BusinessDay 24 Dec 2019

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news you can trust I * tuesDAY 24 DECEMBER 2019 I vol. 19, no 463

Banks’ non-interest income may come under pressure on new ‘guide to charges’ – Analysts MICHAEL ANI

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igerian banks’ revenue from other sources could come under pressure next year given a recent directive reviewing downward their charges on customers, analysts have said.

The analysts said the move could dampen capital-raising activities and impact banks’ feebased income.

The Central Bank of Nigeria (CBN) on Sunday issued a new “guide to charges” to banks, nonbank financial institutions and other financial institutions with effect from January next year.

The new directive, which replaces the Guide to Charges

by Banks and Other Financial Institutions issued in 2017,

₦2,709,717.35 +3.98

N300

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$-N 358.00 362.50 £-N 472.00 481.00 €-N 392.00 401.00

Crude Oil $66.03

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Spot ($/N)

3M 0.93 5.78

I&E FX Window CBN Official Rate

364.17 307.00

Currency Futures

NGUS FEB 26 2020 363.50

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fgn bonds

Treasury bills

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6M

5Y

1.02 6.51

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10 Y -0.48

30 Y -0.05

10.83

11.45

12.83

NGUS MAY 27 2020 364.51

NGUS DEC 30 2020 366.87

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Rising food prices signal bleak Christmas for Nigerians JOSEPHINE OKOJIE & BUNMI BAILEY

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rom vegetables to rice and other key staple foods, rising prices across major cities in Nigeria are choking consumers, signalling what may be one of the bleakest Christmas celebrations in recent years.

Prices of all food items have soared by more than 20 percent in recent months, and consumer goods analysts blame this on the

Inflationary pressure takes toll on consumer spending Traders lament low sales

controversial border closure and rising consumer demand during festive periods. Inflationary pressure has shrunk the value of consumers’ disposable income,

making basic needs unaffordable to Nigerians.

“We cannot afford to buy the things we used to buy before because prices of everything

have gone up,” Blessing Orizu, a mother of three who was at Mile 12 market to make purchases, Continues on page 39

Continues on page 39

Inside

Tax defaulters risk FIRS’ wrath as 7-day deadline expires P. 38

L-R: Abdul Isa, general manager, refinery, Waltersmith Petroman Oil Ltd; Eriye Onagoruwa, external affairs manager; Osten Olorunsola, nonexecutive director; Abdulrazaq Isa, chairman; Mele Kolo Kyari, group managing director, Nigerian National Petroleum Corporation (NNPC); Danjuma Saleh, vice chairman, Waltersmith Petroman Oil Ltd; Chikezie Nwosu, managing director/chief executive officer; Oritsemeyiwa Eyesan, group general manager, corporate planning and strategy, NNPC, and Bala Wunti, managing director, Pipeline and Product Marketing Company, during Waltersmith Petroman Oil Ltd’s Board & Management courtesy visit to the new NNPC GMD in Abuja.

Fresh concern for Nigeria, OPEC as Saudi Arabia, Kuwait resume joint oilfield output DIPO OLADEHINDE

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igeria and other Orga n i sat i o n o f Pe troleum Exporting Countries (OPEC) members may be facing a fresh challenge of defending oil prices by increasing oil supply. This is thanks to a decision by Kuwait and Saudi Arabia to restart oil production from the two fields they share in the so-called neu-

tral zone.

Saudi Arabia and Kuwait will on Tuesday (today) sign a deal to resume production at two major oilfields in a shared neutral zone after five years of stoppage. The two fields were pumping some 500,000 barrels per day (bpd) before production was halted first at Khafji in October 2014 and then at Wafra months later over a dispute between the two Arab Gulf neighbours.

The Kuwait Gulf Oil Company (KGOC) said on Monday the signing ceremony would take place in the neutral zone where the offshore Khafji field and onshore Wafra field are located.

The oil produced in the neutral zone in the border area is shared equally between the two nations.

Khafji was jointly operated by KGOC and Saudi Aramco Gulf Operations, while Wafra was

operated by KGOC and Saudi Arabian Chevron.

It was not immediately specified when the two fields will start pumping again, but the agreement comes as oil prices are under pressure due to abundant reserves and weak global economic growth.

A barrel of Brent crude, the benchmark for Nigeria’s crude, sold for $66.37 on Monday, December 29, according to data

obtained from the Bloomberg terminal. This compares with the $70 per barrel it sold in May. The slump has prompted OPEC and its allies to make deeper production cuts starting new month.

Saudi Arabia pumps just under 10 million bpd, while Kuwait produces around 2.7 million bpd.

The news about oil producContinues on page 39

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news FG talks at possible opening of borders on compliance of ECOWAS protocol …stakeholders meeting for possible review of auto policy next month HARRISON EDEH, ABUJA

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ederal Government on Monday informed of possible opening of its closed borders with West African neighbours soon, assuring that the borders would be opened as member countries comply with the Economic Community of West African State protocol, which it said was largely violated.

“By and large, what we agreed with our neighbours is to activate the joint border patrol, and that joint border patrol comprises of the Customs, and other security outfits in a bid to follow up laid down protocol by the ECOWAS. I know the committee had a meeting on 25th and 26th of November this year, with the ECOWAS protocol, and they will recommend a date for the opening of the border soon,” Niyi Adebayo, minister of industry trade and investment, and Mariam Katagum, minister of state for trade, industry and investment, respectively, said Monday at a joint press conference in Abuja.

“As we are all aware, what has been happening is breach of this protocol. You have containers arriving our borders, the seal has been broken into three four five vehicles and the integrity of such goods are in question on that container. Not having integrity of the container means compromise of protocol, more especially on issues of arms, drugs are being smuggled in.

“The sources of the origin of the goods are also compromised because of items being repackaged, these were some of the concerns we discovered before the Federal Government made up its mind to close the border,” they stated.

Both ministers further informed, “If you have been following closely, there was a meeting of the Economic Community of West African State comprising of Benin, Niger and Nigeria, basically to address the issues concerning the joint border patrol.

“One of the things that led to the border closure was the issue of noncompliance with www.businessday.ng

the ECOWAS treaty on goods coming into the country from Benin and from Niger, which are supposed to be escorted to our own customs for inspections intact without breaking the seal.”

S p e a k i n g f u r t h e r, Katagum, the minister of state, pointed out that the government was working with JAIZ Bank alongside the Small and Medium Scale Enterprise Development for intervention programmes for communities in border towns to ensure they don’t engage in smuggling activities.

She noted that the Federal Government was also reviewing the Nigerian Industrial Revolution Plan to ensure it played its role in Nigeria’s industrialisation.

In his separate response while fielding questions from newsmen, Adebayo noted that the government would be engaging stakeholders on possible review of the policy with engagement of the stakeholders already slated for January 28, and possible bill to be sent to the National Assembly to that effect.

$600m steel plant will boost Nigeria’s economy, says African Industries Group MICHAEL ANI

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anaging director of African Industries Group, Alok Gupta, Monday said the company’s $600 million integrated steel plant will be Nigeria’s biggest non-oil Foreign Direct Investment (FDI). The new plant will boost the nation’s economy and lead to the mining of 5.4 million tons of iron ore in the country.

Gupta also said about 36mw power plant would be constructed from the waste heat recovered from the plant, which will be partly used for captive consumption.

Gupta made the disclosures when the minister of mines and steel development, Olamilekan Adegbite, visited the project site in Kagarko in Kaduna State.

He said the firm would inaugurate Phase 1 of the plant

by December 2020, noting, “We expect to commission the Phase I of the project by end December 2020. We will be mining 5.4 million tons of Iron Ore, beneficiate the ore to produce high grade concentrate followed by making into pellets and then finally into Directly Reduced Iron

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(DRI).

“The DRI will be used to make steel billets and will avoid our need to import the same. We are also building a 36mw Power Plant from the waste heat recovered in the process, which will be partly used for captive consumption.

“Let me also highlight the key benefits of the project at this stage: About $600 million investment will be Nigeria’s biggest non-oil FDI, will serve as a catalyst for development of solid minerals sector by attracting other serious investors following our example in downstream processing.

“The project will eliminate the need to import steel billets thereby saving scarce foreign exchange.

“Currently 100% of steel production in Nigeria is from scrap route, which is a diminishing resource. Producing steel from locally available iron ore will lead to sustainable economic development, considering the abundance of iron ore reserves in the country.

“The project will also contribute significantly to the Nigerian GDP by way of royalties and direct and indirect @Businessdayng

taxes.”

He also highlighted other benefits of the project, including a power plant, saying, “With the completion of first phase of project, there will be significant economic and industrial development in the area by means of creation of several allied industries and social infrastructure.

“The surplus power generated will further assist in developing other industries and residences and will help in urbanization of the local area.

“Our project is not only important for Nigeria or for Nigeria in the African context but for Nigeria in the World context. It complements Nigeria’s desire to be selfsustaining and become an independent steel producer not dependent on imports.

“This Integrated Steel Plant will surely put Nigeria on the world map of crude steel producers of the world.

“This is just the start of our long journey and I would like to thank all the people who trusted in us and supported us so far and we hope that you will keep supporting us in setting up of this Integrated Steel Plant.”

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news

Tech companies prepare Nigerian youths for future of work with AI, Data Science Jumoke Akiyode-Lawanson

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s technology advancements such as artificial intelligence and data science begin to transform the working environment and economies as a whole, and education remains critical for promoting inclusive economic growth and providing a future of opportunity for all.

To this end, technology company, Coven Works, is partnering The Deutsche Gesekkschaft fur Internationale Zusammenar-

Protest by COEASU politically motivated - management

beit (GIZ) to successfully train 100 youths from underserved communities in Nigeria on Data Science and Artificial Intelligence (AI) to prepare them for the work of the future.

As the world faces the transformative economic, social and environmental challenges of Globalisation 4.0, it has never been more important to invest in people. Valuing human capital not only serves to equip individuals with the knowledge and skills to respond to systematic shifts, it also empowers them to take part in creating a more equal and sustainable world.

Coven Works, a data science and AI education organisation in Nigeria, schooled and mentored these 100 participants for a period of 12 weeks and secured placements for each trainee in a three

months internship, where they will work in Data Science and AI related job functions.

While speaking at the project demonstration day of the beneficiaries, Dunsin Fatuase, country director, Coven Works, said, “Coven Works through Coven Labs will continue to focus on up-skilling youths in underserved communities, by providing cutting edge knowledge in data science and Artificial Intelligence for Africans, and other working professionals to the point where we can say that Africa has a refined workforce fully ready for the future of work.”

He expressed his joy as 100 of these beneficiaries could boost lives, projects and technical confidence to better the African market with their new skillset.

The World Economic Forum

(WEF) report on “The Future of Work” supports this notion as it posits that more jobs will be dependent on skills in technology and those who can acquire these relevant technological skills will have job security and inevitably be empowered to achieve more.

The GIZ and its Nigerian German Centre (NGC) have from inception been on the path of supporting as many Nigerians to realise their role in the countries social economic system and it has through this collaboration with Coven Works aided the youth population from some of Nigeria’s underserved communities to acquire skills that would make them relevant in future of work.

Augustine Adugbe, one of the trained youth, said, “The guidance and mentoring during the

last 6 weeks was my motivation and I would like to say a big thank you to the GIZ and Coven Works for not only teaching me how to code and generate insightful visualisations but also, helping me make the quantum leap into working in this field. I almost can’t believe I am starting my internship in a few days.”

The results of the 100 participants in the training programme and their feedback has not only cemented the goals and mandate of the GIZ but it has also encouraged continuous up-skilling of more Nigerians in technology related fields such as Data Science and Artificial Intelligence.

The company said its training of the 100 youths, and the mandatory job placements of all participants is one step further in Coven Works mission to

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anagement of the Abia State College of Education (Technical), Arochukwu, has described as politically motivated the recent protest carried out against the state government over nonpayment of salaries and other sundry issues.

It noted with regret that staff from other Colleges of Education in the South East invaded the state under the guise of protesting for improved welfare of ASCETA staff without being conversant with issues on ground.

In a statement issued by the College Registrar, Ikechukwu G. Odoemelam, the College condemned the acts of foreigners taking over the state whereas the real lecturers in the College were on duty in school.

It stated that at no time did the College force lecturers to obtain a Master’s Degree within two months but that they should present the certificates within the stipulated time.

According to the statement, the College Governing Council had long issued an ultimatum to all lecturers teaching in the College with only first degree to obtain a higher qualification in line with the guidelines given by the National Commission for Colleges of Education.

“Instead of complying with the directive, some of them turned around to complain. How can somebody in academics teach for 16 years without acquiring a higher certificate?”

The College further stated that in spite of efforts it made for the lecturers to improve themselves through scholarships from TETFUND, they remained lethargic.

On the downsizing of workers, the College explained that those affected were released based on the extant laws of the College, which was duly communicated to affected staff.

The College noted that although ASCETA was a parastatal of the state government, the Abia State government had been doing its best in releasing subventions to her for the payment of staff salaries.

It therefore warned staff of the College to desist from engaging in any act that would jeopardise government’s current efforts at rejuvenating the school for sustainable growth. www.businessday.ng

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ensure that Nigerians are better educated to fill the skills gap and ultimately positively impact the African economic market to technological skills education and training .

GIZ-NIGERIA GIZ’s activities in Nigeria are commissioned by the German Federal Ministry for Economic Cooperation and Development (BMZ) and the Federal Foreign Office (AA).

Other partners include the European Union in the fields of peace and security and energy and the Bill & Melinda Gates Foundation in the field of agricultural value chains. The activities focus on economic development and employment, environment and climate change, rural development, security, reconstruction and peace, governance and democracy.

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Precious rights to determine our leaders STRATEGY & POLICY

MA JOHNSON

“Anyone can steer the ship through the calm waters; the real captains take it through the storms.” – Anonymous ontemporary development literature is awash with the terms “governance” and “good governance.” Governance simply means the process of decisionmaking and the process by which decisions are implemented, while government is one of the actors in governance within national context. Good governance ensures that corruption within a given society is minimized, guarantees accountability and transparency in government.

Good governance also confirms that the rule of law is adhered to, while strengthening weak institutions of government. When there is good governance over a period of time, there is bound to be positive narrative about a nation. When there is bad governance for a sustained period, the narrative about a country is negative.

For more than two hundred years, the USA has been a democratic country. As we prepare to celebrate this year’s Christmas, impeachment votes have taken place at the US House of Representatives. President Trump is at the centre of the storm. I hope he would have the strength to lead his country

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through the storm. The 18th day of December, 2019, was a historic date of debate by members of the House of Representatives in the USA. The House of Representatives made the move to impeach the US President, Donald Trump. Both the democrats and republicans had a whole day of debate making their case for and against. For the democrats, it was a day to prove beyond reasonable doubt what they say is President Donald Trump’s abuse of power. While the republicans repeated their protests against a “sham” investigation and “witch-hunt.”

The speeches and debates on the floor of the House generated memorable quotes ahead of the actual impeachment votes. The House Speaker, Nancy Pelosi, opened the debate with what analysts regard as “solemnly and sadly” floor speech that drew on the nation’s founders and the reason why they enshrined impeachment in the US Constitution. “Our founders’ vision of a republic is under threat from actions from the White House,” she said. “If we don’t act now, we would be derelict in our duty. It is tragic that the President’s reckless actions make impeachment necessary. He gave us no choice.”

Although, some republicans raised concerns about a partisan impeachment process in which the majority could do what it wants. They dismissed the first article of impeachment- abuse of power- by saying President Trump did nothing wrong. They equally, described the second article- obstruction of Congress- akin to petulant children saying they didn’t get what they wanted when they (democrats) didn’t ask in the right way.

Some republicans argue that democrats’ impeachment wasn’t to help fulfil a constitutional duty, but a move taken to, because democrats

wanted Hillary Clinton to win the election which took place in 2016.

Although, the republicans argue that the impeachment has nothing to do with Ukraine. It has nothing to do with abuse of power.

President Trump, critics claim, attempted to use his political power to coerce a foreign leader to harass and discredit one of the president’s political opponents. “That, they say, is not only a violation of the constitution; more importantly, it is profoundly immoral.”

But most republicans in the House see the whole issue differently. During the debate, for instance, a republican expressed his views that : “Pontus Pilate afforded more rights to Jesus than the democrats have afforded this president.” He went further to state that Pilate gave Jesus the opportunity to face his accusers. But sadly, he acknowledged, the House committees didn’t allow Trump or any of his representatives to defend himself against all allegations. A pity, you may say. But in a presidential system of government, it takes a lot of gut for members of the House of Representatives to invite an Executive President for interrogation.

In view of this latest development in the US political history, “Hillary Clinton, former United States, US, Democratic presidential candidate, has reacted to the impeachment of the country’s president, Donald Trump by the House of Representatives. Clinton said Trump abused his powers and left the lawmakers with no choice but to impeach him. The former Democrat’s presidential candidate, who lost to Trump in the 2016 US elections stated this in her verified Twitter handle. “One of our most precious rights as Americans is the right to determine who our leaders are,” she tweeted same day.

“The president abused his powers

‘

Why, you may ask? Democracy does not impose leaders on the people. It is the quality of institutions and leadership in Nigeria that will determine progress made in all spheres of national life as we approach the new year 2020

Johnson is an author and a retired naval engineer who has passion for African development and good governance

Decoding global trends in upskilling and reskilling – article on Nigeria

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majority of Nigerian workers believe their jobs are at risk from changes in technology and globalisation, but they are already developing skills to combat this shift 84 percent of the Nigerian workforce devote significant effort to upskilling; 78 percent would also reskill for a new job, according to a study by The Boston Consulting Group (BCG) and The Network LAGOS, November 27, 2019 - Nigeria, Africa’s largest economy is home to almost 200 million people and a growing energetic young population-more than half of population is below 30 years old. Despite having a young population, Nigeria is yet to fully harness the potential of such youthful energy to grow her economy.

According to the National Bureau of Statistics (NBS), in 2018 unemployment and underemployment rate stood at 43 percent of the labour workforce and is mainly driven by youth unemployment and underemployment which stood at 55 percent. While there are several factors driving unemployment in Nigeria, one factor that must be addressed urgently is the un-employability of graduates from Nigerian tertiary institutions. Former government representatives and business executives lament the un-employability of graduates from Nigerian universities.

For example, over the past few years the Nigerian tech industry has witnessed significant growth. Companies like Andela, Jumia and Farmcrowdy are taking the lead and leveraging technology to change industries and how people work. This growth has not gone unnoticed as tech giants such as Facebook and Twitter

have recently moved to enable start-ups and enhance innovation opportunities in Nigeria.

Despite this growth and with such a vibrant young population, tech companies lament the lack of local talent to drive the growth needed in the nation’s tech space.

BCG and The Network as well as local partners -Jobberman and FindAjobInAfrica have done some work to assess the changing work environment and have found that Nigerians are getting increasingly aware of the impact of globalisation and technology on work today and are committing more time than their peers across the world to develop the right skillset in response to these changes. This survey polled 366,000 people in 197 countries to assess their awareness of how work is changing and their willingness to change along with it. Nigerians are the most sensitive to megatrends in globalisation with 74 percent of the 550 respondents in Nigeria acknowledging that globalisation will have an impact on their jobs.

Knowledge of these impacts drives a willingness to learn and develop in order to compete in the new global order - 84 percent of Nigerian workers are willing to devote a significant effort to upskilling. This desire is primarily driven by younger workers as 84 percent of those willing to devote significant time to gaining new skill and knowledge are young Nigerians below age 30. This is encouraging news for Nigeria as workforce is eager to embrace dynamic change.

Apart from upskilling, Nigerian workers are willing to reskill – acquire a new skill in order to get a new job. The study shows that 78 percent of surveyed Nigerians are willing to acquire new skills for a new job under any www.businessday.ng

circumstance. Again, this is primarily driven by young Nigerian workers and emphasizes the desire of people in this age bracket to gain relevant skills in order to compete favourably with their peers globally.

Respondents in Nigeria believe that analytical skills, communication and leadership are the most important skills for the future to cope with change and to compete effectively in the global talent pool. In addition, according to the report, Nigerians acquire these skills primarily through on the job training, self-study and Conferences/seminars. This shows the desire and motivation of Nigerians to take ownership and independently seek out opportunities to improve their skillset.

These findings are really interesting and relevant to government agencies, private companies and educators as they seek to groom local talent that will build industries in Nigeria that can match global standards. In order for companies to adapt to global changes, it is imperative to invest in skill-building programs to help people prepare adequately for the future of work.

Employers in Nigeria should harness the desire by young Nigerians to upskill and reskill by creating programs such as internships that allow young graduates to develop relevant skills on the job. Employers should also invest in on the job training and retraining programs for current employees especially young employees. International companies willing to invest in Nigeria must recognize the desire learn amongst Nigerian workers and plan to invest in developing local hires.

In addition, the ministry of education and

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to cheat in the next election and rob us of that right. Then he obstructed Congress to cover it up. Impeachment is the only remedy,” she tweeted. It was reported that Trump was formally impeached by the House of Representatives, for abuse of power and obstruction of Congress on Wednesday. The vote had followed weeks of testimony, related to his dealings with Ukraine.

230 to 197 votes in the Democraticmajority House saw to the impeachment of the US president. Trump now becomes the third president in US history to be impeached.”

Yes, it is a precious right to determine our leaders. Why, you may ask?

Democracy does not impose leaders on the people. It is the quality of institutions and leadership in Nigeria that will determine progress made in all spheres of national life as we approach the new year 2020. And as we pray to the Creator for abundance and prosperity, I will strongly advocate for ethical rebirth of all our leaders including followers.

And as we celebrate during this festive season, Nigerians’ collective resolution should be to change the narrative of Nigeria for good as from the year of our Lord 2020. Indeed, if our narrative is not positive by May 2023, the government in power will be assessed as a failure. So, our leaders- elected and appointed- should be consistent and committed to good governance in order to earn the respect they deserve. With the will to lead the people by honour, our leaders will be achievers. I sincerely wish all my readers, Merry Christmas and Happy New Year in advance. God bless Nigeria.

Thank you!

BCG’s Global Report stakeholders in the education system should invest heavily in revamping current curriculum and training/retraining teachers in order to provide graduates with the right knowledge and skillset to compete in the global talent pool.

Employers should also take proactive steps to support education institutions to develop curriculum that help graduates fit into the requirements for work as it is today.

“Nigeria’s very young population is a very important asset to drive the level of growth the country needs to fulfil its potential. This is why we find it very interesting that young Nigerians are very self-aware and willing to make the effort to close knowledge and skill gaps. Leaders across all facets of the Nigerian economy must use this knowledge and make targeted interventions towards improving the skill set of Nigerian workers with special emphasis on young workers” said Joao Hrotko partner and managing director at the Lagos office of BCG. “At BCG we see ourselves as part of the solution which is why place a huge emphasis on recruiting young local talent and investing in their development through internal and external trainings so that they display superior skills and knowledge compared to their peers across the world” Boston Consulting Group partners with leaders in business and society to tackle their most important challenges and capture their greatest opportunities. BCG was the pioneer in business strategy when it was founded in 1963. Today, we help clients with total transformation—inspiring complex change, enabling organisations to grow, building competitive advantage, and driving bottom-line impact.

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Culture and doing business in Africa (2) Rafiq Raji

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s discussed in the first part of the paper last week, my cultural framework for doing business in Africa relies on culture, doing business ranking, EM status, & soft power ranking to recommend sectors in Africa that are likely to be successfully tapped by foreign investors. Having already discussed the energy sector, this week I consider the materials, industrials, consumer discretionary, and consumer staples sectors.

Materials sector A good example in this regard is cement manufacturing, which with increased automation, no longer requires as much manpower as in the past. And with automation comes requirements for new skillsets and know-how, most of which are scarce on the African continent and take time and resources to acquire locally. Top-tier management talent is also in short supply. The pan-African success of Nigeria’s Dangote Industries, which relies a great deal on Indian expatriates, who are worldrenowned for their work ethic, to fill the skills gap bears lessons in this regard. So even when an investment decision on a materials venture on the continent relies on where the key raw material is located, disadvantages related to skilled labour and capital could easily be overcome with foreign alternatives.

The success of the Chinese in illegal Ghanaian gold mining, which continues unabated

despite government action, is also a case in point. Chinese entrenchment in Ghana’s mining sector is on the back of a pervasive local culture of artisanal-type but illegal “galamsey” small-scale mining practice. With many poor Ghanaians dependent on galamsey for their livelihoods, and the Chinese now major players, it has become very difficult for the government to clean up the sector. The illegality is not at all endorsed here. But the cultural element as a factor in the success of the Chinese in the Ghanaian gold mining industry is noteworthy.

Industrials sector Aerospace & defence, machinery and transportation industry groups thrive in innovative cultures. Southern African countries are ideal.

They score highest for individualism and other

relevant cultural dimensions. Incidentally, these industry groups already thrive in South Africa. Would they do similarly well in the identified countries in East and West Africa? The low scoring for individualism and high-power distance rankings do not recommend them well for such investments.

Consumer discretionary sector Downstream automobile production is enjoying a resurgence in Africa. Foreign brands have set up bases (or plan to) in Rwanda, Kenya, Nigeria and Ghana. Unsurprisingly, much more advanced upstream activities (e.g. design) take place in South Africa, which already has a thriving automobile industry. There is easily a cultural explanation for why the labour-intensive but less innovative downstream activities (e.g.

assembly) are more viable in East and West Africa while a broader spectrum of the value chain thrives in South Africa. On the consumption side, however, almost every African country qualifies.

Retailing (apparel, etc.) is also more lucrative in South Africa, where a mall culture is already entrenched. The case of South African retailer Woolworths is instructive. When it expanded to West & East Africa, it failed. Still, its business continues to thrive in South Africa.

Incidentally, relatively small-scale local retailers, who import apparels etc., thrive in these same West & East African countries.

Consumer staples sector Food & staple retailing has been found to be successful in almost all African countries.

South African retailer Shoprite’s success in its African ventures is a good example; albeit it is reportedly enduring some challenges lately.

And while largely a low-cost retailer, this has not been primarily the source of its competitive edge in its operations outside South Africa. A local culture of projecting success in Nigeria, say, means a visit by the average shopper to Shoprite during the weekend is more than just about shopping. In general, food, beverage & tobacco investments have been similarly successful across the continent. Still, foreign and local firms involved in the industry have had to rely on robust market research on local cultures to succeed.

References available at https://rafiqraji. com/2019/11/10/culture-doing-business-inafrica/ “Dr Raji is chief economist at Macroafricaintel. He was previously an Africa Economist at Standard Chartered Bank, London, UK. (Twitter: @DrRafiqRaji)”

Decommissioning in the Nigerian oil and gas industry – tax implications

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ased on the 2017 annual oil and gas report issued by the Department of Petroleum Resources (DPR), Nigeria has 285 fields. 184 of these fields are producing while 101 are shut in due to operational reasons. Many of these fields are approaching the end of their expected lifetime.

This, therefore, means that some of the related facilities will need to be shut down and decommissioned in a responsible manner and in compliance with the applicable legislation and regulations. However, the life cycles of these fields can be extended due to factors such as discovery of new satellite fields and improved recovery initiatives. It is also possible to extend the lifetime of oil facilities, which are no longer producing, if they can be used as host installations for other developments in the same area.

Paragraph 36 (1) of the Petroleum (Drilling & Production) Regulations provides that ‘no borehole or existing well shall be redrilled, plugged or abandoned and no cemented casing or other permanent form of casing shall be withdrawn from any borehole or existing well which it is proposed to abandon, without the written permission of the Director of Petroleum Resources.’ Paragraph 36 (2) furthers adds that ‘every borehole or existing well, which the licensee intends to abandon, shall, unless the Director of Petroleum Resources otherwise permits in writing, be securely plugged ……….and shall be dealt with in strict accordance with an abandonment program approved or agreed to by the Director of Petroleum Resources.’

There are three major costs involved in plugging and abandoning of an oil field: shutdown, removal and clean up. Currently, there is no reliable estimate as to how much it will cost to decommission Nigeria’s oil and gas facilities.

However, the general agreement is that it will be significant based on experience from other jurisdictions. In July 2019, the UK Oil & Gas Authority estimated that it would cost £49 billion to decommission the remaining UK’s oil

and gas facilities.

There are several issues that usually arise with respect to returning an oil facility to its original condition at the end of its useful life.

These issues include: estimating the actual work and time scale involved in the decommissioning process, making adequate provision in the financial statements or providing the funds that will be required to implement the abandonment programme and securing tax deductions for the cost involved, given that there will be little or no revenue when the abandonment programme itself commences.

However, this article will only focus on the tax implications of decommissioning costs.

Tax provisions The Petroleum Profits Tax Act (PPTA) is the enabling legislation for the taxation of oil producing companies. The provisions of the Companies Income Tax Act will also apply where the oil company produces gas. The general deduction formula for an expense to qualify for a tax deduction under both laws are similar.

The PPTA specifically states, in Section 10 (1), that ‘in computing the adjusted profits of any company of any accounting period from its petroleum operations, there shall be deducted all outgoings and expenses wholly, exclusively and necessarily incurred (emphasis mine), whether within or without Nigeria, during that period by such company for the purpose of those operations.’ The key question, therefore, is what does it mean for an expense to be ‘incurred’? Does it mean when that expense has been paid for or when there is an obligation to pay?

In a bid to provide some clarity on the tax treatment of decommissioning cost, the then Minister of Finance issued the draft Regulations on Decommissioning in 2018. The major provision of the Regulations is that only cashbacked provision for decommissioning cost will qualify for tax deduction. In other words, the FIRS should not allow the annual provision for decommissioning for tax purposes. The issue

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is, therefore, whether this position is consistent with the provisions of the extant law.

Tax analysis The Courts have generally adopted the literal meaning in the interpretation of tax statutes.

This simply means that one should look at what is clearly said. There should be no room for intendment. Nothing is to be read in, nothing is to be implied. On this basis, the issue is what does “incurred” mean? The Legal Dictionary defines “incur” as “to become subject to and liable for” and “to have liabilities imposed

by Act or operation of law”. This means that expenses are only incurred when the legal obligation to pay them has arisen and not when the expenses have been paid for. This position may also explain why the tax laws do not use the word “paid” to qualify “wholly, exclusively and necessarily” phrase.

In the 2004 case between Shell Norway v Ministry of Finance & Others, the Norwegian Supreme Court held that provisions made in the 1995 and 1996 financial statements in respect of decommissioning costs were incurred even though the decommission process itself had not commenced. The Supreme Court ruling was hinged on the basis that obligation to decommission was unconditional and linked to the right to produce. At the time of the ruling, the provision in the Norwegian Income Tax law for allowing tax deduction was that “a cost shall be deducted in the year in which the taxpayer becomes unconditionally obliged to cover or discharge such costs.”

As a result of the ruling, the Norwegian Government amended its tax laws by adding a proviso to the applicable section – “Obligations to carry out, refrain from, or accept something in future shall be disregarded.” Based on this modification, companies can only claim tax relief for decommissioning cost only in the period in which the work is carried out. In other words, provisions set aside, whether cash-backed or not, will not qualify for tax deduction in Norway.

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ADEWALE AJAYI

Every operator in the Nigerian upstream oil and gas industry has an obligation to plug and abandon a field in compliance with all applicable regulations and the cleaning of the oilfield site to the satisfaction of appropriate governmental bodies, such as the DPR and the Nigerian Environmental Protection Agency.

This obligation arises when the DPR approves the plan for the development and operation of the field. At the time the operator obtains the licence, the obligation to decommission is conditional. The reason is that the operator may choose not to utilise the licence until its expiration or when it is withdrawn. However, the moment exploratory and development activities begin, the obligation becomes unconditional.

Simply put, the oil company becomes subject to and liable for decommissioning of the field at the time of receiving the approval to develop the field and not at the time when production is shut down. This illustrates the difference between provisions that are based on accounting practice and those based on legal requirements. Provisions based on accounting practice does not confer any legal obligations and should, therefore, not qualify for tax deduction unless its deductibility is specifically provided for in the Income Tax Law, for example specific provision for doubtful debts. However, to the extent that provisioning for decommissioning costs is based on both accounting and legal obligations, such provisions will qualify as incurred and therefore deductible for tax purposes.

