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news you can trust I ** tuesDAY 25 february 2020 I vol. 19, no 506

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g L-R: Khaled Abdel Aziz El Dokani, country chief executive officer, Lafarge Africa plc; Sunny Nwodo, national volume award and regional volume award winner; Gbenga Onimowo, commercial director, Lafarge Africa plc, and Toni-Louis Okojie, head of sales (East), Lafarge Africa plc, at Lafarge Africa plc’s 2019 Customer Appreciation Awards in Lagos.

AMAKA ANAGOR-EWUZIE

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ongestion at Nigeria’s major seaports, Apapa and Tin-Can in Lagos, is not abating, and industry analysts are putting the blame squarely on the growing number of overtime and abandoned cargoes, clearing bottlenecks and border closure.

Shipping liners now wait more than 25 days in Apapa Container Terminal, West Africa’s busiest container terminal, before accessing the port to discharge their cargo, as against 20 Continues on page 38

Inside

Hate speech regulation in focus as Social Media Week begins P. 2

3M 0.31 2.87

NGUS jan 27 2021 365.40

Port congestion persists as ship waiting time rises to 25 days

Nigeria’s InfraCredit forges new partnership with USAID to spur infrastructure funding P. 2

fgn bonds

Treasury bills

Nigeria’s economic growth surges to fastest since 2016 MICHAEL ANI, DIPO OLADEHINDE & BUNMI BAILEY

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lthough there is still much to be desired, the Nigerian economy has grown the fastest since the recession in 2016.

Nigeria’s Gross Domestic Product (GDP) expanded by 2.27 percent in 2019, higher than

Crop production, telecoms, trade top contributors to GDP Education, health, 5 other sub-sectors exit recession

the 1.91 percent growth rate recorded in 2018, the Nigerian Bureau of Statistics (NBS) said on Monday.

In line with BusinessDay forecasts, economic growth

strengthened in the final quarter of 2019 to 2.55 percent, printing at the strongest level since Q3 2015.

GDP is relevant because it provides an overview of how a

country’s economy is faring. A rise in GDP may be an indication of improvements such as more people getting jobs and spending their wages or businesses Contin ues on page 38

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Tuesday 25 February 2020

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news Battery recyclers form waste management group in response to BusinessDay’s investigation ISAAC ANYAOGU

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ead-acid battery recyclers in Nigeria have formed a Producer Responsibility Organisation (PRO), a policy approach emanating from the government which places the responsibility for the post-consumer phase of batteries on operators.

This is coming after a BusinessDay investigation uncovered how local recyclers were threatening the health of some communities in Lagos and Ogun States.

The group called the Alliance for Responsible Battery Recycling (ARBR) said it is working with battery manufacturers, importers, distributors, retailers, recyclers, renewable energy operators, environmental groups, development partners and governments across the country to execute programmes and projects that promote the removal of used batteries from the normal waste stream and ensure their environmentally sound recycling.

“We have introduced a Battery Stewardship Pro-

gramme to ensure that a take-back scheme is implemented effectively, and the volume of batteries manufactured or imported into Nigeria is captured properly in our databases,” said Terseer Ugbor, executive secretary of ARBR. Ugbor said the goal is to make certain that the end-of-life recycling is done in an environmentally sustainable manner, keeping in compliance with current environmental regulations, policies, guidelines and the Basel Convention treaty for managing battery waste.

ARBR is the Producer Responsibility Organisation (PRO) for the Battery Sector under the Extended Producer Responsibility (EPR) Programme approved by the National Environmental Standards and Regulations Enforcement Agency (NESREA) to synchronise the stakeholders of the battery sector towards preventing the potential hazards from used batteries and the pollution from dirty battery recycling in Nigeria.

•Continues online at www.businessday.ng

UBA launches ‘Click Credit’ to ease access to cash for customers SEGUN ADAMS

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nited Bank for Africa (UBA) plc has launched ‘Click Credit’, a time loan designed to address the urgent needs of customers whose salary accounts are domiciled with the bank.

As a bank backed by a strong retail franchise with over 1,000 business offices serving 19 million customers, the panAfrican financial institution has introduced this product in line with its mission of creating value for its customers while assisting them to meet their urgent needs. The loan product, already being enjoyed by millions of customers in Nigeria, will be extended to the bank’s other franchises in Africa.

Click Credit, which has been carefully crafted to improve the lives of the UBA customers, is a superfast loan product which will allow qualified customers to apply for up to N5 million loan and pay back over 12 months at an interest rate of 1.58 percent per month, with no hidden fees.

Specifically, salary earners fromN25,000permonthwhofall betweentheagesof18and59can benefit from this facility with no extrafees.Noneedforcollaterals, no paper-work or other difficult issues when it comes to this facility as customers can even apply via LEO, UBA Mobile Banking

and UBA internet banking.

Jude Anele, UBA’s group head of retail banking, who said qualified customers have begun to enjoy the service, explained that the loan provides immediate access to funds once eligibility is confirmed in less than a meeting.

“As Africa’s most innovative and technology-driven financial institution with an array of novel products and services tailored to the needs of its millions of customers, we have launched Click Credit, which is straightforward and more affordable than many other loan products in the market,” Anele said. “Its unique feature is that it meets a critical credit need for our customers.”

Anele, while emphasising the critical role that credit plays in any developing and developed society, said it is part of the customers’ financial power where they can be assisted to get the things they need, when theyneedthemwithouthassles.

While explaining that this productisbeingrolledoutfirstin Nigeria and subsequently in the rest of UBA’s countries of operations,AnelesaidUBAiscommitted to ensuring that Click Credit helps the bank’s customers to covercriticalneedsandsetthem up for success, having moved past that moment of need.

•Continues online at www.businessday.ng www.businessday.ng

R-L: Tony Elumelu, group chairman, United Bank for Africa (UBA)/founder, Tony Elumelu Foundation (TEF); Owanari Duke, country director, Empretec Nigeria Foundation; Tatiana Krylova, head, division of entreprise, United Conference on Trade and Development (UNCTAD), and Ifeyinwa Ugochukwu, CEO, TEF, at the launch of UNCTAD’s Entrepreneurship Policy Framework and Implementation Guidance, held during the EMPRETEC Regional Roundtable on Entrepreneurship in Lagos, yesterday.

Nigeria’s InfraCredit forges new partnership with USAID to spur infrastructure funding ENDURANCE OKAFOR

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heUnitedStatesgovernment through its Agency for International Development (USAID) and Infrastructure Credit Guarantee Company Limited (InfraCredit) recently signed a Declaration of Partnership for the first-ever bond co-guarantee under a risk sharing arrangement to provide increased access to electricity to consumers in Port Harcourt, Rivers State.

The N13 billion ($36.1 million) co-guarantee for a 15-year bond represents a partnership with InfraCredit, a domestic ‘AAA’ rated specialised infrastructure credit guarantee institution backed by the Nigeria Sovereign Investment Authority, GuarantCo (a Private Infrastructure Development Group company), KfW Development Bank and Africa Finance Corporation to provide local currency guarantees and mobilise long-term debt financing for infrastructure in Nigeria. InfraCredit is an of-

ficial partner of Power Africa.

Speaking during the signing ceremony, Stephen Haykin, USAID mission director to Nigeria, said Nigeria is important to the US government’s global development strategy and boosting Nigeria’s economic growth can only be fully realised through a healthy power sector. He, however, noted that despite having the largest population and largest economy in Africa, Nigeria suffers poor electricity supply.

“The lack of a reliable and affordable electric supply in Nigeria impedes every facet of life – from local markets to large industries and schools, hospitals, and impacts the everyday lives of the people,” Haykin said.

“Today’s event highlights a ground-breaking collaboration between USAID, InfraCredit and GEL Utility Limited to increase access to power consumers in Port Harcourt.

This co-guarantee marks the first – ever risk sharing arrangement between USAID and InfraCredit, and emphasises both institutions’ dedication to

supporting the development of Nigeria’s power sector,” he said.

