UK’s data privacy regulator), of its intentions to impose a fine of up £99 million under the European Union’s General Data Protection Regulation (GDPR) on strategic investor, Marriott International Inc; in respect of a data breach that previously occurred in recently acquired Starwood Hotels. StarWood Hotels was acquired by Marriott in 2016 for circa USD 13billion. It did not matter that the said data breach occurred in 2014, two years before the acquisition of StarWood Hotels was consummated by Marriot. It was reported that personal information (including credit card details, passport numbers and dates of birth) contained in approximately 339 million guest records globally were exposed by a cyber security incident in 2014, of which around 30 million related to residents of 31 countries in the European Economic Area.

Amongst others, the ICO reached a decision that: (a) Marriott failed to undertake sufficient due diligence when it bought Starwood; and (b) Marriot should also have done more to secure its systems after the acquisition.

The statement credited to Information Commissioner Elizabeth Denham is instructive: “The GDPR makes it clear that organizations must be accountable for the personal data they hold. This can include carrying out proper due diligence when making a corporate acquisition, and putting in place proper accountability measures to assess not only what personal data has been acquired, but also how it is protected” Some, if not the highest regulatory fines globally, have been imposed by data privacy regulators. For instance, Equifax will pay up to $700 million in fines and monetary relief to consumers over a 2017 data breach.

We sense that regulators across board will follow this regulatory trend in view of its potential for revenue. This is not to say that the reason data privacy regulators impose fines is to drive internal revenue but that data privacy breaches & non-compliance is increasingly a compliance flashpoint and one of the the easiest ways for a business to get a huge dent to its balance sheet. With the new Data Privacy Regulations 2019 issued

by Nigeria’s data privacy regulator, the (NITDA), private equity fund managers and investors doing deals in Nigeria will

Olubunmi Abayomi-Olukunle lead transaction counsel private funds, Finance & Investments Balogun Harold

need to give greater consideration[i] to data privacy issues, both at the fund level and portfolio company level.

Based on our reflections on a recent engagement, here are some key compliance and risk considerations to put in focus: 1. Based on a review of the NDPR and its Implementation Guidelines, our view is that NITDA’s approach to driving data privacy compliance is relatively friendly. However, we cannot yet tell which trajectory, regulatory enforcement of data breaches in Nigeria, will take, from a penalty imposition standpoint. The closest reference point here really, is the global trend towards the imposition of significant fines on data controllers and data processors who are found to be in breach of data privacy regulations. Without a doubt, it would be prudent for private equity investors to design, investigate and implement, as the case may be, a data privacy compliance strategy in advance; 2. Portfolio companies and fund manager entities who are found to be in breach of Nigeria’s Data Privacy Regulations (NDPR) are liable to pay up to 2% of annual gross revenue. However, the financial exposure for data privacy breaches may be more than 2 percent because, the NDPR does not prohibit data subjects from seeking additional monetary damages in Nigerian courts, as a constitutional matter, from data controllers, that are portfolio companies or fund managers; 3. Before the announcement of the NDPR in January 2019, data privacy due diligence, understandably, did not form

part of the traditional legal due diligence approach of transaction counsel in Nigeria. With regulatory developments in this area, it’s now more important to conduct data privacy due diligence as part of legal due diligence. Although a type of legal due diligence, data privacy diligence should ideally be carried out separate to the legal due diligence, preferably by co-counsel; 4. Private equity fund investors doing deals in Nigeria will need to diligence their existing portfolio companies and drive management decisions towards investing in data protection systems and relevant technology. Weighed against the potential risks, it’s not going to be too late, to conduct a data privacy due diligence. Accordingly, it would not be unreasonable for private equity investors, who may have closed a deal after the announcement of the NDPR, but omitted to conduct a data privacy diligence, to still conduct a data privacy diligence post-closing; 5. Private equity investors ( and strategic investors) will need to review the contractual protections in investment agreements, to determine the extent to which the existing representations and warranty framework, protects their investments from the regulatory risk that may occur from a breach of data privacy regulations. It may be strategic for private equity investors to be more specific in their strategy here – for instance, the onset of a fine may be structured to trigger a revaluation or a pricing adjustment, which may also trigger other protective/ restorative shareholder rights or share issuances;

6. Privacy equity investors who carry out data privacy diligence, at entry, may be able to leverage the results of such diligence to gain some pricing/valuation advantages; 7. Similar with legal due diligence, the target should ideally pay for or bear some of the costs for conducting a data privacy due diligence; 8. Private equity investors who conduct data privacy due diligence will be better able to structure and hedge related data privacy compliance risk at the portfolio company level; 9. At the fund manager level, like any business that handles customer and market sensitive data, private equity funds are susceptible to data breaches that can cause exposure of customer information and valuable know how or even trade secrets. In addition to ensuring full data privacy compliance for fund manager entities or corporate investment advisers incorporated locally, fund managers should consider communicating the legal requirements of data privacy compliance to its employees in a clear and consistent manner, during on-boarding and from time to time, through internal data privacy control and policy documentation. Data privacy compliance should be a key function of portfolio management and should be sustained till exit through holding period; and 10. Nigerian venture capital investors with direct investments in US domiciled operating HoldCos which also have Nigerian operations, will need to ensure compliance with US data privacy laws. Similarly, private equity investors with a pan-African investment thesis/ portfolio, would need to put in place a more holistic data compliance strategy that addresses data privacy compliance risk on a jurisdictional basis. As of the date of this update, up to 40 percent of African countries now have data privacy regulations [i] Limited Partners or Non-Managing Shareholders typically reserve the rights to generally remove a General Partner for Cause in definitive agreements like the Limited Partnership Agreement or Shareholder Agreement. “Cause” is usually defined in reference the actions or inactions of a General Partner that constitutes bad faith, fraud, gross negligence, wilful misconduct, a violation of securities laws, breach of fiduciary duty, or a material breach that has a material adverse effect on the business of the investment activities of the GP/Managing Shareholder. On this basis, GPs & fund manager entities alike have a general duty to investigate and understand every risk scenario and put in place structures to avert or mitigate such risks

BusinessDay PRIVATE EQUITY & FUNDRAISING (Team lead: LOLADE AKINMURELE - Analysts: MICHEAL ANI, DIPO OLADEHINDE, ENDURANCE OKAFOR, DAVID IBEMERE ... Graphics: SAMUEL IDUH ) Businessday’s Private Equity and Fundraising section is a weekly publication that provides in-depth analysis on private equity trends and tracks deal activity in Nigeria.

Email the PE & F team loladeakinmurele@gmail.com

Continues on page 34

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35

FINANCIAL INCLUSION

& INNOVATION

Making leaps in financial inclusion through market-creating innovations Olayinka David-West and Ibukun Taiwo

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019 was a phenomenal year for Ghana, Tanzania and Uganda regarding DFS growth. Ghana captured the headlines several times with impressive mobile money adoption and transaction numbers. However, the narrative concerning Nigeria is yet to turn for the better even as our financial inclusion progress has been minimal over the past few years.

Since the NFIS refresh in 2018, several stakeholders have been questioning Nigeria’s ability to meet the 2020 deadline and for good reason.

The 2018 EFinA Access to Finance survey revealed that 36.6 million Nigerians live without access to financial services. Even mobile money, which was heralded to be the “magic bullet” to Nigeria’s financial inclusion woes, has failed to gain the anticipated traction as in other countries.

Despite the various regulatory and market interventions since 2009, Nigeria’s financial services industry is still

plagued by non-consumption.

Popularized by Harvard Business School Professor, Clayton Christensen, nonconsumption is the inability of an entity (person or organization) to purchase and use a product or service required to fulfill an important job. This inability to purchase arise from a series of constraints such as market affordability (cost), institutional voids or complexities (enabling environment) or resource or scarcity (convenience) and the like.

Christensen argues that in emerging markets, non-consumption is a common phenomenon that plagues various industries meant to improve human life and wellbeing. The list of sectors and industries plagued by non-consumption is extensive including health services, mobility, entertainment, housing, energy etc.

In highlighting the gap, Christensen’s proposes the solution - market-creating interventions.

Market-creating innovations address non-consumption by transforming complex and expensive products into simpler and affordable ver-

sions, increasing their availability to the larger society.

In financial services, this is the conversion of complex financial products and services into affordable and simpler versions accessible to the excluded community. Examples include m-Pesa, Paga, Microensure and Zoona.

In Nigeria, our financial inclusion journey which commenced in 2009 is still wavering and we believe a different approach is required.

On November 28, 2019, the Sustainable and Inclusive Digital Financial Services (SIDFS) initiative of the Lagos

Business School will host the 2019 International Financial Inclusion Conference. The conference focuses on nonconsumption, highlighting the need for significant and holistic paradigm shifts in several areas including: 1. Business models and capabilities that target nonconsumption. In Nigeria’s financial services ecosystem, innovations and business models still appear to be designed for the banked customer. The non-consuming population (i.e. the financially excluded) comprises of women, smallholder farmers and

micro and small enterprises.

Can financial institutions design products and services that meet the needs of these customer segments and will they be viable?

2. New value networks.

Brick and mortar branches are the conventional distribution model for financial services.

The disadvantages of this model have become apparent even as digital technology continues to disrupt the industry with new distribution models and cost structures that facilitate affordable service provision to non-consumers. But what will it take for current service providers to explore new models and cost structures? What are the implications?

3. An emergent strategy.

Because non-consumption markets are undefined, providers need emergent, not deliberate, strategies that address market needs. However, providers require wisdom to acquire the relevant market insights as well as how to reformulate their strategies.

How can this process be accelerated?

4. Executive support. Like other businesses that target

non-consumption, financial inclusion initiatives with their apparently unsustainable lower margins, high capital requirements and undefined markets (in the context of businesses not configured for bottom of the pyramid markets) are unlikely to win executive management support. What should be done to ensure better success for pitching innovative products that target non-consumption?

The issues highlighted in this article are just the tip of the iceberg. Nevertheless, they must be addressed to unlock financial services at the bottom of the pyramid, and ultimately move the financial inclusion needle. Developing market-creating interventions are a strategic imperative for targeting bottom of the pyramid markets across industries.

Our conversations at the IFI Conference will provoke the status quo and hopefully trigger appropriate actions.

Professor Olayinka DavidWest and Ibukun Taiwo are members of the Sustainable and Inclusive Digital Financial Services initiative at the Lagos Business School

With mobile money licence, Palmpay is set to deepen Nigeria’s financial inclusion Endurance Okafor

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igeria is one of the countries in Africa with a high population facing life financially excluded. 36.6 million adults in Africa’s largest economy still lack access to financial services.

PalmPay, an Africa-focused mobile payment startup, plans to bring that segment of the population into a financial world that will make their lives easier, better and more connected.

The company allows any Nigerian to open a financial wallet on its mobile app in seconds and start carrying out transactions including P2P transfers, airtime and bill payment. The only thing required to avail of these services is a mobile number, with the full experience available to those with access to a smartphone.

To be able to do this, the company has obtained an Approval-In-Principle for a mobile money license from the Central Bank of Nigeria, which allows it to build an agent network to facilitate inperson cash in and cash out to its mobile wallet.

PalmPay offers consumers a range of digital services

via its mobile application, including transfers, payment of electricity bill, internet sub renewal, DSTV subscriptions, and airtime purchases.

Billing itself as “the payment app that rewards you”, its unique selling proposition of offering cashback and discounts to its users has caught on in the price-sensitive Nigerian and Ghanaian markets.

In Nigeria, PalmPay is offering 10% cashback on airtime purchases and bank transfer rates of N10 with free deposits and withdrawals to its mobile wallet. Over a million transactions have been made on the platform within its first

two months of pilot operations and the company is now eyeing rapid expansion.

To support its growth ambitions, PalmPay has raised $40m USD in a seed round led by device brand TECNO Mobile, with participation from NetEase and MediaTek. TECNO is also supporting PalmPay in other ways, such as giving the startup exclusive access to the mobile phone brand’s online and offline distribution network. The PalmPay app will come preinstalled on at least 20m smartphones per year from 2020. And first on the list to be converted to agents are the thousands of

TECNO retails stores across the country.

For TECNO, the investment in PalmPay seemed like a natural next step as it seeks to develop its mobile ecosystem.

“Tecno has helped expand access to smartphones among the Nigerian population. We are now looking to leverage this infrastructure to further improve people’s lives.” said Stephen Ha, General Manager of TECNO Mobile. “We see a huge growth opportunity in mobile payments and financial services on the continent and are looking forward to working together with the PalmPay team to help shape

L-R: Dami Owolabi, senior marketing manager of PalmPay; Adebiyi Niyi, director of Corporate Communications, VISA; Sofia Zab, global head of Commercial and Marketing; Chidi Okonkwo, deputy GM, TECNO Nigeria; Jason Mycroft, COO of PalmPay and Ladi Ogunseye, marketing manager of PalmPay, during the PalmPay Press conference held in Lagos. www.businessday.ng

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the future of payments in Africa.”

PalmPay also plans to leverage the network of 100,000 merchants belonging to Visa, which the company counts as strategic partners. In April 2019, PalmPay announced that it would work together with VISA to roll out innovations in the African digital payments space. Visa cardholders can initiate payments within the app and make online and mobile payments by attaching their card details to their PalmPay profile. Non-card carriers will be able to instantly generate a virtual Visa card upon registration.

“Our vision for the app is that PalmPay becomes the one-stop-shop for your digital and financial world and that PalmPay becomes the place to go that has the best choice and offers in the market,” said Greg Reeve, PalmPay Global CEO. “We also welcome other companies to join forces with us so we can work together to deliver the best choice and value for consumers”.

The Central Bank of Nigeria plans to ensure that 80 percent of Nigerian adults are included in the financial net by 2020. In January 2012 the National Financial Inclusion Strategy (NFIS) was launched @Businessdayng

to galvanise the financial sector around this objective.

According to the World Bank’s 2017 Global Findex database, mobile money drove financial inclusion in Sub-Saharan Africa. The report stated that between 2014 and 2017, there was a significant increase in the use of mobile phones and the internet to conduct financial transactions which contributed to a rise in the share of account owners sending or receiving payments digitally from 57 percent to 70 percent in developing economies.

“Fulfilling the financial infrastructure gap in Africa by using branchless banking services such as mobile financial services, is seen as a promising way to increase financial inclusion,” the International Monetary Fund (IMF) said.

Through PalmPay’s mobile platform, Nigerians without bank account can have access to financial services.

Therefore, innovations like the smartphone-based ecosystem being built by PalmPay can play a role in accelerating progress to meet Nigeria’s ambitious national financial inclusion goals.

The PalmPay app is available for download on the Google Play Store and iOS App Store.

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Wednesday 20 November 2019

BUSINESS DAY

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Wednesday 20 November 2019

BUSINESS DAY

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news

Flood: Senate begins probe of NEMA after selective disaster response allegation by lawmaker ...wants FRSC to end carriage of dangerous goods on roads Solomon Ayado, Abuja

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enate has ordered an investigation into the activities of the National Emergency Management Agency (NEMA) following an allegation by a lawmaker that the department engaged in a selective emergency response to victims of flooding.

Specifically, NEMA is said to have distributed relief materials to victims of flood in some selected affected areas in the country, without releasing same to other affected places.

The motion on the matter was moved on Tuesday by Binos Yaroe (APC, Adamawa South).

Yaroe recalled that NEMA was established by Act 50 of the 1999 Constitution as amended for the purpose of managing disasters in Nigeria.

While lamenting a major flooding which occurred in October 2019 as a result of release of excess water by the authorities of Lagbo dam in Cameroon, Yaroe accused NEMA of being selective in its disaster response interventions.

“NEMA performed a disaster response action by distributing relief materials to communities in Furore, Yola South, Yola North and Girei Local Governments of Adamawa State affected by the floods.

“This intervention by NEMA was not extended to other local governments in Adamawa State along the River Benue valley equally affected by the flood disaster.

“Although the attention of the Director-General of NEMA was drawn to the need to provide relief materials to communities of the four local governments in Adamawa State severely affected by the October floods, nothing has been done; and NEMA would appear to be selective in its disaster response interventions,” he said.

Consequently, the Senate has mandated its committees on Special Duties, Ecology and Climate Change and Environment to investigate the activities of NEMA, particularly with a response to flood disasters in the year 2019.