Note: the rest of this article continues in the online edition of Business Day @https:// businessday.ng Ajayi is the partner and head tax energy practice at KPMG Nigeria

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Tuesday 24 December 2019

BUSINESS DAY

EDITORIAL 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

Changing energy strategies of Nigeria’s major oil importers

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world without oil is nearer than we had imagined.

Large consumers of oil are accelerating plans to switch to clean/green energy. This means sooner than later, oil will lose its importance and consequently, the price will plummet. Thankfully, Nigeria is also gradually moving away from oil. In 2015, without realising it and for the first time since 1971, Nigeria earned more money from non-oil sources than from oil revenues. This, of course, was due to plummeting oil prices and a consequent rise in nonoil tax collection.

The government is now capitalising on the gains by ramping up efforts to diversify Nigeria’s economy and revenue sources away from oil. The reforms must be fundamental and far-reaching to ensure the country finally and

decisively moves away from oil as the foundation of its political economy.

India, the largest importer of Nigerian crude, has been making big push for electric cars to solve the country’s unbearable pollution problem. Although, its transport minister’s boast in 2017 to shock the automobile world by moving India to 100 percent electric cars by 2030 is unrealisable, the country’s commitment to clean energy is unmistakable. It has signalled its intention to become a “global hub of manufacturing electric vehicles.” More concretely, it recently laid out plans to convert its fleet of buses to electric vehicles.

China, another high-fuel consuming country, is already the world’s largest electric market. It has the world’s largest network of charging stations for electric vehicles and is also the world’s largest manufacturer of batteries – a critical component

of electric cars.

Most countries in Europe – another key destination for Nigerian crude – have set targets to phase out conventional combustion engine cars latest by 2040.

These fundamental energy changes across the world will not only have a huge impact on the price of oil globally, it will directly affect Nigeria and the amount of revenues it can get from oil.

Perhaps, it is that realisation and the revenue challenge brought by lower oil prices that has led to the current aggressive move towards tax and revenue collection by the federal government. This is a good first step. For long, dependence on oil money has made us lazy and unwilling to realise our tax and revenue-generating potentials as a country. This needs to change.

Nigeria must now develop also a duty-based civic culture

that will lead to a much more productive social contract between the government and the people. This will be the permanent solution to the problem of wanton corruption and lack of accountability and transparency in government.

The government must also ensure that its aggressive tax compliance and revenue drives complies fully with the law to guide against cases of shakedowns, double taxation and infringement on rights of individuals and businesses.

Much more fundamental however, is the need to develop a strategy for fully diversifying the country’s economy and revenue sources. We believe that should be one of the key functions of the recently constituted Economic Advisory Council and not the duplication of the functions of the National Bureau of Statistics (NBS) as the president has asked them to do.

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

EDITORIAL ADVISORY BOARD Imo Itsueli Mohammed Hayatudeen Afolabi Oladele Vincent Maduka Opeyemi Agbaje Amina Oyagbola Bolanle Onagoruwa Fola Laoye Chuka Mordi Mezuo Nwuneli Charles Anudu Tunji Adegbesan Eyo Ekpo Wiebe Boer Paul Arinze Boye Olusanya Ayo Gbeleyi Haruna Jalo-Waziri Clement Isong

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Tuesday 24 December 2019

BUSINESS DAY

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20 years of unbroken democracy in Nigeria: Challenges and prospects (2) The Reformer

JOE ABAH

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igeria is a difficult place to live in. Ayo Sogunro has written a book titled “Everything in Nigeria is going to kill you.” I have also heard it said that Nigerians in the diaspora should stop asking Nigerians living at home to speak truth to power, because the mere fact of living in Nigeria, by itself, constitutes speaking truth to power.

Living in Nigeria, and maintaining your sanity, means refusing to give in to the daily frustrations that come from living in this difficult environment.

This environment in which all available circumstances seem to conspire to frustrate you and make you lose hope. This environment in which it is very easy to get angry, particularly as there can sometimes appear to be a reluctance, or in some cases an outright refusal, to do so many things that could be done relatively easily for the benefit of all.

Living in Nigeria, without falling into despondency and hopelessness, is indeed speaking truth to power. It is speaking truth to the power of avoidable dysfunction. It is speaking truth to the power of despondency. It is speaking truth to the power of hopelessness.

Nigeria displays all the characteristics of what the Economist Terry Karl describes as “The Paradox of Plenty.”

The Paradox of Plenty is better known in the literature as the “Resource Curse.”

It is the paradox that countries with an abundance of natural resources like

oil and solid minerals, such as Nigeria, tend to have less economic growth, less democracy, and worse development outcomes than countries with fewer natural resources. As if the Paradox of Plenty is not enough, Nigeria additionally has many other characteristics that appear to exponentially increase the level of difficulty the country faces.

A population of about 200 million that is growing at a rate of nearly 3% means that any encouraging macroeconomic growth tends to mask wide income inequality, with a very wide gap between the haves and the have nots.

An economy that is currently growing at a slower rate than the population growth rate also means that per capita income is falling every day, while poverty is growing. As far back as 1798, Thomas Malthus propounded a theory in his seminal work called “Essay on Population.” Essentially, he argued that if population is left unchecked, one day people will have nothing to eat. His theory is that when this happens, nature itself will control the population by killing off a number of people through famine, disease and natural disasters.

This is a frightening prospect.

More frightening is the fact that Nigeria has the 6th largest youth population in the world, with about half of them unemployed or underemployed.

The median age in developed countries like Japan, Germany and Italy is over 40, while the median age in Nigeria is under 20. A lot of the youth are migrating to urban areas, which means that many young people have no interest in Agriculture.

Additionally, Nigeria has 371 ethnic groups that speak 520 languages. Nigerians have often argued that one of the reasons for the difficulties we have is that we are not a homogenous society that belong to a single ethnic stock and speak the same language. Religion is also an issue. Nigeria has a population that is about 50 percent Christian and 50

percent Muslim, which can be a recipe for tension. To make matters even more interesting, nearly 100 percent of those claiming to be Christians or Muslims believe in Juju and witchcraft. Indeed, some have argued that if public officials were to take their oaths of office by swearing on a traditional deity, rather than the Bible or Quran, they are more likely to honour their oaths.

From everything I have said, you can probably see that all the ingredients for dysfunctionality exists in abundance in Nigeria. Yet, I will argue in this paper that there are opportunities within each of these challenges that I have identified.

I will now proceed to set out some of them, starting with population. High population growth can have both negative and positive influence on economic growth. We have already outlined some of the negative benefits of high population growth on economic growth. On the other hand, where high population growth is matched with high productivity, it can actually become an advantage, as it has in the case of China.

With large, productive populations, Gross Domestic Product goes up, consumption grows and poverty falls. By focusing on increasing productivity, China has been able to lift 600 million out of poverty in 30 years. If Africa was to do what China has done, it would mean that the whole of Africa can be free of poverty in less than 50 years.

Beyond the deliberate efforts that China has made though, there appears recently to be a clear correlation between large populations and macroeconomic growth. The so-called BRIC economies of Brazil, Russia, India and China all have large populations. Brazil has 211 million people; Russia has 146 million; India has 1.3 billion; and China has 1.4 billion. It will be imprudent to claim that large population, without more, results in economic growth. Nevertheless, it is interesting to note the correlation between recent high economic growth

‘

More frightening is the fact that Nigeria has the 6th largest youth population in the world, with about half of them unemployed or underemployed.

The median age in developed countries like Japan, Germany and Italy is over 40, while the median age in Nigeria is under 20

and large population size.

With regards to the Malthusian Theory of Population Growth, there is actually no consistent correlation between high population density in countries and real income per capita.

Sub-Saharan Africa has much lower population density than prosperous Japan. Malaysia was much poorer when its population was lower than now that its population has risen by more than 300 percent. Densely populated places like Hong Kong and Singapore are actually quite prosperous. The point to make though is that these are countries with very high productivity rates. If Nigeria is to turn its population size to an advantage, it must focus more on increasing productivity, rather than representation and the sharing of increasingly scarce resources.

Globalisation and digital technology also mean that there are clear opportunities to turn what has been described as our youth timebomb into explosive growth. India took advantage of globalization and technology to position its youth as some of the leaders in the technology space. Technology giants like Google, Microsoft, Nokia and Adobe are all run by Indians. A lot of the leading lights in America’s Silicon Valley are Indians. It is worth pointing out that the Indian technology revolution did not start with government but was driven by the private sector, with government jumping on the bandwagon much later. Government cannot employ every unemployed Nigerian youth. It can, however, provide an enabling environment for their talent and industry to thrive. Providing such as environment would mean making it easier to register small businesses, removing multiple taxation and providing incentives for innovation.

Dr Abah is a development practitioner and the immediate past Director-General of the Bureau of Public Service Reforms.

Philippine water crisis in international perspective

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ccording to data by World Resources International (WRI), 17 countries – home to one-quarter of the world’s population – are coping with “extremely high” levels of baseline water stress. That’s because irrigated agriculture, industries and municipalities withdraw annually more than 80 percent of available supply.

The list of these countries features Gulf nations (Qatar, Kuwait, Saudi Arabia), Middle East and North Africa (Israel, Lebanon, Iran, Libya), subSaharan Africa (Eritrea, Botswana), South Asia (India, Pakistan). A far larger group of countries face “high” levels of stress, where over 40 percent of available supply is withdrawn every year. The third group suffering from “medium” water stress features two dozen countries.

The countries that belong to the fourth group of “low-medium” baseline presumably suffer less from water stress. It includes the United States, Japan and UK, and Russia. Despite its water woes, the Philippines is listed in this group.

If water stress should be tolerable in the Philippines, why are realities different?

Management or mismanagement The responsible government agencies and water companies argue that the private sector “saved” Metro Manila from the water crisis in the 1990s. Nevertheless, the concession agreements with Maynilad Water Services and Manila Water were heavily criticized at the time.

The defenders of the deal suggest that the government was compelled to sweeten up the concession agreement for companies so that they would be willing to patch up Manila’s water system.

Yet, the agreement rests on an arrangement, which ensures companies lucrative profits, while risks

were passed on to the government and consumers, due to controversial rate rebasing- setting of basic water rates.

Instead of investing on Philippine water safety, water companies seem to prefer substantial dividends. They have also spent millions for expenses like sports, “philanthropic donations,” and reportedly have departments with more managers than rank-and-file employees. Some of these oddities might be explained by the personal hobbies of Maynilad Water’s CEO “Manny” Pangilinan, a wellknown sports patron and team owner. But private hobbies should not thrive at the public’s expense.

Maynilad Water also has interlocking corporate structures associating Pangilinan with Hong Kongbased First Pacific Company Ltd and the group’s investments in Metro Pacific Investment Corp, PLDT and Philex Mining Corp., and think-tanks that have parallel structures with U.S. organisations and controversial foreign interests – including ones that seek to shape domestic and regional geopolitics.

One might think that an exclusive focus on water security would be more warranted.

Collateral damage of foodborne diseases, dengue In March, the World Health Organization (WHO) stated that in the Philippines 1 in 10 people still do not have access to improved water sources, especially in rural communities. In 2016, one of the top 10 leading causes of death in the Philippines was acute watery diarrhea, claiming over 139,000 lives. By spring, the situation was set to worsen as the country is beset by the El Niño phenomenon and climate change that can contribute to rising temperature, drying up water sources.

When water is scarce, people – particularly

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poorer people - are often forced to rely on drinking water sources that are not safe. And as they are unlikely to have sufficient water for basic hygiene, they become increasingly vulnerable to foodborne and waterborne diseases. Low or negative water pressure in pipes due to short supply attracts contaminants that put water quality at risk when the supply is restored.

Moreover, limited supply obliges people to store more water. If not handled properly (and the likelihood increases with poverty), this will provide more opportunities for mosquitoes to breed increasing cases of mosquito-borne diseases, such as dengue fever. According to Department of Health (DOH), more than 402,000 dengue cases were reported nationwide as of Nov. 16, a 92% increase from last year.

While the dengue explosion was affected by many forces, including lack of adequate vaccination and a severe typhoon season, it would be naïve to ignore the impact of severe water challenges through the year.

How water became an international challenge Water crises are becoming more commonplace. In early fall, water reservoirs in Chennai, one of India’s megacities, were almost dry. Last year, South Africa was in headlines when the people of Cape Town barely avoided their water shutoff. And the year before, Rome had to start rationing water to conserve resources.

While increasing water challenges are often attributed to “climate change,” the underlying reasons are more complicated and go beyond the simple issue of drought. In a recent report, WRI discovered that water withdrawals globally have more than doubled since the 1960s, due to rising

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Dan Steinbock demand and show few signs of slowing down.

Many water companies explain the problems by reference to modernization and the rise of new middle-classes. In this view, population growth, development and urbanization are increasing water demands, while climate change is making precipitation and demand more variable.

Yet, none of these phenomena change overnight. Big shifts in population growth take decades, even generations. Development is a long-term process. The transition from agricultural societies to urban centres often requires four to five decades.

Successful businesses know how to adjust to fluctuations of demand in a proactive manner. The big question is why, instead of embracing a flexible long-term strategy, Philippine water companies have not adequately prepared for these challenges that have been building for decades?

Dr. Steinbock is an internationally recognised strategist of the multipolar world and the founder of Difference Group. He has served at India, China and America Institute (US), Shanghai Institutes for International Studies (China) and the EU Centre (Singapore). For more, see https://www.differencegroup.net/ The original version was published by The Manila Times on December 16, 2019.

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Tuesday 24 December 2019

BUSINESS DAY

Media business Marketer reveals strategies for survival of Smartphone brands in Nigerian market Daniel Obi

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marketing expert has assessed the trend of entry and exit of Smartphone brands from Nigeria on account of poor understanding of the market and therefore proffered solutions for survival in Nigerian market, Africa’s most populous nation with about 200 million people.

Increasing competition in the smart phone market, high price of phones and low income of consumers and other factors may have forced those who exited the country. But speaking in Lagos recently, Habib Somoye, marketing director of Xiaomi Corporation, a Chinese electronics company in Nigeria but with headquarters in Beijing believed some brands enter Nigeria and later pull

out because they did not take care of certain marketing strategies.

Somoye who was head of marketing for Gionee, another Chinese phone manufacturer before joining Xiaomi listed four factors that will enable phone brands to survive in the competitive Nigerian market.

One of the factors is after sales service. He said this should be pan Nigeria instead of Lagos alone. Speaking at the introduction of new devices from Xiaomi, Mi Note 10 and Mi Note 10 Pro and hosting of Christmas party for his consumers, Somoye said his company’s after sales service cut across pan Nigeria.

He also identified quality of phone itself is another key factor to thriving in Nigerian market. “Another differentiating factor in Nigeria’s market is offering quality and value phones with more affordable pricing”, he said.

Somoye who displays understanding of smartphone marketing also told marketers that entry strategy of devices in terms of marketing is critical key to surviving in Nigerian market. He said for instance, Xiaomi is nine months-old brand in Nigeria but it is already competing with other older brands that have been in the market for years.

“We have entry model for all segments of the market, low, mid and high categories.

We don’t want to be positioned that the phone is for the rich or for the poor, it is innovation for everyone”.

For the new device, he said it is a great phone with high standard features such as five cameras, quality battery, 108 Mp and Gorilla screen.

“We are leading in terms of innovation and good pricing”, he said adding that Xiaomi has phone for all class of consumers

Enugu State establishes agency to regulate outdoor advertising

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he Enugu State Government has taken measures to regulate and sanitise the chaotic outdoor advertising regime in the state by creation and inauguration of a new agency known as Structures for Signage and Advertisement Agency in Enugu State.

Designed in the mould of the Lagos State Signage and Advertising Agency (LASAA), the Structures for Signage and Advertising Agency of Enugu State will be the first of its kind in the South East and South South and it is envisioned to bring order and restore beauty to the skylines of Enugu State.

Speaking shortly after the agency was inaugurated, the Director General of the new Agency, Ike Ezugwu, lamented the poor state of out-of-home advertising in the state and expressed his commitment to not only restoring order but also to ensure the 17 local government areas in the state maximise the revenue opportunities inherent in a well-organized outdoor regime.

Ezugwu said it was in the interest of the entire advertising industry for the practice to be better regulated adding that the current chaotic na-

ture of the industry diminishes the values that should have been available for professionals.

“I thank His Excellency Governor Ifeanyi Ugwuanyi for fining me and the entire members of the board worthy for this assignment. It is important to note that it can no longer be business as usual in the out-of-home industry here in the state. The situation where someone wakes up and erects a signage of his choice at a place he also chooses has to come to an end. Our governor has always stressed the important of a beautiful Enugu and one of the planks to achieving this is a well structured outdoor practice,” the new DG stated.

Earlier in his speech while inaugurating the board, Governor Ugwuanyi, represented by the Secretary to the Government of Enugu State, Simon Ortuanya, charged the new

agency to be above board and strive to achieve excellence in line with the State Government’s drive to sustain the beauty and status of Enugu as the hospitality of the South East and South South of Nigeria.

Also speaking, Commissioner for the Environment, Enugu State, Chijioke Edeoga advised the board to make stakeholder engagement and consultations a critical tactical engagement tool and called on the general public to extend their cooperation to the new agency in the successful discharge of their duties.

Edeoga, whose Ministry supervises the new agency, stressed the importance of the new agency to the State government and expressed the believe that with the quality of men in the board, the agency was going to be very successful.

BSG kicks-off ‘Don’t Drink & Drive’ campaign park rallies

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L-R: Olusegun McMedal, chairman, Nigerian Institute of Public Relations (NIPR) Lagos State Chapter; Mallam Mukhtar Sirajo, president and chairman of Council, NIPR; Mr. John Ehiguese, CEO, Mediacraft Associates and his wife, Susan Ehiguese, during the presentation of the PR Practitioner of the Year Award to Ehiguese at the 2019 LaPRIGA Award, held at Civic Centre, Victoria Island, Lagos.

Kantar Nigeria drives teamwork with office consolidation Daniel Obi

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antar Nigeria, foremost marketing research and consultancy has formally opened “TheHub”, its ultramodern 5-storey office complex in Lagos which houses its divisions - Public, Worldpanel and Insight Divisions.

The office facility was opened by the doyen of marketing research in Nigeria Kareem Tejumola recently.

According to Fikayo Aremu, chairman of the reloca-

tion committee, the building is equipped with the state of art to drive collaborations across its divisions, domains and functions for excellent client delivery.

The Hub has 10 meetings rooms, sound-proof phone booths, focus group discussion rooms, a server room, play areas and a wellequipped cafeteria for the use of staff members.

The Hub’s play areas would make Gen X, Millennials and Gen Z feel at home while provision is made for quiet time and study in the Mandela library on the penthouse. The www.businessday.ng

village square with its African communication theme provides a nice place for big or small staff meetings Kareem Tejumola chairman Kantar Nigeria commended the management team for providing this conducive atmosphere for work which would enable the company’s specialists in the different domains to work under one roof and deliver world class service for the benefit of clients and other stakeholders.

Kantar is part of Bain and WPP and its services are employed by over half of the Fortune Top 500 companies

he Beer Sectoral Group (BSG) of the Manufacturers Association of Nigeria (MAN), in partnership with the Federal Road Safety Corps (FRSC), recently kicked off the ‘Don’t Drink and Drive’ campaign Park Rally in Lagos State The campaign, which is aimed at encouraging and promoting responsible drinking will hold rallies in 20 bus parks in Lagos, 10 parks in Rivers State and 10 in the Federal Capital Territory, Abuja from December, 2019 to February,

2020. The campaign’s message will be deployed through social media, billboards and posters to reach drivers across the country.

BSG had earlier launched the ‘Don’t Drink and Drive’ campaign to create awareness on the issues and dangers of drunk driving.

Speaking at the kick-off ceremony, the Executive Secretary of BSG, Tony Eneh, said the group was happy to give back to the country by creating awareness on the dangers of drunk driving through the

campaign. He further stated that with the use of breathalyzers donated by the Beer Sectoral Group, FRSC can achieve deterrence, having discovered those driving under the influence of alcohol.

Also speaking at the occasion, The Lagos State Sector Commander, FRSC, Corp Commander, Hyginus Omeje, said the ‘ember’ months’ campaign was an integral component of the FRSC’s strategic intervention to elevate the consciousness of Nigerians to the realities of road crashes.

NIM’s new president seeks for members’ cooperation to move Institute forward Daniel Obi

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igerian Institute of Management, NIM has elected Pat Anabor as its 22nd president and chairman in council. She takes over from Olukunle Iyanda who served his two-year tenure.

During her investiture, Anabor, an accomplished manager, tasked all members of NIM to join hands with the new council to

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move the Institute forward.

She said that her administration will thrive on continuity and consolidation as she intends to sustain all the good programmes of the predecessors of the Institute which will clock 60 years by 2021.

“In addition to consolidating on the existing programmes and activities of the Institute, our priority shall be to develop the Institute’s land in Central Business District at Alausa, Ikeja, Lagos. We are grate@Businessdayng

ful to the last council for perfecting the titles of the land thus paving way for its real development”, she said.

In his speech, the immediate past president of the Institute, Iyanda listed his achievement in the past two years. “We have addressed current management issues in our advocacy programmes with a view of finding an organisational and administrative structure that would enable this country to leverage its enormous resources”

Tuesday 24 December 2019

BUSINESS DAY

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Branding Biggest issues with modern retailing in Nigeria are logistics and finance - Kabir Shagaya Zippy logistics recently launched a national campaign tagged #IspotZippy aimed at rewarding consumers in celebration of the festive season. Kabir Shagaya, the managing director of Zippy Logistics said IspotZippy campaign is a two week online and offline campaign to further propel the spirit of Christmas. In this interview with John Salau he spoke further on the initiative underscoring the firm’s contribution to the logistics value-chain in Nigeria. Excerpts The logistics environment in Nigeria is challenging; so what is Zippy logistics doing differently? ippy Logistics is a onestop supply chain and logistics company. We facilitate trade services, connecting buyers and sellers in modern retail trade nationwide; we cover procurement, inventory management, warehousing and e-commerce dispatch. Through Tranzipp, we have facilitated trade by creating access to retail outlets.

We serve large modern trade and retail facilities nationwide such as Shoprite, SPAR, Game, Market square, Foodco and others.

What innovation has Zippy logistics contributed to the Nigerian supply chain?

Zippy has designed and executed the most efficient way to fulfil modern trade deliveries across Nigeria.

Our unique value proposition allows for fixed logistics costs and brand visibility nationwide. We manage a weekly schedule which covers all major supermarket outlets nationwide and we make sure it remains cost effective by creating a national package which allows our clients to enjoy a universal price irrespective of location.

How has the innovation helped to improve or ease the transporta-

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Kabir Shagaya

tion of goods in the market place?

Our system allows for distribution of goods to various locations regardless of quantity without paying premium price.

Logistics and finance seems to be the biggest challenge for start-ups,

how is Zippy positioned to help players in the sector?

We at Zippy have noticed that the two biggest issues with modern trade retail in Nigeria are Logistics and Finance. Seeing as we have a solution that already addresses the logistics

Concept Nova tackles vandalism, theft with next-generation protection solutions Daniel Obi

T

o better protect goods and valuables across the nation, Concept Nova - Africa’s fastest-growing technology solutions company – has introduced CargoSafe, an intelligent tamperproof solution to prevent theft of goods and valuables for organizations and individuals.

According to reliable security agencies in Lagos State, there has been a return of theft and vandalism, particularly on Lagos roads with incidents recorded in several key areas across the State.

Speaking on the security is-

sues, Concept Nova’s Managing Director, Chukwuma Ochonogor in a statement iterated the need for businesses and individuals to adopt proper security measures to keep their goods and valuables protected all year round, particularly during the ‘Ember’ season.

“All year long, many businesses and individuals constantly fall prey to theft and vandalism of their goods and valuables because they are unprepared to handle these prevalent issues. With the festive period and traffic gridlock expected to surface during the ‘Ember season’, it is exceedingly important that businesses and individuals are equipped with effective ways of preventing their

goods and valuables from being stolen or vandalized.

With our tamper-proof solution, CargoSafe, theft and vandalism threats are neutralized, valuables and goods remain 100% protected, cost of business operations are reduced, and high ROI is enjoyed.

This next-generation protection solution offers security benefits by providing access to detailed audit and reports on the security of valuables, remote lock and unlock access restricted to authorized personnel, as well as real-time alerts and notifications via email, SMS and the App to every relevant stakeholder on all lock/unlock/suspicious activities.”

Ochonogor said.

FRSC, Indomie Fan Club partner to deepen children’s involvement in road safety issues

T

he Federal Road Safety Corps (FRSC) and the managers of the Indomie Fan Club (IFC) - a child centred initiative of Dufil Prima Foods - have emphasised the need for Nigeria to deepen road safety rules in the schools’ curriculum. IFC was established in 2005 with the aim

of creating an environment of learning, fun, excitement and bonding for children between the ages of 5 and 12.

Speaking in Lagos during the 2019 IFC Road Safety Quiz Competition, held at FRSC Sector Command, Ojodu Berger Lagos, representative of the Sector Commander Lagos, FRSC Depwww.businessday.ng

uty Corps Commander, A.S Oyegade, stated that such initiatives will ensure that school children learn road safety rules early in life for survival, even as he urged primary school operators (private and government) in the country to establish Federal Road Safety clubs in their schools.

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problem effectively, we alongside our partners at Providus Bank have designed a product to allow supermarket vendors receive payment at point of delivery and not have to wait for their agreed payment terms with the supermarkets. This will help the businesses with their cash flow situation and enable SME’s to compete on a level playing field with the larger players in the industry.

The company recently launched a campaign tagged, ‘IspotZippy’ what is it about?

The IspotZippy campaign is a two week online and offline campaign taking off during this festive season.

The aim is to further propel the spirit of Christmas; sharing happiness and giving long lasting gifts to all our customers and supporters of our brand over the last six years.

What are prizes to be won?

So, this is the second edition of the IspotZippy campaign. The first time we did it we gave out tickets to New York, Paris and London.

We had a lot of participation from our fans and supporters and the feedback was very positive. The whole idea was to mark a milestone when we had reached a significant stage in the e-commerce logistics industry at that time. We wanted to achieve top of mind awareness to the point that you would now

pay attention to how many zippy bikes you see in a day. Now over the last few years we have diversified; and our business has evolved into a modern trade retail supply chain company. We now cover every major supermarket chain across the country on a weekly basis with a significant fleet of trucks. Our footprints are present in every Shoprite, SPAR, Game, Market square, Foodco, Justrite, Ebano and other locations which we visit at least once a week nationwide; we felt these supermarkets would be fitting as the site for our holiday festivities.

Who are those eligible to participate in this campaign?

Everyone! All you have to do is go into any Shoprite store nationwide and take a picture. The whole idea is to appreciate all our supporters and let them know that we are grateful for the trust and faith they have in our various business ventures. It is as simple as a visit to your favorite store and taking a picture with our representative to upload on Instagram using the appropriate tags. It is our way of giving back to those who have indirectly supported our business. However, it is a part of a larger strategy which we are launching early next year. Consumers can expect innovation and exceptional customer service levels from us going forward.

Indigo wins Best Corporate PR Agency of the Year ...Bolaji Abimbola named PR Personality of the Year

I

ntegrated Indigo Limited, one of Nigeria’s foremost full service public relations and event management consultancy firms has emerged as the ‘Best Corporate PR Agency of the Year – PR Excellence Award’ in recognition of its outstanding contribution towards the Public Relations profession.

The agency was crowned by the Nigerian Institute of Public Relations at its 2019 Presidential Dinner & Awards held recently at Sheraton Hotel and Suites in Lagos. Also, the Managing Director of the agency, Bolaji Abimbola was honoured with the award of the Public Relations Personality of the Year.

Speaking at the award ceremony, Chairman of Council, Nigerian Institute of Public Relations, Mukhtar Sirajo described the choice of Integrated Indigo Limited as a testament to the exceptional level of professionalism on display @Businessdayng

both in the planning and execution of Public Relation services offered to its numerous clients over the last one year which accounted for their reputation and goodwill enjoyed in the marketplace.

Receiving the award, the Managing Director, Integrated Indigo Limited, Bolaji Abimbola expressed profound gratitude to the apex regulatory body of Public Relations in Nigeria for the recognition, describing it as another significant milestone that would motivate the agency to greater achievement and delivery of exceptional services to its clients.

It would be recalled that Integrated Indigo Limited received similar honour from the Institute of Brand Management of Nigeria where it was recognized as the West Africa’s Best in Class Public Relations and Communication Service Company of the Year 2019.

16

Tuesday 24 December 2019

BUSINESS DAY

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Tuesday 24 December 2019

BUSINESS DAY

COMPANIES & MARKETS

17

COMPANY NEWS ANALYSIS INSIGHT

TECHNOLOGY

Carbon’s pan-African digital bank push takes it to Kenyan fintech industry FRANK ELEANYA Kenya with a population of 50 million people may be the home of Africa’s most popular mobile money platform, MPesa, it is also home to hundreds of mobile lending applications that has helped to foster limitless access to credit in the country.

Come 2020, Nigeria’s digital financial services company, Carbon, will be one of the platforms vying for share of the digital banking market in Kenya.

Carbon which has enjoyed some degree of success in the Nigerian market, is hoping to convince Kenyans to access loans on its platform using their National ID number and a selfie, as well as the phone number associated to their mobile wallet. They will also have access to payment services to pay utility bills and buy airtime directly from the Carbon app.

In view of its progressive regulatory environment and high levels of financial inclusion, Kenya is one of the most attractive markets in

Africa. More than 60 percent of Kenyans own a smartphone and more than one in four (27 percent) has taken a digital loan. The Central Bank of Kenya values the mobile payment sector at $36 billion with the sector expected to reach a $125

billion valuation by 2025.

In Kenya, unemployment lies in the average level of African countries.

Many people are working, however in jobs or as small business owners, earning a relatively low income, and are not always able to af-

ford things like a personal vehicle.

While Carbon may have Tala, OKash and Branch to contend with in its Kenyan adventure, it has enlisted the help of partners such as Transunion CRB, MPesa and other a few payment

platforms to aid its launch.

“This expansion presents an opportunity to bring learning from other African successful markets to Kenya,” said Chijioke Dozie, CEO and co-founder of Carbon. “It also enables us to explore what has made

L-R: Haru Al-Hassan, director of New Media and Information Security, Nigeria Communications Commission; Mohammed Ajiya, president, Digital Bridge Institute; Chuks Onyebuchi, CEO, Union Systems Limited, Dan-Azumi Ibrahim, director general, National Office for Technology Acquisition and Promotion (NOTAP); Chris Uwaje, chairman of the National Software Think Tank and Olusola Teniola, president, Association of Telecommunication Companies of Nigeria (ATCON) at the cocktail event organized by the National Software Think Tank and Union Systems in honour of the DG, NOTAP held in Lagos

the Kenyan financial services industry so successful and how this success can be replicated in other markets.”

Since launching in 2016, Carbon has grown its user base to 1.8 million, initially providing consumers with access to credit, simple payments solutions, high-yield investment opportunities and easy-to use tools for personal financial management. The company disbursed more than $35.6 million in loans and in 2018 alone achieved revenues of $10.4 million. Carbon also secured a $5 million debt facility from Lendable, a New York and Nairobi-based technology-enabled funding provider, in March 2019.

Dozie also explained that the expansion to Kenya is in line with the company’s vision of a pan-African digital bank for Africans and Africans in the diaspora.

“Taking our services to Kenya represents the first step in realising that vision and truly delivering financial services that Africans at home and abroad need to thrive and excel.

TECHNOLOGY

Afrione makes move to increase market as it launches Cygnus X ANTHONY NLEBEM AND DESMOND OKON

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n an effort to increase its market share in the smartphone space, and also promote locally made tech, Afrione has launched its latest smartphone, Cygnus X into the Nigeria market.

Designed with the customer ’s satisfaction in mind, the device comes fully equipped with a large 6.53-inch-high resolution water drop full display, with a Lumia Gradient cover.

As the brand’s new line up of smartphone series under the sub-brand Cygnus, the phone is powered by a strong octa core 2.0 Ghz processor with 4GB RAM and 64GB internal memory for a smooth and fast multitasking switch operation and supports up to 256GB expandable storage.