Chinua Azubike, chief executive officer of InfraCredit, said InfraCredit was committed to facilitating investments in the power sector by providing guarantees in collaboration with strategic partners such as Power Africa.

“Whenweareabletodrawon PowerAfrica’scapacity,networks, competence and credit quality, we can achieve our mutual objective of bridging the power infrastructure gap,” Azubike said.

Charles Omoera, chief executive, Stanbic IBTC Trustees, and a Felix Achibiri, non-executivedirector,GELUtilityLimited, who expressed optimism about the success of the partnership.

InfraCredit will also partner with GEL Utility Limited, which develops, operates, and provides grid-connected and off-grid electric power. GEL delivers electricity to the Port Harcourt Refining Company through an 84-megawatt (MW) power plant. The bond issue is symbolic, as it will be the first local currency corporate infra-

structure bonds issued in the Nigerian debt capital markets with a co-guarantee by the USAID. With the benefit of the coguarantee, the Series 1 Bonds was accorded a ‘AAA’ credit rating by Agusto & Co. and Global Credit Ratings Co. The Series 1 Bonds was 123 percent subscribed by 12 institutional investors including 10 local pension funds. The proceeds of the bond stemming from this co-guarantee agreement will be used to provide up to 14 megawatts of excess generated electricity from the power plant to customers within the Port Harcourt area, either through Port Harcourt Electricity Distribution Company or directly to eligible customers under the implementation of the Excess Power Program in collaboration with the Nigerian National Petroleum Corporation and fund replacement of the GEL Utility Limited’s current shortterm financing with long-term local currency debt.

•Continues online at www.businessday.ng

Hate speech regulation in focus as Social Media Week begins ... BusinessDay session on impact investing holds today FRANK ELEANYA

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he plan by the Federal Government to regulate hate speech on social media was the highlight of the first day of Social Media Week 2020 which began in Lagos on Monday, with experts urging the President Muhammadu Buhari administration to clearly define the subject before moving for regulation.

A Bill to prohibit hate speech was last year introduced on the floor of the Senate, sponsored by Aliyu Sabi Abdullahi (APC/Niger North), deputy whip of the Senate.

The Bill, aimed at instituting

stiffer penalties to curb the ugly trend of hate speech, was first introducedbythe8thSenatebut was not passed to become law.

The proposed law is a very extensive piece of legislation which covers a slew of possible wrongdoings, including the publication or presentation of material deemed to stir up ethnic hatred. It also takes aim at written or visual acts seen as threatening, abusive, insulting or offensive.

While the Federal Government through Lai Mohammed, minister of information and culture, threw its weight behind the Bill, it was greeted with widespread condemnation especially in the social

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media space which many said was the major target of the Bill. The minister said the new Bill “will address the existing lacunae in the areas of the regulation of the internet”.

But experts at a panel session hosted by Guardian Nigeria expressed concern that the Bill could be subject to misinterpretation if not properly defined.

Cheta Nwanze, lead partner, SBM Intelligence, said the Bill was not properly thought out having been plagiarised from Singapore that operates “authoritarianism”, hence it was not likely to work in the Nigerian context.

“We have a situation in Nige@Businessdayng

ria where justice is blind in one eye,” said Nwanze. “It is dependent on who you are, where you are from and who you know. Do weexpectsuchasocietytoknow what hate speech is?”

Nwanze said criticism was not peculiar to the Nigerian government as people criticise their elected officials when they believe they have performed below expectations. He harped on the need for public officials to know what to respond to.

“We need to re-educate ourselves, going to school is not to learn 2+2,” he said.

•Continues online at www.businessday.ng

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Global goals and the future we want

STRATEGY & POLICY

MA JOHNSON

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n the year 2000, world leaders adopted the United Nations Millennium Declaration which committed the nations of the world to a new global partnership. A global partnership aimed at reducing extreme poverty and other time-bound targets with a stated deadline of 2015. At that time, it was the Millennium Development Goals (MDGs) comprising 8 goals.

Several reasons were presented by government officials why Nigeria could not achieve the MDGs in 15 years. One of the reasons adduced for the country’s poor performance, was poor leadership of the country even though the implementation started late. Nigeria, it was reported, began to find its rhythm in the implementation of the MDGs from 2005 when the nation successfully negotiated a debt relief from the Paris Club. Some government officials also cited the perennial insecurity in the North Eastern part of the country as one of the factors that inhibited the progress of project implementation across the country.

In explaining why Nigeria and other African countries could not achieve the MDGs, the immediate past minister of Budget and National Planning, disclosed that: “We have not made as much progress as had hoped for partly because of poor implementation mechanisms and excessive reliance on development aid.

Another factor is the failure of many African countries in mainstreaming the MDGs into their national economic plan, policies and budgets. Added to these is the fact that many African countries lacked relevant data and mechanisms

to monitor progress.”

The failures and achievements of Nigeria and other African countries in the MDGs notwithstanding, the MDGs have been superseded by the Sustainable Development Goals (SDGs). The SDGs were officially adopted on 25 September 2015. Also known as the Global Goals the SDGs are a set of 17 goals with 169 targets and a timeframe of 15 years.

The SDGs equally, seek to end poverty, hunger and inequality, tackle climate change and build resilient infrastructure.

Like the MDGs, the SDGs reflect the moral principles that no country should be left behind and that all countries should have a common responsibility of delivering the Global Goals by 2030.

Simply put, “sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.” The SDGs is hinged on the principle of sustainable development. This principle predicts that nations would articulate strategies that meets the developmental needs of their societies today, without mortgaging its prospects for the future.

We want a future fit for our children.

The future we want is that in which development is pursued in a manner that bridges the gap between the present and future generations. A development that is sensitive to providing quality education, bridging gender inequality, and ensuring a healthy environment which is a prerequisite for good health amongst others.

The year 2030 is just a decade away.

It is not too early to start assessing what the federal, state and local governments are doing to actualize the SDGs. The crux of the matter is that one cannot see any sustainable development program being implemented in most of the 774 local governments in the country in the past 5 years. In other words, no one can really say where most state and local governments currently stand on their commitment to the implementation and actualization of the SDGs because of the overwhelming problems confronting them ranging from economic crisis to

increasing insecurity.

At the federal level, efforts are being made to bridge the infrastructural gap.

However, access to water supply and sanitation is restricted. Water management in the country is still an issue. A report (Greenberg Reporters, November 7, 2016) revealed that about 150,000 children under the age 5 die annually from diarrhoea-related diseases that was traceable to unsafe drinking water. The situation is worse in rural areas where polluted ponds and streams remain only source of water for drinking and other household chores. This trend must be reversed.

The successful implementation of the SDGs requires a collective effort of all Nigerians at home and abroad. An inclusive approach where every Nigerian is supporting the governments- local, state, and federal- either locally or nationally is the best strategy to be adopted. The governments (local, state and federal), media, academia, civil society, youths and private individuals should all get involved and ensure no one is left behind.

To buttress the need for the actualization of the SDGs by all stakeholders, the former UN Secretary General, Ban Ki-moon, was of the view in 2015 that: “The Sustainable Development Goals were forged from the most inclusive policy dialogue we have ever organized.

Governments must take the lead in living up to their pledges. At the same time, I am counting on the private sector to drive success. Now is the time to mobilize the global business community as never before. The case is clear. Realizing the Sustainable Development Goals will improve the environment for doing business and building markets. Trillion of dollars in public and private funds are to be redirected towards the SDGs, creating huge opportunities for responsible companies to deliver solutions.”