While directing NEMA to immediately implement a response programme for flood disasters, the Senate further mandated the agency to offer relief items to affected communities in Demsa, Numa, Guyuk and Lamurde Local governments of Adamawa State.

Meanwhile, the Senate has directed the Federal Road Safety Commission (FRSC) to ensure strict compliance with the United Nations 1957 safety agreement and end the carriage of dangerous goods on Nigerian roads.

The Senate gave the directive sequel to a motion on the need for tankers transporting flammable products and premium motor spirits (PMS) in Nigeria to adhere to road safety rules, moved by Tolulope Odebiyi (APC, Ogun West).

CBN, NCC, others join in discussions to disrupt mobile money at ALMPO 2019 JUMOKE AKIYODE-LAWANSON

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entral Bank of Nigeria (CBN), Nigerian Communications Commission (NCC), Economic andFinancialCrimesCommission (EFCC),andmobilemoneyoperators, as well as other stakeholders are gearing up to discuss ways to improve mobile money platforms to further drive financial inclusion at the upcoming Association of LicensedMobilePaymentOperators (ALMPO) mobile money conference in Lagos on November 27.

Mobile money has continued to grow and serve as enabler to the realizationofthefinancialinclusion target in Nigeria.

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According to data released by the Nigeria Inter-Bank Settlement System (NIBSS), Nigeria recorded 50 percent increase in mobile money transactions and added over two million new users to the existing ones in 2018.

Thisshowsasignificantgrowth in the usage and adoption of mobile money platforms in Nigeria.

However, as consumer preference for mobile money services continues to evolve, so does the need to disrupt the traditional systemandexpandthevaluechain of cash in-cash out, bill payments to MicroCredit & MicroSavings, MicroPension, MicroInsurance and AgricTech, to improve users’ experience and grow more adop-

tion in Nigeria.

Speakers from the regulatory bodies, as well as representatives from banks and mobile money service platforms will be discussing the theme; Mobile Money: ‘Beyond Payments’.

Addressing journalists about the upcoming conference, Chinedu Onuoha, the Chairman, Association of Licensed Mobile Payment Operators (ALMPO), said that the objective of this year’s event is to forge a collaborative approachtowardsharnessingnew initiatives and opportunity areas that will accelerate mobile money adoption and deepen financial inclusion.

“The Conference remains

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a platform for mobile money operators, regulators, and other stakeholders to discuss current situations, challenges and advancements of mobile money in Nigeria.

“The event is expected to pull c-levelparticipantsacrosspayment and non-payment ecosystems in Nigeria”,Onuoha said.

The conference will feature discussions around; “Beyond payments: disrupting the value chain to deepen mobile money adoption – with special focus on: micro credit and savings, microinsurance, micro-pension, and agrictech”.

Other topics are centred on enhancing industry synergy in the

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fight against mobile money fraud and setting mobile money agenda for2020.Theywillalsodiscusshow to harness new opportunity areas for mobile money adoption in Nigeriaandgiveapresentationonthe state of mobile money in Nigeria.

Uzo Eziukwu, Group CEO, BlueTag Group, Aishah Ahmad, chairperson of the 2019 mobile money conference and deputy governor, financial systems stability, Central Bank of Nigeria, Umar Garba Danbatta, executive vice chairman/CEO, Nigeria Communications Commission and Olayinka David-West, academic director,LagosBusinessSchoolare expected as speakers and special guests at the event.

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news BusinessDay 2019 States Competitiveness, Good...

Continued from page 1

(FCT), Abuja. The annual programme will have in attendance Yakubu Gowon, former head of state, who is the special guest of honour, as well as His Royal Highness, Yahya Abubakar, Etsu Nupe and chairman, Niger State’s Traditional Council, who is the royal father of the day.

Also expected at the event include the governors who have been nominated for the different award categories, members of the executive cabinets, members of the National and State Assemblies, members of the diplomatic corps, csuits executives, among others.

The annual States Competitiveness and Good Governance Awards was introduced

by BusinessDay, Nigeria’s foremost source of financial and business intelligence, to promote good governance, transparency and accountability in the use of the nation’s scare resources.

The awards programme is meant to provide an independent assessment of state governments’ activities in a fiscal year.

The successful chief executives will be honoured in 14 different award categories.

These include transparency in governance; fastest growing state economy; empowerment, poverty alleviation, defence of women and child rights; education development; agriculture development; healthcare; industrialisation and mineral resources development; rural and urban infrastructure development; security; skills

development and job creation, as well as SME development.

“We need to create an enabling environment that will make businesses thrive. Good roads must be constructed.

Schools and hospitals must be well funded,” Frank Aigbogun, publisher/CEO, BusinessDay Media, said.

“When these are done, jobs will be created, businesses will thrive, and in the end more revenue to government at federal and state levels through PAYE, direct assessment and other indirect taxes. With more revenue, state administrators will be able to execute more laudable projects and the cycle of prosperity continues,” he said.

The States Competitiveness and Good Governance Awards came into being to provide an independent feedback mechanism to states on the different policies, programmes and projects of state governments and the effects such actions have on the socio-economic well-being of the residents of their states.

Parameters employed include the kilometres of rural and urban roads constructed within a fiscal year; the number of hospitals and primary healthcare centres upgraded, renovated and newly built; enrolment rates into public primary and secondary schools; performance in national examinations such as the West African Examination Council (WAEC); improvement in internally generated revenue (IGR); capital importation and foreign direct investment (FDI); the number of classrooms built or renovated; supplies of educational materials, among others.

Fallow deepwater fields hold opportunities...

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plans to roughly double that by 2020, a target that could prove difficult to achieve given delays that often occur in developments.

Analysis on lists of projects sanctioned for commissioning between 2010 and 2020 showed that Final Investment Decisions (FIDs) on major deepwater development projects have stalled as most FIDs that spiked hopes of return of deepwater field development activities fell off the table following disputes over the implementation of the existing 1993 production contracts that spurred the first phase of exploration investment in the terrain.

For instance, Total is seeking to sell its 12.5 percent stake in a major deepwater oilfield off the coast of Nigeria, industry and banking sources said, in an effort to adjust the energy company’s Africa portfolio amid a broad expansion.

The block includes the Bonga field, Nigeria’s first deepwater project which started in 2005 and produced around 225,000 barrels of oil and 150 million standard cubic feet of gas per day at its peak.

Output from the block is planned to grow sharply with the $10 billion development of the Bonga Southwest field which is expected to produce up to 200,000 bpd, roughly 10 percent of Nigeria’s current oil production.

Italian Eni and AngloDutch Shell are working with NNPC to reach FID on Zabazaba and Etan deepwater fields located in oil prospecting lease (OPL) 245 offshore Nigeria in the Niger Delta of the Gulf of Guinea, in water depths ranging from 1,200m-2,400m.

According to offshore technology, the Zabazaba and Etan fields are estimated to hold a combined total of 560 million barrels of oil-equivalent (mboe).

ExxonMobil also has existing plans for three deepwater development projects envisaged to increase production by 230,000 barrels per day.

The company’s Satellite Field Development Programme was planned to come on stream as from 2020 with 80,000 barrels per day but no progress has been made on the FID.

•Continues online at www.businessday.ng www.businessday.ng

L-R: Obong Idiong, managing director/ chief executive officer, Africa Prudential plc; Bayo Olugbemi, chief executive officer, First Registrars and Investor Services Limited/ chairman of council, Institute of Capital Market Registrars (ICMR); Adeyinka Shonekan, divisional head, business development, Central Securities Clearing System (CSCS) plc; Onome Komolafe, divisional head, shared services, CSCS plc, and Dele Ikotun, managing director/chief executive officer, Unity Registrars Limited, during CSCS’ official launch of Regconnect Solution to the Capital Market in Lagos, yesterday.

Abuja DisCo to get new owners as core investor...

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of their contract in terms of remittance to the market.

Abuja Electric was one of the affected DisCos. Abuja Electric along with the affected DisCos filed a petition challenging the regulator’s review of their market remittance obligation. The regulator returned fire by threatening to pull their licences.

While the DisCos have since withdrawn their petitions, the regulator is going ahead with a public hearing where it would serve as judge and defendant. Lawmakers on the power sector committee intervened, urging the regulator to hold fire. The regulator is going ahead anyway.

BusinessDay learns that Thomas Etuh, chairman of Unity Bank plc and TAK Group of Companies, with ties to the presidency, is a front-runner to buy up the 60 percent stake in Abuja Electric held by KANN. According to information on TAK website, Etuh founded TAK Agro & Chemicals

Limited, with the purpose of establishing an agro-allied company that is providing quality agro inputs for the Nigerian farmer.

“The Company under his leadership has become ‘the Farmer’s choice’, and over the years acquired fertilizer blending plants across Nigeria, established a presence in Mali, and built a solid network of agro-dealers that would ensure that the product went from the production plant to the end user,” according to information on the company’s website. “As a major fertilizer blending company with a combined capacity of almost one million tonnes, TAK was forefront in partnering with the Federal Government of Nigeria in driving its Growth Enhancement Support Scheme (GESS) programme.”

Etuh’s firm by virtue of its partnership with the Federal Government is among the top fertiliser dealers in Nigeria. As head of the Fertiliser Producers and Suppliers Association of Nigeria (FEPSAN), he was

Crisis hits Setraco Nig. as Umoru sues Lebanese...

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the seamless management of the company through proxies, harassing and threatening SNL expatriate Lebanese employees with forced resignation, thus making realisation of company objectives difficult, and provocative correspondences with SNL’s bankers and suppliers to frustrate genuine business transactions such as renewal of credit facilities.

It is also being alleged that despite these concerted efforts by the Khalafs to ensure that the company is unable to meet its obligations to regulatory agencies and other stakeholders, the company is doing well judging by all performance indices and when compared with its peers in the construction industry.

The plaintiff stated that the business relationship between him and the defendant started more than four decades ago.

He averred that since then the defendants had engaged in a systematic plot to assume the status of a majority shareholder in Setraco Nigeria Limited with a view to eventually taking over the company from the Nigerian partner.

Khalaf is also alleged to have assigned contracts won

by SNL to other companies in which he has interests without the consent of the board of SNL and also without proceeds shared with SNL. Listed among the other entities are Setramech/Levant Construction Company Limited and Rockbridge Construction Limited.

Khalaf is accused of unilat-

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instrumental in implementing the Presidential Fertiliser Initiative (PFI).

Under the PFI, President Buhari signed a bilateral agreement with the Government of Morocco for the supply of phosphate for the revitalisation of local blending plants.

BusinessDay gathers that acquiring stakes in Abuja Electric is a way to gain a foothold into the power sector and position for the purchase of assets of the Niger Delta Power Holding Company (NDPHC), which could be offered for sale as a way to fund the 2020 budget.

According to rules guiding power asset privatisation in Nigeria, only companies with proven capacity in the power sector can purchase assets offered for sale.

However, investors have already emerged for the NIPPs after the Bureau of Public Enterprise offered them for sale four years ago.

The transaction stalled because investors wanted bankable guarantees including a erally fixing a charge ranging from 7-15 percent of contract fees on all revenues (including unearned revenue like mobilisation for awarded contracts) of SNL as “service fees”, thereby earning double compensation for his role as a director.

According to the claim before the court, the total of such fees earned from February 18, 2008 to July 6, 2015 when it was discontinued, following the intervention of Abu Inu Umoru (the plaintiff), the new chairman and son of the late chairman, Alhaji Inu Umoru, amounted to approximately USD27m.

The plaintiff claimed that SNL got four road contracts from the Kwara State government from 2004 to 2012 totalling a contract sum of N8.43bn, but these were seconded for execution to Setramech/Levant without the knowledge of the partner, Alhaji Inu Umoru (deceased). @Businessdayng

share sale agreement, power purchase agreement with the Nigerian Bulk Electricity Trading Company (NBET) and Put/Call Option Agreement with the Federal Ministry of Finance to procure financing to complete the deal.

The NIPP plants lack firm gas supply agreements and adequate transmission lines to move power to where it is needed. Nigeria’s power market too is also illiquid due to an absence of a tariff that can guarantee commercial returns, besides being bogged down by debts over a N1 trillion.

But the BPE insisted that the investors must post millions of dollars in bank guarantees covering 15 percent of their bid prices six years after the expiration of the initial bank guarantees they posted.

This has also stalled the NIPP privatisation, as the preferred bidders have called on the BPE/NDPHC to address the transaction challenges.

When contacted by BusinessDay, Abuja Electric said they were unaware of any plans by the investor to pull out of the company.

Khalaf was accused of deploying SNL’s funds, equipment and personnel in executing these contracts.

Going by the claims before the court, SNL built a metallurgical fabrication workshop at Mpape to aid in the production of formwork and other ancillary fabrications, but that Said Khalaf floated a company then called Global Equipment Solutions (GES) Limited and instructed that the new company should take over the assets of SNL workshop in June 2009.

The plaintiff further claimed that the value of the workshop (aside the building) was N82.6m, and that without revaluation of the assets and consent of Alhaji Inu Umoru, Khalaf caused SNL to cede the entire workshop to GES at a paltry sum of N54m.

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NNPC denies allegations of financial impropriety Finance bill: Stakeholders disagree with FG ...Reps set up 3 ad-hoc committees to probe banks over stamp duty revenue over VAT hike as Reps boycott joint hearing James Kwen, Abuja

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anagement of Nigerian National Petroleum Corporation (NNPC) on Tuesday dismissed the reports bothering on financial impropriety levelled against it in the audit query issued by the office of the Auditor General of the Federation (oAuGF) between 2014 and 2017.

Chief financial officer of NNPC, Isiaka Abdulrasak, gave the assurance while responding to questions from members of the House Committee on Public Accounts, chaired by Wole Oke on the queries issued by the office of the Auditor General of the Federation between 2014 and 2017.

Abdulrasak explained that the Corporation had addressed all the queries raised by the Office of the Auditor General of the Federation, even as he pledged the Corporation’s resolve to ensure accountability and transparency of public funds.

He maintained that the Corporation would not hide anything from the public and the National Assembly, who

represents the people, and assured that other issues raised by the Committee on Public Accounts about all NNPC subsidiaries would be addressed on the date chosen by the Committee.

Similarly, the House Committee on Public Accounts resolved to set up three Ad-hoc Committees that will audit the accounts of three Commercial Banks involved in the collection of Stamp Duty between 2004 and 2019. The banks are: Fidelity, First City Monument Bank (FCMB), and Wema Bank, respectively.

Chairman, House Committee on Public Accounts, Oke disclosed this at the resumed public hearing into the audit queries issued by the office of the Auditor General of the Federation against Federal Inland Revenue Service (FIRS), Nigerian Postal Service (NIPOST) and all the financial institutions.

The resolution was passed sequel to the presentation of the bank statement submitted by Fidelity Bank of millions of naira declared as total collection from Stamp Duties.

In his contribution, Solomon Maren, who expressed reserva-

tion over the presentation, noted that lying before the Parliament attracted two years imprisonment while lying on oath attracts five years imprisonment without an option of fine.

Maren also called for holistic investigation of the accounts of all the banks with the view to ascertain the actual amount remitted for the period under review.

He argued, “The figures submitted by Fidelity before me are very surprising. I think we should conduct an audit on how much was generated. Sometimes I make at least 5 transactions and deductions of about N52 made per transaction.

“So, the N2.8 million is not up to transaction that takes place in a branch talk less of all the branches.”

Maren further noted that most of the MDAs who interfaced with various Standing Committees during the 2020 budget defence argued that they were unable to implement the capital component of the 2019 Appropriation Act due to paucity of funds, hence the need to ensure accountability of public funds collected on behalf of the Federation by the banks.

... as N50 stamp duty per N100,000 money transfer proposed Solomon Ayado

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elevant stakeholders in the financial sector on Tuesday disagreed with the Federal Government over the proposed increase in the Value Added Tax (VAT).

This is just as the stakeholders asked the federal government to implement only N50 stamp duty charged on electronic money transactions amounting to N100,000 and above.

This was the outcome of a public hearing on the Finance Bill 2019, organised by the National Assembly Joint Committee on Finance held in Abuja.

But members of the House of Representatives committee on Finance, chaired by James Faleke, on Tuesday, boycotted the joint public hearing. Also, the Speaker, Femi Gbajabiamila, who was mentioned as special guest, did not attend the event. The Senate President, Ahmad Lawan was represented at the event by his deputy, Ovie Omo-Agege.