The Cygnus X also offers a high-end AI Camera with

20mp Selfie camera and rear dual 20mp plus 2mp camera, a 4000mah battery capacity, facial unlock ID, finger sensor as well as many other exciting features.

“Cygnus X is making its debut in the market and we are confident it will meet our customers’ needs that will be a delight experience for them and satisfy the users in many ways,” said Bunmi Yagba, brand manager, Afrione Nigeria Limited.

At the price of N44, 600, Yagba said the device is being launched at a very attractive End User price. “It is one phone that consumers will enjoy and they won’t regret owning it,” she said.

Afrione Limited is a Manufacturing and Assembly unit for assembly of mobile phones, tablets PCs, and consumer electronics in Nigeria under the brand Afrione.

The Assembly plant is fully equipped with a state-

of-the-art laboratory for testing and quality control to produce international standard product, it was learnt.

Sahir Berry- CEO Afrione

Nigeria Limited, noted that in a bid to maintain customer satisfaction. “Customer satisfaction remains our key focus while maintaining

upgraded technology, quality and after-sales service across the nation through our wide network of Service Centres which is our key

L-R: Vivien Shobo, outgoing chief executive officer, Agusto & Co; Yinka Adelekan, New CEO, Agusto & Co; and Bode Agusto, founder and non-executive director, Agusto&Co at Vivien Shobo’s send forth ceremony which in Lagos

strength by servicing our customers on any post sales challenge they may face with a minimum Turn-Around Time,” Berry said.

He also stated, while speaking about the strides of the tech firm, that the organization had expanded its product portfolio with the launch of ‘Afrione Beats’ –a contemporary range of music gadgets, wireless ear pods, Bluetooth speakers, headsets, earphones and other accessories like power bank, “targeted at youth.”

According to Yagba, the brand has the vision and opportunity to localize and promote the use of cuttingedge technology for manufacturing in mobility space in Nigeria, as well as provide employment opportunities for the youth.

Revealing future plans, Berry said: “We will start assembling laptops in the near future.”

22

Tuesday 24 December 2019

BUSINESS DAY

COMPANIES&MARKETS

Business Event

SMES

OWC Breaks Bounds, Wins At Lagos Advertising and Ideas Festival Awards MICHAEL ANI

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n its 24 months of existence, Onewildcard shows no sign of slowing down on its wins as it hauls in three awards at this year’s Lagos Advertising and Ideas Festival [LAIF] awards.

Among Onewildcard’s impressive list of awardwinning works are the 2018 video and the Platinum Resume campaign executed earlier in the year.

The design and communications agency led

by Kayode Olowu, has

become one of the fastest- growing creative outfits in Nigeria, exceeding a 500 percent growth rate in two years.

Therefore, a number of LAIF awards wins will be a well-deserved addition to the agency’s list of accomplishments.

At the celebration of its second year anniversary earlier this year, the agency displayed an impressive array of its executed projects and achievements including a new office space, campaigns executed for UBA Plc, Leadway Pensure PFA, Sterling Bank,

Kilimanjaro Restaurants, Adekunle Gold’s ONSWAG, and over 35 notable works published on global advertising magazines and websites.

Onewildcard is a creative design agency that combines intuition, culture, and intelligence, to solve communication, process and service challenges for brands. The brand prides itself in giving its clients an unfair advantage through its offerings; identity design, communication design, process/service design, product design and marketing.

L-R: Dolapo Adebowale, trade marketing manager, Nigerian Bottling Company (NBC) Limited; Odesanya Adebimpe, a N20,000 beneficiary and Coca-Cola Seller; Martins Isah, capability development manager, NBC Limited, and Yinka Oletubo, regional operations marketing manager, Coca-Cola Nigeria Limited, at the presentation of gifts to beneficiaries at the just concluded ‘GBE BOTTLE E’ appreciation campaign in Lagos

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L-R: Remi Soyannwo, principal, commercial finance, Shell Nigeria; Dalu Ajene, deputy CEO/head IBD, RMB Nigeria, and Abimbola Ogunbanjo, president, the National Council of The Nigerian Stock Exchange, at the recently concluded Bonds, Loans and Sukuk Conference Nigeria 2019 sponsored by RMB, in Lagos.

L-R: Adekunle O. Mokuolu, president, Nigeria Society of Engineers, presenting the NSE fellow award to Chukwudi Dimpka at the induction event in Abuja.

L-R: Adetola Odusote, deputy director, Re-Ignite Public Affairs Limited; Olusegun McMedal, chairman, Lagos Chapter, Nigeria Institute of Public Relations (NIPR); Wale Adeniyi, comptroller of Customs/vice president, NIPR; Raheem Olabode, executive director, CMC Connect, and Folasade Olorunyomi, associate group head, HR and admin, CMC Connect, at the 2019 LaPRIGA awards, in Lagos.

L-R: Adebayo Gbemisola, executive director of finance, Fatgbems Group; Hassan Gbemisola, MD; Yinka Adeyemo, Captian of Head Office Team; Kabir Gbemisola, chairman, Fatgbems Group, and Shamsudeen Gbemisola, executive director, at the 2019 edition of the company’ football competition.

L-R: Chimmy Ogbuebile, director business development, MP-Infrastructure Limited; Clem Nwogbo, MD/CEO, MPInfrastructure Limited/chairman, Awka Millennium City project, Willie Obiano, governor, Anambra state, at the groundbreaking ceremony of Awka Millennium City, in Awka

Tuesday 24 December 2019

BUSINESS DAY

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@Businessdayng

19

20

Tuesday 24 December 2019

BUSINESS DAY

In rude health: doing business in the 1950s © Debrocke/ClassicStock

Six ways to improve the wellbeing of workers Tackling stress has to move beyond mindfulness classes to a prevention-based strategy Andrew Hill

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n an article from 1957 about how to “keep managers healthy”, the Financial Times cited a company doctor’s claim that executives rose to the top because of their “better-than-average bill of health” that enabled them “to work longer and harder without showing undue signs of strain”.

Contrast that with today’s understanding of how executives should tackle the stigma of mental illness at work. Richard Heron, BP’s chief medical officer, told a panel I chaired this week how the energy group’s incoming chief executive Bernard Looney had opened a dialogue about mental health.

For example, he has discussed in online company forums how he grew up in a household under the shadow of depression.

Company doctors have long since reinvented themselves as “directors of wellbeing”. The bland catch-all heading is easy to lampoon. Stress, though, is now the leading cause of sickness

absence from work.

Alliance Manchester Business School’s Cary Cooper, who convened this week’s panel, pointed out that tackling stressrelated illness is no longer just about providing “sushi at your desk, or mindfulness at lunch — that’s the low-hanging fruit”.

What, then, will vault wellbeing initiatives into the higher branches? Six lessons stand out.

First, organisations have to work harder at eliminating the stigma of stress-related illness, particularly in sectors where it remains unfashionable to admit to feeling the strain.

Andy Rhodes, chief constable of Lancashire Constabulary and national lead for wellbeing of the force in England and Wales, said that when police officers were asked to rank where they would go for help with mental health concerns, human resources and occupational health came dead last.

Employers need to shift from a culture of “caring for” people to one of “caring about” them, www.businessday.ng

according to BP’s Dr Heron. But that also means making sure the organisation itself can cope.

Lancashire police used to have to deal annually with some 150 referrals for psychological support, from 6,000 staff. That has now spiked to 1,000 a year. “You have got to gear up your services as the stigma reduces,” said the chief constable. “Otherwise, you’ve overpromised and underdelivered.”

Second, in the words of Monika Misra, GlaxoSmithKline’s head of employee health and wellbeing, resist the temptation “to sheep-dip everyone” with a one-size-fits-all programme of mental or physical fitness. What may work for people returning from extended sick leave may not work for others going through an organisational transformation. Increasingly, GSK is moving towards greater personalisation of the resources it offers.

The third lesson: ensure you measure and analyse the effect of what you do. When she took

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over as director of health and wellbeing at construction group Mace, Judith Grant found little data. The first audit of wellbeing revealed ways teams could improve. Only when improvements were linked to performance targets did behaviour start to change, though. In the next phase, Mace plans to combine information about wellbeing with safety, quality, productivity and customer satisfaction data in the hope of being able to analyse more accurately what works — and what does not.

Fourth, don’t trust technology alone to do the job for you. I expected our panel about the future of wellbeing to focus heavily on apps, wearables and tech solutions. Far from it: technology is as much part of the problem; email and messaging tools are rightly blamed for contributing to workers’ cognitive overload.

Yet if Rolls-Royce can monitor every aspect of an aircraft engine’s health in flight, why not track the wellbeing of the engineer who built it? David Roomes, @Businessdayng

the group’s chief medical officer, pointed to obvious obstacles over data privacy.

Companies could overcome some of those hurdles by giving staff control of their own data so they can improve their own performance. It is more important, though — the fifth lesson — for organisations to pay attention to the “soft stuff” that helps inoculate staff against stress. “It’s about conditioning and mindset and recovery,” said Dr Roomes.

“We see people just flogging themselves to a standstill and that’s massively flawed.”

Finally, make sure you do not concentrate only on reactive measures and ignore the root causes of worker distress. It may be necessary to back a pitch for a slice of the corporate budget with data and targets, but, as one audience member pointed out, employers really should not have to make the “business case” for keeping their workers healthy and happy. Even the company doctors of the 1950s knew that prevention was better than cure.

Tuesday 24 December 2019

BUSINESS DAY

21

Executive education that fits around your lifestyle A start-up is taking on business schools by teaching workplace skills through a web tutor Jonathan Moules

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lon Alperovitz took a business masters degree at London School of Economics because he wanted to switch career. By the time he graduated, in 2018, the former operation and relationship manager at the Academic College of Tel Aviv Yaffo had started two new jobs.

From Monday to Friday, Mr Alperovitz is the business improvement architect at the London headquarters of Ted Baker, the UK clothes retailer.

On Sundays, he is an entrepreneurship tutor, logging on from his living room sofa to lead a classroom of a dozen students in Tel Aviv.

“I love it,” Mr Alperovitz says about his weekend teaching role. He works for Jolt, an Israeli technology start-up that brings students into physical classrooms to be taught from a screen by experts working remotely.

The gig economy-based business model works for Mr Alperovitz, who took on the job as a way of sharing his knowledge and passion for start-ups. He did not expect to make a living from it.

The set-up is easy. He just needs a high-speed internet connection. “We have a sixmonth-old baby so my wife takes her to a separate area of the house while I am online,” he says.

Jolt was founded in 2015 in Tel Aviv and has expanded into London and New York. Students attend the classes in person and are taught key workplace skills, such as negotiation techniques, time management and how to solve problems faster.

Jolt aims to “reinvent learning”, according to Roei Deutsch, the company’s co-founder and chief executive. “In the 21st century, learning one subject at university just doesn’t cut it any more,” he says. “Employees need to be constantly expanding their skills, and Jolt solves this problem with stackable classes that fit around your lifestyle.”

The company raised $7.2m in an equity funding round led

by European tech VC Octo-

‘I love it,’ Alon Alperovitz says about his weekend teaching role © Charlie Bibby/FT

pus Ventures, mainly to build the London classroom, which opened in January.

Developing each venue is expensive because everything in the teaching rooms, from the central table around which the students sit, to the web conferencing software, has been designed so that the lesson can be run remotely by one person.

“The learning and development market is ripe for disruption,” says Simon King, a principal at Octopus Ventures. This is what business schools call executive education — and it is worth about $100bn, according to Mr King.

Students of Jolt, known as “sojis”, pay a membership fee of £100-a-month, for which they receive an allocation of “coins”, Jolt’s currency, to fund four 90-minute classes or buy Jolt stationery and merchandise.

Additional coins can be earned by turning up on time regularly and not cancelling bookings or can be purchased through the Jolt smartphone app. Any coins left unspent at the end of a month are rolled over.

Sophie Mackenzie, assistant digital fundraising manager at the British Red Cross, was an early Jolt member in London.

“Within my sector learning and www.businessday.ng

development is fairly limited, due to the lack of funding for this type of extracurricular activity in non-profits,” she says.

Ms Mackenzie, who moved into her first management role last year, aged 24, was introduced by a friend who was a member and signed up at a taster event near Jolt’s London office in Shoreditch, the centre of east London’s tech start-up community.

“It completely busted all [my] prejudices against networking and panel discussions,” Ms Mackenzie recalls. “I actually really, really enjoyed it.”

Jolt sessions are run in a similar manner to business school seminars, where participants are encouraged to participate as much as possible. They may seem like networking events but they are actually something different.

I meet Ms McKenzie at a public speaking class in the London venue, alongside a dozen other sojis.

For an education start-up that claims to be making learning more accessible, the room is difficult to locate, in a half-finished new office development in a side street around the back of the financial district’s hub station, Liverpool Street. The

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only clue to Jolt’s existence is a sheet of A4 paper with ‘Jolt’ on it, stuck to the front door.

Once inside, however, the decor is smart. A screen fills one wall of the classroom, from which extends a large curved wooden table. The dozen or so students sit around this.

There are also framed prints of motivational phases, such as “always learning”, and cabinets filled with Jolt merchandise.

Mr Deutsch runs a finger along the teaching table in the room, noting that its curved shape is specifically designed to enable the tutor to see each student. It is attached to the screen at one end to emphasise the “connection” between the tutor on screen and the people in the room.

“This could be seen as a wasted piece of wood,” he says, measuring with his hands the width of the wood between the presenting screen and the first student’s chair. “But because it is connected to the screen we have shown that it actually improves the amount of participation of the person sitting here by hundreds of per cent.”

Jolt has entered a crowded market. Taking a slice of the huge executive education market, previously dominated by @Businessdayng

business schools, has been an aspiration of many technology companies.

Only healthcare is a bigger market globally, according to Beauhurst, a London-based analyst for young high-growth companies.

Out of the 399 “edtech” companies Beauhurst tracks, there are just 54 that are defined as professional development companies such as Jolt.

But these professional development companies have raised higher amounts on average than their peers in edtech, such as online coding clubs, and were more likely to achieve a successful exit in terms of an initial public offering or sale to another company.

Last year was the biggest on record for professional development start-ups in the UK, according to Beauhurst, with £25.4m raised over 15 deals.

Since the beginning of 2019, a further £5.1m has been raised in another four deals.

The plan has to be to “go big or go home”, according to Mr Deutsch. “This is like a military spectacle, an experience,” he says, casting an arm around Jolt’s London room. “We can only do this, however, if we do it at scale.”

22

Tuesday 24 December 2019

BUSINESS DAY

EDUCATION

Weekly insight on current and future trends in education

Primary/Secondary

‘Private sector investment in infrastructure key to improve teaching, learning’ KELECHI EWUZIE

T

he Lagos State Government says the continuous investment by private sector in educational infrastructure represents the needed resolve to ensure an improved teaching and learning processes in the state and Nigeria.

Folashade Adefisayo, Commissioner of Education, Lagos State while speaking during the commissioning of the renovated block of eight classrooms and conveniences carried out by Nigerian Breweries-Felix Ohiwerei Education Trust Fund at Eva Adelaja Girls Secondary Grammar School, Bariga, commended the company for its commitment to the development of education.

Adefisayo who was represented by Oriola Gbolahan, Chief Whip, Lagos State House of Assembly stated that the Babajide Sanwo-Olu-led administration acknowledged the significant and complementary roles being played by the organisation to improve the standard of education in the state.

“We are quite excited about what you have done in providing these facilities which we believe would go a long way to improve learning in the school. Without any doubt, I can say that your organisation has been of immense support to the growth of education in Lagos state. We are aware of other interventions in education which you have made both in the past and present”, she added.

She therefore charged the management of the school to ensure that the facilities

L-R: Hyacinth Alaekwe of Nigerian Deposit Insurance Corporation, Christiana Akindele of Securities and Exchange Commission, Innocent Okwuosa, Chairman, Nigerian Integrated Reporting Committee; Marylyn Obaisa-Osula of PWC, Olurotimi Kuti of Nigerian Stock Exchange representing Godstime after the meeting of Nigerian Integrated Reporting Committee in Lagos.

are adequately maintained while tasking other corporate organisations to take a cue from Nigerian Breweries Plc by lending their support to provide educational infrastructure or make other necessary interventions in education in the state.

Jordi Borrut Bel, managing director, Nigerian Breweries Plc, while speaking at the commissioning ceremony commended the Lagos State Ministry of Education for offering the necessary approval and support towards the success of the project.

Borrut Bel who was represented by Patrick Olowokere, corporate communications manager noted that the renovated facilities provided through the Nigerian Breweries-Felix Ohiwerei Education Trust Fund is aimed at delivering a conducive learning environment for pupils and improving the quality of teach-

ing in line with Nigerian Breweries’ corporate philosophy of Winning with Nigeria.

According to Bel, the organisation is deeply committed to making the much needed intervention in the education sector which would consequently result in the overall development of the students and teachers in Nigeria.

“As a responsible corporate citizen, our interests in Lagos state and Nigeria as a whole goes beyond the pursuit of business or profiteering. We believe that the right investment in the education of our children will secure a bright future for our nation. We are resolutely committed to supporting the development of the sector going into the future”, Bel stated.

Also speaking, the Permanent Secretary/Tutor General, Education District 4, Are-Adegbite Lola applauded Nigerian Breweries Plc for providing the

much needed facilities that would enhance the performance and quality of teaching in the school.

Appreciating the kind gesture of the company, the Principal, Eva Adelaja Girls Secondary Grammar School, Soyoye Oluyinka thanked the management of the company for the support which has been demonstrated through the renovation of the facilities in the school.

According to Oluyinka, the school authority under her leadership is confident that these facilities would no doubt contribute to the improvement in pupils’ performances both in external and internal examination.

“Last year, our SSCE results indicated that 82.8% passed the exam. With these facilities, I want to assure you that performance of our students will be 100%this year”, Oluyinka said.

Ambrose Alli University alumni Lagos launches N100m Fund to upgrade facility KELECHI EWUZIE

D

etermined to improve the state of facilities in their Alma Mata, the alumni association of Ambrose Alli University, Ekpoma, Lagos chapter has launched a N100m Appeal Fund for the upgrading and renovation of the university health centre.

Chris Iyere, chairman of the Lagos chapter of AAU Alumni association while speaking at a Fundraising and Awards Dinner in Lagos, decried the preventable deaths and lose of lives in the university community as a result of the poor state of the health centre on the university campus.

Iyere pointed out that a visit to the health centre revealed that the facility is operating

with obsolete equipment, some dating back to the 80s when the facility was established.

According to Iyere, “It is appalling that students are still dying due to common malaria as there are no modern diagnostic equipment for proper test, the building is in shambles, no beddings in the wards. It calls for serious introspection and action,” He therefore urged the alumni of the university to donate generously to the fund.

Lawson Omokhodion, Prochancellor and Chairman of the Governing Council of Ambrose Alli University in his goodwill message to the occasion commended the Lagos chapter of AAU alumni for its decision to give back to the university that made them what they are today by raising www.businessday.ng

funds for the upgrading of the university health centre and building of an E-learning centre and other projects in the university.

Omokhodion who was ably represented by Osezua Abhulimen, an alumnus of AAU, said the new Governing Council inaugurated in October 2018 has been tackling the problems of dearth of infrastructure in the university, wrong deployment of academic faculty, deficient international linkages, inadequate funding of the university among other challenges.

He specifically commended the Visitor to the university and the Governor of Edo State, Godwin Obaseki for the support he has given to the Council to turn around the fortunes of the University.

Omokhodion listed some

of the progress made by the university under the present Governing council to include the commissioning of four massive buildings funded by TETFUND in November this year at the cost of N4 billion.

In addition, he said that the President of Dangote Group of Industries, Aliko Dangote has pledged to build two 500-room hostels for male and female students during the last convocation of the university to help reduce the problem of accommodation of students in the university.

The chairman of the Governing Council commended some alumni of the university such as Chris Oyakhilome, Founder of Christ Embassy Church and Tony Elumelu, Chairman of UBA for their contributions to the growth of the university.

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Higher

Human Capital

NIRC set to create awareness on integrated thinking and reporting KELECHI EWUZIE

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embers of the Nigerian Integrated Reporting Committee (NIRC) at its recent gathering in Lagos identified three pillars that will be pivotal to the promotion of Integrated Reporting in Nigeria.

Innocent Okwuosa, Chairman, Nigerian Integrated Reporting Committee and a Council member of the Institute of Chartered Accountants of Nigeria (ICAN) gave an insight into the strategic action plan of the Committee in a media chat after the strategic session.

Okwuosa, who is also a member of Africa Integrated Reporting Council (AIRC), said the Committee’s strategic action plan is built around three pillars: awareness/advocacy, engagement and capacity building. These three pillars have actionable programmes that have been further grouped into short term, medium term and long-term plans.

He further stated that awareness and advocacy programmes will see the NIRC engaging with both private and public sector organizations in

Nigeria including listed companies and MDAs. According to him, “NIRC will be meeting and addressing top management and policy makers of corporate reporting regulators like Financial Reporting Council of Nigeria (FRCN), Securities and Exchange Commission (SEC), Nigerian Stock Exchange (NSE), Central Bank of Nigeria (CBN), National Insurance Commission (NAICOM), National Pension Commission (PenCom), Corporate Affairs Commission (CAC), Federal Inland Revenue Services (FIRS), Ministry of Finance, Accountant General Office, Auditor General office among others.

Okwuosa said the Committee will author two documents that will provide conceptual clarification of integrated thinking and reporting and how organisations in Nigeria should approach it.

It would be recalled that NIRC was inaugurated on October 17, 2019by the President, Institute of Chartered Accountants of Nigeria, Mazi Nnamdi Okwuadogbo, further to the approval of the governing council of ICAN granted in 2018 to establish the Committee.

‘We remain committed to provide well-rounded education’ KELECHI EWUZIE

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ead of Corporate Strategy, Greensprings School, Uche Ogbu says as the first thinking school in Nigeria, Greensprings remains committed to provide a well-rounded education.

Ogbu observes that even though the school is very serious with academics as exemplified by the performance of 5 of its students emerging Top in Country in the 2019 IGCSE examination, we take extracurricular activities very serious.

Speaking about the performances of students in the Christmas shows held across all four campuses of the school, Ogbu expressed happiness about the students’ performances adding that “The stunning performances of our students in these shows support the fact that we are a school that support all round development” Greensprings School celebrated Christmas shows across its four campuses including Anthos House, its school for special needs education. The shows were attended by parents, members of staff of the school and well-wishers, and the students thrilled the attendees with stunning performances.

Onayimi Aiwerioghene, a @Businessdayng

parent while speaking at the school’s Ikoyi campus Christmas show themed A Midwife Crisis, said, “I have never seen a school’s Christmas show production this good! The costumes were perfect, and the storyline of the nativity of Jesus dramatized from a midwife’s perspective was compelling.”

“The midwife heard the news of a king that’s going to be born soon, so she wanted to be the person to take the delivery and be glorified. She believed that kings are supposed to be born in the palace; so she ran helter-skelter in Jerusalem, looking for the palace where Mary would give birth to King Jesus – only to discover that Jesus has been born in a stable.

And rather than Jesus needing the midwife for his delivery, it was the midwife that needed Jesus, so as to be safe and free from sins.”

“The teachers put in a lot of effort in preparing the students for the show, and the students did very well. I enjoyed the show as it was filled with excitement from beginning to end.

Kudos to the teachers!”

The Christmas show themes for the school’s Lekki and Anthony campuses are AIDA and Revelations respectively, and the parents at the shows also spoke to our reporters on how much they were captivated by the presentations of the students.

Tuesday 24 December 2019

BUSINESS DAY

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EDUCATION How technology is fast disrupting Nigerian classrooms ANTHONIA OBOKOH

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he state of education in Nigeria is in dire need of academic curriculum revamp, infrastructure upgrade and increased funding.

In addition to these are several other challenges including lack of teacher innovation, lack of involvement from parents, overcrowded classrooms among others which if addressed would help to reduce poverty, boost economic growth and increase income.

As is the case in every sector, technology can potentially provide innovative solutions if fully embraced and effectively utilised.

One of such technological innovation essential for operating schools effectively and revolutionising classrooms are school management software.

These softwares are platforms designed to automate schools diverse operations from classes to exams to school events calendar. More importantly, these platforms improve and provide better insight into student performance and attendance.

Chris Opetiyan, technology analyst said the emergence of technology has seen various sectors and industries across the world radically transformed for the better.

“The education sector is

no different with innovative technology solutions rapidly altering how schools operate with better outcomes for all stakeholders involved including students, parents, teachers, school owners and even the society.

“Educare is one of such disruptors in the country’s education sector providing tools needed for stakeholders to efficiently manage school life and drive improvement in learning outcomes,” he said.

Meanwhile, EdTech platforms such as educare are rapidly changing the game and disrupting Nigeria’s education system for the better.

The leading school management software saves time and provides better insight into performance, attendance, class and school-wide view, demographic and biological data, medicals and so much more for students at the Nursery, Primary and Secondary Level.

However, parents are also informed in real time scale, of the activities and performance of their children through a readily available and regularly updated news feed.

The adoption of education technology solutions such as educare will mean more individualised approach for students, increased parental involvement, creative teaching by educators and overall better outcomes.

Oando employees celebrate with pupils through Art and Craft …refurbishes early childcare classes in adopted school KELECHI EWUZIE

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n commemoration of the 2019 International Volunteer Day, Oando Foundation led a team of Oando PLC employee volunteers to engage with pupils of Metropolitan Nursery and Primary School, SariIganmu, Orile; an Oando Foundation adopted school.

The initiative themed “Trash to Art” was aimed at refurbishing the Early Child Care classes in the school, providing age-appropriate educational materials, and increasing creativity among learners through arts and crafts using fun based activities such as still-life drawing, class painting, creative collages, sketching and coloring, amongst others.

Adekanla Adegoke, Head of Oando Foundation, speaking on the visit, noted, “On this year’s International Volunteer Day, we are reminded how fortunate we are as an organisation to have such dedicated individuals willing and able to volunteer their time and resources in enriching the lives of others, especially those in our

adopted schools.

Adegoke said the foundation believe in the power of collaboration through volunteerism in actualising the Sustainable Development Goals, particularly Goal 4 which remains Oando Foundation’s key focus.

“We are hopeful that today’s donations and engagement with the students have positively inspired them, and more importantly will help improve their future learning experiences for better outcomes”, Adegoke said.

Ayotola Jagun, Chief Compliance Officer, Oando Plc, who also volunteered for the event appreciated employees for the impressive turnout, emphasising the relationship between this action and Oando’s core values.

“With the amount of volunteers that came out today to support the Foundation’s drive, it is evident that Oando’s core values have been embedded in our DNA. As Humans of Oando, we will continue to support the Foundation’s efforts in mobilizing resources to raise the standard of basic education in Nigeria”. www.businessday.ng

‘Leveraging emotional intelligence for effective M&E in basic education delivery’ SEYI JOHN SALAU

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or effective monitoring and evaluation (M&E) of basic education delivery across Nigeria, education managers, planners and stakeholders are to leverage emotional intelligence as catalyst for standardised educational output in schools.

It is believed that this will help monitors to deploy the right communication skills and human relations techniques in relating with contractors handling basic education projects in their various states.

“Recent research suggests that the competencies associated with emotional intelligence are not set in stone at birth, but that the emotional competencies can indeed be learned and developed,” said Olufunso Owasanoye, executive director, human development initiative (HDI), stating that, “Emotion is a strong feeling that is not visibly seen, majority finds it very difficult to cope, connect or communicate effectively with themselves and others.”

Owasanoye stated this at a recent M&E training of community volunteers and stakeholders in basic education

Advocaat Law Practice (ALP) recently launched its annual mentoring programme themed “Lighting the Path” with the objective of providing mentoring and guidance to young school leavers from Lagos state public schools. The inaugural mentorship session held at the firm’s Lagos offices and had in attendance students of the Birrel Avenue High School.

who were mobilised to monitor SUBEB projects in Lagos.

The training was conducted with support from Mac Arthur Foundation, which facilitated the training of over 50 monitors from various local government education authorities (LGEAs), to monitor the implementation of the 2018 Action Plans in their LGEAs. “What the training has achieved is awareness. Most of those in the community level were not aware of projects funded by UBE in their community talk less that they can be empowered to monitor it.

“As we need intellectual ability to be successful in every aspect of our lives, we also require emotional intelligence that can help us to turn intention into action, in order to

make inform decisions about the things that matter to us and others,” said Owasanoye.

James Fadokun, of the National Institute for Educational Planning and Administration (NIEPA), said bottom-up approach to M&E initiated and owned by the community is required to stop the systemic failure in Nigeria’s education sector.

According to him, monitoring must be evidence based to ensure quality delivery of educational outcomes.

Dapo Israel, permanent board member, Lagos State Universal Basic Education Board (SUBEB) said the introduction of the state’s Eko Excellence in Child Education and Learning (EkoEXCEL) programme is to promote

collaborative learning that engages the pupils/students to deliver better educational outcomes.

“It has two dimensions, first is the introduction of technology into our schools and the cultural shift, which is the best part of it; because when you have a culture reorientation – for life that expression cannot be taken away from you,” said Israel.

Israel opined that there is going to be unified tutorials, lesson note, and that the state has factored in sustainability plan into the execution of the scheme. According to him, 300 schools will be used at the pilot stage of the Eko EXCEL programme when schools resume back for the 2019/2020 academic session in January.

EY donates equipment to aid teaching, learning processes in St. Joseph Catholic School …gift less privilege food items KELECHI EWUZIE

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etermined to support the process of teaching and learning especially among special need pupils, Ernst & Young (EY), a multinational professional services firm has donated 32” LG LED

TV; HP Printer; Sound system; Projector; and 55” Omaha Smart TV to St. Joseph Catholic School.

The company also donated educational materials and some food items to an orphanage as part of its Corporate Social Responsibility (CSR) initiative of giving back to its host community and in celebration

EY Charity Day 2019 visit to St. Joseph Catholic School, Elegbata, Akpongbon, Lagos Island. https://www.facebook.com/businessdayng

of EY’s Charity Day 2019.

While several food items and toiletries were donated to Living Fountain Orphanage that is located in Victoria Island Lagos, to assist the orphanage to achieve its purpose of giving shelter and care for abandoned and homeless children.

Henry Egbiki, general managing partner EY West Africa and Country leader for Nigeria said the EY’s Charity Day 2019 is about the passion to support communities as part of strategic plans towards building a better work place for all.

According to him, “EY is not just about profitability, most times when you think of private organisation, the focus is on profitability; meanwhile we have gone beyond that. We realised that there is a higher purpose why we exist as an organisation, and that purpose is to build a better working environment around us.”

Egbiki opined that efforts are made by management of EY to understand the needs of the people visited. “Touching communities, touching lives, EY cares; that is why we come @Businessdayng

out with this programme.

Every year we set out a day to visit orphanages, schools to support them. We are very passionate about this, and the way we do it is not just to seat in the office and send gifts or money.

“We actually send senior people and members of staff in the organisation to actually visit the environment to relate with the children in the orphanages that we visit; discuss with the leaders in that place to understand what are their needs, what are their pain and what they are doing so that we can actually relate with what they are doing,” Egbiki stated.

According to the EY country head, each year the team visits places, it get inspired seeing the level of humanitarian service the people are doing. “We do not want to visit the same place every year; so, what we do is to actually scan the environment, visits all the schools, orphanages to understand their needs and we select. We also make sure that at least we do not visit the same place every year, so we can spread the love around,” Egbiki concludes.

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Tuesday 24 December 2019

BUSINESS DAY

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Tuesday 24 December 2019

BUSINESS DAY

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Tuesday 24 December 2019

BUSINESS DAY

Investments

ENERGY INTELLIGENCE

Market Insight Companies Commodity Tracker Policy

OIL

GAS

PETROCHEMICALS

POWER

Nigeria’s neighbours, Ajaokuta Steel did not pay electricity bills in Q2 2019- NERC DIPO OLADEHINDE

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eport from Nigerian Electricity Regulatory Corporation (NERC) has revealed that in the second quarter of 2019, Nigeria’s Ajaokuta Steel Company and international customers such as Niger Electricity and Togo/Benin Electricity did not pay electricity bills.