Even though, a sizeable number of MDGs were not attained by the end of 2015, the country has known what is possible and it can now offer a solid foundation on which to build upon. If there was proper engagement and mobilization of

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The successful implementation of the SDGs requires a collective effort of all Nigerians at home and abroad. An inclusive approach where every Nigerian is supporting the governmentslocal, state, and federaleither locally or nationally is the best strategy to be adopted

the private sector and relevant government agencies at local, state, and federal levels concerning SDGs, glad tidings await the country and the continent of Africa at large. But can the private sector in Nigeria be mobilized by the government towards achieving the SDGs? What will be the incentive for private sector participation in the implementation of SDGs? In implementing the SDGs, there are some prospects. It is necessary for the government to carry the civil society and the private sector along as it continues the process of implementation of the SDGs. The need to carry the civil society along as they are drivers of development cannot be overemphasized. Civil societies should collaborate with other NGOs to increase the level of awareness of the SDGs amongst Nigerians at the grassroots. If the implementation strategies of governments are effective particularly at state and local government levels, the impact of development would be felt by the grassroots. The higher the level of awareness, the greater the possibility of the government knowing what citizens need.

One should not overlook some challenges that will affect implementation of the SDGs namely: Leadership, security threat and corruption. As laudable as the SDGs could be, if the twin evils of corruption and insecurity are not dealt with, its goals and targets may end up “developing” personal pockets without achieving its ultimate aim. No African country achieved the MDGs due to leadership failure and the penchant of African leaders to pursue selfish and sectional rather than national interests.

In order to improve the living standard of Nigeria’s 200 million people, there is need to have an improvement in the implementation gap of the SDGs at all levels of governments and proper domestication of the goals in our national development plan and other policies. If there is no improvement, the SDGs may flounder in failure. Thank you!

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

Human capacity development in Nigeria’s transportation sector

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s a nation, it is very important for our long-term survival that we ensure the human resource development and planning of the transport industry is directed towards the quality and creative energy of the people that will provide higher quality results and maximize efficiency in our nation’s transportation sector.

The transport industry plays a fundamental role in the stability and growth of the economy and needs constant improvement and innovation within the sector to drive greater efficiency.

Human resource planning in the sector is a basic resource that is an indispensable means of converting resources in the sector to the benefit of the nation’s economy, and so policies must support a structured process of managing capacity and improving quality, and innovation in conformity with Nigeria’s goal.

It is impossible for our nation’s transportation sector to continue using the same old strategies and then expect different results. For example, most first world nations have well-structured research groups mandated with the responsibility of constantly creating innovation and driving higher performance and system improvement in the sector.

Process development, such as the support and increase of funding of platforms such academic institutions, consultancy, and research. These groups ideally work with a mandate of constantly working round the clock to provide solutions and ideas on how to move the sector to greater heights.

Transportation and logistics are two key areas which play an important role to facilitate

the attractiveness of economic investment of Multi-National Companies. New and emerging technologies such as robotics and automation have changed the way we work and the way that we receive services and products and transportation sector employers need adaptable employees with skills in strategy and management if we desire genuine change.

Systematically ensuring sector-wide training (and re-training) will crucially refresh industry knowledge and technical know-how to keep professionals up-to-date of latest trends, new legislation, and the technologies and practical requirements for their professional occupations, consequently contributing positively to their ability to innovate, adapt and motivate.

While GDP from transport in Nigeria increased to $720.241 million in the third quarter of 2019 from $642.927 million in the second quarter of 2019 with a far greater potential, it is interesting to note that we can learn more through partnerships with nations such as China, Australia, USA and Canada who have consistently grown and achieved greater performance through funding of human capital development, funding research and think-tank groups within the sector.

Most of these transport professionals gained their practical skills either through real life experience, vocational education and training courses and so it is important for government to give priority to these professionals while investing important time, resources and energy in driving policies that will enhance the growth and development of the sector in Nigeria.

Players in the sector (both public and private) www.businessday.ng

need encouragement to develop their employees.

In Nigeria, the challenge of human resource planning has remained prevalent because of lack of attention, awareness and perhaps, because of the growing cost in the training and development of personnel among organisations. Sector management need to make adequate provision for training and development programmes for the greater performance of its work force which is very strategic for its operational efficiency.

Evidence of continuous degeneration and setbacks in the transportation sector in Nigeria can be blamed partially on poor human resource development and subsequent upgrades are needed to meet global standards. Investments in transportation infrastructure, operations and management will be properly utilised to ensure a positive impact on the growth and development of the sector, as well as a direct impact on the economy. Inefficient human resource planning development programmes and applications are also responsible for the slow growth in our transport sector.

The transportation sector contributed 2.49 percent to nominal GDP in Q1 2019, an increase from 1.85 percent recorded in the corresponding period of 2018 and higher than 2.05 percent recorded in the fourth quarter of 2018. The transportation and storage sector grew by 19.50 percent in first quarter of 2019, the sector has very great potentials and has the potential of tripling these results if properly managed and explored.

We need to call on the authorities in the sector to look beyond self-ambition, politics, religion and other negative elements hindering the growth of

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Festus Okotie the sector by setting up research and think-tank groups mandated with the responsibility of coming up with innovative and unique ideas on how best to maximize results within the sector.

The data above shows the GDP contribution of the transport sector to our economy, its importance and why the process of moving goods, persons and services across our nation must be improved, through the use of modern technology and professionals with the right knowledge and expertise to drive greater efficiency. The strategic importance of the sector cannot be over emphasised as all first world nations recognise its relevance in boosting their economy.

Transport sector will continue to play a fundamental role in fostering socio-economic growth and development in nations economy globally and therefore very important for industry leaders to acknowledge that most nations with higher productivity levels had previously taken steps to make uman capacity development an integral part of their business and management culture.

Okotie, a maritime transport specialist, writes via fokotie. bernardhall@gmail.com, Fokotie@bernardhallgroup. com

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Social media & free speech in Africa (2) Rafiq Raji

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tengel’s description of how Russia’s Internet Research Agency (IRA) works provides insights into alternative but likely more effective strategies for fighting online disinformation. “Every day, in two shifts, a few hundred young people spend their time writing blog posts, tweets, Facebook posts, Vkontakte posts and much more…it is indeed a factory; they manufacture thousands upon thousands of pieces of pro-Russian, anti-American content a day.” Although the Russian IRA is owned by a businessman allied to the Russian government, every government should probably have an IRA-type outfit; much like most governments have their own news agencies and broadcasters.

The suggestion is not that a government-owned social media agency should engage in some of the negative activities Russia’s IRA is accused of. Still, such an agency would probably be the more appropriate public bulwark against the purveyors of fake news and disinformation

on social media. It is certainly a better proposition than the potentially free-speech stifling social media regulations being proposed by some African governments and in fact already in practice in Singapore and elsewhere. That said, some regulation of social media has clearly become necessary. The key would be for any regulation to be geared towards incentivizing accurate news reportage. In other words, new media practitioners should be made to have as much fear of punishment as their counterparts in old media.

To succeed, the active cooperation of big tech would be required. But would they choose to be part of the solution?

Make platforms liable for their content Social media platforms are probably conflicted. That is, if you infer correctly from Harvard professor Shoshana Zuboff’s 2019 book The Age of Surveillance Capitalism: The fight for a human future at the new frontier of power, where she asserts “fake news and other forms of information corruption have been perennial features of Google and Facebook’s online environments… [with]…countless examples of disinformation that survived and even thrived because it fulfilled economic imperatives”. Stengel corroborates this view: “The players in this conflict are assisted by the big social media platforms, which benefit just as much from the sharing of content that is false as content that is true.”

Even more bluntly, Stengel asserts “popularity is the measure [social media platforms] care about, not

accuracy or truthfulness.” Still, as Zuboff adds, “they [Facebook & others] absolutely have the tools to shut down fake news”. But they have to be willed to do so conscientiously. And there is evidence they do so when prompted by governments.

Still, in America, where most of the top global social media platforms are headquartered, there is limited incentive for them to combat disinformation. Their complacency stems from the United States’ Communications Decency Act (CDA) of 1996 which provides immunity to social media platforms from being liable for published content. The part of particular interest in that American legislation reads thus: “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” Were this part of the legislation to be modified, it is well-known these platforms are perfectly capable of policing mischievous content with super efficiency. Thus, incentivising them via liability for disinformation might be ideal.