The public hearing was jointly organised by the Senate and House of Representatives before

the feud between the Senators and members was laid open.

National Assembly sources said the Senate and Reps finance committee members disagreed, leading to the boycott. The source said some lawmakers in the Lower Chamber had accused the Senate of being ‘rubber stamp’ to the executive hence their refusal to be present to the public hearing.

The objectives of the bill include promoting fiscal equity by mitigating instances of regressive tax inversion, and forming domestic tax laws to align with global best practices among others.

The finance bill passed the second reading in Senate two weeks ago. Senators deliberated on the bill and recommended a public hearing session to collect views of relevant stakeholders on it.

During the public hearing on Tuesday, the stakeholders registered their grievances on the hike in VAT because, according to them, it would dislodge consumption and reduce the rapid growth of the economy.

President Muhammadu Buhari had while presenting the 2019 budget of N10.33 trillion to a joint session of National Assembly, submitted a draft Finance Bill that proposed an increase of the VAT rate from 5% to 7.5%.

Buhari has said the 2020 Appropriation Bill was based on the new VAT rate to draw additional revenues to be used to fund health, education and infrastructure programmes.

States and Local Governments share 85% of all VAT revenues, which Buhari said was expected to lead to greater quality and efficiency in their spending.

The VAT Act, however, exempted pharmaceuticals, educational items, and basic commodities, which exemptions were to be expanded under the Finance Bill, 2019.

Specifically, Section 46 of the Finance Bill, 2019 expands the exempt items to include brown and white bread; cereals including maize, rice, wheat, millet, barley and sorghum; fish of all kinds; flour and starch meals; and fruits, nuts, pulses and vegetables of various kinds.

NEPC targets $200m revenue from 7 priority commodities HARRISON EDEH, Abuja ith global increase in demand for organic food, the Nigerian Export Promotion Commission (NEPC) targets $200 million revenue within 10 years from the development of organic farming of seven priority commodities for export.

The commodities include: Hibiscus flower, Sesame seed, Cashew, Tiger nuts, Moringe Oleifera, Ginger and Tumeric, as major export commodities.

Currently, global organic food and drinks export is said to have a market share of $97 billion.

This was disclosed by Olusegun Awolowo, executive director

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of the NEPC, on Tuesday at the signing of a memorandum of understanding between the NEPC, local farmers and TAK Integrated Solution held in Abuja.

Awolowo pointed out that the objective of the project was to contribute to the Federal Government policy in developing the potential of non-oil sector of the economy focusing on the organic farming of seven priority commodities.

The project, which is a collaborative effort between the NEPC, local farmers and TAK Integrated, and NICERT Limited as offtakers, targets 10,000 farmers in each geo-political zone within an estimated 100,000 hectares of land over a period of three years.

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L-R: Olugbenga Awe, divisional head, Agric Finance and Export; Fela Ibidapo, divisional head, corporate communications; Jude Monye, executive director; Akeem Durotoye, group head, domestic and e-banking services; Victor Amakwe, group head, private wealth management, and Chukwuma Onwuka, head, head office and experience centre compliance, all of Heritage Bank, during Heritage Bank’s celebration of International Men’s Day, themed: “Making a difference for Men and Boys,” at its head quarter, Lagos.

Afreximbank to help Nigeria accelerate bankable PPP projects - ICRC Onyinye Nwachukwu, Abuja

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frican Export-Import Bank (Afrexim) is to help Nigeria through the Infrastructure Concession Regulatory Commission (ICRC) accelerate bankable Public Private Partnership projects that would enable the much needed investments in the country.

Chidi Izuwah, CEO, Infrastructure Concession Regulatory Commission (ICRC), announced this at a press meeting ahead of the Joint Public Private Partnership Consultative Forum and Nigerian PublicPrivate Partnership Network Meeting holding in Abuja on Thursday.

The event is being held under the theme: Accelerating Bankable PPP Project Development in Nigeria – The Afrex-

imbank Project Preparation Facility (APPF) Meeting and will bring together Governors from across the States, key decision-makers across Ministries, Departments and Agencies of the Federal Government, the National Assembly and notable dignitaries in the PPP ecosystem to discuss how to transform the PPP landscape in Nigeria.

According to Izuwah, the Afreximbank Project Preparation Facility (APPF) seeks to support the supply of investment-ready projects, bridging the infrastructure deficit in the continent and that the event seeks to help identify as well as improve the bankability of selected projects in Nigeria, with a view to accessing project preparation funds from the bank.

“A key expected outcome of the programme is the selection

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of some bankable PPP projects across the country for the APPF. “We also hope that the outcome of this dialogue session will greatly enrich our understanding of the concept of and approach to PPP in terms of policies, guidelines, and operation in the delivery of infrastructure to Nigerians,” he stressed, noting states as important actors in the infrastructure plan.

The Public-Private Partnership Consultative Forum, known as 3PUCF is designed to provide a platform for Heads of PPP Units in Federal MDAs for knowledge and experience sharing; ensure symmetry of effort towards institutionalizing the Federal Government’s PPP programme, provision of training and educational intervention among others.

He said the forum which is @Businessdayng

coordinated by the ICRC was created as a mutual vehicle to provide a one-point-platform for Federal PPP Units created principally to facilitate service delivery as well as ensure faster and reduced cost of project execution.

On the other hand, the Nigerian Public Private Partnership Network [NPPPN] was established in 2011 through collaboration between the ICRC, Lagos State PPP office, and the Nigerian Infrastructure Advisory Facility (NIAF) to create a platform for all States Heads of PPP units nationwide.

Izuwah explained that the NPPPN was designed to serve as a knowledge and experience sharing forum to upscale the learning curve of public officers at the sub-national level of government on Public Private Partnership form of procurement.

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EDC, SMEDAN, others collaborate to deepen entrepreneurship in Nigeria SEYI JOHN SALAUS

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onscious that no economy can grow without thriving small and medium enterprises, the Enterprise Development Centre (EDC) of the Lagos Business School is championing a collaborative initiative with the Small and Medium Enterprise Development Agency of Nigeria (SMEDAN), Fate Foundation, and Atco Realty to deepen entrepreneurship in Nigeria.

The desire is to help Nigeria create an ecosystem where start-ups, mostly small scale businesses, can scale their businesses. This collaboration is expected to affect policy direction towards changing the mindset on how businesses can scale.

D i k ko R a d d a, D G o f SMEDAN, said for Nigerian economy to be fully diversified, the small and medium enterprises must be fully empowered. According to Radda, the small business subsector of the Nigerian economy holds the key to Nigeria’s economic sustenance.

Radda opined that there w ere about 41.5million MSMEs in Nigeria as at 31 December 2017, while about 41.4 million of the MSMEs are micro enterprises. “Whatever we need to do; we need to help them, because that is

the way we need to grow this economy,” said Radda, who was represented by Monday Ewans, director, enterprise development and promotion.

To him, about 99.4 percent of businesses in Nigeria are micro enterprises and operate mostly in the informal sector of the economy, hence the need to help deepen the sector of the economy to scale and move from the informal to the formal sector.

Sp e a k i n g f u r t h e r o n MSMEs contribution to Nigerian economy, he stated that MSMEs employ about 59.6 million persons as at 31 December 2017, accounting for about 76.5 percent of Nigeria’s working population, thereby contributing about 49.8 percent to Nigeria’s nominal GDP, and 7.64 percent of Nigeria’s export figure. “With this statistics you will understand that MSMEs are very important,” said Radda, stating that SMEDAN’s sole objective is to grow the subsector of the economy.

Olawale Anifowose, MD, Global Entrepreneurship Network (GEN), Nigeria said the global entrepreneurship week was a celebration of innovation and creativity. According to him, the essence of celebrating the entrepreneurship week is to strengthen the light of entrepreneurship within the ecosystem in Nigeria.

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LBS Sustainability Centre, ACT Foundation Banking system credit to domestic train 40 youth on waste management economy rise by 30%

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bout 40 young Nigerians in the waste management industry were, on October 2 – 29, 2019, trained by Lagos Business School (LBS) on innovative and sustainable methods of waste collection, removal, processing, recycling and disposal.

Developed by the LBS Sustainability Centre with support from the Aspire Coronation Trust (ACT) Foundation, the Leadership Programme for Sustainable Waste Management is an entrepreneurial platform for sustainableyouthempowerment in mitigating the environmental and health implications of improper waste management.

It also aims at improving the operational and financial viability of waste management businesses.

The one-month programme was delivered by LBS faculty and other local and global experts in the private and public sectors.

Participants were exposed to topics such as Emerging Technologies for Sustainable Waste Management, Circular Economy and Waste Prevention, SocioEnvironmental Impact in Waste Management, Human Capital Sustainability in Waste Management, Duty of Care and Extended Producer Responsibility, among others.

Director, LBS Sustainability Centre, Chris Ogbechie, remarked, “The programme aims to support young entrepreneurs in Nigeria to create socio-economic value and address press-

ing environmental challenges through responsible business ventures. This programme is one of the ways LBS advances environmental sustainability through management education.”

Sharing his experience on the programme, participant, Alexander Akhigbe, who is the founder of the African Cleanup Initiative, described it as an investment he will forever cherish. Akhigbe also added that one of the key takeaways from the programme was the lesson on personal branding delivered by LBS Marketing Faculty, Uchenna Uzo. “I have learned about the significance of personal and organisational branding and the need to develop products and solutions that target a particular market per time. I am mostly impressed because I never imagined that I would be picking up lessons in branding and marketing from a waste management programme. This goes to show how rich the content of the programme was,” said Akhigbe.

Lessons on the Sustainable Waste Management programme were taught using in-class and online lectures, expert panel sessions, and case study discussions.

Participants also had a one-day experiential one learning tour at the Lagos Waste Management Authority (LAWMA) facilities in Ojota and Ikoyi.

A participant, Jennifer Paul, who runs an environmental

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HOPE MOSES-ASHIKE

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ggregate banking system credit to the domestic economy (net) rose by 30.3 percent in September 2019, compared with the growth of 1.9 percent in corresponding period of 2018.

Relative to the level at the end of August 2019, it grew by 24.3 percent, according to the economic report for the month of October released by the Central Bank of Nigeria (CBN).

Deposit Money Banks (DMBs) have been aggressively pushing credit to consumers in compliance with the Loan to Deposit Ratio (LDR) directives of the CBN. The CBN had raised the LDR to 65 percent and set December 2019 as deadline for compliance by deposit money banks.

Afrinvest banking sector report showed that the total loan of the banking sector stood at N15.7 trillion in the first half of 2019, and is expected to hit N16.1 trillion by the end of the year.

Aggregate credit to the domestic economy (net), on month-on-month basis, grew by 4.8 percent to N35.91 trillion at the end of September 2019, compared with the growth of 2.5 percent and 7.0 percent at the end of the preceding month and the corresponding period of 2018, respectively.

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The development was attributed to the respective increase of 10.6 percent and 2.6 percent in net claims on the Federal Government and claims on the private sector.

Net claims on the Federal Government, on month-onmonth basis, grew by 10.6 percent to N10.45 trillion at end-September 2019, compared with the growth of 3.4 per cent and 54.9 per cent at the end of August 2019 and the corresponding period of 2018, respectively. The growth in net claims on the Federal Government reflected the increase in holdings of government securities by the Central Bank of Nigeria. Over the level at endDecember 2018, net claims on the Federal Government rose significantly by 114.8 per cent, compared with the growth of 94.3 per cent at the end of the preceding month.

Relative to the level at end-August 2019, banking system credit to the private sector rose by 2.6 per cent at the end of September 2019, compared with the growth of 2.2 per cent apiece at the end of the preceding month and the corresponding period of 2018. The development was attributed to the 1.7 per cent and 9.0 per cent increase in claims on the core private sector and claims on the state and local government, respectively.

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Achieve 100,000mw to match size of Nigeria’s economy, Senate tells FG Solomon Ayado, Abuja

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he Senate on Tuesday urged the Federal Government to target the achievement of 100,000 megawatts of installed power capacity to match the size of Nigeria’s economy and improve its development status.

The Senate is disturbed that the nation’s current 330kv and 132kv cannot supply enough electricity because of transmission constraints and due to lack of data acquisition system.

The Senate said the nation’s existing distribution infrastructure was decrepit with no modern distribution technology and management systems.

The lawmakers are projecting a 100,000 megawatts capacity to be achievable if the Federal Government makes use of the country’s natural endowments to fuel its power needs by mixture of energy sources such as natural gas, hydro, coal, wind and solar energy.

Specifically, the Senate said it is aware that Nigeria ranks amongst the lowest in electricity availability per capita in the world.

To find solutions to the power deficit faced by the country, the Senate has advised the federal government to liaise with other nations for illumination.

This followed a motion by Chukwuka Utazi (Enugu North) on the need to address Nigeria’s power problems.

According to Utazi, Indonesia with a population of 267 million people has an installed power capacity of 60,000 megawatts and a generating capacity of 42,465 megawatts.

Also, he said Brazil, with a population of 211l million people has an installed capacity of 167,000 megawatts and a generating capacity of 101,363 megawatts while Philippines, with a population of 107 million people, has an installed capacity of 20,055 megawatts and a generating capacity of 16, 271 megawatts.

“Mexico with a human population of 131 million people has an installed capacity of 75,680 megawatts and a generating capacity of 53,653 megawatts.

Egypt with a population of 99 million people has an installed capacity of 42,000 megawatts and a generating capacity of 31,24l megawatts.

“Turkey has a population of 81,916 million people, an installed capacity of 88,178 megawatts and a generating capacity of 57,292. South Africa has a population of 57 million people, an installed capacity of 51,309 megawatts and a generating capacity of 34,978 megawatts.

“Morocco has a population of 36 million people, an installed capacity of 9,754 megawatts and a generating capacity of 6,393 megawatts, while the USA with a population of 330 million has an installed capacity of 1,100,000 megawatts and a generating capacity of 717,710 megawatts.

In comparison, Nigeria has a population of 200 million people with an installed capacity of 12,500 megawatts and a generating capacity of 4000 megawatts,” he informed.

Suggesting further, Utazi said

FG begins process to regulate online media, to amend NBC code Godsgift Onyedinefu, Abuja ederalGovernmentofNigeria has begun putting in place legal frameworks to enable it regulate the online media.

Lai Mohammed, the minister of information and culture, said he would immediately commence the process of forwarding an Executive Bill for consideration of the Federal Executive Council and further legislative action.

He said the bill would address what he described as existing lacuna in the areas of the regulation of the Internet, ongoing Digital Switch Over, Digital Access Fee,

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and insulation of the regulator from partisan politics.

Mohammed said this when he received a report of the National Broadcasting Commission (NBC) reform implementation committee on Tuesday, the report which he recalled includes recommendations already approved by President Muhammadu Buhari.

Mohammed also disclosed that the government would immediately mandate the NBC to review its Act and come up with regulations for the broadcast of content on the Internet and the web to ensure that those who provide broadcast services on the Internet “do so with respon-

sibility”.

Mohammed said the regulations would not in any way gag the press or hinder their universal role of providing valuable information to the citizenry.

He noted that the report from the Committee would revolutionise the NBC, adding that there was an urgent need to come up with regulations that will address existing challenges.

The minister further said the Commission would be mandated to amend its broadcast Code, through new regulations to reflect the upward review of fines from N500,000 to N5 million for breaches relating to hate speeches, inciting comments

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and indecency as approved by Buhari.

He said the code would also be amended to reflect the upgrade of breach of political comments relating to hate speeches and divisive comments to ‘’Class A’’ offence in the Code and to ensure that wilful repeat of infractions on three occasions after levying fine on a station attracts suspension of license.

To address monopoly in the broadcast industry, Mohammed said the NBC would immediately come out with fresh regulations that will promote the local broadcast industry and protect the Nigerian broadcast industry from monopolistic tendencies.

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“These regulations are also in the area of advertising tariffs and production of advertisements in Nigeria. The regulations will also ensure that all anti-competitive behaviours are deterred and sanctioned where they occur”, he added.

Mohammed informed that the government would commence the process for the acquisition of modern broadcast equipment for the Commission for the purpose of monitoring and enforcement.