According to NERC in q2 2019, Special customer which is also known as Ajaokuta Steel company and some international customers did not make payments to appropriate stakeholders such as Nigeria Bulk Electricity Trading Plc and Market Operators.

“During the quarter under review, the special and international customers made no payment to NBET and MO,” NERC admitted in its report.

The Commission noted that Ajaokuta Steel and international customers’ owed Nigeria electricity bills totally N11.17billion.

“The invoices issued to Ajaokuta Steel Co. Ltd (designated as special customer) and International customers (i.e., Societe Nigerienne d’electricite – NIGELEC and Communaute Electrique du Benin–CEB) stood at N0.32billion and N10.85billion respectively,” the Commission said.

NERC admitted that the Nigerian government has continued to engage governments of neighbouring coun-

tries benefitting from the export supply to ensure timely payments for the electricity purchased from Nigeria.

NERC revealed that out of a total invoice of N180.08 billion for energy received by 11 Distribution Companies (Discos) for energy received from NBET and for service charge by MO, the sum of N55.10billion of the total invoice was settled, representing 30.60percent remittance performance, and 2.83 percentage points increase from the first quarter of 2019 “Notwithstanding the slight progress recorded in the second quarter

of 2019, the financial viability of the Nigerian Electricity Supply Industry (NESI) is still a major challenge threatening its sustainability,” NERC said.

NERC said DisCos’ total average remittance to the market which implies NBET and MO during the second quarter of 2019 was 69.68 percent ranging from 43.68percent for Kano DisCo to 80.80percent for Eko DisCo. “This clearly indicates that regardless of the prevailing tariff shortfall, DisCos’ remittance is still signifi-

cantly below the expected threshold.

Thus, to ensure business continuity and improve sector liquidity,” NERC said.

In pursuit of addressing low remittance to the market and a review of DisCos’ viability as a going concern, the Commission said it met with the management of some of the utilities to review their performance and related strategy towards addressing their operational and commercial challenges.

NERC said it has extracted minimum performance obligations from

the DisCos and the compliance unit charged with responsibility for tracking and further actions as necessary.

“The Commission has also finalised a framework for minimum market remittance threshold that would ensure a fair and equitable distribution of market revenues and an intervention towards managing the liquidity and financial challenges of the electricity industry,” NERC said.

NERC said it had also directed Abuja DisCo to pay N50million in compensation to the family of late Master Mohammed Arafat Jibril, and a fine of N250million to the Commission for their infractions on the safety of their power infrastructure. However, Abuja DisCo has since taken the Commission to court challenging the validity of the Order with particular reference to the penalties.

The Commission approved the certification of 14 Meter Service Providers for manufacturer, importer and installer categories and issued permits to 18 Meter Asset Providers.

“The Commission also continued with the technical evaluation of 14 Eligible Customer applications during the second quarter of 2019,” NERC said.

As noted in the preceding quarterly reports, NERC said another major initiative towards improving revenue collection and remittance in the Nigerian electricity supply industry is the provision of meters to all registered end-use consumers of electricity.

Digitisation can create $1trillion value for Nigeria’s oil and gas firms – Seplat DIPO OLADEHINDE

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igeria’s largest listed Oil & Gas firm by market value, Seplat petroleum development plc said through digitisation Nigeria’s energy companies can create a valuation of $1trillion which will help them thrive despite the turbulent market landscape characterized by volatile prices, regulatory overhangs around energy transitions to renewable energy, insecurity in oil production terrains and fiscal uncertainty.

Digitalisation in the energy sector involves the use of data to manage and control multiple operations. It drives efficiencies in energy management and automation systems. Importantly, workers in a digital industrial environment enjoy a massive increase in skills and productivity.

Stakeholders said digitised data gives all of the ease needed by energy companies to grow effectively and also conduct business more efficiently through automation.

“Digitalisation has the potential to create about $1trillion of value for Nigeria’s oil and gas firms,” Seplat’s general manager external affairs and communications Chioma Nwa-

chuku said in her presentation titled “Powering the Future And Digital Transformation Of Nigeria’s Oil, Gas And Renewable Energy Sector With New Knowledge And Skills.”

Outlining on how Nigerian oil and gas industry can leverage on digitisation for sustainable development, Nwachuku said firms must invest in Technological Infrastructure, make digital transforma-

tion a business priority, increase collaboration among companies focus on digital strategy and security while at the same invest in research and development to turn ideas into commercially viable technologies.

Nwachuku said rather than depend on the size and scale of its assets alone, Seplat is driving innovation to maintain its leading position.

Seplat has installed intelligent sensors on all gas plant and select flow stations at Oben, Okporhuru and Orogho gas fields while Sensor calibration and Site Acceptance Tests (SAT) was also put in place to ensure data reliability, reproducibility and integrity.

Other digital impacts on Seplat’s operations include remote monitoring of wellhead pres-

sure and temperature, use of an ‘as-built’ model of facilities that can be viewed through the Navisworks software, use of Infor EAM software to optimize contracting and procurement processes and deployment of Power BI to track key performance indicators for efficient decision making.

In the last five years, Seplat said it have invested over $8million on training work force which is expected to promote new, digital thinking to drive a culture of innovation and technology adoption in the organisation.

Nwachuku said embracing digital transformation is important as advances in technology across the globe is affecting oil and gas exploration, production, distribution and marketing.

“The digital transformation of the Nigerian oil and gas sector involves the changes arising from the application of digital technology to the industry. It has provided opportunities for companies to save millions from operating costs, reduce carbon footprint and enable smarter and more efficient asset base,” Nwachuku said.

“Whether in the oil and gas or renewable energy sector, future winners will need and skills,” Nwachuku concluded.

Tuesday 24 December 2019

BUSINESS DAY

OFFGRID BUSINESS

27

‘International companies are paying a lot of focus on Nigeria’s renewable Sector’

Rensource has just raised $20Million in a Series A equity financing round which is the largest raised by a Nigeria renewable energy startup. ANU ADASOLUM is the Chief Operating Officer at Rensource. She drives the engine room of Rensource’s operations, providing day-to-day leadership and management, empowering the operational team to meet business goals and projections. Her role includes driving growth strategies, managing talent and refining processes to realize the company’s ambition to deliver off-grid power solutions to millions of Nigerians. In this discussion with DIPO OLADEHNDE, She explains the idea behind the fundraising and Rensource next plans after the new financing deal.

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ensource recently raised investment of about $20million is bringing hope to small businesses as it plans to connect one-million merchants with solar energy in the next five years. What’s the implication of these technologyenabled value-added services to SMEs and how will it change things for the renewable energy sector?

Generally at Rensource our focus is on SMEs, we try to make life as easy as possible for SMEs using power products which allow them puts Rensource on their core business. However, beyond the power products, we try to translate these technological services across their other values chain. We have spent enough time in the market to know what their pains are, most especially with the challenges they deal with in running their day to day operations.

In our research, we discovered that in doing business in Nigeria, majority of the SMEs do things that are not core to their business.

Although at Rensource, energy is the main thing now we are looking at how we can make their life easier in other parts of SMEs operations that might be a bit difficult to access in Nigeria or are taking for granted. We have software’s that can make it easier for SMEs to track what is going on in their stores, monitor supply or sales.

Traditionally, it’s difficult to access data on informal business; however, at Rensource the data we have on our customers enable us to enable them to know their challenges and give them access to things that make their life and ways of doing business easier.

You mentioned earlier about leveraging on technology to make life easier for SMEs so is Rensource a technological company or a renewable company?

I don’t think they are mutually exclusive, we are both. We have always used the most advanced technology available in the solar world in providing energy for our audience. For instance, we can monitor all our systems from our office; we can switch off a meter in Kano from Lagos. We use the smartest technology possible so it’s basically the same principle however right now

are encouraging any off-grid decentralized player to come in and deregulation are favorable in a certain way and that helps. I also think companies like Rensource are also showing other firms it’s possible to play in Nigeria in a big way which is a signal for others to come in.

Is Rensource scared of competition?

I think we are fairly different form everyone else in what we do, we are working for sure in more complex part than some other players. We are comfortable there and we know the field, we will just keep giving the best service possible.

Competition is not something we really focus on, it’s really about innovating for your customers so they can be as happy as possible.

Anu Adasolum

we just applying it in fields that are not typically associated with us. So we are still expanding our energy services in a big way, we are not stepping away from the energy space we are scaling there in a big way; we plan to be in a 100 market going forward. It’s just that we are looking at our core capabilities and looking at ways we can use them to further service the people we are already dealing with.

Nigerians would like to know the precise state you would be kicking off the SMEs plan?

Rensource operates in seven clusters across six states in Nigeria such as Lagos, Kano, Ogun, Ondo, Oyo, and Edo. We are looking at expanding this further; we want to be in as many states as possible. We are also looking at Kaduna, Abuja, and Anambra. For us, geography is not a barrier or limitation.

What is the next stage after the

announcement of this deal?

Right now, it’s really about scaling our core operations in Energy, we are expanding that in a big way and making sure we give the best customer experience as possible.

What’s your assessment of Nigeria’s renewable energy space in 2019?

It’s definitely a step forward; a few other companies have raised funds this year.

Internationally there is a lot of focus on Nigeria, companies who are operating in other parts of African are coming into Nigeria which is a good thing because it’s a big market and a big gap and the more investors we have in the sector the less the number of people with power problems which is always a good thing.

Also, the various levels of government have recognized that Nigeria central grid problems are fairly complex and it will take a while so solve and so while they are trying to solve that, they

ANALYSTS: Isaac Anyaogu (Team Lead), Stephen Onyekwelu, Dipo Oladehinde

What’s your message for Nigeria regulators going forward?

They should continue to be supportive of the sector; there is a lot of interest in the sector both locally and globally.

Investors are doing their part, so it’s up to the government to continue to give the space and comfort for investors to bring their money in. The Rural Electrification Agency (REA) led by Damilola Ogunbiyi set the tone and did a lot to bring in a lot of people and also raise the money from the World Bank that government used subsidy to the much additional players, which has encouraged more people to come in, now that she has moved on, one hopes that the momentum is not lost.

We are also looking to work with Discos in a big way, so that if the regulation can be clearly up then it creates much sense of comfort to us to put our money down and say we will partner Discos in areas they can’t transmit to but for it to work every player needs to be able to do their parts and stick to the contract.

Can you be more specific about the discussion with Discos and how feasible is it?

We are working on it as soon as there is a landing, journalists will be the first to hear.

Which of the Discos have you had discussion with?

We have discussion with a few but I can’t share details of the discussion, some Discos are not so flexible while a few are coming on board.

Feedback: 07037817378, 08137433034, 08135447789

email: isaac.anyaogu@businessday.ng, stephen.onyekwelu@businessdayonline.com, oladehinde.oladipo@businessdayonline.com

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Tuesday 24 December 2019

BUSINESS DAY

FEATURE Lafarge Africa: Confronting industry challenges with newly improved ‘Elephant Supaset’ cement SEYI JOHN SALAU

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he construction boom in Nigeria has had a great influence on the state and structure of the built industry.

Although the industry has grown very rapidly in the last few years, however, this growth came with some sociological problems like urban decay, compliance with standards and product standardization issues.

While local contractors are being encouraged by the government to improve on standard, it is hoped that stakeholders in the building and construction industry will develop sustainable strategies to arrest urban decay through effective housing delivery.

Furthermore, there is an urgent need to utilise housing as a catalyst for economic development that will engage professionals in the housing delivery value-chain on the modalities to reduce housing cost through modern techniques and construction materials.

A key stakeholder in the housing delivery value-chain is the block maker. It is noteworthy that cement is a major constituent of blocks for building and construction. Latest studies on the application segmentation of cement show that the block making segment accounts for about 20 percent of total cement consumption.

More so, blocks and precast represent about 22 percent of construction works across the world. Every player in this subsector wants to maximize profit, sometimes cutting corners to produce between 35 to 45 blocks from a bag of cement against the industry standard of 20 to 25 blocks from a 50kg bag of cement.

Unfortunately, this means inferior blocks and weak buildings.

In response to helping the block makers maximize profit while still keeping to industry quality standard; Lafarge Africa recently re-launched an improved formulation of the Elephant ‘Supaset’ cement. This was done to deepen Lafarge’s continuous drive for excellence and innovation in the construction industry.

The new Supaset cement, now in horizontal bags, is the first cement formulation specifically for block making. Supaset is formulated to deliver superior performance to block makers and like other Lafarge Africa brands, consistent quality. The product is tailor-made to complement the efforts and promote the businesses of artisans, specifically block makers and other building construction workers.

L-R: Jelili Akinpelu, audit committee member, Nigerian Institute of Building (NIOB); Gbenga Onimowo, commercial director, Lafarge Africa plc; Michel Puchercos, CEO, Lafarge Africa plc; Abiodun Awe, council member, Nigerian Society of Engineers, and Idim Nsemo, sectional head, product certification department, Standard Organisation of Nigeria (SON), at the re-launch of Lafarge’s newly improved ‘Elephant Supaset’ cement in Lagos.

“The introduction of this improved formulation, ‘Supaset’ is in line with the growth pillar of Lafarge Africa’s Strategy 2022, ‘Building for Growth,’ which aims to drive profitable growth and accelerate our performance in key areas. Providing such a product for our customers is keeping to our commitment to excellence,” said Michel Puchercos, CEO of Lafarge Africa plc.

According to Puchercos, Lafarge Africa has continued to lead technological advancement in the Nigerian manufacturing sector in the last 60 years. Its global presence and research centre in Lyon, France, provides a unique opportunity for the cement manufacturer to deliver in line with best practices and create innovative products and solutions that deliver more value to its customers.

“The new Elephant Supaset is a solution to the long yearnings of our customers, especially block makers who have lost investments as a result of cement products that do not guarantee the strength needed for construction of buildings and other strong high concrete construction works,” Puchercos stated.

Speaking further on Lafarge’s contribution to the built environment as a responsible company, Puchercos said the cement maker’s insights further strengthens its commitment to build for growth and deliver on sustainable construction in alignment with the United Na-

tions Sustainable Development Goals number 11 and 12.

According to Puchercos, by 2030, the world, and indeed Lafarge Africa hopes to attain the goal of sustainable cities and communities amidst responsible production and consumption. In this regard, Supaset provides the right foundation to achieve these goals in the building industry.

“In view of the huge investments in the industry, Supaset provides a solution to making stronger blocks and precast materials at an affordable cost that will not devalue the bottomline of our esteemed customers.

Our artisans now have cement that is stronger, durable and customized for their need. A product they can use efficiently without any fear of losing out on their investments—a product that offers inestimable value.

Across our supply chain, this is our promise,” Puchercos assured consumers.

Supaset is bespoke and more refined to achieve stronger buildings and durable construction works. The superior qualities of Supaset pitched the product above other brands in the market, making it the perfect choice for block moulding and a variety of precast elements.

With the peculiarities of weather conditions across the different regions of the country, Lafarge Africa has improved Supaset to answer to all climate conditions. For commercial value, blocks that are moulded with the new Elephant Supaset

are ready for use in 24 hours.

That would increase the capacity and capabilities of block makers to meet up with increased demand of their product, with higher volume that guarantees more profit.

The brand’s unique value propositions of ‘Supa strong, Supa quality and Supa Value’ are all linked to the fact that Supaset guarantees strong blocks and structures derived from a quality brand which gives unlimited value in profit to the trade and durability to the structure.

“The cumulative result of this is that Elephant Supaset guarantees that blocks set fast and buildings are strong,” said Gbenga Onimowo, commercial director of Lafarge Africa plc, acknowledging that the new product is in response to customer needs and in line with global industry standards.

According to Onimowo, Lafarge Elephant Supaset cement is now positioned as ‘The Chairman’ for the construction of solid structures, being the first specialized cement for block making, precast moulds and concrete applications in Nigeria.

Speaking on other strategies to position the brand in addition to launching the new look horizontal bag improved product performance, Onimowo said that Lafarge supported the roll out with a new marketing communications campaign across conventional and new media channels to improve brand awareness and recall.

“We launched Supaset because we have a unique understanding of the needs of our customers and end users.

With our access to global best practices, innovative solutions from the LafargeHolcim Group we were able to identify and introduce Supaset to take the lead and provide real solutions in construction. We understand the huge losses that block makers face due to the lack of cement formulation that guarantees fastsetting and superior blocks and by extension durable structures,” Onimowo said.

“Supaset, just like the name rightly suggests, is a rapid-setting cement that enables blocks dry and set fast, while retaining its quality and ensuring no cracks and breakages thus making it the only cement with such capabilities in the market today.

The desire to further secure and grow our market share within this segment took us back to the drawing board and the result is what we are experiencing, the relaunch of an improved Supaset.

Supaset has superior value, sets fast and enables the production of ready to use blocks within 24 hours,” he stated.

According to Onimowo, Supaset is the ideal choice for high strength concrete for advanced construction works. He said that Lafarge Africa continues to lead in innovation and creativity, adding, “We are equally proud to present this newly improved product in horizontal cement bags; the first of its kind in Nigeria.”

Tuesday 24 December 2019

BUSINESS DAY

BDTECH

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E-mail: jumoke.akiyode@businessdayonline.com

How communication tax may slow broadband service adoption, impede economic growth Stories by Jumoke Akiyode Lawanson

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espite the desperate calls to the Federal Government of Nigeria to end multiple taxation on the heavily taxed telecommunications sector, stakeholders are further taken aback by the nine percent communications service tax (CST) that was previously suspended by the 8th National Assembly which has re-emerged, and is being considered to be passed into law.

The Communication Service Tax (CST) Bill 2015, if passed, will require consumers of voice, data, short message service (SMS), multimedia message services (MMS) and pay TV services, to pay a nine percent tax on the fees paid for the use of these services.

The tax will be collected in addition to the 5 percent Value Added Tax (VAT) that consumers already pay when they purchase devices and communication services, as well as the 12 percent custom import duties paid on ICT devices, and the 20 percent tax levied on SIM cards.

Industry players say the impact of the adoption of nine percent CST bill is a double tax on voice, sms and data services, as five percent VAT already applies on these services.

The GSMA recently raised serious concerns about a proposal to introduce a nine percent Communication Service Tax in Nigeria. Following substantial research into the impact of taxation on mobile communication services, the GSMA believes such a tax poses a severe threat to Nigeria’s future economic growth.

They say imposing a new ‘sectorspecific’ tax on communication services would result in increasing price levels for consumers, and as a result, decrease the adoption and usage of broadband services. This will in turn have adverse effects on the industry investment needed to improve and expand mobile connectivity across the country. The proposal departs from best-practice principles of taxation recommended by the International Monetary Fund and the World Bank.

These institutions recommend that taxation should be as broad-based as possible (i.e., not sector-specific) and should not undermine investment.

“The government’s long-term digital ambitions will be severely compromised if these tax proposals go ahead,” said Akinwale Goodluck,

head of Sub-Saharan Africa, GSMA. “The potential of mobile broadband is clear from the rapid development of the digital economy in Nigeria. The mobile ecosystem already contributes over US$21 billion to the Nigerian economy and around 16 per cent of total government tax revenue. The focus should be on boosting mobile penetration, and investment in networks to strengthen the economy, rather than undermining this through potentially punitive taxes.”

Economic impact of mobile services is at risk According to the International Telecommunications Union (ITU), a 10 per cent increase in mobile penetration in a sample of African countries yields a 2.5 percent increase in GDP

per capita. To support sustainable economic growth, fiscal policy in Nigeria should promote the wider adoption of broadband services and not hamper their adoption. Such taxes could also end up having a disproportionate impact on poorer households.

Affordability is a barrier to adoption Nigeria recently surpassed 100 million subscribers1. Despite this fact, around half of the population remains unconnected. About one-third of the population in Nigeria use a mobile internet service, and the same proportion have a smartphone. Based on this, Nigeria currently lags its regional peers in terms of mobile broadband adoption. Increasing adoption is crucial in a country where fixed-line penetration is at less than one percent.

L R Olushola Teniola, President Association of Telecommunications company of Nigeria ATCON; Mohammed Ajiya, President/CEO, Digital Bridge Institute DBI; Aisha Mumuni, General manager Value Added & Digital Services MTN Nigeria; Felix Adeoye Commission Secretary Nigerian Communications commission (NCC), representing the Executive vice chairman NCC, Umar Garba Danbatta; Ephraim Nwokenneya, Director Research and Development NCC; Chris Uwaje, Chairman panel of Judges, during the Emerging Technologies Competition and Exhibition held at DBI Lagos recently.

Among the unconnected, affordability is cited as the main barrier stopping them from getting a connection. Based on GSMA analysis of the total cost of mobile ownership, a 1GB basket in Nigeria costs around seven percent of average income in 2018.

This is significantly above the United Nations Broadband Commission’s affordability target of 1GB of mobile broadband data available for two per cent or less of gross national income per capita. The affordability barrier is particularly evident for lower income citizens in Nigeria for whom access to a 1GB basket would cost around 24 percent of income. The new tax, even if only partly reflected in prices, will exacerbate an already significant affordability barrier and hamper the uptake and usage of services, especially for lower income citizens.

“To support its digital agenda, the government should take steps to remove any barriers to affordability, increasing mobile penetration, and investment in Nigeria’s digital infrastructure. This will, over time, lead to much faster economic growth together with higher fiscal income for the government from a broader tax base,” Akinwale Goodluck said.

According to Olusola Teniola, president, Association of Telecommunications Companies of Nigeria (ATCON), the adoption of CST represents an additional burden when applied to a subscriber base of 173 million.

“If the passage of this bill goes through it would negatively impact Nigerians and foreigners that use these services. The implementation of this CST bill would take the affordability of data services out of the reach of the citizenry,” Olusola told BusinessDay.

Global Data Centre Dynamics awards Rack Centre for its operations

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ack Centre, the first carrier neutral state-of-the-art Tier III Constructed Facility Certified data centre in Africa offering colocation, content distribution, interconnect and Cloud services has won ‘The Operations Team of the Year Award’ at the Global Data Centre Dynamics (DCD) award ceremony recently held in London.

Often referred to as the ‘Oscars’

of the data centre industry, the DCD Awards is a global award recognising worldwide excellence in the data centre industry.

The DCD judges recognised Rack Centre operations team’s excellent performance in the data centre operation management despite a very challenging operating terrain, characterised by lack of reliable grid power and limited access to skill sets,

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the Rack Centre team has continued to achieve set objectives at Nigeria’s first carrier-neutral Tier III colocation data centre, using purely local talent and 100 percent uptime of the Rack Centre data centre facility.

Reacting to Rack Centre being celebrated by winning such an outstanding award, Ezekiel Egboye, the chief operating officer of Rack Centre, said “availability is the most criti-

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cal goal and Rack Centre operations team have put in place processes, procedures to deliver 100 percent availability of services and infrastructure since launch, and an outstanding track record of customer satisfaction. Rack Centre operates the most comprehensive Tier III certified ecosystem of carriers, ISPs and content distribution networks in West Africa.”

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Rack Centre is not new to winning DCD awards having won in 2018 the Data Centre Manager of the Year awarded to Sunday Opadijo, its head of data centre infrastructure, this was the first of such win in Africa. Rack Centre was also the first Africa Data Company to win at DCD award with the Data Centre Impact award for Europe, Middle East and Africa in 2015.

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Tuesday 24 December 2019

BUSINESS DAY

BDTECH

E-mail: jumoke.akiyode@businessdayonline.com

Smile introduces innovative eSIM for seamless access Jumoke Akiyode-Lawanson

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s part of its continuous quest to always avail its customers with unmatched products and services, Smile Communications, Nigeria’s popular broadband service provider has introduced an innovative Voice and SMS only product dubbed eSIMVoice.

Early adopters, industry watchers and technology enthusiasts have hailed this latest product as “the future of seamless access”.

An official statement from Smile Communications, disclosed that Smile eSIMVoice comes as a free downloadable application, and when activated the consumer can enjoy 10 minutes free local calls, unlimited on-net calls and SMSs. The customers can also savour zero roaming charges, free on-net audio and video calls and the lowest call rates to any network.

The company advised that customers and prospects eager to enjoy its latest innovation, to simply walk into any Smile shop, kiosk or contact an authorised dealer. The service comes with varying voice plan options that will suit every need. Notable among the Voice Plan options are SmileVoice only plan for 65 minutes, which costs only N500, SmileVoice only plan

for 135 minutes which goes for N1,000 and the SmileVoice only plan for 430 minutes at a cost of N3,000; all the options have 30 days validity period each.

To enable as many customers as possible to take advantage of this offer, Smile has simplified the process towards adopting and enjoying the new product. To activate the offer, the customer needs to buy a Smile eSIM, complete the mandatory KYC and get their assigned SmileVoice number.

Thereafter, the customer will download the SmileVoice app from Google play or App store, click “get activation code”, enter their registered email address to get their activation code and follow other instructions. To make a call, the customer can simply launch their SmileVoice App, dial the number they wish to call and enjoy SuperClear voice calls.

Similarly, customers keen to recharge the SmileVoice only plan just need to visit smile.com.ng,

…offers up to 15% interest on investments

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urst Salvo Limited, a global financial business advisory and investment company, has launched savings and investment mobile App. The App which is available for download on the iOS Store and Google play store, is a savings platform that helps customers save money smartly while earning returns on savings. It is to encourage savings habit among Nigerians in an easy and reliable way, which also offer users lucrative interest payment on savings of between 10

(4G-LTE) mobile broadband in several Nigeria towns that include Ibadan, Lagos, Port Harcourt, Abuja, Kaduna, Asaba, Benin, Onitsha and a host of others. Smile’s overriding objective is to become the broadband provider of choice for SuperFast mobile broadband internet and SuperClearvoice services in each of its markets and to provide fast, reliable and high-quality broadband internet that will help greatly to accelerate development and wealth creation.

Mobola Ojo (4th l), delivery manager, Rack Centre Service; Sunday Opadijo (4th r), head, Data Centre Infrastructure, Rack Centre; Charles Azubuike (3rd l) asst. manager: Governance Risk and Compliance with other Rack Centre Operation team who were recognised as winner of the Data Centre Operation Team of the year at the 2019 Global Data Centre Dynamics Award recently held in London.

Firm launches smart money savings app Jumoke Akiyode-Lawanson

click on “RECHARGE”, click on “XpressRecharge”, select their preferred SmileVoice only plan, enter their registered email address, click show my accounts, select account to recharge, click submit and go to payment, enter card details and click pay.

The Smile eSIMVoice adds to the long list of the company’s wide range of offers to its broad based clientele. Indeed, Smile prides itself as provider of the authentic Fourth Generation-Long-Term Evolution

– 15 percent per annum.

In statement issued by the company, Omawumi Jeyema, marketing director, Furst Salvo Limited, said that, Salvo understands the peculiarity of the Nigerian economy which puts a strain on people’s finances, thereby making it difficult for people to set aside funds to achieve future goals like buying land, car, owning a business or towards tuition fees for their children. With focus on addressing challenges, Salvo has developed an easy and reliable way to encourage saving habit among Nigerians who will not only have access to their full

(L-R) Steven Osiadi; Head Business Operations, Furst Salvo Limited, Omawumi Jeyemi, Marketing Director, Peter Owunna Managing Director and Wale Iyanda,Head of Credit, Furst Salvo Limited during the unveiling of Furst Salvo Savings and Investment Mobile App in Lagos. www.businessday.ng

savings but also get an enviable interest on their money.

Savings can be done daily, weekly or monthly with as little as 100 Naira which allows Nigerians begin their journey into financial freedom. As required by the Nigerian Law, this product is powered and supported by a duly licensed bank; Xslnce Microfinance Bank.

“As a socially responsible organization, over the years, we have remained committed to providing reliable financial solutions to Nigerians, to make life easier for all and ensure peace of mind that would guarantee a feeling of satisfaction and fulfillment,” Jeyema said.

She further disclosed that, customers should expect continuous development of the application to make savings seamless and assured value for money.

“We are consistently active in this regard as our technical team works round the clock to ensure the Salvo savings application meets global standard and guarantees ease of process,” she said.

Salvo is the guide to financial security where users can invest, save and spend responsibly, it is an easy to use with smooth navigation through the downloading process.

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Bolt expands Nigerian operations to Enugu, Abeokuta Jumoke Akiyode-Lawanson

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olt, the popular ridehailing platform formerly known as Taxify, has extended its operations into two more Nigerian cities – Enugu and Abeokuta, totaling 11 cities covered in Nigeria.

In a bid to bring convenient and reliable transportation services closer to its customers during this festive season, the company added these two cities to its list of operations on December 20, 2019.

Bolt started operating in Nigeria in 2016 in Lagos, and with the launch of Enugu and Abeokuta this month will operate in Lagos, Abuja, Ibadan, Owerri, Benin, Uyo, Calabar, Port Harcourt, Kano, Enugu and Abeokuta.

“Demand for ride hailing services is growing across Nigeria as public transport is still unreliable and the costs of car ownership soar. Ride hailing services like Bolt make it possible for more people to enjoy the convenience and safety of getting from one place to another, without the costs of car ownership or the inconvenience of public transport,” said Uche @Businessdayng

Okafor, Bolt’s regional manager for West Africa.

The transportation app has been hugely successful in every city where it has launched since commencing operations in Nigeria in 2016, growing exponentially year on year. Bolt has facilitated entrepreneurship opportunities for Nigerians who would otherwise have been included in the country’s unemployment statistics, with thousands of drivers now using the Bolt platform to start their own businesses, earning an income and supporting their families on a flexible schedule.

“The ride hailing sector has stimulated unprecedented innovation, growth and job creation in a new industry that is just four years old in Nigeria. Bolt is committed to the Nigerian market, and we intend to grow our footprint to more towns and cities across the country, making it possible for more people to benefit from ride hailing services, whether they are riders seeking cost-effective convenience, or drivers seeking business opportunities,” Okafor said.

Tuesday 24 December 2019

BUSINESS DAY

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property&lifestyle Why an understanding of role of Wills is needed when buying property CHUKA UROKO

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uying a property, especially land, is not as simple as buying a piece of cloth in the regular market. This is why experts advise that property buyers should involve professionals who know or understand all that are needed for the buyer to function well in this special market.

The experts say that when buying or investing in property, buyers or investors should, above everything else, have a good understanding of the role of Wills, Trusts and Letter of Administration in property transactions.

Wills and wills-making, according to them, is an arrangement which ensures that properties of a person devolve on his heir according to his express wishes and directives. This makes a will very important as it is a document that speaks after the death of the testator.

A will is a creation of statute and it is necessary that it should be governed by the provisions of relevant statute. Its understanding becomes very critical when property transaction involves buying or investing in an inherited property in which case ownership of the property has been transferred from a deceased person or benefactor to an inheritor or beneficiary.

“In purchasing property, it is required that applicants must be well acquainted with relevant laws, neces-

CHUKA UROKO

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sary documents and due process in perfecting title documents relating to an estate,” explained Adetokunbo Alli-Balogun, Registrar of Titles, Lagos State Land Bureau.

Alli-Balogun, who spoke at real estate investment forum in Lagos recently, cited the Land Registration Law which requires that title document must be properly registered with the Lagos State Land Registry as one of such laws and due processes.

In Lagos, the Lands Registry is exclusively responsible for keeping up-to-date records of all registered land title documents. The registrar said that on January 21, 2015, the Lagos State Land Registration Law 2015 came into force. It became the comprehensive legislation

on land registration and repealed all the previous legislations on title registration.

“In line with the recent and ongoing reforms at the Lands Registry the core responsibility of the Lands Registry is to carry out thorough investigation of each Title/Instruments on Land,” she said, pointing out that the registry is saddled with the responsible to ensure that thorough investigation is carried out on any processes that are lodged including Wills and Letter of Administration in the Lands Registry for registration.

The Registrar listed titles or instruments that can be derived under a will or letter of administration. They are the Vesting Deed which can be registered with the support of a Letter of Ad-

ministration only. Another is the Deed of Assent usually registered with the support of both the Will and Letter of Administration.

She pointed out however that neither the Deed of Accent nor Vesting Deed can be used to transfer property to another or to a third party that is not named in the Will or Letter of Administration.