In practice, considering the robust political lobbying apparatus of American big tech firms, this would be a herculean task. But if African governments and others truly desire a curb on disinformation, it would not be untoward for them to be part of a global effort towards forcing the US Congress’ hand, via the United Nations perhaps – not that that has ever successfully forced the Americans to do anything they didn’t want to do – towards such a modification.

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In practice, considering the robust political lobbying apparatus of American big tech firms, this would be a herculean task.

But if African governments and others truly desire a curb on disinformation, it would not be untoward for them to be part of a global effort towards forcing the US Congress’ hand, via the United Nations

Even so, Stengel sees a way to make changes to the legislation that may likely be acceptable to social media platforms: “One way to do this is to revise the language of the CDA to say that no platform that makes a good faith effort to fulfil its responsibility to delete harmful content and provide information to users about that content can be liable for the damage that it does.” Still, Stengel adds, “for all this to work, we need global privacy regulations, a universal definition of disinformation and legal consequences for purveying it.”

In any case, Singapore is pushing ahead with fighting fake news on its own; albeit it could be argued its intentions are not entirely altruistic.

In November 2019, for instance, the Singaporean government ordered Facebook to issue a disclaimer (“Facebook is legally required to tell you that the Singapore government says this post has false information”) on a post by a local newspaper that it considered inaccurate. But how many of these orders can it issue?

Its progress in this regard is likely to be incremental. A global effort, with America in the lead, under the auspices of the United Nations, would likely be more effective. In the absence of such a global coalition, hard-fought democratic gains around the world would be increasingly eroded; especially in the poor parts of the world, like Africa, where they are mostly needed.

“Dr Raji is chief economist at Macroafricaintel.

He was previously an Africa Economist at Standard Chartered Bank, London, UK. (Twitter: @ DrRafiqRaji)”

Global Strategy Debrief: Huawei in the eyes of the storm

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uawei had quite an impressive result in 2019 selling over 240 million smartphones representing a 17 percent increase from 2018.

These are not withstanding the restrictions and limitations coming from the United States which argues that Huawei poses a national security threat, going as far as pressuring it’s allies to shut their doors against the company. US blacklisting Huawei has affected the company’s value chain and relationship with key partners including Google.

The United States seems to be all out to destroy the Chinese Telecom giant causing severe harm to both operations and marketing. Unable to use Google services on its devices since the May 16 2019 blacklist, the company has gone ahead to release its Mate 30 smartphone running the open source android 10 operating system but without the popular Google apps such as Gmail, Map, YouTube and others seen as the defining features of the android phones. Huawei has as an alternative designed its own app gallery promising to provide alternatives to the missing Google apps.

This move as it appears can either be the beginning of the end of Huawei or the dawn of a new day in the mobile phone competition. Only recently, Xiaomi, Huawei and BBK came together to create a Google Play Store alternative, a partnership called the Global Developer Service Alliance. These companies all together control over 40 percent of

the global smartphone market share as at Q4 of 2019.

But Huawei faces yet another serious problem and that is US determination to stop Huawei from participating in the development of the $31 billion 5G market estimated to be worth $11 trillion by 2026 not only in America but in their allies countries citing concerns its gear could be vulnerable.

Though top US allies, UK and Germany intends to allow Huawei play a limited role in the 5G technology, the United States filling of superseding indictment, in which it accused the company of conspiring to violate the Racketeer Influenced and CorruptCorrupt Organisations Act and to steal trade secrets from six US technology firms to grow its business may change their decision.

Brian’s insight These are very troubling moments for Huawei and a time to watch in the smartphone and mobile technology industry.

Recall that in 1998 Nokia was at its peak controlling 23 percent of the global GSM market. By 2005 Nokia annual revenue exceeded 29 billion euros with the company controlling 45 percent of the market in Eastern Europe, the Middle East and Africa and 63 percent of the market share in India. Nokia seemed unstoppable even as competition intensified. By 2007 as the industry had shifted to software, Nokia’s symbian operating system remained the most widely used in the world with 65 percent market share.

As the iPhone began to gain market share

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and the Google’s Open Handset Alliance, a consortium of 84 firms formed to develop open standards for mobile devices released the Android in 2008, the dynamics of the competition changed and the beginning of Nokia’s sad end began.

History seems to be repeating itself today with Huawei in the spotlight. The direction of the story and how it plays out will depend on the choices Huawei is able to make. The competitive knives are out, to remain standing depends on making hard choices that can restructure the industry. Tactics and operational improvements will no longer work at this time, Huawei survival and thriving is about changing the rules of the game.

Every competitive advantage can be made obsolete, but innovative products and services are unlikely to suffice at this moment.

Huawei needs to take a hard, long look at its value chain and make sustainable decisions about logistics, production, and operations.

As Huawei struggles with a reputation under attack, following the path of truth and honor irrespective of the consequences could be the surest path to success. There is so far you can go with a cover up, technology theft, cyberespionage are serious issues that threaten national and shouldn’t be treated with kids gloves. If they are true, then Huawei walking the path of truth and honor by owning up and facing whatever sanctions and consequences might be the only card capable of preserving the Huawei global business interest. The effects will be catastrophic if

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Brian Reuben Huawei is convicted in court.

If the US allegations are false, then superior technology, business model and product innovation and increased share of the markets outside the United States are keys to a sustainable business. Without adjusting the Huawei value chain even if the ban is lifted and Huawei is free to source inputs from the United States, the company cannot guarantee there will be no fresh charges and trade ban tomorrow especially as the trade war might take any direction.

The partnership called Global Developer Service Alliance is a good strategic move which if well executed could well change the dynamics of the competition. Another giant doesn’t have to fall but whether or not that happens depends on the choices Huawei makes.

To learn more email admin@brianreuben. com Dr. Reuben, business consultant, researcher and keynote speaker has influenced business leaders globally. He holds business trainings regularly in Lagos, Dubai and London with participants paying upto $10000.

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Tuesday 25 February 2020

BUSINESS DAY

EDITORIAL Publisher/Editor-in-chief

Cracks on the Rock Silence of the president amid Moguno-Kyari power play confusing

Frank Aigbogun editor Patrick Atuanya

DEPUTY EDITOR John Osadolor, Abuja NEWS EDITOR Chuks Oluigbo MANAGING DIRECTOR Dr. Ogho Okiti EXECUTIVE DIRECTOR, OPERATIONS Fabian Akagha EXECUTIVE DIRECTOR, STRATEGY, INNOVATION & PARTNERSHIPS Oghenevwoke Ighure ADVERT MANAGER Ijeoma Ude FINANCE MANAGER Emeka Ifeanyi MANAGER, CONFERENCES & EVENTS Obiora Onyeaso BUSINESS DEVELOPMENT MANAGER (South East, South South) Patrick Ijegbai COPY SALES MANAGER Florence Kadiri DIGITAL SALES MANAGER Linda Ochugbua GM, BUSINESS DEVELOPMENT (North)

Bashir Ibrahim Hassan

GM, BUSINESS DEVELOPMENT (South) Ignatius Chukwu

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onfusion over who should direct the national security of Nigeria is a threat to the country. It should not be treated like the twofighting scene common in primary schools.

Turf wars among the advisers of presidents are common, whether over how the economy is run, a foreign policy or a political strategy.

Under President Muhammadu Buhari these battles aren’t over ideas but personalities, perks and positions. Petty preoccupations that harm the economy, international relations and national security.

A leaked document from Mohammed Moguno, the national security advisor, accusing Abba Kyari, the chief of staff, of “illegal acts that serve nothing but the continuous undermining of our national security framework”

is serious enough to make any president react. But President Buhari has kept quiet, as he is accustomed to do.

His silence, to be fair, may mean he prefers to settle such a sensitive matter quietly.

Keeping quiet, however, is one thing, resolving issues quickly is another.