He added that the government would also commence the process of beefing up the material, training and manpower needs of the Commission.

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Art - a big part of African culture Senate raises alarm over sale of fake medical reports by Nigerian hospitals

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frican art history has played a significant role in shaping the culture and history of the world. The belief that Africa is the cradle of the history of mankind is virtually unshakeable. The origins of African art history lie long before recorded history, preserved in the obscurity of time. Rock Art is centuries old, while shell beads fashioned for a necklace have been recovered in a cave in the furthest reach of the southern peninsula of South Africa that are 75,000 years old.

A lot of African art has been acquired for curious means by travellers, traders and missionaries in the century before, and taken out of the continent. Colonialists most often did not give indigenous art the merit and attention it deserved and thereby African art history has not been documented.

And that’s why the recently concluded West-Africa’s Premier International Art Fair - ART X Lagos, supported by Access Bank, is ‘More Than An Art Fair,’ it

grant, a three-month residency at Gasworks, London, in 2020, and a solo presentation at ART X Lagos in 2020. During an interview, in which she shared the impact that Art X Lagos has made on her career and person, she said, ”In 2018, I went for my first ever ART X Lagos fair, and I was really inspired by the kind of works I saw there.

Fortunately this year, I got nominated and went ahead to win the Access Bank Art X prize 2019, meeting the jury members was really amazing. It made me review my practice; they made me think there’s much that I can do than what I am doing now.

“The subject matter I’m dealing with is very personal to me. I want people to see and feel everything I felt on my journey of documenting this project. I am looking at more immersive ways of putting together an exhibition that will stir up something in people.

“The relevance of the Access Bank Art X prize would be to give visibility to the artist. With the Access Bank Art X prize, I will be able to con-

Solomon Ayado, Abuja

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enate on Tuesday raised an alarm over the sale of fake medical reports by public hospitals in the country, saying the ugly trend, it described as “very dangerous,” was worrisome and must be curbed immediately.

It said it was fully aware that the Code of Ethics of the medical profession forbids illegal issuance of medical certificates and records to patients without conducting the relevant tests.

Consequently, it mandated the Federal Ministry of Health to quickly initiate an efficient measure to not just identify the culprits but

to also prevent the commercialisation of medical reports.

Also, the Senate directed the Nigerian Medical Association (NMA) “to intensify its effort in checking incidences of fraud and quackery in the medical profession, especially in public hospitals.”

The decision by the Senate followed a motion on the proliferation of Fake Medical Reports emanating from Public Hospitals in Nigeria moved by Uche Lilian Ekwunife, (Anambra Central).

L e a d i n g t h e d e b a t e, Ekwunife revealed that medical reports which ought to be issued free of charge were

often obtained from some public hospitals in Nigeria at a high fee.

She said to worsen the situation the hospitals do not conduct proper medical tests on the report seekers before issuing them.

According to Ekwunife, the ugly trend poses grave danger to the medical health and safety of the citizenry which, she noted, result to fatal misdiagnosis of patients who relies on the medical reports.

“The dire importance of the medical report as a document which is accorded great weight and importance in the ordinary course of our day to day business, includ-

geria’s fiscal terrain, investors are worried about their margins most especially getting back their cost of production which is a huge concern for oil exploration,” Kyari said at the 37th Annual International Conference of the Nigerian Association of Petroleum Explorarionists (NAPE) in Lagos.

The NNPC boss also raised concerns over the instability

in crude oil prices, stating that any oil price above $70 was not favourable to Nigeria’s economy.

“Competition from other energy sources, most especially the optimism in renewable energy, is making it difficult for oil companies to invest deeply in Nigeria’s oil exploration,” Kyari told the audience.

The NNPC boss believes

ing courts of law.

“Medical reports contain individual’s personal medical records and details, which are used to ascertain a person’s medical condition, obtain health benefits, certify one’s mental state, investigate addictions, diagnose treatments, and most importantly, ascertain and form medical opinions.

“The integrity of medical reports issued by hospitals in the country are being compromised and eroded by the realisation that it may not contain the true and accurate medical details of the person named in the report,” she stated.

Investors worry about investing in Nigeria’s oil exploration - Kyari DIPO OLADEHINDE

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igeria National Petroleum Corporation (NNPC) Group Managing Director Mele Kyari has said that investors are worried about investing in Nigeria’s oil exploration, a development which has led to a decline in investments in the last ten years.

“Due to lack of clarity in Ni-

that crude oil would still remain relevant beyond international agencies forecast of 2040.

“Increasing population and growing demand will always remain a factor, which implies there will still be at least an oil consumption of 100 million barrels per day by 2040,” Kyari said at the event.

news analysis was a love letter to Africa Art. The fair was inclusive, it was as innovative, pristine, original, modern, and African with its numerous exhibitors, collectors, families, children, enthusiasts, students, professors and other guests from Nigeria and across the world.

This 2019 fair that held in Lagos between November 1 and 3, 2019, was the most ambitious to date, with a larger and better gallery to receive a wide array of artists from the continent and the diaspora.

The art sector, largely, is one of Nigeria’s most undervalued and underutilised value-propositions that could be highly marketable for our national image boost and exportable for our economic growth. Art X Lagos recognises that Nigerians really do have talent, and are highly skilled and have amazing stories to tell through Art, which is one of the reasons for birthing the fair, in order to inspire, promote, give opportunities and establish emerging artists to the end that their potentialities to contribute to national growth and development are boosted.

Spotlight was on Etinosa Yvonne, self-taught Documentary Photographer who leverages the power of visual storytelling to create awareness, educate and inform people about causes and issues she is passionate about, who also is the winner of the 2019 Access Bank ART X Prize of N1.5 million cash

tinue researching, continue travelling and interviewing survivors of terrorism and violent conflicts in Nigeria. ”This will be an opportunity for me to immerse myself in the whole art experience and see how I can basically push my project forward.”

Attendees could not contain the thrill of being at the fair and expressed their excitement. During interviews at the Access Bank Art X lounge, Art connoisseur, Patrick Koshoni, said, “I’m so happy, it’s all fantastic new work I’m seeing, and I’m titillated!” IBK said, “Hi, I’m so inspired and happy, it feels like something else.”

Herbert Wigwe, GMD/ CEO of Access Bank plc, a gold sponsor of the fair, lauded the founder Art X Lagos, Tokini Peterside, and stressed the importance, contribution and relevance of Art X to Africa when he said, “Art X Lagos is establishing itself as the Premier Art Fair in Africa and not only in West Africa, because it is making a difference, speaking to inclusiveness and speaking to the beauty of all parts of Africa.”

Art X Lagos shows us that as Africans, we can begin to harness the very best of talent on the continent so that we can begin to change the narrative of not just Nigeria, but of Africa, he further stated. The whole world must begin to focus on our continent and the quality of skills that we have. www.businessday.ng

L-R: Russell Brooks, public affairs officer, US Consulate General, Lagos; Claire Pierangelo, principal officer US Consulate General, Lagos; Herbert Wigwe, group managing director, Access Bank plc; Aruna Amirthanayagam, country public affairs officer, US Consulate, Nigeria, and Bolanle Austen-Peters, founder, Bolanle Austen-Peters Productions, at the 2019 AFRIFF Globe Awards.

High vacancy rate in Apapa Mall underpins deep gridlock impact on businesses CHUKA UROKO

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radually but steadily, congestion and high traffic volume which have in recent years defined Apapa as a port city have continued to impact negatively on investments, household income and businesses.

Besides other businesses, the property market in the port city is taking the worst and hardest hit as many of the residential and commercial buildings are now empty. By the last count, it was estimated that 40 percent of buildings in the port city was empty.

A major business enterprise, which has more than a fair share of the impact of the gridlock is the Apapa Shopping Mall that came as a response to the yearning of residents for a

modern, world-class shopping experience.

The mall is today telling a new story with its high vacancy rate, estimated at 38 percent by a new half-year report on the Nigerian real estate market compiled by Northcourt Real Estate. This is one of the highest among about 20 shopping malls surveyed in the three cities of Abuja, Lagos and Port Harcourt.

Before the coming of the mall, developed by Top Services Limited, residents and workers in Apapa which was home to an estimated 522,384 people, according to Lagos State government records, had been without a world-class retail outlet to serve their shopping and relaxation needs.

Shortly after it opened for business, the shopping mall with 40 retail sales outlets

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played host to top brands from both within and outside the shores of the country, including Kobis Restaurant, Card Shop, Daviva, Essenza, Health Plus, Casa Bella, Etisalat, Airtel, Cash N Carry and Busen.

Others include Shoprite, MedPlus, Skye Bank ATM, US Polo, Diva House, Evoke Beauty Salon, Image N Soul, Homely, Suntan and Time Keepers, plus such quality retailers as Beerhugz Cafe, Spectranet, Audacious Business Concepts, Filmhouse and Pepstore.

But when BusinessDay visited the retail facility on Monday, it was observed that many of the outlets were empty. Of all the retail outlets upstairs, only one was stocked while the rest were empty. Downstairs, it was discovered that about eight outlets were empty. @Businessdayng

“The situation in Apapa Mall simply shows how deep the impact of the traffic congestion in Apapa is. Shoppers avoid the mall because they find it difficult to access the facility whether it is weekend or working days of the week,” Mojeed Olugbenga, an estate manager, explained to BusinessDay. He noted that many of the retailers have fled and the beneficiary of this exodus is the Adegunsanya Mall in Surulere, also on Lagos Mainland. Unlike Apapa Mall, the vacancy rate here is about 12 percent.

Because of its degraded environment caused by truck drivers and other marine activities, Apapa is no longer attractive for both residence and business. Many residents and businesses have relocated.

Wednewsday 20 November 2019

BUSINESS DAY

news

Dasuki never wished to be remanded in DSS custody Felix Omohomhion, Abuja

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ounsel to the detained former National Security Adviser, Sambo Dasuki, says Dasuki never wished to be kept in the custody of the Department of State Security (DSS).

Ahmed Raji, a senior advocate of Nigeria, who made the clarification in Abuja on Tuesday, said the detained former National Security Adviser never prayed that he be kept in the detention camp of the DSS for whatever reason.

The senior lawyer disclosed that contrary to the position of the DSS that Dasuki and others in its custody preferred to be kept in its custodythaninprison,Dasukiwas bent on pursuing his release from DSS custody.

Dasukihasbeeninthecustody of the DSS since 2015, despite being granted bail by four different courtsinthecountry,includingthe Court of Justice of the Economic Community of West African States (ECOWAS).

Dasuki is standing trial on alleged diversion of funds meant for procurement of arms to fight insurgency in the North East of the

country and illegal possession of firearms.

Though he has been granted bail, the Federal Government has refused to release him even after meeting the attached bail conditions.

However, in a statement last week, spokesman of the department, Peter Afunanya, told Nigerians that many of those in their custody, including Dasuki, had opted to remain in their custody, addingthattheyappealedtocourts to be left in the custody of the Service and not the prison.

The reason, according to the agency,isthequalityoftheholding facilities provided by the DSS, all of which are within international standards.

But in a swift reaction, Raji, who described the DSS position as untrue, specifically as it relates toDasuki,said:“Thisstatement,as alluringasitsounds,isacontradiction of the events that have taken place since 2015, when charges were first preferred against Col. Mohammed Sambo Dasuki.”

Theseniorlawyerqueriedwhy an individual would choose to remain in custody contrary to his

constitutional and internationally enshrined fundamental human rights, and still continuously, challenge his unlawful detention at both National and International fora.

“It is therefore most incorrect and inaccurate to claim that Col. DasukiprayedtheCourttobekept in DSS facility. This is far from the truth. Perhaps, there is no synergy betweenthecounselappearingfor the government in Dasuki matters and the DSS hierarchy.

“Consequently,weappealtoall authorities and principally – DSS, to comply with the various extant orders of the court, by immediately releasing Col. Dasuki. (rtd.), “ Raji said.

Raji in the statement gave accountofhowDasukiwasarraigned before the various courts and consequently granted bail on all occasions.

“On 3rd November 2015, the Federal High Court – Abuja, after admitting Col. Mohammed SamboDasuki(Rtd.)tobailonselfrecognizance, granted him leave to travel abroad for a three-week medical consultation, on account of failing health.

L-R: Stella Okoli, group MD, Emzor Pharmaceuticals; Cheptoeck Careen, winner, Lagos Women Run 2019; Ibijoke Sanwo-Olu, first lady of Lagos State; Elizabeth Nuhu, 2nd runner up, Lagos Women Run 2019; Deborah Pam, 1st runner up, Lagos Women Run 2019, and Tayo Popoola, general coordinator, Lagos Women Run, at the presentation of prizes, at the Emzor sponsored 2019 edition of the Lagos Women Run in Lagos.

Sanwo-Olu in China on trade, business drive … to meet top Chinese investors JOSHUA BASSEY

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arely three months after his trip to Japan in company of President Muhammadu Buhari, Lagos State Governor Babajide Sanwo-Olu has embarked on another Asian trip aimed at scaling up Foreign Direct Investment (FDI) and bilateral partnership.

The governor is on a working visit to China - the world’s second largest economy - to sign partnerships and agreements that will support Lagos State’s efforts in transforming its economy to be 21st Century compliant.

Sanwo-Olu will be meeting the top management teams of China Railway Construction Company (CRCC) and China Civil Engineering Construction Company (CCECC) for a joint appraisal of ongoing projects being handled in Lagos by the Chinese construction giants.

In the course of the visit,

Sanwo-Olu will be making a keynote speech at the ChinaAfrica Business Council, which aims at putting Lagos before the Chinese investment community and declare the State’s openness to foreign investments.

The governor’s economic ambassadorial role will be taking him to Zhuhai Changiong Ocean Park, Huawei, GAC Motor Factory and Green Air Conditioning for talks on partnerships in industry, tourism and facility development.

Since its inception, the Sanwo-Olu administration has stepped up efforts for investments in infrastructure, renewable energy, Information and Communication Technology (ICT) and transportation.

The governor has been unequivocal about his quest for both local and foreign finance to transform the State’s economy through sustained investments in infrastructure.

While presenting the N1.1 trillion 2020 budget penultimate week, he noted that Lagos had revised its approval procedures and extant laws to promote Public-Private Partnership.

These efforts have yielded fruits, given the recent release by the World Bank, which praised Lagos as “significant contributor” to Nigeria’s impressive performance in the Ease of Doing Business Index.

Nigeria moved 15 places higher in the ranking.

Lagos and China have strengthened their bilateral relations since the inception of Sanwo-Olu’s administration. Recently, the governor witnessed the signing of four agreements with China Development Bank (CDB), including the $629 million financing facility to accelerate completion of the Lekki Deep Seaport project, which started in 2011 and will be completed in 30 months.

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POLITICS & POLICY Bayelsa guber had pre-determined outcome - Dickson …Speaks on relationship with Jonathan Samuel Ese, Yenagoa

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ayelsa State Governor, Henry Seriake Dickson has opened up on his feelings on the People’s Democratic Party (PDP) loss in last Saturday’s governorship election, saying “The pain is great, it may last for a long time.”

Addressing a world press conference in Yenagoa on Tuesday, Dickson blamed the loss on the unprofessional attitude of the security agencies and the Independent National Electoral Commission (INEC) who he alleged were used by the Minister of State for Petroleum Resources, Timipre Sylva.

He said the All Progressives Congress (APC) had pre-written results and predetermined figures for Nembe, Ogbia and Southern Ijaw Local Government Areas and

used the military to shield off the returning officers who were all from the University of Benin, the home state of APC National Chairman, Adams Oshiomhole.

Dickson said he believes in the rule of law, but lamented that the security agencies were partisan during the election and warned that partisan security agencies was the beginning of the fall of any nation.

He said he has confidence in the judiciary to upturn the victory of the APC in his first media event since INEC announced the results.

The governor accused Sylva of eroding the integrity of the security forces and dignity of his people, insinuating that the security of the state has been outsourced to him and determines police commissioners that are posted the state numbering about 17 this year.

He also accused APC lead-

Seriake Dickson

ers of using the narrative of disagreement with former President Goodluck Jonathan and Timi Alaibe as “justification for the daylight robbery

of our people.”

Defending his relationship with Jonathan who he said remained his leader, Dickson said: “Let it be known that I

and my government have absolute regard and respect for former President Goodluck Jonathan.”