“Property or land not stated in a Letter of Administration whether with or without Will cannot be accepted in processing the registration relating to that land or property. The Applicant must then apply to the Probate Registry to have the property listed if it is by omission or mistake, otherwise, an additional Asset will be declared for the property to be listed,”

she said.

She said that the Lands Registry has a role to play in the registration of instructions/titles derived under a will or letter of administration, explaining that it has the exclusive responsibility of processing the will or letter of administration to finally become a registered title.

Alli-Balogun pointed out that the Wills or Letters of Administration are not registrable in the Lands Registry, adding however that the Lands Registry had been working hand in hand with the Probate Registry by sending confirmation letter in order for the Probate Registry to verify Probates/ Letter of Administration clients bring in support of filed application.

How to beat inflation using real estate

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n the last two decades, Nigeria’s yearly inflation rate has only been below 10 percent for 7 years and that, not in a row. Some records put yearly returns on real estate investment at between 3 percent – 8 percent with a scarcity of 8 percent ROI per annum, especially on incomegenerating real estate.

Pieces of statistical evidence have shown largely an ROI of between 4 percent – 8 percent from cash-flow generating investments while appreciation value is somewhat portrayed as a huge percentage to be attained in the future – whenever that future comes and there is an opportunity for a re-sale.

It also appears as if real estate appreciation value is founded on mere speculations except for a strategic investment entry and exit for those tactful enough to plot them.

Advisedly, an investor should plan and work with measurable returns and embrace a future appreciation value as a plus, if it does happen.

NMRC says collaboration with ITF aimed to empower youths for building industry skills

Chief among the reasons an investor engages in investment is to make a sustained and increasing gain and it is widely believed that an investment in real estate offers some protection for the changes that will occur to the value of money within a given period. In simple terms, real estate provides a hedge against inflation.

In economics, inflation, is defined basically as a consistent increase in the price of goods and services. It is using more money to buy the same product. An inflation hedge is an investment intended to protect (hedge) the investor against a decrease in the purchasing power of money (inflation).

In addition to the belief that investment in real estate hedges against inflation, it is also believed to deliver a relatively high return on investment. Return on investment (ROI) in simple terms, measures the gain or loss generated on an investment relative to the amount of money invested. ROI is usually expressed as a percentage

and it is typically used for personal financial decisions to compare the efficiency of different investments.

These general beliefs do not seem to hold completely true with all kinds of real estate investment. They hold true more at certain investment entry points than others.

Why the above submission ?It is because it is not all kinds of real estate that hedge against inflationanditisnotinalllocations that a real estate investment can hedge against inflation.

The yearly inflation rate in Nigeria is currently at 11 percent and projected to rise to about 12 percent in 2020 with the possibility that it remains so till the year 2024. This rise in inflation is believed to contribute to the rising value of the real estate as inflation is, itself, a direct effect or impact of rising prices. Rising value pushes purchase for ownership beyond the reach of some income earners.

Given that shelter is a basic necessity and considering the peculiar situation of some

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Talking Real Estate

With Oluwakemi Adeyemo income earners, consumers explore options other than the purchase of a property because real estate use or access becomes more important than its ownership.

A real estate business that can meet such an evergreen need carefully and strategically will beat inflation. How long the business enjoys that advantage will be determined, to a large extent, by how well the business can invest in customer retention and satisfaction.

The current and popular trend seeks to promote real estate ownership and largely, for end users. Anyone entering a real estate investment at any entry point should seek to clearly answer why they are making the investment, especially because at the enduser ownership level which is

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common in a clime like this, inflation hedge and considerable ROI are far-fetched in many instances.

When demand is high and supply is low, when purchasing ability is high but competition is not as fierce, inflation in real estate prices can result. This kind of price inflation makes an investor happy as investments in such a scenario will likely achieve a high ROI. It then becomes an investor’s responsibility to look forward to this kind of situation or perhaps create one – which is possible in a free market. When creating such, especially with cash-flow investments, bear in mind that customers are barely naturally loyal and keep in view location policies and regulations. @Businessdayng

he Nigeria Mortgage Refinance Company (NMRC) says its collaboration with the Industrial Training Fund (ITF) is aimed to empower the youth and this action has helped to narrow the wide skills gap in Nigeria.

This collaboration has empowered 40 unemployed and vulnerable youths with training in technical skills in housing construction and entrepreneurship.

The skills gap in Nigeria, often cited as one of the key constraints to the growth of the country’s housing market, is such that builders resort to importing artisans who are proficient in plumbing, carpentry, tiling, bricklaying, etc from neighbouring West African countries notably Togo, Ghnana, Benin Republic.

The training, which is part of the company’s 2019 corporate social responsibility programme, involved 15 female victims of various forms of human trafficking and domestic abuse under the care of the National Agency for the Prohibition of Trafficking in Persons (NAPTIP).

The trainees underwent a two-month intensive training programme in electrical installation, plumbing, screeding/painting and interior decoration.

“The training programme was part of NMRC’s ongoing strategic community outreach programme,” explained Kehinde Ogundimu , NMRC’s Managing Director/Chief Executive, who spoke at the graduation of the trainees.

NMRC’s goal, he said, was to impact lives, empower unemployed and vulnerable persons as well as to contribute to on-going efforts to redress the skills gap in the building industry in Nigeria, leading to the slow growth of a robust housing market in the country.

Ogundimu commended ITF for their continued partnership and timely completion of the training programme. He also commended NAPTIP for their collaboration and encouraged the beneficiaries to make judicious use of the skills they have acquired to take their lives to the next phase.

Joseph Ari, DG /CEO, Industrial Training Fund, represented by Danladi Wase, Area Manager, ITF, Abuja, commended NMRC for sustaining the yearly empowerment programme, noting that the training has given the beneficiaries the chance to take charge of their lives.

Kemi Abayeh, Head of Training at ITF, lamented the high unemployment rate in the country and highlighted the need for strategic partnerships with corporate bodies to help fix it.

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property&lifestyle Real estate sector’s return to recession means more struggles for investors, home seekers ENDURANCE OKAFOR

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hile the Nigerian economy reported a 2.28 percent growth in the third quarter of 2019, the fastest in four quarters, it was however not enough to pull the real estate sector out from its contraction mode.

Commonly referred to as a laggard, the Nigerian property industry returned to recession in the third quarter of 2019 after the state data agency, the National Bureau of Statistics (NBS), reported -2.31 percent growth for the period, the second quarter negative report.

With the current growth levels, it may mean there is no relief in sight or more struggles for both the supply and demand side as developers may continue to access funds at a high cost which will translate to an expensive property that will remain unaffordable to most Nigerians out of which 80 percent are living on less than $2 dollar a day.

This will eventually lead to high vacancy rate in a country where there is a housing deficit of more than 17 million units, a pointer that the sector may not be seeing the end of the tunnel in the nearest future.

According to Andrew S. Nevin, Partner - West Africa Financial Services Leader and Chief Economist, PwC, real estate is the most important sector to create jobs and alleviate unemployment.

“No other sector can have the multiplier effect of real estate and no other sector can compensate if real estate languishes. So it is disappointing that the sector continues to not grow robustly,” he said.

Adeniyi Akinlusi, CEO,

Trustbond Mortgage Bank, agrees, pointing out that not much progress can be made in this sector with a large portion of Nigeria’s population outside the housing market and mortgage remains too expensive for many people to access and afford.

The sector’s contraction mode is neither good for real estate developers, home seekers nor for the Nigerian economy which has consistently produced more people than it can feed in the last four years.

Nigeria’s housing challenge borders on insufficient stock, low ownership level and lack of demand enabler in terms of mortgage or low-rate housing finance.

Due to the high cost of raising funds, real estate investors are almost unable to produce low-cost properties that meet the needs of most Nigerians whose purchasing power were eroded by the country’s five-quarter recession.

“Finance is a key strategy for everything. The reason the prices of properties are high

is that the funding comes at a cost, and all those costs are buried into the cost of construction,” Adekunle Abdul, Managing Director, Metro & Castles Homes, said.

Abdul explained that while it may cost as low as N25 million to put up a property, it may be sold for say N40million. “By the time we bury in the interest rate, we may increase the selling price by 13percent to cover for the finance before we start having other government agency costs, cost of survey and the likes,” he said.

With a deficit of more than 17 million units, the Nigerian property market contributed 6.21percent to real GDP in the quarter under review, lower than the 6.43percent it recorded in the preceding quarter as well as the corresponding rate a year earlier in 2018.

“There is no liquidity in the market, no one is releasing the money,” Tosin Ajose, Lead Advisor at Dealhq Partners, said.

According to her, “it would take two to three years for the

sector to fully recover.”

The recent banking sector report by the NBS revealed that even the banks have low confidence in the real estate sector as the credit to the sector dropped 3.62percent, its lowest level in the last five years.

Despite reporting 56.69 percent drop in Non-Performing Loan (NPL) in 2019, banks’ credit to real estate shed N121.52 billion year-on-year from N710.20 billion in Q3 2018 to N588.68 billion in the corresponding quarter of 2019.

The NPL posted by the real estate sector was down by a whopping N74.02 billion from N130.58 billion in the third quarter of 2018 to N56.56 billion in the corresponding quarter of 2019; a data that shows the sector should have been more attractive to the lenders.

“The decline in bank lending to the sector again shows that it is struggling. Our paper on ‘Unlocking Dead Capital’ earlier this year showed clearly the impact of a vibrant real estate sector,” Nevin said.

L-R: Feyisola Abiru, MD, H and Y Furniture Manufacturers; Mutiu Sumonu, chairman, Alpha Mead Group; Damola Akindolire, MD, Alpha Mead Development Company (AMDC), and Femi Akintunde, GMD, Alpha MeadGroup, at the grand opening of Lekki Pearl Estate developed by AMDC in Lagos.

Pic by Olawale Amoo

Infrastructure Maintenance With Tunde Obileye Obileye is a UK-trained lawyer and CEO, Great Heights Property and Facilities Management Limited Email: Tundeobileye@greatheightslimited.com

Emergency action plan common mistakes

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acility managers, as part of their responsibility, should consider at all times the safety of all who use, work or visit their facilities. More important ly, there is the need to ensure an emergency action plan is in place to deal with emergency situations.

Often times, an emergency action plan may not be fitfor-purpose because certain considerations have been omitted. Today I want to highlight the common gaps that facility managers must take cognizance of when an emergency action plan is written.

To prepare an emergency action plan, referencing the Occupational Safety and Health regulations is advised. The following factors are required to be included in such a plan.

1. Have an emergency action plan that covers all known and potential hazards, a list of hazards can be found in OSH regulations.

2. Special needs of persons such as those who are pregnant, people temporarily on crutches, contractors or visitors on site who may be unfamiliar with the facility should be covered in the plan.

3. A head count system is needed to determine that all the people within the facility at the time of the emergency are accounted for.

4. Training people hands on in implementing the emergency action plan is neces-

sary. This can include Onscreen training but it cannot be a substitute.

5. Build an emergency team that is large enough to effectively manage an emergency. Standard practice is one team member to every five persons.

6. Establish a chain of command. If the highest-ranking member is not available for whatever reason, there should be someone who takes charge to avoid lapses.

7. Different sources of communication should be made available as cell phone signals may or can likely be down. The use of two-way radios is a reliable option.

8. By law, an evacuation map must be included in the emergency action plan in order to move people out of danger to a secure area.

9. The emergency action plan must be designed for the particular facility as each facility will most likely have its own peculiarities. Adopting another plan is not advisable because it may not work for the users of the facility or it may be out of date.

10. Facility managers must not rely on others to create an emergency action plan. They may involve other people, including safety experts if necessary, but their active participation is important.

The point to remember is that facility managers are the first responders.

Concessionaire explains why motorists have to pay more on Lekki-Ikoyi Link Bridge CHUKA UROKO

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or reasons bothering on enhanced, efficient, flexible and quality service delivery, Lekki Concession Company Limited (LCC), the concessionaire on Lekki-EpeEti-Osa Expressway, says it will be raising the toll paid on Lekki-Ikoyi Link Bridge by 100 percent, beginning from January 1, 2020.

What this means is that instead of the current N300, car owners who use the Link Bridge will be paying N600 while those who use Sports Utility Vehicles (SUVs) will be paying N800 as against the current N400.

The concessionaire had, a couple of years ago, moved the toll for cars from N250 to N300, and N400 for SUVs, up from N300.

The management of the

company said at a media briefing in Lagos that, as part of the package for the new toll, only electronic payment systems that include eTags, prepaid cards, contactless cards and payment vouchers would be acceptable as means of payment.

Omomuwasan said there would be additional convenience services offered by LCC including 24/7 Security and Traffic Patrol services, free breakdown/recovery assistance, Ambulance services, LCC dedi-

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cated Police, LASTMA, Man O’ War amongst others.

“We offer these services free of charge to road users irrespective of if you paid tolls or not. Our aim is to ensure a safe environment and ease of traffic flow on the expressway,” he assured.

The Lekki-Ikoyi Link is an engineering marvel constructed by the Lagos State government under Babatunde Fashola as governor. It was aimed to serve dual purposes including decongesting the Lekki-Epe Expressway and also enabling motorists to connect to the mainland through Ikoyi.

“We deemed it fit to upgrade the tolling system in order to achieve efficiency in traffic management on both the Lekki Road and LekkiIkoyi Link Bridge,” explained Yomi Omomuwasan, managing director/CEO of LCC.

He explained further that the new order is in line with Governor Babajide Sanwo-Olu T.H.E.M.E policy to provide respite to Lagosians in terms of adequate traffic management and free flow of traffic.

According to him, LCC has merged the tolling account of Lekki-Ikoyi Link Bridge with that of Admiralty Circle Toll Plaza such that one road user can make use of one or same card to access both tolling plazas without hitches.

On the Admiralty Circle Toll Plaza, which caters for vehicle users plying LekkiEpe-Eti Osa Road, both cash and cashless toll collections would still be allowed from road users.

“We are making every preparation like carrying out regular media campaigns using billboards, flyers, banners, new spapers publications and other media outlets to

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enlighten and educate the general public on the commencement of cashless toll collection next year,” he said.

He said there would be a demonstration of what would happen on January 1, 2020 by next week to enable the firm to take lessons from some of the teething problems that would emerge before the full or 100 percent cashless toll begins.

Omomuwasan said LCC recently launched LCC Mobile App that would enable road users to register for eTag, call for help in case of emergencies and top up accounts from one’s home or office without having to make physical visit to LCC office.

Stating that no additional fees would be collected from road users that go cashless as planned, the LCC boss said that compliant road users would be rewarded with 10 percent payment discounts @Businessdayng

for using e-tags and other electronic payment systems.

He stated that LCC was also keen on offering auxiliary services that include roundthe-clock patrol to aid traffic movement at black spots, ambulance service to cater for emergencies in the case of accident and protocol arrangement with police and LASTMA officers to control traffic.

He said the firm would also engage agents to handle the informal sector especially the unbanked.

Earlier, Veronica Jacob, commercial and corporate media, had described LCC as a Special Purpose Vehicle set up specifically to execute the Eti-Osa Lekki Toll Road Concession Project.

She said that the firm also to deliver essential road infrastructure and services along the Lekki Peninsular of Lagos.

Tuesday 24 December 2019

BUSINESS DAY

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Tuesday 24 December 2019

BUSINESS DAY

Live @ The Exchanges Market Statistics as at Monday 23 December 2019

Top Gainers/Losers as at Monday 23 December 2019 LOSERS

GAINERS Company

Company

Opening

Closing

Change

N112.5

N105

-7.5

N6.6

N6

-0.6

CCNN

N18.65

N18.1

-0.55

0.2

FBNH

N6.5

N6

-0.5

0.2

TRANSCOHOT

N5.4

N4.9

-0.5

Opening

Closing

Change

NASCON

N11.95

N12.5

0.55

MTNN

WAPCO

N13.75

N14

0.25

ETI

JBERGER

N19.5

N19.7

0.2

OANDO

N3.4

N3.6

UPDCREIT

N3.4

N3.6

ASI (Points) DEALS (Numbers) VOLUME (Numbers) VALUE (N billion) MARKET CAP (N Trn)

26,115.80 2,605.00 188,791,402.00 2.430

Global market indicators FTSE 100 Index 7,620.90GBP +38.42+0.51%

Nikkei 225 23,821.11JPY +4.48+0.02%

S&P 500 Index 3,227.05USD +5.83+0.18%

FTSE 100 Index 7,620.90GBP +38.42+0.51%

Generic 1st ‘DM’ Future 28,574.00USD +92.00+0.32%

Shanghai Stock Exchange Composite Index 2,962.75CNY -42.19-1.40%

12.606

Concerns over Santa Claus rally as investors book another N198bn loss Stories by Iheanyi Nwachukwu

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he possibility of witnessing usual Santa Claus rally which comes in the last five trading days of the year till early part of the New Year looks hazy after Monday’s stock trading on Customs Street Lagos.

The situation worsens as sell pressure from nervous investors who have been offloading equities at low prices makes the local stock market not to scale new peaks.

The market record another decline of 1.55 percent at the sound of the closing gong on Monday December 23, 2019.

December 2019 has been a disappointing month for the Nigerian market with the NSE All Share Index (ASI) recording negative return of -3.28percent.

While select names on the local Bourse failed to push the benchmark Index higher, the market which opened this week on a negative note furthered the year-to-date (ytd) negative returns to 16.91percent.

L-R: Toyin Sanni, CEO Emerging Africa Group/Chairperson, Women in Finance Nigeria; Mary Uduk, acting director general, Securities and Exchange Commission; Oghogho Osula, CEO OOVI Group and Hajara Adeola, CEO Lotus Capital during the Women in Finance year End Program in Lagos

The NSE ASI which opened this week’s trading at 26,526.35 points closed at 26,115.80 points, down by 1.55percent while the cumulative value

of listed stocks printed lower from preceding day high of N12.804 trillion to N12.606trillon, representing N198billion loss.

The negative takeoff into the new week ahead of Christmas and Boxing Days holidays came despite United Capital analysts’ expectations that

investors will continue to lock in gains in stocks with strong potential for growth as the year runs to an end. Though their counterparts at Lagos-based Afrinvest said they expect market performance to remain bearish “due to continuous sell-offs.”

In 2,605 deals, investors exchanged 188,791,402 units valued at N2.430billion.

Banking stocks led the activity chart. UBA, GTBank, Access Bank, NASCON and FBN Holdings were actively traded.

The shares of MTNN led the losers table after it dropped from a day open level of N112.5 to N105, losing N7.5 or 6.67percent; ETI followed from a high of N6.6 to N6, down by 60kobo or 9.09percent, while CCNN dropped from N18.65 to N18.1, losing 55kobo or 2.95percent.

On the gainers table, NASCON led other stocks after its share price increased from N11.95 to N12.5, adding 55kobo or 4.60percent. Lafarge Africa Plc also rose from N13.75 to N14, adding 25kobo or 1.82percent, while Julius Berger Nigeria Plc advanced from N19.5 to N19.7, adding 20kobo or 1.03percent.

11 Plc makes inroad into Hotel business …to acquire Lagos Continental Hotel from AMCON

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1 Plc (formerly Mobil Oil Nigeria Plc) said it has finalised discussions with Asset Ma n a g e m e n t C o m p a n y of Nigeria (AMCON ) to acquire Lagos Continental Hotel through its subsidiary company.

The acquisition is still subject to the terms and conditions agreed between the parties.

11 Plc which currently owns several prime properties in its real estate portfolio fully rented to blue chip tenants said the acquisition of this asset is consistent with its desire to diversify its interest “given the current challenging environment in the downstream sector of the petroleum industry.”

Fuel margins have remained stagnant for several years in the highly competitive and regulated industry.

11 Plc anticipates that the asset will contribute positively to earnings and underlines the faith of its stakeholders in the future of the Nigerian economy.

Presco says ready to push more products into the market in 2020 …attains 200,000 metric tons of fresh fruit bunches, rewards workers

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resco Plc, a key player in the agricultural sector listed on the Nigerian Stock Exchange (NSE) has ended 2019 business year on a happy note.

Speaking at the company’s end of year party last weekend, the Managing Director, Felix Nwabuko who commended staff for their resilience and dedication throughout the year said the company attained 200,000 metric tons of Fresh Fruit Bunches (FFB), adding that, the company is set to achieve 250,000 tons in 2020.

Nwabuko also used the opportunity to explain that, though Presco Plc achieved more this year than 2018 in

terms of volume, the company earned less in value terms due to economic factors, outside the company’s control. According to him, Presco Plc is ready to push more products into the market in 2020.

He noted that, the average selling price of oil palm produce was low because of what he described as, “unfavourable market situations’’ occasioned by the failure of other West African Countries to maintain a uniform tariff as provided in the Economic Trade Liberation Scheme.

Explaining further during the ceremony held at the company’s Obaretin Estate, Benin City, Edo State, Nwabuko commended Federal Government’s border www.businessday.ng

closure, adding that, its an opportunity to open discussions with neighbouring West African Countries.

He expressed hope that the future is bright for the oil palm industry in Nigeria with the Central Bank of Nigeria (CBN) Oil Palm Development Initiative and implementation of the Nigeria Oil Palm Industry Policy.

While commending the company’s res earch and development (R&D) department for its innovations, Nwabu ko des c r ib e d th e company’s staff as its greatest asset. He explained that the output from the research work of the R&D is rated superb by international research

institutes; he also thanked the entire workforce for their dedications and contributions

to the growth of the company.

During the ceremony, the company honoured its long

serving staff in the categories of 15, 20, 25 and 30 years for their meritorious service.

L-R: Jagdish Kavathar, head of marketing; Felix Nwabuko, managing director, Fidelia Nwabuko, head of Admin/Relations Manager, Anthony Uwajeh and Maria Uwajeh at the 2019 end of year party.

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Tuesday 24 December 2019

BUSINESS DAY

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Tuesday 24 December 2019

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news

Reviewed bank transaction charges will promote cashless policy - NECA JOSHUA BASSEY igeria Employers’ Consultative Association (NECA) believes the Central Bank of Nigeria’s (CBN) new guide on charges by banks and other financial institutions that showed a downward review for some electronic banking transactions will encourage the cashless policy being promoted by the apex bank.

Director-general of NECA, Timothy Olawale, described the new guideline as released on Sunday as a welcome development, “as it will make financial services more accessible and affordable to various stakeholders in the economy.”

Olawale, who spoke in Lagos on Monday, stated, “The guideline will encourage Nigerians to be more aligned with the cashless policy,” applauding the reduction in the remote-on-us (from other bank’s ATM) to maximum of N35 after third withdrawal

N

within the same month from N65.

On the electronic funds transfer, Olawale averred that “although the new guideline introduced new additions for transactions below N50,000, attracting N25 and N10, respectively, we suggest that transactions of N100,000 and below should fall within the newly reviewed charges of N25, taking into account the low-income earners.”

He drew the attention of the CBN to the Real Time Gross Settlement (RTGS) charge, which was reviewed upward from N750 for transaction of N500,000 and above to N950.

He expressed that “we are of the opinion that in the spirit of benevolence demonstrated by the CBN, if the charges cannot be reviewed downward to about N300, status quo of N750 should subsist.

Expressing hope for the successful implementation of the new guidelines, the

NECA DG stated the need for a total cancellation of N50 PoS charge on Stamp Duties still in operation.

He argued that “the conspiracy of the N50 Stamp Duty charge” was a burden on Nigerians and businesses. As the citizens grapple under the weight of inflation and eroding purchasing power, these charges, under any guise tend to further impoverish the Banking populace.”

He called on the CBN to continuously promote policies and guidelines that facilitate the ease of doing business and banking in the country.

He believed that efforts should be made to deliberately align monetary policy with the fiscal policies in order to drive development of the economy, and called for an aggressive sensitisation of the people to enable bank customers acquaint themselves with the provisions of the guideline and be properly guided.

Work begins on $100m Ibadan Inland Dry Port early next year REMI FEYISIPO, Ibadan

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oncessionaire, China Railway Construction Company (CRCC), for the proposed $100 million Ibadan Inland Dry Port located in Akinyele Local Government Area of Oyo State, is expected to move to site early next year.

The full business case and concession agreement will be concluded early January 2020, according to Glory Onojedo, director for the South West zone of the Nigerian Shippers’ Council (NSC).

The dry port project, which is to be developed on a 40-hectare land at the Ibadan end of the Lagos – Ibadan standard gauge railway line at OlorisaOko, Moniya in Akinyele Local Government Area, will also have industrial park developed near it.

The industrial park is to be developed on a 50-hectare land allocated for the purpose by the Oyo State government at Moniya in Akinyele Local Government Area.

The industrial park is being developed to complement the Ibadan Inland Dry Port promoted by the Nigerian Shippers’ Council.

He however pointed out that the concessionaire agreement was ready and full negotiations would be done in early January by all parties after which they would move to site

for construction work.

According to Onojedo, after moving to site there shall be a ground breaking to signal the take-off of the project.

Onojedo, during a visit to the project site in company of officials from the Nigerian Railway Corporation and Oyo State government, said the process to deliver the Ibadan Inland Dry Port was very much on course, as the dry port would be developed in three phases.

“In the first phase, a facility capable of handling 40,000TEUS will be developed.

This will then be expanded in the second and final phase to the full capacity,” he said.

He said the business case was evaluated and issued with a certificate of compliance by the Infrastructure Concession Regulatory Commission.

Subsequently, he pointed out that the NSC subjected the project to a rigorous, open, transparent and competitive bidding process that saw to the emergence of a preferred bidder, CRCC, with strong technical capacity and financial capability.

He stated that since the NSC commenced the PPP processes for the Ibadan inland dry port in 2018, much progress had been made and it was at the concluding phase of procurement.

“We adopted the two stages procurement process recom-

mended by the regulatory authority. This included the request for qualification phase whereby prospective bidders were required to make categorical statement about their technical capacity and financial capabilities. This phase was followed with the request for proposal phase,” he said.

On delivery, he said, the project would be delivered in 18 months saying “ i see no delay in delivering the project because the concessionaire has all it takes to deliver at the appropriate time, so the delivery of the project is on course according to the work plan.”

The standard gauge railway line will be the major mode of freighting containers to the ports, which is located at the terminal end of the rail line.

Upon completion, the dry port, which is on a Public Private Partnership (PPP), is expected to have capacity to handle 90,000 twenty feet equivalent units (TEUS) container per annum.

The Ibadan Inland Dry Port is a privately initiated public private partnership project by a Nigerian incorporated Chinese company.

Meanwhile, the dry port has been lauded by maritime stakeholders because of its potentials to decongest the Lagos ports, free the metropolis of trucks and ease traffic on the Lagos–Ibadan expressway.

Senator Ordia commends Obaseki’s developmental stride in Edo

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enator representing Edo Central Senatorial District, Clifford Ordia, has commended the Edo State governor, Godwin Obaseki, for providing impactful and purposeful leadership in the state.

Ordia gave the commendation when he received the governor at his residence in Irrua, to celebrate his 30th marriage anniversary and re-election to represent Edo Central people at the National Assembly.

He said the governor was working tirelessly to transform

the state, urging him to continue with his developmental strides, saying, “As far as I am concerned, the governor is making an impact in the state and we can see his good works. I am happy to receive the governor in my residence today to celebrate with me on my 30th marriage anniversary and felicitate on my election to represent my people for another tenure.”

In his remarks, Governor Obaseki emphasised that despite belonging to a different political party, Ordia has always www.businessday.ng

supported the policies of his government.

He said his visit was to show appreciation for his support and congratulate him on his 30th wedding anniversary.

“We are here to celebrate with Senator Clifford Ordia.

He is a senator that supports government policies as well as pushes our requests in the Senate despite the fact that we are in different political parties.

We are here to celebrate with him especially as he celebrates his 30th marriage anniversary.” https://www.facebook.com/businessdayng

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Monday 23 December 2019

BUSINESS DAY

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news

CAN urges Oshiomhole to reciprocate Obaseki’s support for his eight years administration IDRIS UMAR MOMOH, Benin

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eadership of Christian Association of Nigeria (CAN), Edo State chapter, on Monday urged the national chairman of the All Progressives Congress (APC), Adams Oshiomhole, to reciprocate the kind support the state governor, Godwin Obaseki, gave him during his eight years government in the state.

Recall that Oshiomhole was the governor of Edo State between November 12, 2008 and November 12, 2016. The CAN leadership made the appeal at a press conference in Benin City.

The state chairman of the association, Oyonude Kure, who addressed the press conference, noted that Obaseki supported Oshiomhole during his eight years as governor of the state.

“We appeal to you your excellency Comrade Adams Oshiomhole to let this matter amicably come to an end in the interest of peace of the state.

“Your love for the Edo people and the brotherly love that will forever remain unbridled between you and your brother, Governor Godwin Obaseki after the game of politics is over.

“We therefore enjoin Comrade Adams Oshiomhole to

support the seating governor as he also supported his administration for eight years by putting his party machinery together to the best of his ability within the limit of the law to bring the house (APC, Edo State) together for its unity in the interest of the peace of the state and in the interest of his party.

“To ensure continuity of the administration of Godwin Obaseki in the art of governance of Edo state as he the Comrade Governor had in his tenure for the purpose of the development, advancement of the state, more particularly for the uncommon impact that the Godwin Obaseki’s administration has made in the state developmentally and in every ramification within the very short time of his administration, which the Edo people are very well pleased with and reposed their confidence in him for a second term in office,” he said.

Kure, who said Obaseki was the candidate of Adams Oshiomhole during the governorship primary and in the election in 2016, however urged the national chairman not to allow few individuals soil the good name and legacy he had enshrined on the chronicles of achievers and builders of Edo land.

FirstBank to reward 3 customers with Dubai trip in Verve Card reactivation promo

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t is raining promos with FirstBank Cards this season as the bank recently announced its Verve Card Reactivation Promo to reward three customers with all-expense paid trips to Dubai for reactivating and using their Verve Cards to transact on PoS and online. The ongoing promo kicked off on December 2, 2019 and would end on January 25, 2020.

In addition to the Dubai trip, 600 customers will be rewarded with N3,000 worth of airtime and 60 customers with N50,000.00 cash prize during the 2-month

promo period. The airtime and cash prizes will be delivered weekly and winners have begun to emerge already. Winners of the grand prize of a trip to Dubai will be announced at the end of the FirstBank Verve Card Promo.

In the same vein, FirstBank is also rewarding its customers for all transactions done with their Visa Gold and Naira Credit cards this season. Customers can get a percentage of their total spend with FirstBank Visa Gold and Naira Credit cards this season. This promo runs until January 8, 2020.

Peak Milk celebrates Nigerians with 12 days of Peakmas

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n the spirit of celebrating the Yuletide, Peak Milk commenced the Christmas celebration with the “12 days of Peakmas’’ – a campaign that exemplifies love and kindness to everyone, everywhere. The campaign began with asking the public to nominate unsung heroes, who through their selfless and often unrewarded service make our societies a better place.

Peak, joined by celebrities as Ayo Makun, popularly known as “A.Y,” Nollywood actress, Eniola Badmus, and actor, Williams Uchemba, visited these “Peakmas Heroes” in a surprise of carols, praise and rewards for their selfless acts, enabling the common man reach for their peak. The campaign also took to open markets and superstores to reward customers with shopping vouchers, cash and lots of exciting gifts.

One of the unsung heroes nominated and celebrated during the campaign is Segun Awosanya, popularly known on Twitter as “Segalink.” His effective advocacies are renowned spurring the social needs of the common man and on several counts, have brought about the needed succour required for

standard living.

Another hero, Sargent Solomon Dauda (popularly known as “Emergency”), a traffic warden stationed at the NNPC junction in Garki, Abuja, is widely appreciated for the energy and entertainment he has brought to passers-by in 13 diligent years on the role.

According to Grace Onwubuemeli, marketing manager for Peak, Peakmas is Peak Milk’s rendition of the spirit of Christmas. The campaign emanates from the purpose of the Peak brand, which enjoins all Nigerians to “reach for their Peak.

For the period of the campaign, Peak visited various cities including Lagos, Abuja, and Port- Harcourt; thanking lots of consumers and shoppers for being there throughout the year.