While he may choose to speak less and act more, it’s important that the president remembers he is the commanderin-chief. For national security issues he has appointed an advisor, even though he serves at his pleasure. A chief of staff presiding over national security meetings with service chiefs is unconstitutional and violates constitution the president has sworn to protect. National security is above the paygrade of the chief of staff.

If his silence is an attempt to avoid responsibility (and put the blame on overambitious appointees eager to please) we

remind the president that the blame for the confusion at Aso Rock falls on him. It is the consequence of a leadership style that prefers abdicating duties to a trusted few. A style which contradicts Buhari who in his Chatham House speech in 2015 promised to “always lead from the front” if elected president.

Mr President, lead from the front, take responsibility for insecurity in the country.

The silence of the president about the extent of the power of his chief staff, especially after instructing that all matters be channelled through him, leaves room for unrestricted exercise of power. Unchecked power in the hands of a political appointee with no pressure to deliver on campaign promises or interest in the common good of the country is dangerous. It says volumes about who runs the country and makes nonsense of his inaugural speech about belonging to nobody.

Choosing to ignore the confusion around him and the calls for a rethink of national security strategy is indicative of how Kyari has become de facto Prime Minister of Nigeria. It limits the quality and breadth of advice available to the president in a country as diverse as Nigeria.

According to Moguno, leaving Kyari to attend to matters beyond his capacity and office “have not only ruptured our security and defence efforts but have slowed down any meaningful gain the president sought to achieve.”

To fight the terrorists, insurgents, bandits and militants that are emerging across the country, Nigeria requires more than just air strikes. The Moguno-Kyari squabble will make it difficult to initiate a comprehensive economic development plan to build infrastructure, promote agriculture and generate jobs.

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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BUSINESS DAY

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The strange war with WHO’s battle against COVID-19

Dan Steinbock

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urrently, the greatest virus outbreak concern is to avoid any possible emergence of secondary virus clusters.

Recently, this critical task has been complicated by misguided media coverage and attacks against WHO, China and people of Chinese descent rather than the virus.

Infodemic versus epidemic Last Saturday, WHO DirectorGeneral Tedros Adhanom Ghebreyesus urged global leaders to stop stigma and hate amid the virus outbreak. His comments in Munich followed reports that people of Asian descent have faced discrimination amid virus fears. “We will all learn lessons from this outbreak,” he added, “but now is not the time for reclamations or politicization.”

At the end of January, the World Health Organization (WHO) declared the ongoing virus outbreak a “public health emergency of international concern” (PHEIC). As WHO made clear, the PHEIC was not motivated by China, but the possible effects of the virus, if it would spread to countries with weaker healthcare systems.

At WHO, the concern was compounded when terms, such as “virus outbreak,” “epidemic” and “pandemic,” got blurred even in reputable international media. Tabloid hysteria contributed to ugly instances of xenophobia, even racism against people of Chinese and Asian descent, while leading to

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bullying in schools, colleges, even universities.

The misinformation on global scale compelled the WHO to declare the COVID-19 an “infodemic” on February 2. Since international media seemed to be shunning its responsibility to correct myths and rumours, WHO had to allocate some of its scarce resources to do the job.

Stunningly, it took until mid-February for some of the world’s largest technology companies – including Google, Amazon, and YouTube – to get together, when WHO hosted a Silicon Valley meeting to discuss how to tamp down on misinformation about the virus.

In the concurrent weeks, the struggle against COVID-19 has gone hand in hand with a battle against the WHO and its executives.

WHO and its chief were targeted Since late January, almost 380,000 people have signed an online petition to the UN for the WHO chief to resign because he allegedly “solely believes” Chinese outbreak data. In contrast to allegations, WHO chief Tedros has initiated a review process to study the causes of the virus, while stressing adherence to WHO guidelines regarding pandemics.

The smear campaign is an ugly déjà vu. In 2017, Tedros, a high-level Ethiopian health executive, succeeded Margaret Chan as the chief WHO. While he was considered highly qualified for the job and an innovative reformer in Ethiopia, his candidacy was attacked at the last eve of the WHO election, when odd stories surfaced about an alleged cover-up of cholera epidemics in Ethiopia. Reportedly, the allegations came from Lawrence Gostin, a US law professor who advised the rival UK candidate (and has recently resurfaced as a critic of China’s virus struggle).

In the UN, the African Union dismissed the allegations as an “unfounded and unverified defamation campaign.”

Yet, once again, the old smear campaign

stories have been recycled in media.

When attacks against Tedros went nowhere, international spotlight focused on WHO Infections Hazards Director Sylvia Briand when she stated in early February that “we are not in a pandemic.” Then she became a target for criticism.

To avoid political intrigues, WHO’s pandemic declaration requires strong evidence and relies on a tested six-stage classification.

The last pandemic was the 2009 H1N1 flu outbreak (swine flu), which is estimated to have killed around 150,000 to 300,000 people around the world. In contrast, COVID019 has so far resulted in 4 deaths outside China, despite weeks of diffusion.

Slow to provide reports In the early 2000s, China’s efforts to control SARS were criticized as the disease spread internationally before the global outbreak was subdued. A decade later, Chinese response to the Avian influenza (H7N9) was significantly faster, broadly praised and the disease did not spread widely. With COVID-19, as Tedros has stated, China should be credited with identifying the virus in “record time,” sharing its genetic sequence quickly, and flagging potential international spread.

Yet, there is a strange discrepancy in the international coverage of the COVID-19. This coverage has systematically focused on China’s alleged conduct, while ignoring the actual conduct of many other influential WHO member states.

This discrepancy prevails even today, despite the news bomb of February 4, when WHO chief Tedros said that it was not China, but countries outside China that had proved slow in sharing complete information about cases.

WHO was particularly concerned about the fact that, even after almost a month of international crisis and global alert, it had received complete case reports for only 38 percentage of the cases.

In other words, a whopping three of five member countries had failed to

‘

In the past few weeks, countries outside China did not send adequate case reports to WHO in time, while media suffered an infodemic.

Instead of battling COVID-19, WHO and its chief were targeted

provide adequate information to WHO in a timely manner. Those reports were vital to the global organisation so that it could assess the true international scope of the outbreak, while broadening and deepening containment efforts.

“I don’t think it’s because they lack capacity,” Tedros stated pointedly about these WHO members. It would be ideal, he added, if WHO would receive the most up-to-date information, not just from China but the rest of the world.

It was only after Tedros’s public statement that some member states began to share data with WHO. Meanwhile, precious time had been lost.

Politicisation of the outbreak Even though these lost opportunities could result in potential secondary COVID-19 outbreaks outside China, international media has not yet asked the tough questions about the belated international cooperation outside China.

Instead of focusing on the need for international cooperation, international coverage has produced a series of headlines against the WHO. On February 5, a day after Tedros had urged countries to provide complete case reports, Financial Times reported that the influential WHO emergency committee member and veteran professor John Mackenzie “hit out at Beijing’s ‘reprehensible’ response,” and “accused China of not reporting coronavirus cases fast enough.”

Note: the rest of this article continues in the online edition of Business Day @ https://businessday.ng 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/ This is a short version of a commentary that was published by The World Financial Review

Latest about the $9bn arbitration award against the Nigerian government (1) Breaking the ice n this article, I shall be discussing the enforcement of the $9 billion arbitration award by Process and Industrial Developments Limited (P&ID) (an engineering and project management company registered in the British Virgin Islands with a Nigerian office) against Nigeria in the English Court presided

by Justice Christopher Butcher. The enforcement proceedings are another major arbitration incident of 2019 worth discussing and I shall be doing justice to this conversation in succeeding paragraphs. As both an arbitration enthusiast and a Nigerian with the interest of the country at heart, I am particularly concerned by the huge related to the arbitral award and interests that currently loom as one of the largest arbitral awards in the world.

According to Bloomberg, the arbitral award sum is “potentially the largest financial liability in the African country’s history” and also “equivalent to almost 2.5 percent of Nigeria’s annual gross domestic product.” Further capturing how severe the award sum is, The Guardian (UK) has equally noted the award sum is equivalent to one-fifth of Nigeria’s foreign reserves.