The governor disclosed that prior to the election, he went to Jonathan 16 times, but the former President did not congratulate the PDP governorship candidate, Douye Diri on his emergence as the party’s candidate even when he also participated in the primary election.

He said the insinuations on the relationship between Jonathan and the APC is not misplaced in reference to the visit of some APC governors to the former President, saying what they did was strategic after they came and took the state by force.

According to him, “They are using his name and image to legitimise what they are doing by taking David Lyon to him” even when they did not call on him as governor and that with the “kind of

comments they are making, it is Hallelujah if they are finally embracing him.”

He said Jonathan did not consent to the alleged rigging as his Ogbia kinsmen never voted, but the APC was using him to prepare a window to wash off their hands and drop everything at his doorstep.

Dickson also defended PDP’s choice of candidates for the governorship election, explaining that with what happened, no candidate of the PDP would have won the election unless such a candidate had a pre-arrangement with the APC. In rejecting the election results, he said it was shocking that in Southern Ijaw Local Government Area where the Speaker of the House of Assembly, Director-General of the campaign, four state legislators, council chairman and councilors as well as other appointees are members of the PDP, the party would lose.

Buhari seeks speedy creation of special court for corruption cases

Bayelsa guber: More defections to hit PDP

…Special court would speed up corruption case - Ubani, Bayesha

Samuel Ese, Yenagoa

Iniobong Iwok with agency

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resident Muhammadu Buhari Tuesday charged the National Assembly to fast-track the passage of the Special Crimes Court Bill.

Speaking at the national summit on ‘Diminishing Corruption in the Public Service’ organised by the Independent Corrupt Practices and other Related Offences Commission (ICPC) in collaboration with the Office of the Secretary to the Government of the Federation, Buhari also urged the judiciary to embrace and support the creation of a Special Crimes Court.

According to him, “The

fight against corruption is of course not only for government and anti-corruption agencies alone. All arms and tiers of government must develop and implement the anti-corruption measures.

“I invite the legislative and judicial arms of government to embrace and support the creation of Special Crimes Court that Nigerians have been agitating for to handle corruption cases,” he said.

Buhari added that the speedy passage of the Bill was a priority of his administration’s Economic Recovery & Growth Plan 2017-2020.

Also speaking on his recent directive to all agencies of government to enroll

into the Integrated Payroll and Personnel Information System (IPPIS), he directed ICPC to beam its searchlight on public institutions that are yet to comply.

Reacting to the president’s comment in an interview with BusinessDay, a former vice-president of the Nigerian Bar Association (NBA), Monday Ubani said the passage of the bill would aid the fight against corruption.

Ubani lamented that several corruption cases were pending in Court because they had to compete with civic cases.

“It is a good move. I support the passage of that bill. If you look at what is happening in the country,

Ikeja partners Aliam’s Care Foundation for youth, women empowerment

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ore youths and women in the country will soon be pulled out of the poverty circle as Ikeja LGA of Lagos State goes into partnership with Aliam’s Care Foundation for the purpose of empowering them to create wealth. Already, the LGA says it has empowered over 250 youth this year to go into various wealth-creating ventures and is optimistic that the new cooperation with Aliam’s (an NGO) will help pull thousands of more youths and women out of

poverty in the nearest future.

Disclosing this at a press conference held recently to mark the official launch of the NGO in Lagos, Mojeed Alabi Balogun, executive chairman of Ikeja LGA, said the government was quick to embrace the Foundation because of the parity of vision as regards youths and women empowerment, wealth creation and fight against unemployment, poverty and hunger in the country.

The LG boss, who was represented at the occasion

by Aka Bashorun Taiwo, the www.businessday.ng

head of dept of Women Affairs and Poverty Alleviation, expressed his government’s excitement about the partnership due to his passion for empowerment and creation of wealth among youths and women. Also speaking at the event, Justin’s Chibututu, founder of Aliam’s Care said that the increasing rates of poverty and social vices in the country such as kidnapping and armed robbery, call for concerted efforts by individuals and government to fight the root causes, particularly, unemployment.

some corruption cases are pending for up to seven years without headway.

“Special court would speed up the process, I have always advocated for it,” Ubani said.

Jhon Bayesha, a lawyer and Senior Advocate of Nigeria (SAN) supported the passage of the bill, but said the existing judges in the country may not be enough.

“I support the creation of special court if that would speed up the corruption cases, because it is embarrassing for one case to be in court for four, five years, even more. But I would also say that the government needs to engage more judges; they are not enough,” Bayesha said.

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he Bayelsa State Chapter of the People’s Democratic Party (PDP) could witness more defections in the coming days and weeks in the aftermath of last Saturday’s loss of the governorship election.

Last week, prior to the election, it was believed that the Speaker of the state House of Assembly, Monday Obolo Bubou had defected from the PDP to the All Progressives Congress (APC), but it was swiftly debunked.

However, just two days after the announcement of the election result by the Independent National Electoral Commission (INEC), the grapevine had it that as many as eight lawmakers and some commissioners are about to decamp to the APC.

Political watchers believe that such an action could mean the death of the PDP in the state as the victory of the APC in the governorship election has consolidated its hold on the political life of the state.

The APC governorship candidate, David Lyon who is now the governor-elect scored 352,552 votes to defeat Douye Diri of the PDP who polled 143,172 votes.

Although the PDP candidate and Governor Henry Seriake Dickson have indicated they would challenge the outcome of the election in court, that may not satisfy those who are trying to secure their political futures.

Some PDP members who were irked by the handling of the party’s primary election had predicted an exodus of party members if it lost the poll, which could play out in the next few days or weeks.

Ishaku’s Appeal Court victory: Federal lawmaker urges opposition to accept verdict Nathaniel Gbaoron, Jalingo

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avid Fuoh, member representing Sardauna, Gashak a a n d Ku r m i Federal Constituency in the House of Representatives, has called on the opposition APC in Taraba to accept the verdict of the appeal court affirming Governor Darius Ishaku of Taraba as the winner of the governorship election in the state.

Fuoh made the call on Tuesday while reacting to the court of appeal’s judgment upholding the judgment of

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the Governorship Election Petition Tribunal which earlier affirmed Ishaku as the winner of the March 9 governorship election in the state.

Recall that the All Progressives Congress (APC) had appealed the earlier judgment by the Governorship Election Petition Tribunal at the Court of Appeal in Abuja.

The Federal Court of Appeal, Abuja Division, led by Justice Chidi Nwanna on Monday dismissed the appeal on the ground that APC’s candidate, Sani Danladi was disqualified for the contest, hence the party did not field @Businessdayng

a candidate for the said election.

Fuoh said that the judgment by the appellate court was a justification for the aspirations of the Taraba masses who voted massively for Ishaku for the consolidation of his landmark achievements in the state.

The legislature said that the judgment had further rekindled the hope and aspirations of the common masses of Taraba.

He commended the judiciary for rising to the occasion by giving hope to the common man.

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cityfile Internet fraudster bags 6 months in Ibadan REMI FEYISIPO, Ibadan

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L-R: JideAdenuga, director, Information Management & Data Processing; IbilolaKasunmu, GM, Lagos State Residents’ Registration Agency (LASRRA); Aliyu Aziz, DG, National Identity Management Commission (NIMC); Uche Chigbo, Special Assistant to the DG, and Opeyemi Okunoren, MD/CEO, Silicon Harbour, during the recent visit of LASRRA’s GM to NIMC to seek collaboration of both agencies, in Abuja.

Zamfara: Peace accord suffers setback as bandits kill 14

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he police have confirmed the killing of 14 persons and injuring of 10 others by bandits at Karaye, a community in Gummi local government area of Zamfara State.

The attack, according to the police on Monday, was the first major breach of the peace agreement between the state government and the bandits initiated by Governor Bello Matawalle.

Spokesperson of the state police command, Muhammad Shehu said t h e att a ck o c c u re d o n

Sunday. According to him, a total of 14 persons were killed, 10 others sustained gunshot injuries while some houses were set ablaze.

Shehu recalled that on November 3, some members of local vigilante, known as “Yan sakai in Bardoki village, attacked and killed nine persons suspected to be Fulanis under the suspicion that they were bandits. He said on receiving the report, the command arrested 11 members of the vigilante suspected to have participated in the killing.

Shehu said Sunday’s

attack might have been a reprisal of the November 3 incident.

“The incident is being investigated by the state CID, Gusau, and all the suspects will be charged to court for prosecution in order to serve as deterrent to others.

“However, combined teams attached to Operation puff Adder, men of Operation Hadar inDaji and vigilantes led by the divisional police officer in charge of Gummi mobilised is combing the area with a view to trailing and arresting the perpetrators.

“Corpses and injured victims were conveyed to the General Hospital Gummi for autopsy and treatment,” he explained.

He added that discreet investigation into the incident was ongoing and whoever involved would be prosecuted. “ We a r e c a l l i n g o n members of the public to desist from taking law s i nto t h e i r ha n d s.

The command will not hesitate to deal decisively with any person or group of person that tries to sabotage the relative peace currently being enjoyed in the state”, he said.

EU-UN engages journalists on gender-based violence NKECHINYERE OGINYI, Abakaliki

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uropean UnionUnited Nations (EU-UN) Spotlight Initiative has engaged media professionals on possible ways of eliminating violence against women and girls in Nigeria.

At a two-day media engagement in Ibadan on Monday, participating journalists were charged to position themselves as advocates against gender-based violence in the society.

EU-UN Spotlight Initiative revealed that 43 percent of Nigerian girls marry before the age of 18 while 17 percent of

them do so before they clock 15 years. About 20,000 new cases of obstetric fistula occur ever y year because of child marriages in the country.

According to the Init i a t i v e, v i o l e n c e a n d other forms of harmful practices against women and girls were on the rise in the country despite campaign against the phenomenon.

In a remark, UNICEF child protection specialist, Sunbo Odebode, noted that violence against women and girls was a silent killer that had taken the lives of many victims through physical, psychological www.businessday.ng

or mental-related health issues.

She lamented that violence against women and girls in Nigeria was yet to receive full legal support, as some of the victims prefer to be in abusive relationships than face the ridicule of abandoning the relationship.

“The social context of violence against women and girls is based on the traditional patriarchal structure that defines gender. It is the belief in Nigeria being a patriarchal society that women are subordinate to men and when married, they surrender to their husbands,” Odebode said.

“Women do not have a say in decision making; issues concerning their lives are decided upon and determined by others, usually men and older women, in the family and violence is prevalent in the society,” she said.

James Ibor, human rights activist, while speaking on confronting the political and social challenges around violence against women and girls, advocated for special laws to protect women and girls against violence while child protection committees at the rural areas should be strengthened.

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n internet f r a u d s t e r, Adeleke Oluwaseyi has been sentenced to six months imprisonment after being found guilty of impersonation in a one-count charge filed against him by the Econ o m i c a n d Fi n a n c i a l Crimes Commission (EFCC), in Ibadan, Oyo State.

Adeleke, 21, who claimed to be eight months into online dating apprenticeship when arrested in June, operated with the name Patrick Bob, claiming to be an American citizen.

He was sentenced by Justice Joyce Abdulmalik of the Federal High Court, Ibadan judicial division.

Adeleke was initially a r r a i g n e d o n a f o u r-

count charge before the counts were reduced to one after entering into a plea bargain with the EFCC. The one- count charge, to which he pleaded guilty, violates section 22(3) of the Cybercrimes (Prohibition, Prevention, Etc) Act, 2015.

Owing to his plea of guilty, counsel to the EFCC, Ifeanyi Agwu had prayed the court to sentence him in accordance with the content of the plea bargain arrangement.

Besides the jail term, the convict was also ordered to restitute $150,000 to his victim through the Federal Government of Nigeria.

He will equally forfeit his Samsung J3, Infinix and Kigtel phones as well as his Lenovo laptop to the Federal Government of Nigeria.

Kano: Agency to install security tracker on tricycles

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anaging director, Kano State Road Traffic Agency (KAROTA), Baffa Danagundi, says the agency will soon commence the installation of security trackers on tricycles across the state.

Dan-agundi said this while briefing newsmen after he appeared before the Kano State House of Assembly to defend the proposed 2020 budget for the agency.

According to him, the plan to install the device on all tricycles operating in the state is to check their menace and reduce criminal activities associated with them.

“The decision to commence the installation of the trackers on tricycles followed the state government’s decision to allow them to continue operating in the state.

“It is therefore imperative that we embark on such installation, to monitor their operations. We also begin the registration of tricycles and other commercial vehicles within the state.” @Businessdayng

Dan-agundi said the agency was also planning to introduce community service as punishment for road traffic offenders across the state.

He added that the law establishing the agency would soon be amended to include community service punishment.

The managing director explained that over N1 billion was proposed for the agency in the 2020 budget proposal recently presented before the State House of Assembly by Governor Abdullahi Ganduje.

He hoped that the agency would generate about N6 billion in 2020, adding that such could be generated through the registration of tricycles and other commercial vehicles.

He disclosed the tricycles operating in the state have since commenced the payment of N100 each as revenue to the government daily.

Dan-agundi said the agency was not only to generate revenue for the state but also to change the thinking of road defaulters through community service and awareness. NAN

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Wednesday 20 November 2019

FINANCIAL TIMES

World Business Newspaper Demetri Sevastopulo

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ieutenant Colonel Alexander Vindman, a US national security council official, said that Donald Trump made “inappropriate” demands in the July 25 phone call with President Volodymyr Zelensky that has sparked a congressional impeachment inquiry.

“What I heard was inappropriate,” Col Vindman told the House intelligence committee, which is leading the public phase of the inquiry. “It is improper of the president of the United States to ask a foreign government to investigate a political opponent.”

Mr Vindman and Jennifer Williams, a state department official working for vice-president Mike Pence who is also appearing before the committee on Tuesday, are the latest officials to testify publicly after previously giving closed-door testimony about a White House campaign to pressure Mr Zelensky.

In the July 25 call, Mr Trump asked his Ukrainian counterpart to find dirt on former Democratic vicepresident Joe Biden and the local business activities of his son Hunter, who served on the board of Burisma, a Ukrainian gas company.

Mr Trump also enlisted Rudy Giuliani, his personal lawyer, to urge Kyiv to probe the Bidens and look into widely debunked claims that Ukraine had interfered in the 2016 US presidential election.

Mr Trump faces the biggest crisis of his presidency after a CIA whistleblower in August sent a complaint to the CIA inspector-general that

White House official says Trump demands were ‘inappropriate’

Alexander Vindman testifies about Ukraine call during public hearing in impeachment inquiry

Alexander Vindman is publicly testifying after giving closed-door testimony about the July 25 phone call that has sparked an impeachment inquiry © Reuters

said White House officials were concerned Mr Trump was using his office to push for an investigation into a possible political rival, which would amount to foreign interference in a US election.

Mr Trump has accused the Dem-

Study shows France, China and US would raise barely any extra tax under OECD proposal

Goldman Sachs hired to sell group with $293bn under management as industry consolidates

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rivate equity owner TA Associates has hired Goldman Sachs to explore a sale of Russell Investments, putting the $293bn asset manager on the block as part of a wave of consolidation in the fund management industry, according to people briefed on the matter.

A sale of the money manager follows several bruising years for the industry, with profits at some of the biggest fund houses squeezed by the rise of passive investing. Shares in listed asset managers have trailed the benchmark US stock index, the S&P 500, over the past five years.

Russell Investments was last valued at $1.15bn in 2016 when TA Associates acquired the group from the London Stock Exchange.

It is unclear how much TA is seeking for the Russell, which claims to have invented the first so-called smart beta strategies with the creation of small capitalisation, growth and value investing funds more than three decades ago and runs multi-asset, equity, fixed income and alternative funds.

The growing pressure on fees from passive investing has forced

a number of active managers to consolidate in recent years, including the £11bn merger between Standard Life and Aberdeen Asset Management, the $6bn combination of Janus Capital and Henderson Global Investors and Invesco’s purchase of rival OppenheimerFunds for $5.7bn.

Dealmaking has been concentrated this year between smaller fund managers that have sought to unite to build scale and fend-off larger rivals.

Russell and TA Associates did not immediately respond to a request for comment. Goldman declined to comment.

Seattle-based Russell brought in Michelle Seitz as chief executive two years ago from the much smaller William Blair Investment Management. She has since focused on controlling costs.