“It was rewarding to watch the smiles on the faces of our Peakmas Heroes as they received their gifts, and we look forward to creating more avenues for celebrating Nigerians doing exceptional work. The gratitude and emotion from giving to everyday people like our unsung heroes and consumers, is nothing short of the happiness the season brings”, continued Onwbuemeli. www.businessday.ng

L-R: Bolanle Austen Peters, director, Fela’s Republic and The Kalakuta Queens; Laide Babayale, Fela’s original dancer and queen; Patrick Akinwuntan, managing director, Ecobank Nigeria Limited; Omolara Sosanya, Fela’s original dancer and queen, at the presentation of the stage play ‘Fela Republic and the Kalakuta Queen’ at the Terra Kulture, Victoria Island, Lagos.

Bayelsa guber: A’ Court sets aside high court judgment disqualifying APC deputy governor candidate Felix Omohomhion, Abuja

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ourt of Appeal sitting in Abuja on Monday set aside the judgment that disqualified the deputy governorship candidate of the All Progressives Congress (APC) in the November 16 governorship election in Bayelsa State, Biobarakuma Degi-Eremieoyo.

A three-man panel of the Court of Appeal in a judgment held that Degi-Eremienyo met the necessary academic qualifications for contesting the election.

The panel presided over

by Justice Stephen Adah, consequently set aside the judgment of a Federal High Court in Abuja, which had earlier disqualified the APC deputy governor-elect.

Justice Inyang Ekwo had

in a judgment delivered on November 12, disqualified the APC Governor-elect on grounds of giving false information to the Independent National Electoral Commission (INEC).

Dissatisfied with the decision of the trial court, the appellants approached the Court of Appeal to set aside the judgment.

Appellants include All Progressives Congress (APC), Governor-elect, David Lyon, deputy governor-elect and INEC, while respondents are the People’s Democratic Party (PDP), its governorship candidate in Bayelsa State, Douye Diri, and Lawrence Ewhruojakpo.

The appeal which was predicated on 16 grounds, also has four issues for determination by the appellate court.

However the appellate court

No evidence proving your illness can’t be handled in prison, court tells Kalu Joshua Bassey

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Federal High Court sitting in Lagos on Monday dismissed the application for bail of ex-governor of Abia State and the Senate chief whip, Orji Uzo Kalu, who is currently serving a jail term in prison for fraud.

As a result, Kalu, who was sentenced to 12 years in imprisonment, will continue to serve his jail term pending the outcome of an appeal against the decision of the lower court.

The for mer governor was jailed by a Federal High Court in Lagos on December 5, for stealing N7.2 billion belonging to Abia State during his tenure (1999-2007) as governor.

He had filed an application seeking the court to grant him bail on health grounds. In his application for bail, Kalu argued that the prison lacked the medical facility to cater to his health.

But Justice Mohammed Idris held that there was no

tangible ground for granting the application.

Idris dismissed the grounds of ill-health raised

by Kalu, saying he did not prove that the diseases he mentioned were contagious.

On the grounds that the bail would enable Kalu to represent his constituency in the Senate, the judge held that his constituents knew that he was on trial and still voted him into power.

On the grounds that the appeal might be delayed, Idris said developments had broken past records on that.

“It is not in dispute that there are practice directions involved in appeal, but in recent times, this practice directions have been recently enhanced for speedy hearing and determination of high profile corruption cases.

“I believe the applicant can take advantage of these rules to run through the appeal channel. I found nothing in favour of the applicant in this application; it is, therefore, discountenanced,” the judge ruled.

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in a judgment set aside the judgment of Justice Ekwo on the grounds that the lower court erred in arriving at the conclusion that the alleged false information was enough grounds to disqualify the contestant.

According to the judgment, the qualification for a governor or deputy is set out in the Constitution, and that section 31(5&6) of the Electoral Act was not part of the grounds for the disqualification of a candidate.

Consequently the appellate court held that the lower court was wrong to have activated section 31(5&6) in disqualifying the contestant.

In the unanimous judgment delivered by Justice Rilwan Abdullahi, the Court of Appeal also held that there was nothing to prove that Senator Degi-Eremienyo gave false information to INEC.

According to the court, the issues raised in the suit are criminal in nature, which places the burden of proof on he who alleges, adding that the respondents failed to prove their claims beyond reasonable doubt.

The Court of Appeal said that the lower court was also wrong to have determined the suit which facts are in dispute through an affidavit evidence, adding that by so doing the lower court breached the right of fair hearing of the appellants.

The court in addition held that the different names contained in the appellant form CF 001, his first leaving school certificate and General Certificate of Education (GCE) belong to the same person, going by the supporting affidavit of change of name and newspaper publication.

“The appeal has merit and it

Echo MFB targets N1bn capital for state licence in 2020 Hope Moses-Ashike

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cho Microfinance Bank Limited, a customerfocused bank, has signalled plans to raise its capital from over N50 million to N1 billion in order to operate a state licence bank next year.

The Central Bank of Nigeria (CBN) had in March 2019 reviewed the minimum capital requirements for microfinance banks, allowing for instalment payment and categorisation of Unit Microfinance into two of Tier 1 and Tier 2.

Echo MFB is classified under rural licence with capital requirement of N50 million but the bank’s capital base is above the requirement.

“Our thinking is that we are going to go state wise having operated in the rural. We want to move to the urban proper come 2020 and to tap into other markets we have not been able to move into because of our limitation,” Ndoma Ndoma Odey, managing director/CEO of the bank, said.

Speaking at the bank’s promo/target end of year cer@Businessdayng

emony in Ikorodu, Lagos, he said the bank had been able to sustain itself for 10 years.

“Our authorised share capital is N100 million and fully paid is N83 million. The new capital requirement for statewise MFBs is N1 billion. Our target is that we want to move to N1 billion so that we can operate outside the axis we are already operating and tap to other local government within Lagos,” he said.

The bank last week recognised and appreciated about 2,507 customers who were major savers and had been loyal and supportive to it.

Consequently, the bank gave out various reward items ranging from sewing machines, phones, toasters, blenders and pressing iron, among others.

“We want to reward customers that are very loyal and supportive to this bank. These people you see here contribute from January to December.

They are good savers without withdrawal. Today we want to reward them for their loyalty,” Odey said.

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Tuesday 24 December 2019

BUSINESS DAY

news Wema Bank partners Cellulant, NIRSAL to boost agribusiness value chain

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ema Bank has reaffirmed its commitment to applying technology in delivering excellent financial solutions to Nigerians.

To help develop the agribusiness value chain, the bank has signed a tripartite commodity aggregation finance scheme with Cellulant Nigeria and Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL plc).

Cellulant owns Agrikore Marketplace, an online marketplace (e-marketplace) solution focused on digitalising both the production and marketing segments of the agric value chain by linking all the players from the production level to the marketing and consumption level. NIRSAL is a nonbank financial institution owned by the Central Bank of Nigeria (CBN) created to redefine, measure and share agribusiness-related credit risks in Nigeria.

The tripartite partnership is focused on providing easily accessible, affordable fund-

ing to all participants in the co-created platform. The aim is to create access-to-market and access-to-finance for farmers, aggregators, retailers and other primary stakeholders in the agribusiness sector.

Ademola Adebise, managing director/chief executive officer, Wema Bank, reiterated the importance of cooperation between every player in the agric value chain.

Speaking at the inaugural partners’ summit organised by Cellulant in Lagos, Adebise noted that “holistic interventions across the value chain are required to achieve the desired impact and outcomes in the sector”.

Adebise, who addressed the subject ‘Financing the Agric Value Chain to Deliver Transactional Impact to Stakeholders’, identified a low level of budgetary allocation, negligible financial literacy, a large percentage of unbanked population and the limited understanding of the value chain as part of the challenges facing the agric sector.

•Continues online at www.businessday.ng

Nigeria’s SEC explains support for securities lending Iheanyi Nwachukwu

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he Securities and Exchange Commission (SEC) says it is advocating for securities lending in the Nigerian capital market because such would deepen liquidity in the nation’s bourse as well as offer more returns to both the lender and the borrower.

Securities lending is the act of loaning a stock, derivative or other security to an investor or firm. It requires the borrower to put up collateral, whether cash, security or a letter of credit.

Mary Uduk, acting director general of the SEC, said in Abuja on Monday that the Commission has rules on securities lending and expects capital market operators to take advantage of the opportunity.

Uduk said securities lending is useful for trading activities such as short selling, hedging and arbitrage and that hedge funds can also partake more in the Nigerian capital market as the SEC develops securities lending activities.

“We have a framework which has been approved.

However, we noticed that it is not being fully explored.

What we want to do now is to see what restrictions we can remove and what enlightenments we can do to ensure that other necessary parties key into the rules,” Uduk stated. “We are encouraging them to go into securities lending.

They are being encouraged to lend out these securities, they make money out of it.”

The acting DG said the Commission is engaging with institutional investors like the National Pension Commission to enact standards that will enable funds to lend their equities.

“There are many institutional and even some individual investors that sit on large pools of stocks which they do not trade actively,” Uduk said.

“A vibrant securities-lending market will provide liquidity to such stocks and earn some returns for both the lender and the borrower.”

Uduk said the SEC has a committee which has been engaging all institutional investors that have substantial holding of equities. The essence of having this securities lending, she said, is to actually deepen the market.

“All of us are contributing to our own pension accounts and these PFAs are buying equities. What they do is to buy and hold; they don’t sell. So the essence of securities lending is now to give room for them to make money and so that the money will now add up to their own contribution fund. We have a framework which has been approved and we are encouraging the market to go into self-lending by meeting these institutional investors,” she said.

•Continues online at www.businessday.ng www.businessday.ng

L-R:- Oluwole Ajimisinmi, Lagos regional executive, Wema Bank plc.; Ademola Adebise, MD/CEO Wema Bank plc.; Bolaji Akinboro, co-CEO Cellulant; Solomon Abiakalam, chief compliance officer, and Jennifer Onyebuagu, retail marketplace, Cellulant, at the launch of Agricore Platform, an eco-system for food produce at the Cellulant Inaugural Summit.

Tax defaulters risk FIRS’ wrath as 7-day deadline expires ENDURANCE OKAFOR

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usinesses and individuals who have defaulted in their tax remittances may be at risk of having their operations interrupted by the Federal Inland Revenue Service (FIRS) as the seven-day notice by the tax regulator expires today.

The FIRS had in a public notice dated December 17, 2019 warned that it would commence a nationwide tax enforcement exercise on all taxpayers – individuals, partnerships, enterprises, corporate organisations,

ministries, departments and agencies – that are in default of payment of taxes.

It “strongly advised” all taxpayers to settle their tax liabilities within seven days of the publication to avoid any inconveniences or interruptions in their operations.

“Obviously, this could hamper sales particularly for businesses that are defaulters and rely on holiday sales to boost yearly revenue,” Ayorinde Akinloye, a consumer goods analyst at Lagos-based CSL, said.

The FIRS, in the notice signed by Muhammad

Nami, its new chairman, said the tax enforcement was pursuant to the provision of Section 8, 26(2), 33 and 35 of the Federal Inland Revenue Service (Establishment Act, 2007).

“The taxes referred to are as follows: Petroleum profit tax, companies income tax, value-added tax, withholding tax, tertiary education tax, NITDA levy, stamp duty and capital gain tax,” the notice read.

Analysts see the recent tax enforcement notice by the Service as a move to widen the tax net and upscale Nigeria’s revenue.

Africa’s largest economy has tax-to-GDP ratio of 5.6 percent, one of the lowest in Africa, according to data from the World Bank. Taxto-GDP ratio in Algeria, South Africa, Morocco, Angola, Kenya and Egypt currently stands at 34.75 percent, 26.80 percent, 21.35 percent, 19.25 percent, 18 percent and 15.20 percent, respectively.

The number of tax defaulters in Nigeria stood at about 55,000 as at June 2019, according to Tunde Fowler, immediate past Continues on page 39

Invisibles gulp largest share of FX utilisation in November, says CBN

… FX inflow into economy rises $9.84bn, non-oil export earnings up by 15.4% HOPE MOSES-ASHIKE

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he invisible sector accounted for the bulk (62.5 percent) of total foreign exchange disbursed in November, according to the economic report for the month of November released by the Central Bank of Nigeria (CBN).

This was followed by the components of the visible sub-sector including industrial sector 16.2 percent, manufactured products 9.0 percent, minerals and oil 6.4 percent, food products 3.9 percent, transport 1.3 percent, and agricultural products 0.7 percent.

Invisible sector consists of an international transaction that does not include an exchange of tangible goods.

This includes customer service outsourcing, overseas banking transactions, and

the medical tourism industry.

Aggregate sectoral utilisation of foreign exchange rose by 3.2 percent to $3.49 billion in November 2019, compared with the $3.39 billion in the preceding month.

Foreign exchange (FX) inflow into the economy amounted to $9.84 billion, showing an increase of 7.5 percent above the level at the end of the preceding month.

It, however, showed a decrease of 21.1 percent relative to the level at the end of the corresponding period of 2018.

The increase was as a result of 5.8 percent and 8.5 percent rise in inflow through the bank and autonomous sources, respectively.

Aggregate foreign exchange outflow from the economy, at $4.70 billion, fell by 12.2 percent and 21.3 percent below the levels in the preceding month and the

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corresponding period of 2018, respectively. The development was attributed mainly to the 12.9 percent decline in outflow through the bank.

Inflow through autonomous sources rose by 8.5 percent to $6.12 billion in November 2019, above the level at the end of October 2019. Outflow from autonomous sources, on month-on-month basis, fell by 3.9 percent to $0.39 billion, reflecting a decline in invisible and visible imports.

Accordingly, foreign exchange flows through the economy resulted in a net inflow of $5.14 billion in the review period, compared with $3.81 billion and $6.51 billion at the end of October 2019 and at the end of November 2018, respectively.

Total non-oil export earnings, at $455.37 million, indicated increase of 15.4 percent and 48.9 percent relative to the @Businessdayng

levels in October 2019 and the corresponding period of 2018, respectively. The rise in earnings from non-oil exports in November 2019 was due largely to 3,797.7 percent increase in receipts from mineral sector to $78.88 million.

However, export receipts from food products and industrial sector fell by 10.3 percent and 7.2 percent below the levels in the preceding month to $9.41 million and $188.02 million, respectively.

Proceeds from the transport subsector also fell by 0.01 percent below the level in the preceding month to $0.04 million.

The shares of the various sectors in non-oil export proceeds were: industrial sector 41.3 percent, agricultural products 30.5 percent, minerals 16.2 percent, manufactured products 9.9 percent, and food products 2.1 percent.

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news Rising food prices signal bleak Christmas...

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told BusinessDay.

Since the Nigerian government shut the country’s borders in August, prices of all food items have surged as supply is unable to meet demand.

BusinessDay survey at some markets in Lagos shows that a 50kg bag of local parboiled rice now sells for an average of N22,500, from an average of N17,000 a year ago, indicating a 32.4 percent increase in price.

Similarly, a 50kg bag of foreign rice sells for N27,500, up from N14,500 last December, indicating a 90 percent rise in price.

The price of a 10kg carton of frozen chicken increased by 35 percent to N13,000-N13,500 as against N9,500-N10,000 sold in December 2018.

Further checks show that a 10kg carton of frozen turkey now sells for N15,000 as against N12,500 sold a year ago, showing a 20 percent rise in price.

A big basket of fresh tomatoes now sells for N17,500 as against N17,000 sold last year December, while a small basket sells for N9,000 as against N8,500 last year.

Also, a 25-litre keg of vegetable oil now goes for N11,500 as against N10,500 last year December.

“It has been really difficult for my family. We now buy little of what we feel is important. The painful thing is that my salary is still the same despite high rate of inflation in the economy,” Orizu said.

Inflation in Africa’s most populous country accelerated to 11.85 percent in November 2019, fundamentally driven by food inflation, according to figures from the National Bureau of Statistics (NBS).

This figure surpasses the Central Bank of Nigeria’s 11.7 percent projection for headline inflation for the year end.

“My disposable income now is smaller than it was last

year as I have to get little for the same amount I spent before,” Ronke Suwara, a banker, told BusinessDay. “Every Christmas, I usually cook and share with my neighbours, but I will not be doing that this year; I cannot afford to do so because of the high cost of food items,” Suwara told BusinessDay at Iddo Market in Lagos.

“I couldn’t buy anything for my parents this festive period as I cannot afford to; prices are higher and it’s making it difficult for me,” she said.

Ayorinde Akinloye, a consumer goods analyst, told BusinessDay earlier that prices would continue to trend higher towards the end of the year which will mar Christmas cheer.

“I anticipate a bitter Christmas this year,” Akinloye said.

Nigeria still has huge demand-supply gap in most of its food crops. The country imports from neighbouring West African countries to cover the shortfall as population continues to grow faster than food production.

Traders have been hard hit as low purchasing power is dampening trading activities in the country.

“Sales have been very slow unlike last year because there is no money in the economy.

Prices are higher now and people do not have the money to buy,” Bimpe Alabi, a frozen food seller, said.

“Most of my customers are complaining of no money.”

Nigeria’s recent GDP report shows the trade sector (wholesale and retail) contracted quarter-on-quarter by -1.45 percent in the third quarter of 2019, thereby recording a consecutive quarterly decline in sector growth after Q2 trade growth was reported as -0.25 percent.

The report said the trade sector had been predicted to contract as border closure, poor government policies and weaker consumer spending continue to subdue growth.

L-R: Uzo Obi, executive director, Resourcery plc.; Yeye Nwidaa, company secretary, Jackson Etti and Edu law firm; Shuaibu Ahmed, chairman, Resourcery plc., and Tani Fafunwa, managing director, Resourcery plc., at the 29th Annual General Meeting of Resourcery plc. in Lagos.

Banks’ non-interest income may come...

Continued from page 1

will see the slashing of various charges by banks on

electronic transactions, card maintenance fee, ATM usage as well as other related costs.

“The new directive would affect banks’ profitability,” Gbolahan Aina, head of investment at Cordros Asset Management, told BusinessDay. Fee-based income has been the major boost for banks in the wake of a fragile economy that has seen an average growth of 2 percent, below population growth.

Ayodeji Ebo, managing director/CEO of Lagos-based investment and securities firm, Afrinvest, said there may be a reduction in fees and commission, especially for online transactions, in the short run.

“However, we expect that volume of the transaction would increase in the middle and long-term to cover up for

this gap,” Ebo said.

The banking stock index dipped further by -0.82 percent to close 352.49 points at the close of trading, Monday, as investors continue to react to likely implication of the move on their investments.

According to the CBN, the cut in charges will incentivise stakeholders, especially those making micropayments, to further embrace electronic banking channels, thus improving financial inclusion.

Banks in Africa’s largest economy have leveraged non-interest income to boost bottom-line given the macroeconomic challenges facing the nation. This is even as the banks have been discouraged by the CBN from investing in high yield government securities at the expense of economic growth.

The non-interest income of a bank is derived primarily from fees including deposit and transaction fees, annual

Fresh concern for Nigeria, OPEC as Saudi... Tax defaulters risk FIRS’ wrath as 7-day...

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tion from the two fields will

be a huge concern for OPEC and its allies who now face a dilemma on whether to include or exclude the neutral zone which was previously exempted from production cuts.

The resumption of oil production from Khafji and Wafra will not add to global supply because both Kuwait and Saudi Arabia comply with their production quota under the OPEC+ agreement, according to a source who spoke to Bloomberg.

However, any news about the restart of the neutral zone fields would punish prices as all reports so far have.

On December 5, OPEC and its allies (comprising a wider group of countries that have been involved in an oil alliance since 2016) reached a new production cut of around 1.7 million bpd.

The group, which pumps

more than half the world’s oil, is expected to take on 372,000 bpd of the additional cuts that take effect from January, while countries outside the cartel will be responsible for 131,000 bpd.

More than any other country, Africa’s biggest oil-producing country needs the oil price to rise, and in the worst case remain steady at any price above the $57 benchmark of the 2020 budget.

To achieve this, the country needs to avoid disruptions in crude production and also hope that the alliance under OPEC achieves its objective, even though many are yet to comply with the output cut, including Nigeria.

Contrary to a production benchmark of 2.1 million bpd usedforthe2020budgetestimates bytheFederalGovernment,Nigeria needs to cut production down by 53,000 barrels to arrive at a new quota of 1.685 million bpd, down from the reference production figure of 1.797 million bpd recorded in January 2019. www.businessday.ng

Continued from page 38

FIRS boss. This leaves the country, which depends heavily on funds from In a bid to upscale tax remittance, the Fowler-led FIRS administration had appointed banks as collection agents of taxpayers considered to be in default of tax payments. In order to achieve this, the FIRS directed the relevant banks to freeze the accounts of the taxpayers to prevent them from drawing funds from the accounts.

The analysts, however, say the notice is too short and that the regulator should go by the number of days stated by the tax law.

Commenting on the seven-day deadline by the tax authority, however,

Taiwo Oyedele, head of tax services at PwC, said the notice was inappropriate because in the processes of tax enforcement, there is an assessment process that leads to the tax appeal tribunal which will go on for as long as the court decides. As such, to issue a seven-day public notice is “completely meaningless”, he said.

In the event that a taxpayer is not disputing a tax assessment, Oyedele said “it would imply that such a taxpayer has an amount to pay and hasn’t remitted it and for such a situation the law allows for a grace period as it relates to a different kind of tax, whether its VAT, personal income tax, company tax, they all have different timing but

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fees, monthly account service charges, inactivity fees, cheque deposit slip fees – all charged by banks in rendering effective financial services to customers.

In the nine months of 2019, six Nigerian lenders (UBA, EcoBank, First Bank, Zenith Bank, Stanbic IBTC and Union Bank) generated a total sum of N675.9 as noninterest income, according to BusinessDay data. This is a 12 percent increase when compared with the N606 billion generated in the same period the previous year.

The year 2020, would be a busy year for banks as the CBN continues to roll out policies that it hopes would lift an ailing economy.

The CBN is planning on raising the loan to deposit ratio of deposit money banks to 70 percent next year, according to a statement by Hassan Mahmoud, its deputy director, financial policy & regulation department. This is despite struggle by banks to meet the

second target of 65 percent LDR by December year-end.

The apex bank had in July this year raised the loan to deposit ratio of banks to 60 percent in a bid to force banks to lend to the real sector of the economy.

Following the directive, loans by banks to the private sector increased by 7.39 percent to N16.25 trillion in the third quarter, up from N15.13 trillion in the second quarter, with the manufacturing sector benefitting greatly from the impact.

Without allowing the dust to settle, the CBN further raised the LDR for banks to 65 percent with a December 31 deadline.

The apex bank later barred non-bank foreign investors from partaking in its N14 trillion OMO market, pushing individuals and local firms to pack liquidity in short-term treasury bills. This sent yields of one-year treasury bills to lower lows at 6.17 percent, according to FMDQ data.

there are no seven days in the tax law”.

Checks by BusinessDay show that the provisions of section 33 of the Federal Inland Revenue Service Establishment Act (“FIRSEA”) give the tax authority the power to distrain, that is, to go after a tax defaulter.

This can also be found in Section 86 of the Companies Income Tax Act (CITA), Section 104 of the Personal Income Tax Act (PITA), and Section 3(1)(b) of the Petroleum Profits Tax Act (PPTA).

This power is exercised by a simple issuance of a warrant of distraint by the FIRS. However, for FIRS to exercise the power to distrain, two conditions must be met: an assessment by the FIRS must be final and conclusive and, secondly, a demand notice must have been served and the time

stipulated on the demand notice must have expired without the tax being settled.

On how to get more Nigerians to be tax compliant, Oyedele suggested the use of data. According to him, the way to get people to comply with tax remittances is to ensure that there is the right use of data.

“Data is very powerful in tax collections. Once I have enough information about you, I can determine what you should be paying and I can tell that based on your tax returns. You haven’t submitted what you are supposed to submit and you haven’t paid the right amount of tax and based on the law, I will be able to give you the deadline and also what the consequences are as stated by the law,” he said.

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news

Oyo signs Appropriation Bill for 2020 fiscal year into law ... pledges 70% of implementation before end of year REMI FEYISIPO, Ibadan

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L-R: Eriye Onagoruwa, external affairs manager, Waltersmith Petroman Oil Limited; Roseblossom Nnodim, technical assistant on media to minister of state for petroleum resources; Rowland Ogundu, general manager, operations, Waltersmith Petroman Oil; Danjuma Saleh, vice chairman, Waltersmith Petroman Oil; AbdulRazaq Isa, chairman, Waltersmith Petroman Oil; Timipre Sylva, minister of state for petroleum resources Nigeria; Simbi Wabote, executive secretary, Nigerian Content Development and Monitoring Board; Chikezie Nwosu, MD/CEO, Waltersmith Petroman Oil, and Osten Olorunsola, non-executive director, Waltersmith Petroman Oil, during working visit of the minister to 30,000bpd Waltersmith Refinery.

NCC commits to driving ICT innovations in academia, invests over N105m in R&D Jumoke Akiyode-Lawanson

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n keeping with its ongoing tradition of driving technology innovations through funding relevant researches in tertiary institutions, the Nigerian Communications Commission (NCC) is investing heavily in Information Communication Technology (ICT) research and development (R&D) in several higher educational institutions across Nigeria.

The NCC has in the last one year partnered academia, industry and other stakeholders with plans to further boost the country’s telecoms sector.

In May 2019, the commission announced N40 million endowment funds for Bayero University, Kano, and the Federal University of Technology, Owerri. The fund, it said, will be utilised by the institutions for innovation, research and development in the digital space with an ongoing commitment to expand the list of benefiting institutions.

Also, in June 2019, the Commission again demonstrated its determination to facilitate research and innovation in the telecom industry in Nigeria by presenting the sum of N65 million to 11 different universi-

ties in Nigeria for innovation, R&D to deliver research result and prototypes that are implementable, commercially-viable and capable of engendering innovation in different sectors of the economy.

According to Umar Garba Danbatta, “For growth to happen you need research into emerging issues and emerging technologies that is why we partner with the academic institutions, as they are the home of those research and development efforts. The universities are institutions of research, which is their core area. So, partnering with them enables them to do what they can do and do it best,” he said during the announcement of partnership with the Federal University of Technology (FUT), Minna, earlier this year.

Abdullahi Bala, vice chancellor, FUT, Minna, sought NCC’s partnership for the establishment of a centre for emerging technologies in its campus, saying the largely ICTbased centre would address issues such as cybersecurity, cryptocurrency, digital policing and forensics, among others.

In its continuous efforts to support young technopreneurs, the NCC has been playing a pivotal role in pro-

moting investment opportunities and innovation within the digital ecosystem for economic growth, and in exposing young

Small and Medium Enterprises (SME) owners in the ICT industry to global investment opportunities.

overnor Seyi Makinde of Oyo State has signed the 2020 Appropriation Bill of the state into law, saying the government will target a minimum of 70 percent implementation.

The 2020 budget signing ceremony, held Monday inside the State’s Executive Council Chambers, Governor’s Office, Agodi Ibadan, was witnessed by the deputy governor, Rauf Olaniyan; the speaker of the House of Assembly, Adebo Ogundoyin, members of the House of Assembly and other top government functionaries.

While stating that the budget will achieve landmark infrastructural development in the state, he said: “So, as I stated in the budget presentation speech, our objective is to, at least, achieve 70 percent implementation at the end of the 2020 fiscal year.”

He indicated that the budget was geared towards achieving the plans outlined in the roadmap for accelerated development of Oyo State from 2019-2023.

“The Appropriation Bill for

Outlook for Ciuci Consulting’s UK business positive in 2020 Hope Moses-Ashike

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he outlook for Ciuci Consulting, a leadi ng ma nag e m e nt consulting firm, looks positive as Tayvanie Nagendran will be joining the advisory board of Ciuci (pronounced see-you-see) Consulting’s UK arm.

Tayvanie, an innovative strategic healthcare investment professional and an alumnus of Oxford University, will play a significant advisory role in the execution of the company’s growth strategy.

According to Chukwuka Monye, Ciuci’s global managing partner - “This is strategic, especially as we strength-

en our global position and healthcare capabilities within the group.”

He said this at the Health Investor Power 50, an exclusive event in London for major players in the UK health sector, attended by both him and Tayvanie.

Ciuci Consulting, a leading management consulting firm with a fully diversified clientele and footprints in a number of countries including Ghana, Nigeria, US and UK. The firm, which has received a number of international awards for its innovative approach to solving client problems has successfully executed over 350 projects in its 12 years of operations. www.businessday.ng

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@Businessdayng

the 2020 fiscal year, which I am about to sign into Law, represents the aspirations of the people of Oyo State. It is geared towards achieving the plans outlined in our roadmap for accelerated development in Oyo State from 2019-2023. We produced this document during the electioneering period and it is exactly what we are following.”

The governor commended the Oyo State House of Assembly for the prompt scrutinising and passing of the proposed budget bill in order for the implementation of the budget to start from the beginning of the next year.

“Let me start by thanking the Oyo State House of Assembly for promptly scrutinising and passing our budget proposal. This makes it easier for the Executive to do its part in implementing the budget from the beginning of next year. So, I want to, on behalf of the Executive, appreciate the Honourable Speaker and other House of Assembly members that are present here.”

He said all the civil servants would receive their 13th month salary by December 28, 2019.

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news Waltersmith sponsors N460m electrification project in partnership with Imo government

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he lives of people living in six communities in Imo State who have lived all their lives without electricity from the national grid is set to c ha ng e a s Wa l t e r s m i t h Petroman Oil Limited in conjunction with the Imo State Oil Producing Areas Development Commission (ISOPADEC) kicked off the first ever electrification project for all six communities.

“Darkness is a normal part of our existence,” says an indigene of one of the communities comprising Umuapu-Obite-OchiaAwarra-Assa-Obile, which will benefit from the electrification project valued at N460 million, is funded jointly by Waltersmith and ISOPADEC. Speaking at the flag-off ceremony recently, Governor Emeka Ihedioha of Imo-State expressed appreciation to Waltersmith for partnering the government and thanked them for their contributions in the state till date.

The governor assured the communities of gov-

ernment’s willingness to bring development to the r u ra l a re a s, s ay i ng t h e electrification project was a fulfilment of his promise to utilise the proceeds of 13% derivation funds essentially for the developm e nt o f Ohaj i / Egb e ma and Oguta Local Government Areas, and particularly the oil pro ducing communities.

In a statement, Waltersmith noted that it was p ro u d t o b e a n e q u i t y partner in the project as it was a symbol of its robust corporate social responsibility (C SR) initiative and its deep rooted commitment to bring tangible benefits close to the communities and ensure sustainable growth and development in its areas of operations.

At the kick-o ff cere mony, the visibly elated members of the communities were full of praise for Waltersmith, stating that the provision of electricity was a dream come true and would open up job opportunities and build local capacity. www.businessday.ng

Defecting members are failed, irrelevant politicians - Lagos PDP

Sowore: Judge excuses self from suit, says SaharaReporters maligned him in the past Felix Omohomhion, Abuja

Iniobong Iwok

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agos State chapter of the People’s Democratic Party (PDP) has described some members of the party who recently defected to the ruling All Progressives Congress (APC) as failed politicians, who were no longer irrelevant in the party.

Last week, some chieftains of PDP and their supporters formerly joined the APC and were received by leaders of the party, while they were handed the APC flag at the party’s secretariat in Ogba, Ikeja.

The defecting chieftains are former Minister of Works and Housing, Adeseye Ogunlewe, and his son, Moyo; a former PDP leader in Ikeja constituency Mutiu Okunola; Raman Falawe (Lagos Island); Jebe Dayo (Mushin), and Adeoye Shamolu (Ojo).

Others included Jaiye Agoro (Lagos Mainland); Sukanmi Fabiyi (Apapa), and Arisekola Afeez (Accord Party, Mushin).

The defecting chieftains had said they defected to the APC with their supporters to change the narratives.

However, speaking in an interview with BusinessDay,

Monday, publicity secretary of the PDP in the state, Taoffick Gani, said the party was not bothered about the defection of the chieftains and their supporters because they had only gone back to where they came from.

Gani said the former members did not understand the essence of party politics and were only fighting for their selfish interests.

According to Gani, “All the people who defected to the APC don’t know why they belong to a political party in the first place.