Meanwhile, BBC also notes that “The final amount of more than $9 billion is equivalent to about 20 percent of Nigeria’s declared foreign reserves of $45 billion.”

Understanding the journey to enforcement proceedings in the UK The foregoing said and in mind, it now becomes imperative to provide a background to the enforcement proceedings instituted in the UK, for the benefit of those who have hardly been following this grave development. By way of background, the Nigerian government was

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accused by P&ID of reneging on its obligation to supply natural gas (Wet gas) to P&ID under a Gas Supply and Processing Agreement dated 11 January 2010 (GSPA). Under the GSPA, P&ID was to construct and operate the facility necessary to process the Wet Gas, with a view to boosting domestic power generation and electricity supply, through the productive utilization of existing natural gas reserves. By Clause 20 of the GSPA, the governing law for the GSPA was stipulated as Nigerian law and it was agreed that “any difference or dispute” arising “concerning the interpretation or performance” of the GSPA would be referred to arbitration where amicable resolution of such difference or dispute could not be reached.

In 2012, a dispute arose with respect to the GSPA with P&ID contending that the Nigerian government had failed to make available to make available Wet Gas in accordance with the GSPA. It was P&ID’s claim that the Federal Government of Nigeria (FGN) frustrated the construction of the Gas Project agreed to during the regime of the late President Yar’Adua and deprived P&ID the potential benefits expected from 20 years’ worth of gas supplies with “anticipated profits of $5 to $6 billion.” Consequently, P&ID served a Notice of Arbitration on the FGN. On 19 September 2012, P&ID appointed Sir Anthony Evans to act as arbitrator while the FRN appointed Chief Bayo Ojo, SAN as its arbitrator on 30 November 2012. Thereafter, the two arbitrators invited Lord Hoffmann to preside over the arbitral tribunal as the ‘chairman’ and the invitation was invited by Lord Hoffmann.

P&ID’s initial claim, as reflected in its initial Statement of Case before the arbitral tribunal was damages in the sum of $5,960,226,233, plus

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interest for breach of the GSPA. The arbitral tribunal unanimously decided that the FGN had repudiated the GSPA by failure to perform its obligations under the GSPA; that P&ID was entitled to damages, in an amount to be assessed, for the repudiation of the GSPA. Worth noting that while the arbiters unanimously agreed on the liability of the Nigerian government to damages, there was no unanimity among them as to the quantum of damages. As a matter of fact, while two of the three arbiters granted the seemly enormous award, the third (Chief Bayo Ojo SAN) was of the view that a much lower sum should have been awarded as damages for breach of the GSPA. Capturing the latest on the liability of the Nigerian government to P&ID, BBC writes: “The firm was first awarded $6.6 billion (£5.4 billion) in 2017, but the London court has now added $2.4 billion in interest.”

The final award notwithstanding, an out-oftribunal agreement for the payment of $850 million (about 9.6 percent of the $8.9 billion award) was successfully reached with P&ID during the erstwhile President Goodluck Ebele Jonathan government. However, the responsibility for the disbursement of funds to P&ID was passed on to the then incoming administration of President Buhari. However, rather than take the recommended action, the President Buhari led administration opted to set aside the settlement agreement and challenge the enforcement of the award before the English Commercial Court, while making little efforts at exploring amicable resolution of the matter with P&ID. A strategy that I criticised and spoke against during my interview with CNBC Africa last year March.

Dissatisfied with the approach taken by the

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Joseph Onele

Nigerian government in resolving the issue and settling the arbitral award, P&ID approached the English Commercial Court seeking orders granting access to seize Nigeria’s commercial assets in England. This P&ID hope to do, with a view to levying execution of the award earlier obtained from an arbitral tribunal consisting of Lord Hoffmann, Chief Bayo Ojo SAN and Sir Anthony Evans on the FGN. Coming before the English Commercial Court, P&ID sought to convert the tribunal’s award to a judgment of the High Court of England, with a view to enforcing the arbitral award as a judgment of the High Court.

However, FGN contested the hearing, arguing that given that the GSPA was signed in Nigeria, the English court had no jurisdiction and that the Ministry of Petroleum Resources lacked the authority to have entered into the GSPA in the first instance.

The FGN also argued that the arbitral tribunal erred in its award and urged the English Commercial Court to refuse to enforce the arbitral award.

The Commercial Court, however, found in favour of P&ID and gave its ‘blessings’ to P&ID to enforce the $9bn award. I shall critically examine the arbitral award itself and decision of the English Commercial Court in my forthcoming publication(s).

(To be continued)

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Tuesday 25 February 2020

BUSINESS DAY

COMPANIES & MARKETS

COMPANY NEWS ANALYSIS INSIGHT

EQUITIES

Local investors drive January market rally as total transaction jumps 84% to N235bn amid liquidity glut OLUFIKAYO OWOEYE

Analysis of Domestic Foreign Transactions for the Month Jan. 2020

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fter underperforming its global peers in 2019, the nation’s bourse started the year on a good note early this year ranking it among the best performing.

The resurgence was buoyed largely by retail and few institutional investors who were forced to take new bride in the equities market after been forced out of the high-yielding Open Market Operations OMO by the CBN. According to the NSE’s domestic and foreign portfolio investment report for January, as at 31 January 2020, total transactions at the nation’s bourse increased by 84.03percent from N127.94 billion in December 2019 to N235.46 billion in January 2020.

The performance in January 2020 when compared to the performance in Janu-

FINANCIAL SERVICES

CreditRegistry celebrates 17yrs of credit risk management in Nigeria SEGUN ADAMS

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reditRegistry, Nigeria’s largest and p i o n e e r c re d i t bureau, on Friday marked almost two decades of helping to de-risk the supply of credit to the Nigerian economy by providing data on creditworthiness.

The milestone for the credit bureau, which Financial Times Magazine listed as one of Africa’s top 20 most innovative companies, has been on account of the support from its customers, shareholders, management, directors, industr y regulator and peers, CreditRegistry said.

“We are Nigeria’s largest credit information database, we are the country’s largest credit bureau and the foremost leader in our industry. It wouldn’t have been possible without our customers,” said Jameelah Sharrieff-Ayedun, MD/CEO CreditRegistry in Lagos.

According to SharrieffAyedun, part of the high-

light of the 17-year journey in Nigeria has been CreditRegistry’s provision of fast, easy and efficient access to data and financial software solutions that smoothens the process of verifying creditworthiness for consumers and top financial institutions in Africa’s largest economy.

“Now lenders are able to give you a loan without meeting you physically.

They can rely on the information we provide to assess your creditworthiness,” Sharrieff-Ayedun said.

At CreditRegistry’s annual cocktail event for c u s t o m e r s , A n d r e w S. Nevins, Par tner - West Africa Financial Services Leader and Chief Economist, PriceWaterhouseCooper, commended the credit bureau for being a big part of the push for the implementation of the Bank Verification Number (BVN) policy, among other accomplishments.

Nevins, who gave the keynote speech at the Eko www.businessday.ng

Pearl Tower, said access to credit for consumers and businesses is necessary in driving the economy.

“When I first arrived here in 2008, there wasn’t enough credit going into the private sector,” said Nevins, noting that limited credit opportunities to small businesses and consumers, at that time, was due to information gaps.

“CreditRegistry has really filled the role by creating a database without which lending to SMEs and private individuals would be difficult,” he said.

CreditRegistry is Nigeria’s largest and pioneer credit bureau operator serving members since 2003 and licensed by the Central Bank of Nigeria (CBN).

The credit bureau prov i d e s g rou n d - b re a k i ng leading technology solutions such as its biometric discovery service, its SMARTScore along with 268 credit score characteristics and its newest product for borrowers called

CreditConnection.