The asset manager also operates a large investment outsourcing unit that works with companies and non-profit organisations to structure their retirement and investment programme portfolios, conduct due diligence on money managers and assist with compliance. The company counts aircraft manufacturer Boeing, telecoms group AT&T and the Union Pacific railroad among its clients. www.businessday.ng

November 2020 election.

Devin Nunes, the top Republican on the committee, said the media were Democratic “puppets” in the “Ukraine hoax”.

Republicans have described some witnesses who have provided damag-

Global digital tax plans would be a flop, French council warns

Asset manager Russell Investments put up for sale Eric Platt, James Fontanella-Khan and Owen Walker

ocrats of pursuing another hoax in the wake of the Russia probe led by Robert Mueller. Republicans have accused the Democrats of seizing on the Ukraine issue to impeach Mr Trump because they are concerned that he will be difficult to defeat in the

ing testimony as “Never Trumpers”.

Some have questioned the patriotism of Col Vindman, a decorated army officer whose family emigrated from the Soviet Union when he was a child.

Joe Dunford, the recently retired chairman of the US joint chiefs, told Fox News that Col Vindman, who worked on his staff, was a “patriotic and loyal” officer.

“He’s made an extraordinary contribution in peacetime and in combat,” Mr Dunford said.

Mr Trump has described the July 25 call as “perfect”. He said he was just trying to root out corruption in Ukraine and was concerned that Hunter Biden received hundreds of thousands of dollars from Burisma despite having no relevant experience.

Republicans have accused Joe Biden of forcing Ukraine to end a probe into Burisma — a claim that has been debunked by former US aides and officials from other countries and multilateral institutions involved in efforts to stamp out corruption in Ukraine.

Asked by the Democrats on Tuesday if they were aware of any credible allegations about Mr Biden and Ukraine, Col Vindman and Ms Williams both said they were not.

Chris Giles

T

he OECD’s proposal to allow national governments to tax a slice of multinationals’ profits on the basis of sales in their countries would hardly raise any additional revenues, according to an independent assessment for the French government.

A simulation performed by the French Council of Economic Analysis, which has the role of advising the French government, found that the change in corporate tax receipts would not be substantial for France, Germany, the US and China under the OECD’s proposals to rip up a century of international corporation tax rules. Meanwhile, it would create bureaucratic complexities, the study noted.

France, for example, would gain from being able to tax an element of the sales of likes of Facebook, Apple, Amazon, Netflix and Google at home but would lose some of the rights to tax its giants such as luxury group LVMH, the council said.

Instead, any extra tax collected by advanced economies would come from the OECD’s second proposal to agree an effective global minimum corporation tax rate — a much more contentious plan than the first proposal.

Mathieu Parenti, assistant professor of economics at the

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Université Libre de Bruxelles, said the limited results of the OECD’s proposals might make them “politically feasible because nothing changes”.

The big tax gains, he said comes from the other proposal for a global minimum tax, which is a “bit brutal” in getting “a big slice of the pie and decreasing the incentive for tax shifting” to low-tax countries such as Ireland, the Netherlands or Luxembourg.

But the OECD would also have a harder time securing an international agreement for it.

The Paris-based institution is engaged in its own impact assessment of its proposals and believes the change in the location of taxing rights would be significantly greater than the French Council of Economic Analysis study suggests.

The independent analysis estimated that France currently loses at least €5bn a year from its multinationals shifting profits and the location of intangible assets, such as brands, to low-tax jurisdictions. That is roughly 10 per cent of annual corporate tax revenues.

The council estimated that there would be only a 0.3 per cent increase in French and German corporate tax revenues under a scenario that attempted to replicate the OECD’s plans to stop multinationals from shifting profits around the world to avoid tax.

Philippe Martin, chairman of @Businessdayng

the French Council of Economic Analysis, said the low revenue estimates resulted from the proposals to tax “only a tiny bit of global profits of multinationals” based on where they sell rather than where they are physically located.

The OECD plan is to split global profits into “routine” profits that are taxed as now and “residual” profits, of which a proportion would be taxed in the country of sales. Given the weak results, the council therefore suggested a much more radical policy of taking a proportion of overall profits in the country of sales rather than just residual profits.

The minimal effects found in the independent study is questioned within the Paris-based international organisation, however.

It is still working on its analysis and Pascal Saint-Amans, director of the OECD Centre for Tax Policy and Administration, expected the change in taxing rights to have a larger and more positive impact on revenues in large European countries, the US and China, with heavier losses in tax havens.

But he accepted the broad direction of the French council’s results, with the first part of the OECD proposals always intended to address the allocation of taxing rights between countries, thus raising less money than the second part, which ensured all multinationals paid a minimum level of tax.

Wednesday 20 November 2019

FT

BUSINESS DAY

50

NATIONAL NEWS

Korean banks join Africa Finance Corporation’s Asian investor list Lagos-based energy and infrastructure fund closing a $140m Korean syndicated loan David Pilling

K

orean banks have become the latest Asian investors to finance the Africa Finance Corporation with the closing of $140m so-called “kimchi” facility by the Lagos-based energy and infrastructure fund.

The AFC, a pan-African multilateral development fund partly owned by the central bank of Nigeria, will on Wednesday announce the completion of the Korean syndicated loan, bringing the amount it has raised from Asian investors to about $1.2bn in just over a year.

The AFC, founded in 2007, closed a $225m samurai bond in September and a $300m loan through China’s Export Import Bank last October. Investors from Hong Kong, Taiwan, Singapore and Malaysia have also been buyers of the AFC’s Eurobond issues.

Samaila Zubairu, president and chief executive of AFC, using a term

to denote Asia, said the capital raising “signifies the East’s growing appetite for African investments, which are particularly attractive considering today’s negative-yield environment”.

He declined to specify the coupon on the Korean bond, but said it was narrower than could be obtained from either US or European lenders.

He estimated Asian investors now accounted for about one-fifth of the AFC’s borrowings.

Mr Zubairu said his institution had a good record of investment returns, saying it had only one “pastdue loan” in its $6.6bn portfolio of projects across 30 African countries.

He highlighted the group’s investment in renewable energy, including wind farms in Djibouti and Cape Verde and hydroelectric dams in west Africa.

Although Nigeria’s government is the largest shareholder, the AFC is majority owned by private investors, mostly African banks.

Chibuzo Opara

Gordon Sondland’s phone call with US president likely to be scrutinised in impeachment hearing

D

onald Trump will face intense scrutiny on Wednesday when Gordon Sondland, the US president’s ambassador to the EU and a central character in the Ukrainegate scandal, testifies in a televised hearing before the congressional impeachment inquiry.

Mr Sondland is a critical witness because he was one of the few officials with first-hand knowledge of the role Mr Trump played in the scandal that has sparked only the fourth impeachment investigation into a US president.

The former hotelier was instrumental in the effort to press Ukrainian president Volodymyr Zelensky to dig up dirt on Joe Biden and his son Hunter. He helped orchestrate a pressure campaign that withheld $391m in military aid to Ukraine and made a White House visit for the Ukrainian leader conditional on Kyiv investigating the Bidens.

Mr Sondland liaised with Mr Trump and Rudy Giuliani, the president’s personal lawyer, who was a key figure. Mr Sondland was one of three officials — alongside former Ukraine special envoy Kurt Volker and energy secretary Rick Perry — who dubbed themselves the “Three Amigos” after being enlisted by Mr Trump to help Mr Giuliani.

In a previous closed-door appearance before Congress, Mr Sondland denied there was a “quid pro quo”, giving ammunition to Republicans defending Mr Trump. In a dramatic revision, however, he later conceded that he had told a top Ukrainian official that the military aid was tied to the public announcement of a probe into the Bidens.

When Mr Sondland testifies, he will almost certainly be grilled on the following three Ukrainegate episodes: ‘The drug deal’ In July, Mr Sondland brought two Ukrainian officials to the White House for a meeting with John Bolton, then national security adviser. In the meeting, he stunned the National Security Council officials present by telling the Ukrainians

that Mr Zelensky had to commit to the “investigations” before the White House would agree to set up a meeting with Mr Trump.

Mr Bolton was already concerned about Mr Giuliani, whom he called a “hand grenade”, and his alliance with Mick Mulvaney, the White House chief of staff who had relayed the order to withhold the aid. As soon as he heard Mr Sondland mention the “investigations”, he abruptly cancelled the meeting. Mr Bolton then told his top Russia aide, Fiona Hill, to stay with Mr Sondland and the Ukrainians while they remained in White House.

When Ms Hill later reported back that Mr Sondland had mentioned an investigation into Burisma — a Ukrainian gas company that hired Hunter Biden to sit on its board even though he had little relevant experience — to the Ukrainian officials, Mr Bolton told her to report the conversation to John Eisenberg, the top NSC lawyer. “Tell Eisenberg that I am not part of this drug deal that Sondland and Mulvaney are cooking up,” Mr Bolton said.

The Warsaw meeting When Mr Sondland testified in private last month, he told lawmakers that there had been no “quid pro quo”, in a statement that was welcomed

by Mr Trump, who argues that there was nothing inappropriate about the July 25 phone call with Mr Zelensky that sparked the impeachment investigation.

But Mr Sondland changed his testimony after William Taylor, the top US diplomat in Ukraine, and Tim Morrison, then the senior NSC Russia official, testified that Mr Sondland had told Andrey Yermak, a top adviser to Mr Zelensky, that the aid would only be released if Ukraine opened an investigation into Burisma.

In his revised testimony, Mr Sondland said his “recollection” had been “refreshed” by the testimony of Mr Taylor and Mr Morrison. He said he now remembered having told Mr Yermak in September in Warsaw that the resumption of aid “would likely not occur until Ukraine provided the public anti-corruption statement that we had been discussing for many weeks”. www.businessday.ng

World’s largest counterfeit drug market ripe for disruption Africa’s flourishing open market in medicine is costing money and lives

Questions Trump’s EU ambassador will have to answer Demetri Sevastopulo and Lauren Fedor

A promise to clean up Mexico’s endemic corruption helped propel Andrés Manuel López Obrador to power © MARIO GUZMAN/EPAEFE/Shutterstock

I

had devoted nearly half my life to practising medicine when my father, who had sickle cell disease, died due to a lack of basic drugs.

On the night that he suffered a sudden pulmonary embolism my older brother, a doctor, and my mother, a nurse, had called the hospital before he arrived to check if they had the medicine.

He needed some strong painkillers and a parenteral anticoagulant, such as heparin or warfarin, used to treat clots. It is a drug that should be available in all emergency rooms.

But a nightmare ensued to find out simply if it was available and if so where it was being stored. This is sadly all too common a scenario in Nigeria, Africa’s most populous country with about 190m people. It might sound strange, but the average healthcare provider doesn’t know where to go to get medicine. The country’s booming pharmaceutical industry is fragmented, with critical supply chain gaps.

Nigeria has made progress in the war against counterfeit drugs, with fake medicine reported to have decreased from 42 per cent thanks to strong public awareness measures.

Still, between 10 per cent and 30 per cent of pharmaceutical products are fake and the figure is far higher for some of the most basic and essential drugs, according to the country’s National Agency for Food and Drug Administration and Control (NAFDAC). Up to 64 per cent of medicine for malaria, Africa’s biggest killer, could be counterfeit.

At outdoor markets, patients and healthcare facilities buy drugs like they would biscuits or tomatoes from unlicensed hagglers. Our flourishing trade in prescription drugs resembles

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a flea market. Private and public sector hospitals and health centres fork out anywhere between twice, and a staggering 64 times, the international reference price for medicine.

My friend Adham Yehia, who would later become my business partner, was at one stage managing a private hospital and primary care centres. He would watch shabbily dressed traders bringing in cartons from the market. “How can we be sure that we don’t receive counterfeit medicine?” Adham asked the doctors and owners. A typical answer would be: “It’s Nigeria; everyone sources medication through the open market. What choice do we have?”

This triggered a deep sense of disappointment in the health system. We were not prepared to accept a status quo where health providers don’t get the medication they need while patients suffer.

This chaotic system costs lives. Fake drugs cause at least 100,000 deaths on the continent annually. Africa accounts for 42 per cent of all instances of fake and substandard medical products globally, more than any other continent, according to the World Health Organization. Nigeria has the biggest counterfeit drug market of all developing countries, says the NAFDAC. My father, a professor in surgery, died not from lack of medical expertise, but from lack of resources. If my family, who are working at the heart of the medical profession, can’t access the drugs they need, what hope is there for others?

Nigeria’s first National Drug Policy launched in 1990 with the goal of improving drug availability, supply and distribution.

We have a national procurement policy for the public sector and a dedicated procurement depart@Businessdayng

ment for health-related items.

Yet every day, I receive calls from former colleagues at hospitals desperately searching for basic drugs.

The NAFDAC has tried to increase availability of safe drugs, but Nigeria severely lacks the licensed professionals to distribute them. There are 12,807 registered community pharmacists — or about one per 20,000 people — far below the global average of 10 per 20,000. Nigeria needs about 50,000 pharmacists within the next five years, according to the Pharmaceutical Society of Nigeria (PSN).

Government initiatives show a resolve to fix the problem, but this is too big for one agency alone. It requires co-ordination between the NAFDAC, the PSN, the Pharmacists Council of Nigeria, law enforcement, technology and the private sector to rationalise the distribution of quality products so hospitals no longer have to resort to whichever drugs are convenient.

The NAFDAC can set the rules, but it lacks the infrastructure and resources for enforcement across the country. Handheld spectrometers can detect fake drugs within 30 seconds.

Their use should become routine at borders and strategic points in the supply chain.

The PCN can shut down illegal pharmacies, but these have grown beyond their reach.

Suppliers of counterfeit drugs must be convicted not as petty swindlers but as what they truly are: killers.

In short, we urgently need to disrupt and change the system.

We need a hassle-free procurement process for all licensed healthcare workers to source medication, consumables and small medical devices.

It might be too late for my father. But in my lifetime, we can change the fate of others.

Wednesday 20 November 2019

BUSINESS DAY

51

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

UK business rates: toll tale The biggest winners from reductions would be large landlords Thomas Mayer

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hodunnit? Business rates are a prime suspect when it comes to the death of the UK high street. With an election imminent, Conservatives and Labour have both promised to tackle the system’s failing. But for all the clamour for reform, do not expect big changes. Business rates reliably raise about £30bn a year. The mischief they cause is exaggerated.

Admittedly, there are ample grounds for suspicion. Business rates, which are a tax on property, have risen from about a third of rents in the 1990s to more than half. The burden is the highest in Europe, as a share of tax take. One example: the UK accounts for 8 per cent of Vauxhall’s European floor space but two-thirds of its European property taxes.

Retailers are particularly exposed. They represent 5 per cent of the economy but pay a quarter of all business rates. For bricksand-mortar retailers, rates bills can be 2 per cent of sales — not much below their operating profit margins. To add salt to the wound, their online competitors typically pay just 0.5 per cent of sales, says Tesco.

Chart shows annual average %

change per year, decade to 2016 showing rents have not kept pace with rates The supermarket group is pushing for a shift in the burden with a new online levy and a 20 per cent business rates cut for bricks-andmortar retailers. That reduction, applied to its own £700m rates bill, would boost net income by 8 per cent, before taking account of reinvested savings and its share of the online levy. The plan would tackle the perceived unfairness of rates. But it would be tricky to implement and could soon be overtaken by global reforms to digital taxation.

The main cause of the high street’s woes is that the UK has far too many shops. Business rates are a red herring. Cutting them leads to higher rents and vice versa in markets where the supply is fixed. Between 1990 and 2010, business rates increases were entirely capitalised into rental values after three to four years, one study found. There are caveats: rents do not always adjust and even a temporary lag can inflict severe pain. Still, it is hard to escape the conclusion that the biggest winners from business rate reductions would be large landlords. The case for cuts to the levy is far from open-and-shut.

Is bitcoin really an “uncorrelated safe haven”?

California and Oregon schemes boost biofuel investment even as federal credits fall Jemima Kelly

O

ver the years bitcoin has frequently been touted as a “safe haven”. It’s an idea that seemingly doesn’t to want to die, despite the fact that its pretty much the most volatile things you can get your hands on and there’s been a stream of thefts and hacks worth hundreds of millions of dollars from exchanges and other crypto platforms.