They are irrelevant and six of the people who joined the APC where originally in AD before they joined us. The last one was lucky to get our party ticket and contest election in the last general elections.

“They joined the APC because of what they would eat; we would bounds back to win elections in the state.”

Speaking further, he said the popularity of the APC in Lagos State was waning because of the poor performance of the incumbent administration, stressing that the party would lose the 2023 general elections in the state.

He noted that PDP in the state had put behind past elec-

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ustice Ahmed Mohammed of a Federal High Court, Abuja, Monday, excused himself from hearing a motion challenging the continued detention of RevolutionNow convener, Omoyele Sowore.

Sowore is being detained by the Department of State Service (DSS) despite court orders granting him bail.

Sowore had on December 15 sued the Attorney General of the Federation and Minister of Justice, Abubakar Malami and the director-general of the DSS, Yusuf Bichi, over his re-arrest and continued detention.

He also filed an exparte application seeking an order of the court to compel the DSS to immediately and unconditionally release him from detention.

On December 17, shortly after the suit was called, the trial judge, Justice Inyang Ekwo, ordered service of court process on the defendants and adjourned to December 23 for hearing of the motion.

However, there was a new development on Monday, December 23, when a new judge, Justice Mohammed took over the matter. @Businessdayng

Sowore was re-arrested on December 6, within the premises of the Federal High Court, Abuja, by operatives of the DSS, barely few hours after he regained freedom from a four-month detention.

However, when the matter came up on Monday, Justice Mohammed declined to entertain the motion on grounds of likelihood of bias.

According to the judge, he cannot go on with the matter because Sowore’s media outfit, SaharaReporters had sometimes in 2016 accused him of being a bribe taker.

Justice Mohammed held that irrespective of where justice would go at the end of the day, he would be accused of bias, adding that the best thing was for him to return the case file to the Chief Judge of the Federal High Court for re-assignment to another judge. He consequently recused himself from the suit.

Responding, Sowore’s lawyer, Femi Falana, consented with the view of the judge to step aside from hearing the matter.

Sowore and one Olawale Bakare are standing trial on a 16-count charge bordering on treasonable felony, money laundering, among others.

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Gamesville Foundation lifts three NGOs with N6m donation

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Tuesday 24 December 2019

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he Gameville Foundation, a non-profit organisation that provides games recreation and aid to humans that are onset by hardship, loneliness or disability, has lifted three NGOs by fundraising and donating N6 million to their causes.

The fundraising effort culminated at a games-themed gala that included an interactive mystery game hosted by HC Bonum and casino games administered by Oceans 7.

The funds were given to three charities: Street Child Care and Welfare Initiative, Jakin N.G.O, and Echoes of Mercy and Hope Foundation, which focus on the welfare and integration of street and underprivileged children into society.

Each NGO received N2 million, which will be spent on the welfare of the children, including school fees, school clothes and kits, vocational training, and nutrition. Speaking at the event which was held at Havilah Events Centre in Lagos, Chidinma Obi, cofounder and Trustee of The Gamesville Foundation said: “We put this event together to support the grassroots work that these charities are doing to improve the lives and wellbeing of children who are on the streets, in harm’s way, or living in deep poverty. We are keen to use our platform and access to resources to support sustainable solutions to problems plaguing children, and we are deeply grateful to our corporate and individual sponsors for empowering us to do so.”

Major donors of the event include Shelf Drilling, GTP Oil Field Solutions Limited, Zenith Bank, and the staff of LEKOIL employees. Hamilton Esi - GM, Corporate Communications at LEKOIL, summed up the reason for the staff pulling resources together to make a contribution by explaining that “LEKOIL shares in The Gamesville Foundation’s mission of improving lives and values-building, and we’re delighted to support their efforts in this mission through independent employee engagement and volunteer work”.

The Presidents of the NGOs, Fola Soyebo of Echoes of Mercy and Hope Foundation, Olubukola Adebiyi of Jakin N.G.O, and Comfort Alli Babalola of Street Child Care and Welfare Initiative, each thanked the coordinators of The Gamesville Foundation and assured all donors that the funds which were raised to assist the underprivileged children will be judiciously used.

The Gamesville Foundation is the NGO arm of Lagos Games Group, a private social organisation that promotes recreation and values-building through board, card, roleplay and other interactive games. The organisation hosts games once a month.

KFW invests additional€23.5m subordinated capital in InfraCredit Hope Moses-Ashike

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nfrastructure Credit Guarantee Company Limited (InfraCredit) has announced the successful second round closing of €23.5 million (USD equivalent) subordinated capital investment by its existing investor, KfW Development Bank (KfW), the largest development bank in Europe.

The Government of the Federal Republic of Germany through KfW Development Bank has invested an additional €23.5 million 10-year subordinated unsecured capital in further support of InfraCredit, to increase its capitalisation and strengthen its balance sheet, as it continues to grow its guaran-

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tee portfolio.

The investment was accompanied by a €0.75 million technical assistance grant funds to support InfraCredit’s market development and capacity building programme. The subordinated unsecured long-term capital will rank as qualifying capital for capital adequacy and financial leverage purposes.

In October 2018, KfW Development Bank made an initial subordinated capital investment of €31 million in InfraCredit. The financial cooperation is consistent with the goals of the 2030 Agenda (SDGs), and will make a major contribution to job creation and sustainable economic growth (SDG 8) and promotion of innovations and

the expansion of infrastructure (SDG 9).

In a statement, Chinua Azubike, managing director/CEO, InfraCredit, said, “We are delighted and extremely pleased with the confidence that a respected, long-term oriented development institution like KfW has demonstrated in the vast opportunity ahead for InfraCredit. This second round investment is a strong signal of KfW’s commitment to the long-term strategic growth of InfraCredit and the development of long-term local currency infrastructure finance in Nigeria.”

According to Jan Martin Witte, director, Central Africa & Regional Funds of KfW, “We

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are very proud to partner with InfraCredit to promote sustainable infrastructure investments in local currency in Nigeria.

Today, we signed an additional subordinated loan facility with InfraCredit worth €23.5 million.”

InfraCredit is a ‘AAA’- rated infrastructure credit enhancement facility established as a commercial entity by the Nigeria Sovereign Investment Authority and GuarantCo to provide guarantees to enhance the credit quality of local currency debt instruments issued to finance eligible infrastructure assets in Nigeria.

InfraCredit acts as a catalyst to attract the investment interest from pension funds, insur-

@Businessdayng

ance firms and other long-term investors, thereby deepening the Nigerian debt capital markets. InfraCredit operates on a commercial basis and benefits from private sector governance.

KfW is 80 percent owned by the Federal Republic of Germany (FRG), with the remainder owned by the German federal states. It was established in 1948 and is the largest development bank in Europe. Its obligations are backed by a direct and unlimited statutory guarantee from FRG. Based on the maintenance obligation (Anstaltslast), FRG is committed to safeguarding the economic basis of KfW and ensuring that its operations can continue in the event of financial difficulty.

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BUSINESS DAY

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Tuesday 24 December 2019

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FINANCIAL TIMES

World Business Newspaper

ANDREW EDGECLIFFE-JOHNSON

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oeing has replaced Dennis Muilenburg as its chief executive after he failed to gain control of the crisis which followed the fatal crashes of two of its 737 Max jets.

David Calhoun, a board director who had taken over the chairmanship from Mr Muilenburg in October, will become CEO from mid-January. Lawrence Kellner, the former chief executive of Continental Airlines who is a Boeing director, will replace him as chairman.

Boeing said Mr Muilenburg had resigned but made clear he had done so under pressure.

“The board of directors decided that a change in leadership was necessary to restore confidence in the company moving forward as it works to repair relationships with regulators, customers, and all other stakeholders,” Boeing said in a statement on Monday morning.

Shares in Boeing rose more than 3 per cent to about $338 each on the announcement, against the 12 month-low of about $292.

The news came days after the

Boeing CEO Muilenburg out after 737 Shares rise on news chairman David Calhoun will step into breach in mid-January

© Andrew Harnik/AP

largest US exporter sent shockwaves through its supply chain by announcing that it would halt production at its 12,000-strong Renton pant near Seattle. With regulators still reviewing Boeing’s

Development finance chief warns Beijing’s infrastructure investments will shatter economies

Bank admits former chief operating officer ordered surveillance of ex-head of HR Peter Goerke

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redit Suisse has admitted to spying on a second top executive, reigniting a scandal over the bank’s actions just as it had begun to emerge from initial allegations of snooping.

In a statement on Monday the Swiss bank said its former chief operations officer, Pierre-Olivier Bouée, had ordered surveillance of its former head of human resources, Peter Goerke. It said chief executive Tidjane Thiam had not been aware of the activity.

Credit Suisse last week launched a hastily arranged investigation after fresh allegations of corporate espionage emerged. Switzerland’s NZZ newspaper reported that Mr Goerke was tracked by a team of eight people, who monitored his home and trailed him around Zurich.

The revelations followed similar action against the bank’s former head of wealth management, Iqbal Khan, who was also shadowed.

Credit Suisse said Mr Bouée had orchestrated both instances. The bank’s board was now terminating its previous settlement with Mr Bouée, who would be considered as having been fired from his former position, it added in the statement.

“The board of directors considers the observation of Peter Goerke to be unacceptable and completely inappropriate. In no way did this operation — or the subsequent observation of Iqbal Khan — correspond to the corporate culture of Credit Suisse,” the bank’s board said on Monday.

Mr Thiam has been under mounting pressure since the Khan affair exploded into the open this year, shocking Switzerland’s staid and

notoriously discreet financial community.

Mr Khan discovered his followers, leading to a confrontation in downtown Zurich, and weeks of lurid headlines detailing a spectacular personal breakdown between him and Mr Thiam. Mr Khan has since joined rival UBS as co-head of its flagship wealth management arm.

The cases raise serious questions over Credit Suisse’s public communication of its position and the findings of its investigations.

The spying against Mr Khan was originally characterised by the bank as a rogue, isolated operation that had been conducted off the books by Mr Bouée on his own initiative.

Last week, the bank initially staunchly denied that the surveillance against Mr Goerke had occurred, insisting that its original investigation following the Khan affair had been exhaustive and found no evidence of further malfeasance.

In its statement on Monday, Credit Suisse said previous inconsistencies in its communications stemmed from the implicated staff having lied to lawyers conducting its internal investigations.

“The observation of Peter Goerke, which has now been confirmed, is inexcusable,” said chairman of the board, Urs Rohner. “It is of grave concern that the responsible individuals failed to answer truthfully about this observation during the external investigation in September 2019.

“We are aware that the observations of Iqbal Khan and Peter Goerke have damaged the reputation of our bank. With the measures that we have put in place, we are sending a clear message that the board of directors firmly rejects a culture of observation.” www.businessday.ng

entire career with Boeing, was widely criticised for a faltering response to the crashes which killed 346 people and the board indicated that it was aware of the need to improve communication,

China’s $1.3tn global spending spree will collapse, says top US official

Credit Suisse admits to second case of spying on a top executive SAM JONES

fixes to the Max airlines have been pushing back their estimates for when they will be able to fly it again, with United saying it will not return to service until June.

Mr Muilenburg, who spent his

not least with the Federal Aviation Authority, its domestic regulator.

“Under the company’s new leadership, Boeing will operate with a renewed commitment to full transparency, including effective and proactive communication with the FAA, other global regulators and its customers,” its statement said.

Mr Kellner noted Mr Calhoun’s deep industry experience and record of strong leadership, saying “he recognises the challenges we must confront.”

Greg Smith, its chief financial officer, will serve as interim CEO during a brief transition period, while Mr Calhoun extricates himself from other commitments.

The former GE executive is senior managing director and head of portfolio operations at Blackstone.

Despite lingering concern from some consumers about the safety of the 737 Max design Mr Calhoun said: “I strongly believe in the future of Boeing and the 737 MAX.”

JAMES POLITI AND DEMETRI SEVASTOPULO

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top US development finance official has warned that China’s $1.3tn global spending spree on infrastructure is destined to collapse, shattering some emerging market economies.

Adam Boehler, the chief executive of the US International Development Finance Corporation, told the Financial Times that China’s international investments were “100 per cent” like a house of cards because of “debt overload, poor infrastructure, bribes [and] lack of transparency”.

“Everything comes around, it’s only a matter of time. It was only a matter of time before WeWork came around, right?,” Mr Boehler said, referring to the distressed office rental start-up that unravelled this year. “We have to be there as an alternative because I could see China take down a whole bunch of emerging countries . . . there will be more and more cracks and then the glass will break,” he added.

Mr Boehler, a former US healthcare official and executive, became head of the DFC late this year after the agency received a big funding boost from Congress that doubled its war chest to up to $60bn and allowed it to make equity investments.

As well as ensuring that US businesses pump more money into developing countries, the DFC is also much more explicitly tying its deals — including loans, loan guarantees and risk insurance — to the Trump administration’s national security priorities, including challenging China’s growing economic and stra-

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tegic influence around the world.

“My job isn’t to go out and make up American foreign policy,” Mr Boehler said. “[But] we co-ordinate very heavily with [the] NSC, with State, USAID, USTR, to get a US government view when we approach things. We’re cognisant of what China is doing, but it’s not a reaction to China . . . playing offence not defence here,” he added.

Although the DFC — which was previously known as the Overseas Private Investment Corporation — is not ruling out investments in traditional infrastructure such as ports, motorways and bridges, it is increasingly looking to compete with China in funding advanced technologies, including 5G, both in terms of building out the networks and participating in spectrum auctions. “It doesn’t have to be the United States, it doesn’t have to be a US-based company. But we do care quite a bit about that data being secure,” Mr Boehler said.

The DFC is also part of the US government’s broader effort to stop countries from using technology run by Huawei, the Chinese telecommunications company that is accused by Washington of espionage and being a threat to national security. “The answer to Huawei is not ‘don’t buy Huawei and that’s it.

You need an effective and credible alternative,” he said.

While many in Washington fear that the US is struggling to persuade countries to reject Huawei as they build out their 5G networks, Mr Boehler was more upbeat, saying he detected “changing winds” as governments were “getting smart” on these issues. “More and more you’re seeing people say no”.

He called Chinese investment a “drug” but said more countries were @Businessdayng

becoming sceptical of it in terms of the sustainability of the debt. “I think people are pretty circumspect about it,” Mr Boehler added. “There is a lot of concern where there’s over-leverage toward China in the market right now, a lot.”

The agency’s disbursements remain well below its caps, but it has already started to ramp up spending this year, from $3.3bn in 2018 to $5.3bn this year, its highest level in more than 20 years.

At a time when the Trump administration’s relations with US allies is rocky and the White House has struggled to mount a united front to confront Beijing on trade, Mr Boehler said he would like to do more business alongside similar agencies in Japan, Europe and beyond.

“I would rather write a smaller cheque and do it with JBIC,[ the Japanese development finance agency] or our friends at African Development Bank or others,” he said. With the Japanese in particular, he added that there was a live “conversation about how do we drive our goals in Indo-Pac together because they are shared goals”.

“We should be holding hands on that. That’s a strong message, not just against China but against anybody that wants outsized influence in a sovereign nation and that’s going to push a closed system instead of an open one,” he added.

Mr Boehler was sceptical that the DFC could ever work with the Beijing-backed Asian Investment Infrastructure Bank, unless there was a big change in China’s approach. “To the extent we have concerns about transparency, rule of law and outsized influence, it would be difficult to work together,” he said.

Tuesday 24 December 2019

FT

BUSINESS DAY

48

NATIONAL NEWS

Ethiopia seizes crown as fastestgrowing country in the 2010s East African nation beats a bevy of Asian states — but is now ripping up its playbook STEVE JOHNSON

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country that is in the process of ripping up its economic model and has been forced to go cap in hand to the IMF might be expected to be one mired in recession.

Yet Ethiopia, which is undergoing a sharp reversal in strategy under Nobel Peace Prize-winning prime minister Abiy Ahmed, has been the world’s fastest-growing economy over the past decade, both in overall and per capita terms.

Since 2009, Ethiopia’s gross domestic product has jumped 146.7 per cent, according to data collated by the IMF, while in per capita purchasing power parity terms it has risen 149 per cent, enough to put it top of both lists as the decade draws to a close*.

The 112m-strong east African state is one of a number of countries to have doubled its output by both of these measures this decade, ranging from heavyweights China and India to relative economic minnows Mongolia, Turkmenistan and Laos.

Nauru, Rwanda and Ghana have also doubled real gross domestic product, while Myanmar, Bangladesh and Cambodia has seen 100 per cent-plus rises in per capita output in purchasing power parity terms, despite the economic gloom that has enveloped much of the past decade.

However, progress has been far from widespread, with conflictriven Libya and Yemen seeing GDP plunge by 71 per cent and 36 per cent respectively, while things have gone so badly in Syria and Venezuela that the IMF has stopped collating data.

Bar chart of 10 fastest growing countries (%) showing real GDP growth since 2009 The average person is also now poorer in Equatorial Guinea, Greece, the Central African Republic, Sudan and Trinidad & Tobago than they were in 2009.

When it comes to the winners, “you could argue that almost all

of these have very strong Chinese links or have adopted the Chinese growth model”, said Charles Robertson, chief economist at Renaissance Capital, an emerging markets-focused investment bank, referring to the likes of Mongolia, Laos, Cambodia, Ethiopia and Rwanda, as well as Vietnam, another strong performer.

Among African states, Ethiopia has arguably been the keenest pupil of the Chinese growth model, embarking on an authoritarian, state-led investment push, focused on infrastructure and manufacturing.

“Ethiopia has been growing really hot on a model that was initially brought in by [former prime minister] Meles Zenawi, who was a committed Marxist,” said François Conradie, head of research at NKC African Economics.

“It was state-led growth, public investment in infrastructure — roads and a lot of electricity. They realised the competitive advantage they had through hydropower [via the Blue Nile, river Omo and others] and using those dams for irrigation to boost agriculture, and building roads and allowing farmers to get their produce to market.”

Mr Robertson said Ethiopia had investment rates above 40 per cent of GDP, “which is Chinese-type levels”.

Bar chart of 10 worst performing countries (%) showing real GDP growth since 2009 Unlike China, however, Ethiopia did not have enough domestic savings to pay for such an investment blitz and was forced to borrow, sending its debt-to-GDP ratio soaring to 60 per cent, as of last year, from 27 per cent at the start of the decade, according to the central bank. This has left it at “high risk” of falling into debt distress, the IMF has said.

“That [growth] model has come up against some hard limits in terms of debt,” said Mr Conradie, who said NKC was “pretty certain” there is additional off-balance sheet debt lurking in state-owned enterprises.

ECB president Christine Lagarde puts her signature on a €20 banknote © Armando Babani/EPA/Shutterstock

Christine Lagarde expected to change ECB inflation target Majority of economists surveyed believe strategic review will shift central bank policy MARTIN ARNOLD AND ALEXANDER VLADKOV

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hristine Lagarde is expected to significantly change the European Central Bank’s inflation target for the first time in more than 16 years as part of next year’s strategic review, according to economists polled by the Financial Times.

The ECB president will launch a sweeping strategic review of the central bank’s remit and tools in January, and its inflation target will be one of the key areas that the review will consider.

In its only previous strategic review in 2003 it tweaked its medium-term inflation objective from between zero and 2 per cent to a narrower objective of “below but close to 2 per cent” to guard against the risk of deflation.

Having struggled for years to lift inflation in line with this aim, the ECB is widely expected to change its main policy objective once more. More than half the 34 economists polled by the FT said they expected the ECB to amend its inflation target.

Ms Lagarde said this month that interpreting the ECB’s price stability mandate would be the “core and centre” of its review, adding that “there is no preconceived landing zone at this time”.

Many of the economists polled by the FT said they expected the ECB

to ditch the “below but close to” part of its existing objective and instead switch to a simpler goal of 2 per cent, which would raise the bar required before it started lifting interest rates again.

“I am optimistic for some important changes: most obviously, an altered inflation target — 2 per cent over the medium term — which does away with the current vague formulation,” said Paul Diggle, senior economist at UK fund manager Aberdeen Standard Investments.

Such a change would bring the ECB into line with the US Federal Reserve and the Bank of England, which both have a straightforward 2 per cent inflation target.

More than 40 per cent of the economists polled by the FT said the central bank should adopt a symmetrical objective, to indicate it would be as worried about inflation being too low as being too high. That principle was embraced by Ms Lagarde’s predecessor Mario Draghi this year in his final months as ECB president.

“I expect that the ECB’s planned strategic review of monetary policy will result in an adjustment in the definition of price stability to imply a symmetric target around the 2 per cent inflation level,” said Lena Komileva, chief economist at G+ Economics.

Overall, the economists were almost universally positive about the choice of Ms Lagarde to replace Mr Draghi at the start of November, with

many of them praising her political experience, communication skills and consensus-building approach. “[Ms] Lagarde is an outstanding choice,” said Willem Buiter, adjunct professor of economics at Columbia University. “Her insistence on budgetary support measures, especially in countries with material fiscal space — eg Germany and the Netherlands — is entirely justified.”

However many of the economists expressed scepticism about whether the strategic review will achieve much, given the deep divisions that emerged on the ECB governing council at the end of Mr Draghi’s leadership.

Ken Wattret, economist at IHS Markit, said: “The concern remains therefore that longstanding differences of opinion might result in a cosmetic exercise with window-dressing rather than tangible results.”

A handful of the economists surveyed said they expected the ECB to adopt a band of inflation as its new objective, such as between 1.5 and 2.5 per cent, to give it more flexibility to accept periods of lower or higher consumer price growth.

Shifting to a range-based target “would signal that the ECB will start to remove some of its stimulus once core inflation approaches 1.5 per cent”, said Holger Schmieding, chief economist at German bank Berenberg.

Only two economists thought the ECB might lower its inflation objective.

Saudi Arabia sentences 5 to death for Jamal Khashoggi murder Court convicts 8 for killing of journalist in Turkey but clears royal adviser ANDREW ENGLAND

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Saudi court has found eight people guilty of the murder of Jamal Khashoggi but cleared a former adviser to Crown Prince Mohammed bin Salman of involvement in the journalist’s killing.

The court sentenced five people to death for the murder but ruled that Ahmed Assiri, deputy intelligence chief at the time of the killing, should be released because of insufficient evidence. Saud al-Qahtani, another former adviser to Prince Mohammed, was investigated but not charged because of a lack of evidence, said Shalaan al-Shalaan, deputy attorney-general.

Diplomats considered the case as a crucial test for Riyadh after the murder triggered the kingdom’s biggest diplomatic crisis since the September 11 2001 attacks on the US. But human rights activists have repeatedly expressed concerns that the main perpetrators would go unpunished and the decision not to prosecute Mr Assiri and Mr Qahtani has already fuelled criticism that the trial lacked credibility.

ALQST, a UK-based Saudi human rights group, said the court was “neither fair nor independent and has not tried the real defendant”. “Executing those who carried out the operation means killing key witnesses,” the group said on Twitter.

Lynn Maalouf, Amnesty International’s Middle-East research director, said the verdict was a “whitewash which brings neither justice nor the truth for Jamal Khashoggi and his loved ones”.

“The verdict fails to address the Saudi authorities’ involvement in this devastating crime or clarify the location of Jamal Khashoggi’s remains,” she said.

The kingdom’s state prosecutor last year said that its preliminary investigation found that the operation that led to Khashoggi’s murder at the Saudi consulate in Istanbul was ordered by Mr Assiri. It also implicated Mr Qahtani, who was the crown prince’s media specialist and widely regarded as his enforcer,

saying he co-ordinated with Mr Assiri.

Both men were sanctioned last year by the US, along with 15 other Saudis, in relation to the killing. Both men were dismissed from their official positions with the Saudi state but activists have feared that Mr Qahtani has continued to operate in the background.

The CIA reportedly concluded that Prince Mohammed must have authorised the killing as the kingdom’s de facto leader. He has denied any involvement in the murder and Riyadh blamed it on a rogue operation.

Khashoggi was killed after entering the consulate in Istanbul on October 2 last year while his fiancé waited outside. His body was

dismembered and has not been recovered.

The court did not name the eight people found guilty, but five were sentenced to death and three others received sentences of 24 years in prison, said Mr Shalaan, who read out the court’s findings. Eleven people were put on trial for the murder, but under Saudi law none were identified.

The state prosecutor also decided to release Mohammed al-Otaibi, the Saudi consul-general in Istanbul, saying he was off-duty on the day of the murder, Mr Shalaan said.

Washington sanctioned Mr Otaibi this month as it called on Riyadh to conduct a “full, fair and transparent” trial.

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Tuesday 24 December 2019

BUSINESS DAY

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

Stocks near year’s end on high note while pound drops Easing of trade tensions smooths path for investors ANNA GROSS

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lobal stocks remained close to record highs as trading dwindled in the run-up to the Christmas holidays and investors took profits on gains made earlier in the month.

China announced on Monday it would cut import tariffs on a range of products, including frozen pork, avocados and some kinds of semiconductors. Over the weekend, US president Donald Trump said the US would “very shortly” sign a “phase one” trade agreement with China. The signing is set for January.

Net long positions in the dollar halved last week, hitting their lowest level since mid-June, according to Rabobank’s Commitment of Traders report, as optimism about a phase one trade deal rekindled demand for riskier assets.

Brent crude continued last week’s upward trajectory, adding 0.11 per cent to reach $66.21 a barrel.

The MSCI all-country stock index was up 0.36 per cent on Monday, above Friday’s record high. It has risen almost 3 per cent over the course of December and 23 per cent over 2019.

Japan’s Nikkei was relatively flat on Monday after it reached a 14-month high on Friday. It is up 2.3 per cent since the start of the

month.

Chinese stocks were down by their biggest amount in six weeks, after the government announced it would cut its investments in some chipmakers. The pan-European Stoxx 600 index remained flat, after ending last week up 1.6 per cent.

The only big report expected this week is the US data on personal consumption expenditure for November, due to be released on Friday.

The FTSE 100 rose 0.52 per cent in Monday trading, notching up a nine-day rally and adding to a fivemonth high. The domestic-heavy FTSE 250 added 0.93 per cent, to total three straight sessions of gains.

In part, that reflects the latest tumble in the pound, following one of its worst weeks of the year last week. It dropped as much as 0.7 per cent against the dollar to a low of $1.2916. It also tumbled 0.6 per cent against the euro to €1.166.

The pullback, though likely exaggerated by threadbare preholiday trading conditions, illustrated that an ugly exit for the UK from the EU remained a pressing concern for UK markets.

“PM [Boris] Johnson is still using the threat of a no-deal Brexit as a negotiating tactic in the forthcoming trade talks with the EU,” wrote analysts at Rabobank. “This is likely to ensure that Brexit remains a driving factor for the pound.”

Hg to regain control of software company Personal & Informatik Deal highlights ‘pass the parcel’ activity in private equity sector KAYE WIGGINS

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rivate equity group Hg has agreed to buy a majority stake in Personal & Informatik, in an acquisition that values the German software business at €2bn and is the latest in a series of so-called “pass the parcel” deals between buyout groups.

London-based Hg originally bought P&I — which provides payroll software to Germany’s Mittelstand of small and medium-sided companies as well as hospitals and local municipalities — from private equity group Carlyle in a 2013 deal that valued the business at €438m.

It sold a majority stake to Permira in 2016 at a valuation of between €800m and €900m, according to two people familiar with the matter, keeping a minority holding.

Several private equity groups have this year bought back companies they previously owned, arguing that their existing knowledge of the business gives them a good chance of growing it further. Many have raised record funds that they need to invest.

Hellman & Friedman last week agreed to buy AutoScout24, the car classifieds unit of Scout24, which the US buyout group and Blackstone listed in 2015. In June, Blackstone

was part of a consortium which agreed to buy leisure group Merlin Entertainments, which it had previously owned.

P&I, which operates in Germany, Austria and Switzerland, had 430 employees and reported €62.4m in earnings before interest, tax, depreciation and amortisation in the year to March, the most recent period for which public figures are available.

The company is shifting its software to a cloud-based model which Hg believes justifies a higher price tag, in part because groups that have made the transition tend to use a rollover subscription-based payments model which carries less risk of clients defecting to competitors.

“The thing that’s important to me is that we support P&I on this journey [to cloud computing],” said Michael Biehl, a director at Hg who worked on the deal. “At the same time we’re exploring expansion in continental Europe.”

In a few years’ time, P&I could be listed, or sold to a listed company or another private equity group, he added.

Permira will keep a minority stake in P&I. Hg is buying the business using a £1.5bn fund it raised last year, which specialises in larger deals for software companies valued at more than £1bn. www.businessday.ng

Most banks are first and foremost in the business of lending, and only second in the business of helping people manage their money © Bloomberg

Japan’s quest for cashless payments

The country’s reputation as a fintech innovator is at stake LEO LEWIS

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n a survey conducted in mid2019, the Bank of Japan asked why so many Japanese still preferred using cash for dayto-day transactions. By far the top answer — despite a protracted government campaign of cashless evangelism — was “because a cash transaction is completed on the spot”. Another favourite response was that “cash is quick”.

In an earlier Nomura survey of why businesses were reluctant to introduce cashless payment terminals, the top answer was high fees.

Some 3 per cent said they had never even heard of cashless payments.

Decades of consumer habit and resistance from retailers, say banking and fintech analysts, are proving hard to dislodge from a society that is used to paying in cash, enjoys the anonymity that comes with it and generally feels safe enough carrying around large sums.

The big question looming over Japan’s retail and financial sectors as they enter 2020 is whether the long-hoped-for behavioural shift will happen before the variety of incentive schemes that are in place run their course by the end of June.

Even as Tokyo prepares to cast next year’s Olympics as a showcase of Japanese technological prowess,

the signals from both public and private sectors on the great cashless conversion are mixed.

The Japanese government’s ambition is at least clear. As things stood in 2018, roughly 20 per cent of consumer payments were made cashlessly. That put Japan a little ahead of Germany (15 per cent) but miles behind South Korea (90 per cent) and China (60 per cent).

To address criticism that it was falling behind, Japan said in 2018 that it would aim to bring its cashless payment ratio up to 40 per cent (the global average) by the time the city of Osaka hosts the World Expo in 2025.

The country’s reputation as a fintech innovator — it was the first country to introduce e-money contactless cards for public transport in 2000 and the first to launch mobile phone-based payments in 2004 — is at stake.

That sense of pressure has become even more acute as Japan’s banks, their prospects visibly suffering after almost four years under the BoJ’s negative interest rate policy, have pinned much of their optimism for the future on a series of fintech bets that have yet to pay off. In its outlook for 2020, the credit rating agency Moody’s declared a negative outlook for Japan’s banks.

The main bright spot for the three megabanks — Mitsubishi UFJ,

Sumitomo Mitsui and Mizuho — was that each has committed investment to cashless systems for consumers and retailers.

But even with those investments in place, the government decided in 2018 that it had to accelerate the nation’s conversion to cashless. To do so, it focused on a long-expected hike in consumption tax on October 1 that economists fully expected to hurt consumer spending. Customers who transacted cashlessly in small- and medium-sized companies, however, would be able to receive reward points to offset the tax increase.

The response by the SMEs, revealed the Ministry of Economy, Trade and Industry on Monday has been unexpectedly strong. Since May, when the scheme was first mooted, 940,000 shops, restaurants and other consumer-facing businesses have registered for the scheme — a process that forced many of them to bring cashless payment terminals into their stores for the first time.

There have been early signals that the scheme is working. Convenience store chains Lawson and FamilyMart said shortly after the tax increase that cashless payments had jumped 50 per cent year-on-year.

Cashless payment systems such as Line Pay and PayPay also said they saw sharp increases in sign-ups.

Pound drops as post-election glow evaporates

UK currency extends losses amid fears of a hard and chaotic Brexit ANNA GROSS

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he pound tumbled on Monday, notching up a five-day run of losses that more than erases its post-election rally as investors face growing anxiety around the possibility of a hard and chaotic Brexit in the coming months.

The currency suffered one of its worst weeks of the year last week, and the selling has continued, with sterling dropping by as much as 0.7 per cent against the dollar to a low of $1.2916. It also tumbled 0.6 per cent against the euro, to €1.166.

In the immediate run-up to Christmas holidays, trading tends to be sparse, and small trades have the ability to generate exaggerated

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market moves. Still, the pullback illustrates that an ugly exit for the UK from the EU remains a pressing concern for UK markets.