With over 20 products in its portfolio, hundreds of financial and non-financial institutions now benefit from using Nigeria’s largest credit information database. The credit bureau has laid the foundation for fraud-proof, largescale consumer and small business credit in Nigeria.

In its tradition, CreditRegistry treats its members to its EPIC Story Cocktail Evening every year.

The event is held to show appreciation to business partners and subscribers that make the credit bureau’s vision possible.

Some of its customers which graced the 2020 event include RenMoney, Carbon, Guaranty Trust Bank, Zenith Bank, MTN, Stanbic IBTC, Dangote and Standard Chartered.

Jumoke Oluwole, the Senior Special Assistant to the President on Ease of Doing Business was among the guest of honor at the event.

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ary 2019 revealed that total transactions increased by 92.87percent.

With maturing OMOs hitting the system, January saw a surge in volume of the funds chasing existing investment vehicles with some of the liquidity flowing into the equities market just ahead of annual results announcements, it also saw some profit taking as investors locked in gains after the surge.

At an average interest rate of 12.19 percent, the central bank’s liquidity management tool, Open Market Operation (OMO), remains the only instrument offering positive real return.

These high-yeiding OMO Bills are, however, not accessible to non-bank corporate or individual investors but only foreign investors and local banks.

In January 2020, the total value of transactions executed by Domestic investors outperformed transactions executed by Foreign investors by approximately 40percent A further analysis of the total transactions executed between the current and prior month (December 2019) revealed that total domestic transactions increased by 154.86% from N64.80 billion in December to N165.14 billion in Janu-

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ary 2020.

Similarly, total foreign transactions increased by 11.35percent from N63.14 billion (about $206million) to N70.32 billion (about $229.42 million) between December and January 2020.

The value of domestic transactions executed by Institutional investors outperformed Retail investors by 2percent.

A comparison of domestic transactions in the current and prior month (December 2019) revealed that retail transactions increased by 233.75percent from N24.47 billion in December 2019 to N81.67billion in January 2020.

Similarly, the institutional composition of the domestic market increased by 107.02percent from N40.32 billion in December 2019 to N83.47 billion in January 2020.

Trend over a thirteen year period shows that domestic transactions decreased by 72.30percent from N3.556t in 2007 to N985bn in 2019 whilst foreign transactions increased by 53.08percent from N616bn to N943bn over the same period.

Total domestic transactions accounted for about 51percent of the total transactions carried out in 2019, whilst foreign transactions accounted for about 49per-

Tuesday 25 February 2020

COMPANIES&MARKETS COMPANY RELEASE

BUSINESS DAY

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Business Event

First Bank takes SMEs business clinic to Port-Harcourt, Abuja

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n recognition of the significant role SMEs play in achieving sustainable growth and development in the economy of the country, Nigeria’s premier and leading financial services provider, First Bank of Nigeria Limited would host SMEs in its 2020 second edition of the SME Business Clinic. The event themed “Building a sustainable Business” would be held on 25th and 27th February 2020 in Port-Harcourt and Abuja respectively.

SMEs are encouraged to take the FirstBank SME diagnostic tool by visiting https:// smeconnect.firstbanknigeria. com/ in order to stand a chance to be amongst the participants that will be in the SME Business Clinic in Port-Harcourt and Abuja. The FirstBank SME diagnostic tool is designed for SMEs to check the health of their business, better understand it and drive profitability. The SME Clinic will feature one-onone business advisory services, mentoring, networking opportunities and participants will also be acquainted with the requisite knowledge

and business tools needed to drive efficiency in the dayto-day operations of their business.

Speaking on the event, Gbenga Shobo, the Deputy Managing Director, FirstBank, said “at FirstBank, we are proud of the giant strides we have taken over the years towards enhancing the SMEs for their businesses to thrive, have a fair play in the market and contribute to the Gross Domestic Product of the country. We remain the trusted financial partner of SMEs and reiterate our resolve to be known as the brand that enables their success; much the same way that we have for over 125 years enabling Nigerians and the economy at large”.

The coaches at the event are Seye Olurotimi, Lead Consult at Cedar Tribe Limited, an SME branding expert and business growth consultant with vast experience helping SMEs grow effective brands and Robert Yakubu, founder of the Instabiz Academy and the Business Mastery Program, a digital entrepreneur and business strategist empowering en-

trepreneurs, marketers and business professionals in Port-Harcourt and Abuja respectively.

The SME Clinic session is organized in partnership with SME Traction, a leading business coaching platform aimed at empowering SMEs to make informed choices about their businesses, thereby facilitating growth and bolstering their contribution to the development of the economy.

Expressing her delight on the impact the inaugural SME Clinic has had on her business, the CEO, Nibbles Plus More Ventures, Owoeye Oluyomi, stated that “the first step I took after the SME business clinic was do a strategic road map for my business. Riding on the information I got from the business trend session on consumer landscape, I had a clearer understanding of who my target audience are and have included that in my business plan. The feedback we believe will help us identify untapped markets and problems in our industry, how to reach them and what value we can offer them”.

L-R : Tein Jack-Rich , president and founder , Belema Oils; Adeyeye Enitan Ogunwusi , the oni of Ife, and President Muhammadu Buhari, during the closing ceremony of national conference of repositioning the Muslim Family for National Development in Abuja weekend.

L - R: Eben Amstrong , director of biomedical training and technical services, Medshare International ; Ishaq Adebayo Salman , chairman of the board, Federal Medical Center, Owerri ; Nwamaka Onyemelukwe , public affairs and communications manager, Coca-Cola Nigeria Limited ; Achigbu Kingsley, medical director, Federal Medical Center, Owerri, and Osuji Joe,commissioner for health, Abia State, at the inauguration of newly installed medical equipment at the Federal Medical Center Owerri under Coca-Cola’s Safe Birth Initiative in Imo State

IPMAN lauds PPMC/NNPC for success of ‘operation white’

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ashir Dan-malam, the chairman, Independent Petrol e u m Ma rk e t e r s Association of Nigeria (IPMAN), Kano state chapter, has commended the management of PPMC/NNPC for ensuring the success of ‘operation white’ project which was launched by the Federal Government last year.

This is contained in a statement signed by state IPMAN chairman and ssued to newsmen in Kano on Sunday.

According to Danmalam, the commendation was necessary because op-

eration white had addressed the seemingly intractable issue of fuel scarcity, especially during the Yuletide season.

Dan-malam attributed the success of the project to the leadership qualities and doggedness of the managing director of PPMC, Alhaji Bala Wunti who he said continued with the good works of his predecessor, Alhaji Umar Ajiya now CFO NNPC. The IPMAN chairman noted that Wunti was always in close contact with marketers since the operation white was introduced last year in order to ensure its

success.

“Operation White’- is an initiative which takes stock of all products lifted across the country, in a transparent manner.

“The initiative has helped curtail the smuggling of petroleum products and reduced imported consumption figures,” Danmalam said.

He, therefore, called on members of the association across the country to adopt the principles of ‘operation white’ in order to ensure smooth supply and distribution of petroleum products nationwide.

L-R: Executive Secretary, Universal Service Provision Fund (USPF), Ayuba Shuaibu; Executive Commissioner, Stakeholder Management, NCC, Adeleke Adewolu; Executive Secretary, Tertiary Education Trust Fund (TETFund), Prof. Suleiman Elias Bogoro; Executive Vice Chairman, NCC, Prof. Umar Danbatta; Minister of Communications and Digital Economy, Dr. Isa Ali Ibrahim Pantami and Chairman, National Broadband Plan Committee 2020-2025, Ms Funke Opeke, during the submission of draft report by the Committee to the Minister in Abuja, recently.

Explosion: DPR warns against sales of gas in residential areas

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epartment of Petroleum Resources (DPR), Os ogbo Field Office, has warned skid gas operators against sales of liquefied petroleum gas (LPG) in residential areas in the state.

Olusegun Daboh, DPR’s Operations Controller, in an interview with the News of Nigeria (NAN) on Sunday in Osogbo, said the warning had become imperative in order to avoid fire outbreak.