What makes the persistence of the idea particularly odd is that bitcoin has not performed like a safe haven asset to date.

Take a look at this chart from an article on Coindesk last month, for example, which charts bitcoin’s correlation with gold — traditionally seen as a safe haven — over the past four years: You will see that the 90-day correlation swings between a positive one and a negative one — meaning that sometimes bitcoin goes up when gold goes up and sometimes it goes down.

You will also see that the trend line shows a slightly negative correlation, which has become slightly weaker over time (0 represents zero correlation). There is certainly no positive correlation to gold, at least not for any meaningful length of time.

You might argue that despite its reputation as the ultimate store of value, gold itself hasn’t always performed like a safe haven, and you’d be right.

But neither has bitcoin ever shown any consistently negative relation to share prices, nor any sign that investors pile into it when stock markets are plunging or when they are concerned about risks to the global economy.

The funny thing is that almost as often as bitcoin is referred to as a “safe haven”, it is referred to as uncorrelated from other assets; indeed the

two ideas do not seem to be seen as incompatible.

Take Alphaville’s favourite non-selfidentifying bitcoin bro Antony “Pomp” Pompliano, for example. In May, he tweeted that bitcoin is “the best safe haven currency in the world”: But then the following month, the Pomp tweeted that bitcoin in fact didn’t care about essentially anything (because “the math stays true”): If bitcoin “doesn’t care about” trade wars or actual wars, why should it be seen as a safe haven? Aren’t those two ideas fundamentally incompatible?

Safe havens surely do care about both trade and military wars — they are assets that investors tend to flock to during these anxious times, and they therefore tend to rise when there’s market uncertainty.

We got to thinking about all this during a conversation in New York last week with some crypto types, who insisted that bitcoin was in fact an “uncorrelated safe haven” — a term that to us, made little sense. We thought the idea of a safe haven was to be an asset investors flock to when stocks and other so-called “risk-assets” were plunging. Indeed Investopedia defines it thus: A safe haven is an investment that is expected to retain or increase in value during times of market turbulence.

Safe havens are sought by investors to limit their exposure to losses in the event of market downturns.

It turns out though, that the New York crypto bros aren’t the only ones pushing the “uncorrelated safe haven” idea. If you Google the phrase (with parentheses), you get 1,680 results.

And the vast majority of those (on the first few pages of Google results, anyway), are referring to bitcoin. Like the lead from this CNBC piece from back in May: www.businessday.ng

Mr McDonnell said companies would be allowed to have either a single board or a new German-style two-tier structure with a supervisory board overseeing the executives © NEIL HALL/EPA-EFE/Shutterstock

McDonnell takes aim at ‘predatory business model’

Shadow chancellor sets out reforms for corporate governance and company law Jim Pickard

A

Labour government would install workers and consumers on the boards of all UK listed companies as part of what the shadow chancellor called an attempt to “rewrite the rules of our economy”.

John McDonnell set out plans on Tuesday to shake up corporate governance, reform the audit market and rewrite company law to tackle what he called the current overriding “predatory business model”.

Mr McDonnell said companies would be allowed to have either a single board or a new German-style two-tier structure with a supervisory board overseeing the executives. In either set-up, companies would be expected to have workers, consumers and shareholders represented.

Edwin Morgan, director of policy at the Institute of Directors, a business lobby group, said the new board structures would be “different, not better”. “Increasing firms’ flexibility to take this approach is a reasonable step, but that doesn’t mean you can import a different business culture wholesale, or that supervisory boards prevent corporate failures.”

Meanwhile, Mr McDonnell confirmed that Labour was pro-

ceeding with its controversial plan to seize 10 per cent of the shares of all companies with more than 250 staff in the UK — albeit over 10 years — and hand them to staff through “inclusive ownership funds”.

The funds would receive the dividends for those shares but distribute to employees only up to a cap of £500 per worker. Any surplus would be passed to the government as an effective tax.

However, the plan has been refined so that it would no longer apply to the international profits of UK-based companies in order to prevent a “transfer of wealth from the global south to the UK”.

The calculation would be based on profits generated in the UK, as illustrated by companies’ domestic corporation tax payments.

R e s e a rc h f ro m C o m m o n Wealth, a leftwing think-tank, suggests that this would reduce the annual payment to the funds to about £5.8bn rather than £10.7bn under the initial proposal.

Attacking corporate excess, the shadow chancellor outlined policies designed to tackle greed and short-termism in the business world.

Mr McDonnell said a Labour government would review whether legislation could be used to restrict votes in takeovers to those who have held their shares for a long period, for example two

years.

There would be an overarching “business commission” to oversee a shake-up of Britain’s regulatory system; the Big Four accountancy firms would be forced to separate their audit and non-audit businesses; and a new statutory auditor would regulate financial services companies.

Labour is set to unveil its full election manifesto on Thursday.

Mr McDonnell denied reports there would be a new “windfall tax” on oil companies, but would not comment on whether there could be another form of new levy on the oil industry.

Mr McDonnell said Labour would rewrite the companies act to make sure businesses were responsible to staff and customers as well as shareholders.

Big companies which fail to take adequate steps to tackle climate change will be delisted from the London Stock Exchange, Mr McDonnell said — confirming a policy he floated in May. A Labour government would impose a 20:1 pay ratio between highest and lowest paid workers in the public sector and private companies bidding for state contracts.

All executive pay packages in large companies would be subject to an annual binding vote by stakeholders including staff and consumers as well as shareholders.

Tech start-ups: the WeWork non-effect

As long as global interest rates remain ultra low, funds will keep arriving

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f WeWork is a lesson in what not to do, then Silicon Valley startups should be swapping revenue growth and heavy operating losses for positive cash flow by now. Don’t hold your breath. Generous funding means net losses are going nowhere.

Persistently low interest rates are encouraging investors to take dangerous risks, says the IMF. No kidding.

PitchBook’s quarterly report on venture capital funding calculates that not only are total deals on the rise, with more than 10,000 expected for the year, but deal sizes are high too. Total VC deal value reached $97bn in the first three quarters of 2019 — the second highest on record after 2018. As long as global interest rates remain ultra low, funds will keep arriving.

This means tech start-ups have few

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reasons to change their habits and become more frugal in the hopes of turning a profit. Amazon is often cited as proof that profitability is the wrong measure of success for growing tech companies. But Amazon turned cash flow positive before it was profitable — funding its expansion with the money it made. The company burned through $1.1bn before it became cash flow positive in 2002. Adjusted for inflation that is about $1.6bn. Uber burned through that in the first half of 2019 alone.

Public markets are proving unwilling to pour money into tech companies forever without at least a hint of how profits will one day appear. Uber made a point of emphasising its formula for breaking even in its last quarterly earnings. But in private markets it is business as usual. @Businessdayng

The notion that funding has dried up as a result of WeWork’s failure is wrong. See the money raised for new funds by Blackstone and Tiger Capital.

Even SoftBank is back with a second Vision Fund.

WeWork is being written off as an aberration. The office-sharing startup’s claim to be a tech company was shaky in the first place. Irrational valuations can be laid at SoftBank’s feet, given the Japanese bank led funding rounds that valued WeWork at tens of billions of dollars. Plus the company was based in New York, miles away from Silicon Valley. More importantly, yields in safe assets are low and trillions of dollars of public and private sector bonds have negative yields. WeWork’s failure looks insignificant against the wall of money looking for a home.

52

Wednesday 20 November 2019

BUSINESS DAY

ANALYSIS

FT How Riyadh’s Saudi Aramco ambitions were thwarted

Bankers had to deliver news to angry chairman that investors valued oil group at well below $2tn target Simeon Kerr, Arash Massoudi and Anjli Raval

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ome of the world’s top investment bankers gathered at a Riyadh palace on Saturday to deliver their final recommendations on a project that had consumed the government of Saudi Arabia for the past few years: the initial public offering of Saudi Aramco.

The financiers were there to meet Yasir al-Rumayyan, the state oil company’s chairman and the head of the country’s sovereign wealth fund, along with cabinet ministers and the company’s leadership.

Their message would disappoint the hosts: international

ensuring his ambitious economic reforms stayed on track.

Only a handful of bankers there from the nine global IPO co-ordinators were selected to deliver their recommendations: Bank of America’s Soofian Zuberi, Citigroup’s Tyler Dickson and Morgan Stanley’s Henrik Gobel.

Others, such as Mike Daffey from Goldman Sachs, were left to loiter in an anteroom. The banks declined to comment.

“There were basically two options — an international deal valued at $1.5tn, which could possibly have been walked up to $1.6tn, or a local version coming in at $1.7tn,” said one person briefed on the meeting.

The bankers’ nerves were al-

Alison Martin-Campbell of EY © Anna Gordon/FT

Yasir al-Rumayyan, Saudi Aramco chairman and head of the kingdom’s sovereign wealth fund © AFP via Getty Images

investors were unwilling to buy shares in Saudi Aramco anywhere near the $2tn valuation long sought by the kingdom’s powerful Crown Prince Mohammed bin Salman. No amount of sweeteners — from promises of higher dividends to bonus shares for local retail investors — had managed to change that reality.

At the heart of Prince Mohammed’s economic reforms, the IPO was at one time seen as a mechanism to raise $100bn from a 5 per cent share sale and help open up the Saudi economy to foreign investors. Not only was the size of the listing scaled back, so was its scope, along with any plans to list on international exchanges.

Chart showing that Saudi Aramco could be 75% of the Tadawul exchange with a valuation of $1.5tn Dogged by repeated delays since Prince Mohammed first disclosed his intentions to list shares in Saudi Aramco nearly four years ago, the heir apparent in September put Mr Rumayyan in charge of the IPO process while ousting the kingdom’s powerful oil minister who was seen as an obstacle to the listing.

The kingdom’s highest authorities then pushed to get the flotation over the line as early as December on Riyadh’s Tadawul exchange.

The bankers who assembled in the Saudi capital presented the group with what they thought was a moderate proposal to get a deal done and help keep Prince Mohammed’s credibility intact while

ready strained after they were left waiting for five hours, occupying the time by munching on sandwiches and sipping juice with their rivals.

The meeting with Saudi officials lasted just 10 minutes.

The bankers were left to head off to their respective homes, from Riyadh to Europe, without knowing what the country’s highest authorities had decided.

Despite years of jumping through hurdles to win business from Prince Mohammed, the sovereign Public Investment Fund and Saudi Aramco, advisers only found out the decision on Sunday morning.

It was then that Saudi Aramco announced its 1.5 per cent sale at a price that would value its shares at $1.6tn-$1.7tn and raise only as much as $25.6bn.

Plans to market the shares directly in the US, Europe and Asia were also scrapped. The IPO would be focused on Saudi and Gulf investors.

“Rumayyan must have thought : ‘Why do we want to hand over our crown jewel to these internationals [for a lower valuation] when we could sell it to our own people,’” the person said.

But it was known that ultimately “all the decisions come from MBS” — a reference to the crown prince.

Some foreign institutions can still invest, but through limited channels. Given the constrained distribution, some advisers working for the dozens of banks on the deal now question their purpose. www.businessday.ng

Hong Kong: ‘You either have the rule of law or you don’t’ With fierce protests testing the territory’s legal system, its attraction as a financial hub is at stake Sue-Lin Wong and Nicolle Liu

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niversity campuses are the new frontline of the Hong Kong protests. Images of defiant students clashing with armed police in centres of learning have stunned the world.

Yet perhaps the most shocking and potentially significant incident in five months of ever more violent scenes — and one of the main triggers for the campus protests — came when a police officer last week was caught on video firing his gun at point-blank range into the abdomen of a protester moving towards him. The blackclad figure slumped to the ground before trying to escape and being chased down.

The protester was later charged, while lying in an intensive care bed, with unlawful assembly. Eight days on, the traffic cop has not been disciplined — like virtually all police officers involved in recent clashes — but is off duty to recuperate from his injuries. It was the third such close range shooting of a protester since early October. Police tactics are again under scrutiny as the siege at Hong Kong Polytechnic University continues and the territory’s chief executive Carrie Lam urges talks to resolve the crisis.

For many the shooting symbolised the breakdown in the rule of law in one of the world’s main financial centres, which — in tandem with its legal system — has long distinguished Hong Kong from the rest of China.

Critics say the protection that the system once offered to Hong Kong’s citizens is being stripped away and instead it is being used as a weapon for the police and government to crack down on the largest pro-democracy uprising on Chinese soil since the 1989 Tiananmen Square massacre.

More than 4,400 people have been arrested in the city since the protests began over a bungled bid to introduce an extradition law that would have made it easier to send people to mainland China. Yet officially there has been just one police officer, from a force of 30,000, suspended over the same period.

“It is outrageous that police officers who have shot people are not put on leave and an investigation of the circumstances of the shooting isn’t launched,” says Antony Dapiran, a Hong Kongbased corporate lawyer. “That happens everywhere in the world,

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including in the US where police shoot people all the time.”

Officers are only supposed to use their weapons as a last resort if their life is threatened. But there is growing anger in Hong Kong at the behaviour of the police, and the immunity they seem to enjoy, since the unrest began in June. An October survey from the Chinese University of Hong Kong found 51 per cent of the population had zero trust in the police, up from 6.5 per cent before the protests erupted in June. There are calls from protesters to disband the police force.

“No one follows the rules and guidelines any more,” says a frontline police officer aged in his twenties who asks not to be identified.

“When my colleagues break the law, they never admit it and our superiors provide cover for them.”

The officer’s personal information has been shared online by protesters in a practice known as “doxxing”. Despite this, he says he is sympathetic to their cause, adding that it is difficult to express his opinions inside the police force.

He says he and his colleagues have been assured by commanders that they would be protected even if they fired live rounds at protesters.

“There are absolutely no checks and balances any more,” he adds.

The police force defends the actions of its officers as lawful and justified.

Critics argue that the authorities in both Hong Kong and Beijing are using the legal system as an instrument of political control to target opponents and clamp down on dissent. “Police are acting without restraint, seemingly with the backing of the Chinese Communist party, the central authorities, and without any sort of accountability, without any consequences,” says Dennis Kwok, a barrister and opposition lawmaker.

The violence by both sides in Hong Kong has rapidly escalated.

After last week’s police shooting, a group of anti-government protesters set a man alight. Images of demonstrators using catapults to fire petrol bombs and bricks at police are now common.

Responsibility for the escalation lies mainly with the government and police, opinion polls suggest. A survey released by the Hong Kong Public Opinion Research Institute last week found 83 per cent of people blamed the Hong Kong government for the increase in violence, 74 per cent blamed the police and 41 per cent the protesters. @Businessdayng

“It is very unfair for anyone to put the blame on police officers for the current chaotic and panicked situation,” says John Tse, the chief of the police force’s public relations branch. “Who would have imagined a university has become a manufacturing base for petrol bombs and a refuge for rioters and criminals?”

For months, pro-democracy advocates have been calling for an independent inquiry into the policing of the protests that they say includes incidents of torture in police detention, acts of random violence and brutal tactics that have injured protesters. Images of children in school uniform lined up against a wall being arbitrarily searched and videos of police on footbridges throwing rubbish bins on to protesters below have gone viral.

The seeming lack of accountability stands in contrast to the last pro-democracy demonstrations in Hong Kong in 2014, when students occupied roads in central Hong Kong for 79 days. Then, five officers were imprisoned for assault.

And a retired police superintendent was convicted of hitting an unarmed pedestrian with a baton.

But now there is a widespread practice of police officers covering their faces and taking off their identification numbers, making it more difficult to prosecute or investigate illegal acts or abuses of power. The officers justify removing their ID numbers to avoid them being targeted online.

Government supporters argue the police force has not done anything that requires prosecution.

“I’m absolutely certain that the secretary for justice would prosecute any policeman who has committed a criminal offence in using excessive and unreasonable force in maintaining law and order,” says Ronny Tong, a senior counsel who sits on Hong Kong’s de facto cabinet.

“But up until this moment, we have not seen a single incident which correctly answers this description.”

Despite the plummeting level of trust in Hong Kong’s police force, it is celebrated across the border in mainland China. “Bald Lau Sir”, who rose to fame in Hong Kong when he pointed a shotgun at protesters outside a police station in July, was one of 10 officers feted as an honoured guest at China’s National Day celebrations in Beijing in October. He has 1m followers on the Chinese social media platform Weibo, where he posts about protesters being “cockroaches” and “terrorists”.