“PM Johnson is still using the threat of a no-deal Brexit as a negotiating tactic in the forthcoming trade talks with the EU,” wrote analysts at Rabobank. “This is likely to ensure that Brexit remains a driving factor for the pound.”

The pound surged after Boris Johnson’s election victory on December 12, but has since reversed all of those gains as the prime minister signalled a hardline stance in Brexit negotiations with the EU. He pledged last week to outlaw any extension to the UK’s post-Brexit transition period at the @Businessdayng

end of 2020.

Dean Turner, UK economist at UBS Global Wealth Management, said investors should be prepared for “wide trading ranges” in sterling, between $1.30 and $1.40, as further negotiations take shape.

“It’s possible that there will be some bounce in activity given the clarity on Brexit, but any improvement in sentiment is likely to fade as the next Brexit deadline draws closer,” he said.

Ruth Gregory, senior UK economist at Capital Economics, said: “We doubt sterling will rise again substantially as long as there remains the possibility of something like a ‘no deal’ at the end of next year.”

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Tuesday 24 December 2019

BUSINESS DAY

FT

ANALYSIS

Bond market wobble shrinks global pile of negative yields Late-December outbreak of optimism on global trade talks helps cool government bonds TOMMY STUBBINGTON

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n end of year sell-off in global bond markets has helped shrink the pile of negativeyielding debt by $6tn since the summer peak, in a sign that recession fears are abating.

Tentative signs of an emerging US-China trade deal last week fed a drop in bond prices that pushed Japan’s 10-year yield above zero for the first time since March, while 10-year US yields climbed to a fiveweek high of 1.92 per cent. Yields in the eurozone also rose sharply.

The market moves pushed the total amount of negative yielding debt from a peak of $17tn in the summer to just above $11tn — the lowest since June.

An outburst of guarded optimism on trade talks has dulled the appeal of government debt that investors treat as a safe retreat in times of stress.

The drop in prices has surprised some fund managers who had been betting on ever-lower yields. But analysts are reluctant to see it as a sign that the bizarre phenomenon of bonds guaranteeing a nominal loss for investors is coming to an end.

“Three factors have come together to push yields higher despite reaffirmation from central banks of the ultra-low for longer rate regime: less bad global growth indicators, de-escalation of trade tensions and a technically offside market with too many looking for a further cascading compression of yields,” said Mohamed El-Erian, chief economic adviser at Allianz.

During the summer, a wave of nerves over the global economy

generated a huge bond rally that pushed the value of debt around the world trading with sub-zero yields to a record level. The tally has receded as investors scale back their bets that a recession is on the way.

Some investors expect bonds to resume their rally next year, particularly as US-China trade talks are prone to hiccups, but they are reluctant to buy during a period of relatively light trading volumes during the Christmas period, which could exaggerate market swings.

“It doesn’t make sense to get in the way of this move,” said Mohammed Kazmi, a London-based portfolio manager at Swiss private bank Union Bancaire Privée. “Market participants are probably going to wait until next year to reallocate to bonds. We don’t think anything has changed. Big central banks are on hold and if anything there’s a more of a risk of them cutting again.”

Some investors have grown increasingly uncomfortable about holding debt with negative yields, particularly given the growing backlash against the use of subzero interest rates by central bankers. Sweden’s Riksbank last week ditched negative rates as it lifted it benchmark rate to zero even despite signs of a weakening economy.

“Although the move was in line with expectations, this sets a potential precedent for other central banks to similarly move away from negative rates,” said Deutsche Bank analyst Jim Reid.

A brighter outlook for the global economy resulting from a trade truce could further dim the appeal of holding negative-yielding debt, which guarantees a nominal loss if it is held to maturity.

Xi turns peacemaker amid dispute between Tokyo and Seoul

Tensions between South Korea and Japan are complicating free-trade talks with Beijing TOM MITCHELL, ROBIN HARDING AND SONG JUNG-A

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resident Xi Jinping played the unlikely role of potential peacemaker between two feuding US allies on Monday as he met the leaders of Japan and South Korea separately in Beijing.

Japanese prime minister Shinzo Abe and Moon Jae-in, South Korea’s president, will travel to Chengdu, in south-west China, for a bilateral session of their own on Tuesday as well as trilateral talks with Li Keqiang, the Chinese premier.

The flurry of diplomatic activity has given Beijing a rare opportunity to help to smooth a festering political and economic dispute between Tokyo and Seoul, which has complicated long-running discussions to forge a free trade area between east Asia’s three largest economies.

Mr Xi’s administration also hopes that a free trade agreement with Japan and South Korea will help to offset its own trade frictions with the US as well as drawing Washington’s two closest allies more closely into its economic orbit.

Japan and South Korea have been at loggerheads for more than a year in a dispute over compensation for historic forced labour. In the summer, Japan imposed export controls on chemicals vital to South Korea’s semiconductor industry; Seoul retaliated by threatening to scrap an intelligence-sharing treaty.

“Trade friction between Japan and South Korea harms China as well,” said Chu Shulong, an international relations professor at Tsinghua University in Beijing.

“The three countries are in the same industrial chain, with Japan at the top and South Korea in the middle. China relies heavily on the semiconductor chips processed by South Korea.”

The Chinese government announced on Monday that it would cut import tariffs on more than 800 products, including semiconductors, in the new year as it attempts to boost economic growth.

While Mr Abe and Mr Moon have taken steps to calm the dispute, their only recent encounter was an 11-minute conversation at a meeting of the Association of Southeast Asian Nations in November. The bilateral meeting in Chengdu is regarded as an opportunity to build trust.

“Japan-Korea relations are in a bad way, but when you consider the security environment in east Asia, co-operation between . . . Japan and South Korea is essential,” said Mr Abe before he boarded a plane to Beijing.

He reiterated Japan’s uncompromising line that all wartime claims were settled in a 1965 treaty.

“Promises between countries must be kept. The treaty on claims is the foundation for relations between Japan and South Korea.” www.businessday.ng

Bermuda’s status as safe harbour for insurers under threat Scrutiny of tax havens and a wave of consolidation are testing an industry that is a mainstay of the island’s economy

OLIVER RALPH

P

itts Bay Road in Bermuda is a who’s who of global insurance. Winding along the picturesque waterfront of Hamilton, the island’s capital, the road and its surrounding streets house the local offices of Allianz, Chubb, Axa and Aon. Over the past 30 years, the Atlantic Ocean island has turned itself into one of the world’s biggest insurance hubs through a combination of low taxes, flexible regulation and easy access to the US. Its speciality is reinsurance — the cover that insurance companies buy to protect themselves from huge claims caused by extreme events, such as big US tropical storms. The Association of Bermuda Insurers and Reinsurers says that its members generate about $100bn in premiums a year and employ around 1,500 people on the island.

Marc Grandisson, chief executive of Bermuda-based Arch Capital, says: “Clients come here . . . because [there is] a marketplace. Clients can come here and talk to 60 per cent of their providers . . . within a square mile.”

But Bermuda’s status is under threat. Its tax advantages — long one of the big attractions of doing business there — have been eroded by US laws designed to stem the flow of capital offshore. A lot of independent insurers have been swallowed up by global companies. And cities around the world such as London and Singapore are fighting hard to grab a chunk of the island’s business.

The increased scrutiny of tax havens and calls to improve transparency in such jurisdictions will increase the pressures on the island nation of 65,000 people, which has suffered from a decade of economic decline.

“Bermuda is still important, but it is no longer the shining outlier that it used to be,” says Christian Reber, a partner at BCG. “The novelty has worn off.”

Bermuda’s insurance industry sparked into life in the 1970s and 1980s when a handful of companies were set up to fill a hole in the market for some types of US commercial insurance.

The early days were pretty hairy.

“Bermuda was a dirty word in the 1980s,” says Stephen Catlin, an insurance industry veteran. “There was terrible regulation — you could turn up with a brass plate and do what you wanted.”

But the industry, and the regulators, evolved quickly. The boom times came in the 2000s. Prices for reinsurance spiked in the early 2000s after the 9/11 terror attacks led to huge claims, and again in 2005 when Hurricanes Katrina, Rita and Wilma caused extensive property damage

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in the US. Insurance entrepreneurs were quick to jump on the opportunities presented by rising prices to set up new companies. Bermuda welcomed them with open arms, offering a convenient location and a regulator that allowed businesses to be set up quickly.

“Post 9/11, you could get yourself up and running in Bermuda in four weeks. In London it would take a year because of regulation,” says Mr Catlin.

Low taxes were also a major attraction. Bermuda has no corporate income tax, which is a big advantage to a reinsurance industry where years with no significant natural catastrophes can be very profitable.

The companies set up were known as the class of 2001 and the class of 2005. The former included Arch Capital, Axis and Allied World.

The latter included Ariel Re, Flagstone Re and Validus Re. Those two waves helped to build a critical mass of insurers in Bermuda.

“The physical presence of companies, underwriters and brokers is a key feature,” says Arthur Wightman, territory leader at PwC. “It is not a shell jurisdiction . . . it is a substantive market.”

Mr Grandisson adds: “Tax created the impetus . . . but Bermuda also has English law, is well developed and created a regulatory environment that is very strong yet more flexible and a lot easier to work with than most of the other jurisdictions around the world.”

The regulator — the Bermuda Monetary Authority — is no pushover though. Its reputation among both insurance companies and their customers was boosted in 2016 when the EU said that Bermuda’s rules were equivalent to its own Solvency II regime. And in November this year, the US National Association of Insurance Commissioners ruled that Bermuda was a “reciprocal jurisdiction” — similar to equivalence.

The classes of 2001 and 2005 and a host of other independent Bermudan insurers have slowly disappeared. Ace and XL, two of the earliest insurers on the island, have now combined with Chubb and Axa respectively.

There are just a handful of sizeable, independent Bermuda-based companies left, including Arch, RenaissanceRe and Argo. Life is not necessarily smooth for them — Argo is in the midst of a bitter fight with an activist investor and is facing an SEC investigation into pay.

Industry executives say that reinsurance is slowly becoming a scale game, in which only the largest companies have the capacity and data processing power to create the best prices for big clients.

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that multiplied in Bermuda, they say, need to specialise if they are to survive.

The multinationals say they are still committed to Bermuda, arguing that they would not have made acquisitions there if they did not like the market.

AIG, for example, bought Validus for $5.6bn in 2018. “Bermuda is a safe bet when you’re forming a company . . . you’ve got a venue that people will put money into,” says Bermudan-born chief executive Brian Duperreault. “You’ve got a regulatory climate that is tough but fair. Bermuda will continue to survive if it continues to be an innovative place for the market.”

Greg Hendrick, chief executive of Axa XL — a part of the French multinational, says: “It will remain a vital market for low frequency, high severity insurance and reinsurance . . . it is a core part of our North American business.”

And yet many companies are diversifying away from the island.

AIG itself has just decided to open up a big new reinsurance business in Lloyd’s of London. It has also agreed to sell most of its stake in Fortitude Re, a Bermuda-based reinsurer, for $1.8bn.

Japan’s Sompo, which bought Bermuda-based Endurance for $6.3bn in 2016, has just reshuffled the management of its international business. The new boss, Mikio Okumura, will be based in New York, unlike his predecessor whose office was in Hamilton.

And Axa XL earlier this year reshuffled its management, merging its London and Bermuda units, although Mr Hendrick says it has no plans to change headcount on the island.

Even the remaining Bermudabased independents, which are still very committed to the island, are diversifying. RenaissanceRe last year agreed to buy Tokio Millennium Re for $1.5bn. Part of the rationale was access to new markets: “We liked that it was Zurichbased, advancing our strategy in that region with an established European underwriting platform,” says Kevin O’Donnell, chief executive of RenaissanceRe. The company also has an office in Singapore, to help rising demand for reinsurance from Asia.

These changes are part of a wider shift in which people and businesses in the reinsurance sector have slowly been leaking away from Bermuda, threatening the island’s economy.

Nigel Frudd, head of Sompo’s international business, says: “The number of companies here has shrunk primarily due to industry consolidation and we have seen a significant departure of talent, such as senior managers and underwriters.”

Tuesday 24 December 2019

BUSINESS DAY

51

Live @ The STOCK Exchanges Prices for Securities Traded as of Monday 23 December 2019 Company

Market cap(nm)

Price (N)

Change

Trades

Volume

Company

Market cap(nm)

Price (N)

Change

Trades

Volume

PRICES FOR MAIN BOARD SECURITIES (Equities) BANKING ACCESS BANK PLC. 344,788.69 9.70 1.04 179 24,989,269 UNITED BANK FOR AFRICA PLC 230,846.09 6.75 -2.17 182 32,172,525 ZENITH BANK PLC 574,555.84 18.30 -0.27 336 12,086,702 697 69,248,496 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 215,371.76 6.00 -7.69 248 12,983,726 248 12,983,726 945 82,232,222 TELECOMMUNICATIONS SERVICES MTN NIGERIA COMMUNICATIONS PLC 2,137,223.87 105.00 -6.67 72 526,697 72 526,697 72 526,697

BUILDING MATERIALS DANGOTE CEMENT PLC 2,385,671.04 140.00 -0.07 62 1,128,788 LAFARGE AFRICA PLC. 225,509.14 14.00 1.82 67 475,416 129 1,604,204 129 1,604,204 EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 323,467.98 549.70 - 7 1,614 7 1,614 7 1,614 1,153 84,364,737 REAL ESTATE INVESTMENT TRUSTS (REITS) SKYE SHELTER FUND PLC 1,710.00 85.50 - 0 0 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) 10,175.81 40.70 - 0 0 UPDC REAL ESTATE INVESTMENT TRUST 9,605.77 3.60 5.88 14 1,033,610 14 1,033,610 14 1,033,610 OTHER FINANCIAL INSTITUTIONS NIGERIA ENERYGY SECTOR FUND 411.91 552.20 - 0 0 VALUEALLIANCE VALUE FUND 3,312.39 103.20 - 0 0 0 0 0 0 14 1,033,610 CROP PRODUCTION FTN COCOA PROCESSORS PLC 440.00 0.20 - 0 0 OKOMU OIL PALM PLC. 52,465.05 55.00 - 5 17,620 PRESCO PLC 47,500.00 47.50 - 7 25,210 12 42,830 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 8,500.00 4.25 - 0 0 0 0 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 1,500.00 0.50 - 4 38,912 4 38,912 16 81,742

DIVERSIFIED INDUSTRIES A.G. LEVENTIS NIGERIA PLC. 1,456.01 0.55 10.00 5 134,195 JOHN HOLT PLC. 217.92 0.56 - 0 0 S C O A NIG. PLC. 1,903.99 2.93 - 1 1,500 TRANSNATIONAL CORPORATION OF NIGERIA PLC 40,241.51 0.99 1.02 41 3,891,841 U A C N PLC. 23,914.76 8.30 - 21 115,880 68 4,143,416 68 4,143,416

BUILDING CONSTRUCTION ARBICO PLC. 521.24 3.51 - 0 0 0 0 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 26,004.00 19.70 1.03 16 140,282 ROADS NIG PLC. 165.00 6.60 - 0 0 16 140,282 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 2,182.65 0.84 - 6 47,355 6 47,355 22 187,637 AUTOMOBILES/AUTO PARTS DN TYRE & RUBBER PLC 954.53 0.20 - 0 0 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 7,281.43 0.93 - 2 20,000 GOLDEN GUINEA BREW. PLC. 242.22 0.89 - 0 0 GUINNESS NIG PLC 70,201.77 32.05 - 65 637,079 INTERNATIONAL BREWERIES PLC. 80,801.10 9.40 - 6 102,030 NIGERIAN BREW. PLC. 463,420.47 57.95 - 59 494,869 132 1,253,978 FOOD PRODUCTS DANGOTE SUGAR REFINERY PLC 173,400.00 14.45 -3.02 42 470,632 FLOUR MILLS NIG. PLC. 79,957.40 19.50 -1.03 65 2,017,279 HONEYWELL FLOUR MILL PLC 7,930.20 1.00 - 14 558,900 MULTI-TREX INTEGRATED FOODS PLC 1,340.10 0.36 - 0 0 N NIG. FLOUR MILLS PLC. 766.26 4.30 - 0 0 NASCON ALLIED INDUSTRIES PLC 33,117.98 12.50 4.60 27 15,380,673 UNION DICON SALT PLC. 3,321.07 12.15 - 0 0 148 18,427,484 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 18,030.74 9.60 - 14 8,305 NESTLE NIGERIA PLC. 1,030,453.13 1,300.00 - 27 22,277 41 30,582 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 22.10 - 0 0 VITAFOAM NIG PLC. 4,940.83 3.95 1.28 46 3,080,467 46 3,080,467 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 21,440.58 5.40 0.93 30 1,261,165 UNILEVER NIGERIA PLC. 116,049.11 20.20 - 45 186,369 75 1,447,534 442 24,240,045 BANKING ECOBANK TRANSNATIONAL INCORPORATED 110,097.31 6.00 -9.09 105 5,054,777 FIDELITY BANK PLC 60,847.07 2.10 -2.33 51 2,271,795 GUARANTY TRUST BANK PLC. 863,805.11 29.35 -0.84 117 26,325,838 JAIZ BANK PLC 20,624.97 0.70 6.06 3 367,850 STERLING BANK PLC. 54,701.79 1.90 - 9 198,516 UNION BANK NIG.PLC. 198,021.12 6.80 - 19 175,280 UNITY BANK PLC 8,416.32 0.72 - 6 38,118 WEMA BANK PLC. 26,616.38 0.69 -1.43 13 569,732 323 35,001,906 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 0.20 - 0 0 AIICO INSURANCE PLC. 4,989.75 0.72 1.41 10 1,921,300 AXAMANSARD INSURANCE PLC 18,900.00 1.80 - 3 11,500 CONSOLIDATED HALLMARK INSURANCE PLC 3,170.70 0.39 - 0 0 22,820.04 2.20 - 0 0 CONTINENTAL REINSURANCE PLC CORNERSTONE INSURANCE PLC 5,597.21 0.38 -9.52 11 470,000 GOLDLINK INSURANCE PLC 909.99 0.20 - 0 0 GUINEA INSURANCE PLC. 1,228.00 0.20 - 0 0 INTERNATIONAL ENERGY INSURANCE PLC 487.95 0.38 - 0 0 LASACO ASSURANCE PLC. 1,977.33 0.27 - 4 152,150 LAW UNION AND ROCK INS. PLC. 2,362.98 0.55 - 0 0 LINKAGE ASSURANCE PLC 4,240.00 0.53 8.16 4 221,600 MUTUAL BENEFITS ASSURANCE PLC. 2,234.55 0.20 - 0 0 NEM INSURANCE PLC 10,561.01 2.00 - 3 15,000 NIGER INSURANCE PLC 1,547.90 0.20 - 0 0 PRESTIGE ASSURANCE PLC 2,745.10 0.51 - 3 100,000 REGENCY ASSURANCE PLC 1,333.75 0.20 - 2 5,650 SOVEREIGN TRUST INSURANCE PLC 2,502.25 0.20 - 1 4,500 STACO INSURANCE PLC 4,483.72 0.48 - 0 0 STANDARD ALLIANCE INSURANCE PLC. 2,582.21 0.20 - 0 0 SUNU ASSURANCES NIGERIA PLC. 2,800.00 0.20 - 4 7,000 UNIC DIVERSIFIED HOLDINGS PLC. 516.46 0.20 - 0 0 UNIVERSAL INSURANCE PLC 3,200.00 0.20 - 1 4,900 VERITAS KAPITAL ASSURANCE PLC 2,773.33 0.20 - 0 0 WAPIC INSURANCE PLC 4,817.79 0.36 -2.78 43 10,342,422 89 13,256,022

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MICRO-FINANCE BANKS NPF MICROFINANCE BANK PLC 2,629.63 1.15 - 0 0 0 0 MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 4,200.00 1.00 - 1 200 ASO SAVINGS AND LOANS PLC 7,370.87 0.50 - 0 0 INFINITY TRUST MORTGAGE BANK PLC 5,796.93 1.39 - 0 0 RESORT SAVINGS & LOANS PLC 2,265.95 0.20 - 0 0 UNION HOMES SAVINGS AND LOANS PLC. 2,949.22 3.02 - 0 0 1 200 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 8,240.00 4.12 - 33 384,736 CUSTODIAN INVESTMENT PLC 33,232.53 5.65 - 2 33 DEAP CAPITAL MANAGEMENT & TRUST PLC 600.00 0.40 - 0 0 37,427.12 1.89 -0.53 46 2,234,573 FCMB GROUP PLC. ROYAL EXCHANGE PLC. 1,440.70 0.28 -3.45 2 212,645 STANBIC IBTC HOLDINGS PLC 393,936.28 37.50 - 29 474,897 UNITED CAPITAL PLC 14,400.00 2.40 0.84 66 4,273,597 178 7,580,481 591 55,838,609 HEALTHCARE PROVIDERS EKOCORP PLC. 2,069.19 4.15 - 0 0 UNION DIAGNOSTIC & CLINICAL SERVICES PLC 710.63 0.20 - 0 0 0 0 MEDICAL SUPPLIES MORISON INDUSTRIES PLC. 494.58 0.50 - 0 0 0 0 PHARMACEUTICALS EVANS MEDICAL PLC. 366.17 0.50 - 0 0 FIDSON HEALTHCARE PLC 6,467.72 3.10 - 4 8,361 GLAXO SMITHKLINE CONSUMER NIG. PLC. 6,278.35 5.25 - 15 88,544 MAY & BAKER NIGERIA PLC. 3,692.00 2.14 - 8 81,418 NEIMETH INTERNATIONAL PHARMACEUTICALS PLC 1,082.52 0.57 - 9 281,355 NIGERIA-GERMAN CHEMICALS PLC. 556.71 3.62 - 0 0 PHARMA-DEKO PLC. 325.23 1.50 - 0 0 36 459,678 36 459,678 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 888.00 0.25 4.17 5 789,853 5 789,853 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 1,470.89 0.50 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 2.54 - 1 2,500 NCR (NIGERIA) PLC. 486.00 4.50 - 0 0 TRIPPLE GEE AND COMPANY PLC. 316.77 0.64 - 0 0 1 2,500 PROCESSING SYSTEMS CHAMS PLC 1,596.66 0.34 -5.56 9 773,801 E-TRANZACT INTERNATIONAL PLC 10,962.00 2.61 - 0 0 9 773,801 TELECOMMUNICATIONS SERVICES AIRTEL AFRICA PLC 1,123,311.48 298.90 - 4 2,445 4 2,445 19 1,568,599 BUILDING MATERIALS BERGER PAINTS PLC 1,956.31 6.75 - 3 22,615 CAP PLC 16,800.00 24.00 - 4 6,100 CEMENT CO. OF NORTH.NIG. PLC 237,897.37 18.10 -2.95 32 12,044,400 MEYER PLC. 286.87 0.54 - 1 700 PORTLAND PAINTS & PRODUCTS NIGERIA PLC 1,769.32 2.23 - 1 1,100 PREMIER PAINTS PLC. 1,156.20 9.40 - 0 0 41 12,074,915 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,256.91 2.09 - 0 0 CUTIX PLC. 2,553.92 1.45 - 9 389,106 9 389,106 PACKAGING/CONTAINERS BETA GLASS PLC. 26,898.49 53.80 - 2 55 GREIF NIGERIA PLC 388.02 9.10 - 0 0 2 55 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 62.50 - 0 0 0 0 52 12,464,076 CHEMICALS B.O.C. GASES PLC. 2,289.35 5.50 - 0 0 0 0 METALS ALUMINIUM EXTRUSION IND. PLC. 1,781.64 8.10 - 0 0 0 0 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 0.20 - 1 10,000 1 10,000 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 83.60 0.38 - 0 0 0 0 1 10,000 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,377.79 0.22 10.00 8 587,770 8 587,770 INTEGRATED OIL AND GAS SERVICES OANDO PLC 44,753.08 3.60 5.88 59 2,039,142 59 2,039,142 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 53,332.04 147.90 - 12 111,453 CONOIL PLC 12,838.11 18.50 - 13 12,382 ETERNA PLC. 3,912.43 3.00 - 4 3,946 FORTE OIL PLC. 23,574.91 18.10 - 22 76,494 MRS OIL NIGERIA PLC. 4,663.23 15.30 - 8 59,598 TOTAL NIGERIA PLC. 37,652.97 110.90 - 13 6,474 72 270,347 139 2,897,259 ADVERTISING AFROMEDIA PLC 1,509.28 0.34 - 0 0 0 0 AIRLINES MEDVIEW AIRLINE PLC 15,796.05 1.62 - 0 0 0 0 AUTOMOBILE/AUTO PART RETAILERS R T BRISCOE PLC. 247.03 0.21 - 0 0 0 0 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 2,623.26 4.45 - 3 12,577 TRANS-NATIONWIDE EXPRESS PLC. 464.16 0.99 - 0 0 3 12,577 HOSPITALITY TANTALIZERS PLC 642.33 0.20 - 0 0 0 0 HOTELS/LODGING CAPITAL HOTEL PLC 4,259.15 2.75 - 0 0 IKEJA HOTEL PLC 2,328.25 1.12 - 2 18,360 TOURIST COMPANY OF NIGERIA PLC. 7,862.53 3.50 - 0 0 TRANSCORP HOTELS PLC 37,241.98 4.90 -9.26 2 267,248 4 285,608 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 4,320.00 0.36 - 0 0 0 0 PRINTING/PUBLISHING ACADEMY PRESS PLC. 223.78 0.37 - 5 35,832 LEARN AFRICA PLC 964.31 1.25 - 0 0 STUDIO PRESS (NIG) PLC. 1,183.82 1.99 - 0 0 UNIVERSITY PRESS PLC. 504.75 1.17 - 1 4,200 6 40,032 ROAD TRANSPORTATION ASSOCIATED BUS COMPANY PLC 745.97 0.45 - 0 0

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BUSINESS DAY Tuesday 24 December 2019 www.businessday.ng

Folorunso Alakija: The billionaire philanthropist MICHAEL ANI

W

ith investments across various sectors of the economy, Folorunso Alakija, Nigeria’s richest woman is not just billionaire businesswoman, but also a giver who has spent over three decades of her life helping the poor, widows and the less privileged.

Due to her love and affection for the needy, Alakija in 2008 launched the Rose of Sharon Foundation, with the vision of providing help and succour to widows and orphans in Nigeria as well as the rest of the world.

The foundation among other things gives a facelift to widows who are members, by providing them with funds at zero per cent interest to start a business of their choice.

Since it started 11 years ago, the foundation has so far touched directly the lives of over 3500 widows, who to a large extent were left stranded due to situations of life, and has also indirectly rubbed positively on over 10,000 households.

The foundation has also succeeded in training several widows through school for those of them who wish to go further in their education, as well as their children, Alakija told BusinessDay. According to her, the desire to assist both the widows and the orphans through the foundation, was necessitated on a “call from God”.

“The foundation was birthed out by the call of God after he showed me James 1 vs. 27, a verse of the bible, which is to look after widows and orphans to help them out in the challenge they face,” she said.

She noted that many of these women were traumatized and depressed after they were left with nothing from the hands of their in-laws hence, the need to provide a platform that they can leverage on to explore “At first when we started, we had only three widows, the number increased to 900 and here we are having thousands of them across the country doing great with their children working,” she said From Secretary to Billionaire Alakija was born on 15 July 1951 to the family of Chief L. A. Ogbara in Ikorodu, Lagos State.

At present, she is the managing director of Rose of Sharon Group and executive vice-chair-

Alakija

man, Famfa oil, with investments across different sectors of the economy, including real estate, oil and gas, printing and fashion.

In 2015, she was ranked by Forbes as the richest woman in Nigeria, with a net worth of over $1 billion; and second most influential woman in Africa after Okonji Ngozi-Iwela, a one-time finance minister under the Goodluck Jonathan’s administration.

But Alakija’s renowned success did not come on a platter of gold but as a result of years of hard work and her continued resilience for success.

Alakija started off her corporate career as a secretary with Sijuade Enterprises at the prestigious Western House, Broad Street, Lagos shortly after completing a secretarial course at Pitman’s Central College London.

She later joined the First National Bank of Chicago (today known as Finbank PLC), where she held the position of executive secretary to the managing director.

With diligence and hard work, she rose to the position head of the corporate affairs department of the International Merchant Bank of Nigeria (formerly First National Bank of Chicago) and subsequently, moved up further to the position of an office assistant to the treasury department.

Shortly after her career in the corporate world, Alakija took

up a new challenge driven by her passion for fashion to study fashion design at the American College in London and the central school of fashion.

Her return to Nigeria saw the birth of her first fashion label; Supreme Stitches which was later renamed the Rose Of Sharon House of Fashion in1996.

By the year 2001, Alakija had already started mass-production of Tee-shirts and thus changed its name to The Rose of Sharon Prints and Promotions.

Her Famfa Oil, an indigenous company, made its first application for an oil exploration and production licence in 1991.

In collaboration with Texaco Nigeria Ltd (later taken over by Chevron Nigeria Ltd), it commenced full operations in 1996.

The business then was a true family business with Modupe Alakija (her husband) as its chairman, while she and her four sons were executive chairmen and executive directors respectively The drilling of the first Agbami well commenced on her birthday on the 15th of July, 1998, on an exploratory well that was 4,700 feet underwater, the deepest water depth in Nigeria at the time.

The recoverable reserves for the field would later be appraised to rank amongst the largest single finds in deepwater West Africa.

From Famfa’s application for an oil licence in January 1991, it

took 17 years to reach ‘first oil’ where production commenced from its 17 million year deposit, a risky venture which Alakija said later paid off.

The government at the time then saw it fit to forcefully “take” 50 per cent of Famfa’s participating interest, but on the 22nd of May, 2012, after 12 long years in the law courts, the company’s shares were restored having gone through years of prayers and fasting.

According to Alakija the partnership between Famfa, her oil firm, and Agbami, saw scholarships given to almost 9,000 medical and engineering students nationwide.

The firm also donated 21 chest clinics for the treatment of tuberculosis (TB) in 21 different states in Nigeria and 21 science laboratories in 21 different states (including 9 in the Niger Delta region and Lagos State).

In addition to these, it donated four e-libraries and two school libraries in different states of the Federation.

Alakija’s investment in the printing press business was known as digital reality print limited, which commenced its operation in September 2006 as a large format printing outfit.

Alakija noted that the reason for the establishment of the firm was to develop a sustainable brand that is best-in-class for everything within the space of printing.

According to her, the company deployed the latest technology to provide quality, timely and awesome images which attract, excite and create lasting impressions.

In addition to these, Folorunso is the Executive Vice Chairman of Dayspring Property Development Company Limited, a real estate company.

It was said that her relationship Alakija cultivated during her time as a fashion designer served her a great deal when she decided to take a leap into the oil industry.

When reflecting on her achievements, Folorunso’s foremost reaction is always to give glory to God through Jesus Christ and to share the secrets of her success. A born again Christian since 1991, she draws her strength from her unfaltering belief in the.

The God factor Alakija’s tremendous success is built on god, which she says is the source of her wealth and inspiration.

In obedience to the word of God and working according to his will and purpose, she and her husband founded a house fellowship which has grown to become a full-fledged Christian Ministry known as the Rose of Sharon Glorious Ministry International.

She has authored several books including, alone with God (a free annual Christian devotional); university of marriage (a guide for married couple); growing with the hand that gives the rose, (her autobiography); the cry of widows and orphans (a sensitization material on the plights of widows and orphans); his name Is…., (A collection of over 3000 names of God).

Others include Folorunso Alakija speaks -an inspirational book for all, (A collection of her speeches); Folorunso Alakija speaks 1 -an inspirational book for Christians, (a collection of the author’s ministrations); wish for it? pray for it”, (a series of three books containing a collection of her favourite scriptures for husbands, wives, and parents); lastly, her latest book for single men and women; window shop for your spouse (a practical guide for choosing the best spouse).

In her words, she urged Nigerians to extend love and reach out to the poor always.

She noted that one need not be a billionaire to be able to reach out to the poor, “as little as your worn clothes can go a long way in saving the lives of people in the country,” she said.

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