Wednesday 20 November 2019

BUSINESS DAY

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Wednesday 20 November 2019

BUSINESS DAY

Live @ The Exchanges Market Statistics as at Tuesday 19 November 2019

Top Gainers/Losers as at Tuesday 19 November 2019 LOSERS

GAINERS Company

Opening

Closing

Change

N15.4

N16.9

1.5

MTNN

N121

N121.9

FO

N15.9

N16.6

NB

N48.5 N3.7

CONOIL

EKOCORP

Company

ASI (Points)

Opening

Closing

Change

WAPCO

N14.9

N14.65

-0.25

0.9

ZENITHBANK

N18.7

N18.5

-0.2

0.7

UCAP

N2.3

N2.18

-0.12

N49

0.5

ETI

N7

N6.9

-0.1

VALUE (N billion)

N4.07

0.37

N4.3

N4.2

-0.1

MARKET CAP (N Trn)

AFRIPRUD

DEALS (Numbers) VOLUME (Numbers)

26,739.44 4,405.00 394,347,103.00 6.543 12.905

Conoil, MTNN, Forte Oil, others lift stock market by N23bn Stories by Iheanyi Nwachukwu

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espite activities of profit takers on Custom Street, the Nigerian equities market still gained N23billion on Tuesday November 19, 2019 –thanks to stocks like Conoil Plc, MTNN Plc, and Forte Oil Plc. The stock market had on Monday November 18 lost part of its record gains last week.

The value of Nigeria’s listed equities increased to N12.905trillion at the sound of trade closing gong as against N12.882trillion recorded the preceding trading day. The NSE All Share Index (ASI) moved up by 0.18percent from 26,691.09 points to 26,739.44 points.

In 4,405 deals, equity investors exchanged 394,347,103 units valued at N6.543billion. The stock market’s negative returns year-todate (ytd) currently stand at -14.92percent.

On the gainers table, Conoil Plc led the pack after its share price moved from N15.4 to N16.9, adding N1.5 or 9.74percent. MTNN followed

from N121 to N121.9, adding 90kobo or 0.74percent.

Forte Oil Plc advanced from N15.9 to N16.6, adding 70kobo or 4.40percent, while Nigerian Breweries Plc rose from N48.5 to N49, adding 50kobo or 1.03percent.

While the equities market advanced on the back of capital appreciation in the most capitalised stock –MTNN as

well as gains in the Consumer Goods and Oil & Gas sectors, market watchers expect the market to once again exhibit some level of volatility on Wednesday, with persistent profit taking in some counters and bargain hunting in others.

On the losers table, Lafarge Africa Plc led others after moving down from a high

of N14.9 to N14.65, losing 25kobo or 1.68percent.

It was followed by Zenith Bank Plc which dipped from N18.7 to N18.5, down by 20kobo or 1.07percent.

United Capital Plc declined from N2.3 to N2.18, shedding 12kobo or 5.22percent, while ETI Plc dropped from N7 to N6.9, after losing 10kobo or 1.43percent.

F

FTSE 100 Index 7,317.43GBP +9.73+0.13%

Nikkei 225 23,292.65JPY -124.11-0.53%

Generic 1st ‘DM’ Future 27,948.00USD -60.00-0.21%

Deutsche Boerse AG German Stock Index DAX 13,218.92EUR +11.91+0.09%

S&P 500 Index 3,119.80USD -2.23-0.07%

Shanghai Stock Exchange Composite Index 2,933.99CNY +24.79+0.85%

Access Bank appoints Awosika board Chairman as Belo-Olusoga retires

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he Board of Directors of Access Bank Plc on Tuesday November 19 announced the appointment of Ajoritsedere Awosika as the Chairman of the bank. Mosun Belo-Olusoga will retire as chairman of the bank on January 8, 2020.

Awosika will be leading the Board in the next phase of bank’s transformation into becoming Africa’s Gateway to the World. Her appointment is in line with the bank’s robust leadership succession plan.

Belo-Olusoga became the Chairman of the Board in July 2015 and she completes the maximum 12-year term limit allowed by the Central Bank of Nigeria’s Code of Corporate Governance for Banks and Discount Houses.

Belo-Olusoga has confirmed that she has no disagreement with the Board and there are no issues relating to her retirement that need to be brought to the attention of the shareholders of the Company of the regulatory authorities, the bank said in a statement at the Nigerian Stock Exchange (NSE).

Awosika joined the Board in April 2013 as an Independent

Non-Executive Director and has been the Chairman and Vice Chairman of the Board Credit and Finance Committee and the Board Audit Committee respectively in addition to membership of other Board Committees.

She is an accomplished administrator with over three decades experience in public sector governance. She was at various times, the Permanent Secretary in the Federal Ministries of Internal Affairs, Science & Technology and Power.

Awosika is a fellow of the Pharmaceutical Society of Nigeria and the West African Postgraduate College of Pharmacy. She holds a Doctorate degree in Pharmaceutical Technology from the University of Bradford, United Kingdom.

She is the Chairman of Chams Plc and Josephine Consulting Limited and a NonExecutive Director of Capital Express Assurance Ltd. Access Bank board expressed its appreciation to Belo-Olusoga for her contributions to the Bank’s transformational growth and wished Awosika success in her new appointment.

CSCS introduces ‘Regconnect’ to improve interaction with Registrars’ community

FBNQuest Asset Management receives award for money market fund of the year BNQuest Asset Management emerged winner of the Money Market Fund of the year category at the recently concluded BusinessDay Banks & Other Financial Institution Awards (BAFI), which held in Lagos.

The BAFI award ceremony, seeks to identify the contribution of financial institutions to the industry, across a number of areas including financial performance, sustainability and corporate governance.

FBNQuest Asset Management is the manager of the FBN Money Market Fund and serves the needs of various customer segments t h ro u g h a b ro a d ra n g e of solutions comprising,

Global market indicators

capital preservation, capital growth and other bespoke strategies. The award was in recognition of the strong performance track record of the FBN Money Market Fund.

Since 2017, the FBN Money Market Fund has outperformed its benchmark, inflation as well as other funds within its category, by achieving a cumulative return of 53percent from January 1, 2017 to September 30, 2019.

“In the past three years and based on our strong fundamental and quantitative research capabilities, our portfolio management team’s performance has remained consistent and our clients have benefited immensely from exposure to www.businessday.ng

our solutions, including the FBN Money Market Fund “said Ike Onyia, Managing Director of FBNQuest Asset Management.

“It was gratifying to see our firm recognized for providing investors with value-adding solutions and for contributing to the industry. Our firm’s pursuit for best practice was demonstrated earlier in the year through compliance with Global Investment Per for mance Standards (GIPS), which means that our performance reporting framework is now comparable to the practice in mature markets and that investors are better served through standardized and transparent p e r f o r m a n c e re p o r t i n g principles.

We continue to provide strategic investment advice to discerning individuals and institutions who will be well served through an allocation of their portfolio to the FBN Money Market Fund, which offers strong competitive yields”, he added.

The FBN Money Market Fund is a low risk, open-ended mutual fund, which invests in a diversified portfolio of short-term, high quality money market securities such as Treasury Bills, Commercial Papers, Bankers Acceptances and Certificate of Deposits issued by rated banks in Nigeria.

It provides investors with short to medium term financial goals, minimum starting investments, competitive returns, low risks and high level of security.

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C

entral Securities C l e a r i ng Sy st e m (CSCS) Plc has introduced to the Nigerian capital market Regconnect, a web-based application powered by CSCS to transform and improve the user experience of Registrars, by providing an easy to use platform to exchange information. The solution was formally launched on Tuesday November 19, 2019 at the company headquarters in Lagos.

In a bid to conform with global best practices, the application was developed having reviewed CSCS’ operations and methods of interaction with Registrars.

Prior to the solution, Registrars could only connect with CSCS through a Data Exchange application that did not have the ability to process the data being submitted.

The Data Exchange ap-

@Businessdayng

plication and Regconnect solution are being run on a parallel deployment until December 2019, when total switch over to Regconnect will occur.

However, Regconnect provides an efficiency lever for the capital market, as the application facilitates day to day processes regarding the maintenance of registers, with immediate validation of all data being submitted to ensure the accuracy of records, and in less time.

According to the Managing Director/Chief Executive Officer of CSCS Plc, Haruna JaloWaziri, “As part of our strategic pillars to automate and improve operational efficiency in the Nigerian capital market, the application will automate our interactions and improve CSCS’ connection with the Registrars’ community.

Wednesday 20 November 2019

BUSINESS DAY

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BUSINESS DAY Wednesday 20 November 2019 www.businessday.ng

Facebook’s fake numbers problem — Lex in depth The social network has 2.5bn monthly active users but almost 400m of the accounts are bogus Elaine Moore & Hannah Murphy

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and residentialpva.com, exploit this open-door policy, competing to offer unique, handcrafted, phone-verified profiles to buyers via a PayPal or bitcoin payment.

“Very trusted by Facebook, very resistant to being banned,” one of the companies claims.

The process is easy. It costs just $25 to buy 50 fake accounts.

More if they are fleshed out with profile pictures, interests like sports teams, even reviews of longdistance moving companies. After an online payment is made the accounts arrive by email the next day in a spreadsheet of usernames and passwords. Facebook security checks were triggered for newly created accounts bought by the FT when details were added. But accounts created years ago — like Amy Dowd’s — did not arouse suspicion until some were accessed in multiple countries at the same time. It was blocked on Friday.

Chart showing monthly users of Facebook. As total user numbers have grown to over 2 billion active monthly users, the number of duplicate, undesireable, misclassified or false accounts has risen even faster, resulting in nearly 400 million such accounts by mid 2019 What happens next is up to the buyer. Fake accounts can be used to boost follower numbers, which is useful for online influencers who are paid for plugging products or services. Purchasers may use bogus identities to spread disinformation or unsolicited commercial messages, content or requests.

Facebook is aware of the issue.

The Federal Trade Commission has declared that selling fake followers is illegal. But last week the company declared it had shut down an extraordinary 5.4bn fake accounts in the first nine months of this year alone — more than double the number of actual users.

In March, Facebook announced that it was suing four Chinese companies for selling fake Face-

book and Instagram accounts, citing illegal use of the company’s trademarks. The defendants have since taken down the sites.

“It is adversarial,” says Alex Schultz, Facebook’s vice-president of growth. “As we lock down one area, spammers come in and they will attack another area. And so we take on the new attacks.”

Fake account detection is complicated by the fact that not everyone uses Facebook in the same way.

“There is a massive range of behaviours,” says Mr Schultz. “Think about a new user to the internet who has never touched an app or website. They will behave very differently to a super-connected teen in the west or somewhere like Japan or South Korea.”

In 2017, Facebook adjusted its calculation and raised its estimates of fake accounts but it also admits the problem itself has grown as it expands in emerging markets. When the company filed its S-1 document with the Securities and Exchange Commission, ahead of an initial public offering in May 2012, estimates for fake or

”

t first glance, Amy Dowd’s Facebook account appears perfectly normal. There is a smiling profile picture of a young woman surrounded by autumnal leaves and the date that she began a new job at Southeast Missouri State University. But look more closely and things begin to seem strange.

Unlike most 29 year olds, Amy has no friends, no interests and no photos. The only thing she has written is a gushing review of a US haulage company. “Fake account,” replied one user. They were right.

This Amy Dowd does not exist.

Her account is a fake bought by the Financial Times as part of an investigation into the millions of bogus accounts littering the social media network in spite of efforts to better verify users.

The proliferation of phoney identities has reached a record high. That is a problem for a company that trumpets user growth — considered a barometer of health by investors — while receiving criticism for failing to prevent the spread of false information by third parties.

Facebook’s own estimates suggest duplicate accounts represent approximately 11 per cent of monthly active users while fake versions make up another 5 per cent. Others claim the total is higher. Yet Facebook continues to promote its user base as an incredible 2.45bn per month — close to one-third of the global population.

A fake Facebook account bought as part of an FT investigation Growth in user numbers looks significantly less impressive once adjusted for duplicate and fake accounts — up 7 per cent in the past two years, rather than 18 per cent calculated by Facebook.

The discrepancy highlights the lack of transparency around the metrics used by one of the world’s most valuable companies. Given the importance of users to the company’s revenue growth and profitability Facebook needs to open up its data to more detailed audit and create a new, adjusted metric to count users.

Mark Zuckerberg has always said the company he founded is a platform for authenticity.

Unlike anonymous chat rooms, Facebook encourages real names and photos. Facebook-owned messaging service WhatsApp and photo-sharing platform Instagram are promoted in the same way.

Last year, the chief executive told Congress users were “not allowed” to have fake accounts.

Yet creating an account simply requires a name and email address — no other verification is required. Third-party onlinevendors, such as pvacart.com

Fake users have become more difficult to identify as the company has grown. When it launched in early 2004 Facebook offered an appealing veneer of exclusivity

duplicate users were not included.

By the end of that year, Facebook calculated that 5 per cent of accounts may have been duplicates, 1.3 per cent “misclassified” and 0.9 per cent “undesirable”.

Fake users have become more difficult to identify as the company has grown. When it launched in early 2004 Facebook offered an appealing veneer of exclusivity.

Membership was limited to Harvard students and then extended to a handful of Ivy League universities. By 2006, this approach had been abandoned in pursuit of global domination. Membership numbers exploded. In 2008, the social network had 100m users.

By 2012, it had 1bn.

Facebook’s user growth and rising revenue have supported its share price in the midst of scandals and a worldwide #deletefacebook campaign. Expectation of future growth is why Facebook trades at 21 times its expected earnings.

The wealth of information users provide — where they live, what they like and what they buy — gives Facebook a vast data set from which to sell tailored adverts.

Along with Google it has created a digital advertising duopoly. Last year, revenues came close to $56bn. This year it is expected to make over $70bn.

Users and advertisers complain that Facebook does not offer the same sort of insights about itself. In most industries — from financial services to oil and gas — independent auditors ensure that the assets the company holds are accounted for. But technology companies whose business models are built on gathering user data consider themselves an exception, citing privacy concerns and the technical difficulty of allowing others to look under the hood.

The way Facebook identifies fake and duplicate account numbers, for example, is not explained in detail. There may be overlap.

All the company will say is that

it involves an internal review of a limited sample of accounts and “significant judgment”.

Brand owners and advertising agencies have long demanded Facebook open its platform to allow for fully independent thirdparty verification of other metrics, accusing the company of “marking its own homework”. Dina Srinivasan, former advertising executive and author of The Antitrust Case Against Facebook, describes this as “familiar behaviour of monopolists” in advertising markets that do not want others to know the data they possess. Line chart of Facebook advertising revenue ($ per user) showing Revenue growth shows no sign of slowing.

Many advertisers want more meaningful data on areas such as audience reach and the content that runs alongside ads. “It’s fair to say [progress has been]slower than people would like it to be,” says Wendy Clark, chief executive of Omnicom Group’s DDB Worldwide advertising agency.

Demands have become more pressing since Facebook admitted in 2016 that it had miscalculated the average viewing times of some video adverts. Marketers argued that average view times were inflated by as much as 900 per cent in a lawsuit that was settled for $40m.

Since then Facebook has made a concerted effort to lift the lid on certain statistics. Last year, it received accreditation from the US Media Ratings Council for its advertising impressions numbers — verifying internal metrics around users’ exposure to adverts. It has established the independent Data Transparency Advisory Group to assess metrics. However, the group’s first report noted that it did not speak directly with engineers maintaining systems day-to-day.

“It’s a truism that a company can always do more,” says Mr Schultz. “But we have changed a lot since 2016 . . . I’m proud of the progress we’ve made.” Plus, he says, revenues speak for themselves. “The advertisers keep coming back because of the results they get.”

Exactly how many fake accounts Facebook has is open to debate. Mr Zuckerberg’s former Harvard classmate Aaron Greenspan, believes up to half are fake. Giving evidence to a British parliamentary subcommittee on disinformation in June he called the company a black box. “We routinely hear that Facebook has over 2bn users and I think that is not true,” he says.

However, Mr Greenspan admits to a chequered history with Mr Zuckerberg. He settled a legal dispute with the company a decade ago and has shorted Facebook stock. Facebook has stated that Mr Greenspan’s claims are wrong.

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