Daboh, who noted that proliferation of illegal gas skid operators in the state had reached a worrisome level, said that the organization would continue to clamp down on those selling LPG in residential areas.

He said that the agency had given all illegal gas skid operators in the state, especially those operating in residential areas till end of February to close shop.

The controller said anyone caught after the expirawww.businessday.ng

tion of the ultimatum would be dealt with in accordance with the law.

Dabor, who noted that the department had shut more than 20 illegal gas plants in the last few weeks, said that the agency would not rest until safety procedures were strictly adhered to by gas plants operators in the state.

He said that the only approved places for sales of gas were gas plants and gas stands in the state.

L-R: Legal Director and Company Secretary, Guinness Nigeria Plc, Rotimi Odusola, Corporate Communications Manager, Ayodele Alabi, Supply Chain Director, Colman Hanna, Managing Director, Baker Magunda, Human Resources Director, Adediran Aderemi, during the presentation of Guinness Nigeria 2018/2019 Sustainability Report in Lagos

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Tuesday 25 February 2020

BUSINESS DAY

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BUSINESS DAY

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Tuesday 25 February 2020

BUSINESS DAY

Media business To avoid beaten by competition, expert advises marketers to fuse technology into strategy Daniel Obi

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ny marketer that is yet to embrace technology which has become an integral part of business or delays in fusing technology into strategy will lose out in the competitive environment. This is as technology increasingly upends all aspects of business, including marketing.

Over time, technology has impacted the ability of marketers to collect and reach consumers in different ways.

With recent understanding of the role of technology in helping the growth of industry, business owners are progressively adopting it and Seni Adetu, former managing director of Guinness Nigeria told marketers recently to follow the trend as marketing is crucible part of business.

Adetu who spoke on ‘The future of marketing in a technology driven world’ at National Institute of Marketing of Nigeria, NIMN’s fellows dinner and awards night noted that “the way we are doing things in the past will not suffice in

the new world”.

Challenging marketers about the things they need to be aware of in terms of how technology is shaping the world, Adetu who is now the Group CEO of Algorithm Media Limited said technology and leadership will define the future of marketing anywhere in the world.

He believed that future of marketing will leverage Artifi-

cial Intelligence, virtual reality and Internet of Things, IoT for effectiveness.

“We need to ramp up technology and it will take out all the wastages, inefficiencies in the way we operate manually.

We can therefore convert our manual capacity and resources into other things and use technology to advance things that don’t need men to do”.

In terms of leadership,

La Casera pays courtesy visit to Emir of Kano, promises national growth

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n today’s world of cut throat competition, it is refreshing to see companies still investing in peoples’ lives while driving growth. This conviction was put forward when the management of The La Casera Company (TLCC), makers of leading premium apple soft drink, La Casera Apple drink paid a courtesy visit to the Emir of Kano, His Highness, Muhammadu Sanusi II, at the his palace recently during a visit to the state for the grand draw of its ongoing consumer promo According to a statement, Managing Director TLCC, Chinedum Okereke, thanked the Emir for the rare privilege granting such a historical visit. He highlighted the pedigree of the company, which houses brand names such as La Casera Apple drink, Smoov Chapman, Nirvana range of products and Bold Bitter lemon along with the newly introduced variants that form the Bold Franchise.

Chinedum while outlining the company’s contributions in building the nation and the economy through employments, said: ‘We employ over 1,000 peo-

ple directly in our company operations and over 10,000 people indirectly across the country. We equally have close to 2,000 direct dealers handling our products, as well as several vendors in our value chain.’

The La Casera Company which holds the historical city of Kano as a key location for its business, in 2019, carried out a multi-platform educational enlightenment campaign against the ills of substance abuse, targeted at the youth.

The Emir in his remarks, underscored the significance and relevance of Kano not just as a major market for

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products but also as a strategic point through which goods travel to the whole of West Africa. He expressed his desire for Kano to develop further beyond a consuming market into a production and manufacturing hub. He stressed that this was the only way to curb the social problems that bedevilled youth in the region.

His Highness, Muhammadu Sanusi II, while speaking also advocated for more investment in agriculture and manufacturing, urging The La Casera Company to have a strategic plan to put more infrastructure on ground in Kano, even as their business continues to expand.

After leaving the Emir’s palace, the TLCC team, according to the statement headed for the Vesico-vaginal Fistula (VVF) Kwali Rehabilitation Centre, where they made the donation of 3.5KVA solar power equipment to the centre, after identifying water and power as the major challenges faced by its inhabitants.

The solar panels will provide electricity and help to power the water pump in the hostel.

Adetu who introduced Orijin drink in Guinness said that one of the things marketers should focus on is what they can change in their marketing strategy and avoid what they cannot change.

“A lot of times, people tend to play the blame game. People tend to focus on things outside of their control like weather and security. The risk of doing that is they leave the things that

they can change and shape”.

He also told marketers to understand that less is more.

This means that marketers can execute few strategies to their advantage than planning more strategies.

While advising them to measure themselves against the best, Adetu who also worked with Coca Cola said intuition at times is as good as insight. “You may not generate all the insight you need and in those circumstances, use your intuition”, he advised.

Speaking earlier, the President of NIMN, Tony Agenmonmen who said that the institute is steadily on the rise, noted that over the past years the council has re-engineered the NIMN brand equity. At the night, the body inducted about 77 leading lights in the marketing community as fellows. Agenmonmen, said the new set of awardees comprises men and women who have distinguished themselves in the area of marketing in their various organizations.

Responding on behalf of other new fellows, Akobi Amaechi, the Group Head Corporate Communication of Access Bank expressed the

awardees’ appreciation to NIMN while underscoring the importance of marketing to survival of businesses.

In his comment, the Head of Brand and Marketing Communication at Polaris Bank, Nduneche Ezurike described the event as colorful which helped to draw the attention of the business community and the public sector on the need to face the strategic role of marketing in enabling profit and sustainability.

Nduneche said marketing especially in the era of industry 4.0 should be deliberate, targeted and measurable. “Institutions who treat marketing as tangential function will ultimately underperform or extinct. I congratulate the institute for this milestone and also all professionals who were inducted as Fellows”.

Others who were inducted included Oliver Omajuwa, General Manager, SIFAX Off Dock Nigeria Limited; Adenike Adebola of Guinness Nigeria; Abiona Babarinde, General Manager, marketing and corporate communication at Coscharis Group; and Joseph Okonmah, the lead consultant/CEO of Jasek Consulting.

SBI wins 9Mobile media account

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igeria’s next-generation media agency, SBI, has won 9mobile’s media account to manage the brand’s strategic advertising. The agency will be deploying its strategic planning expertise and vibrancy as one of the mission-critical driving force for the brand to propel itself into reckoning as the most innovative and best-loved mobile network in Nigeria.

In attestation to its exceptional performance as a media agency, SBI is current media agency of the year at the 9th edition of Marketing World Awards (MWA), held in Ghana.

Commenting on his agen-

Rotimi Bankole

cy’s plans to support 9mobile brand, Bankole in a statement added that “our ambitions and objectives are very clear, and that is to help grow the 9mobile

brand with creativity and innovative campaign. We are also committed to drawing from our pool of talents and also from the wealth of resources that is available in our organisation and global network to strengthen 9mobile brand in the Nigerian telecom sector”.

Starting out in 2013, SBI Media Group is among West Africa’s diversified media and marketing communications groups. As a member of the Masscom Global Network, the group is partnering with some of Africa’s largest brands to push their markets and business ambition across the continent and beyond.

IMC players to discuss ‘advertising and power of Nigerian story’ March 6

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mbued with the passion to massively accelerate growth in Nigeria’s marketing communications industry and propel all-round relevance of the industry in the country’s development, Goddie Ofose, one of Nigeria’s top brand analysts and journalist is convening an industry evening summit with the theme “Advertising and the Power of the Nigerian Story”.

The event holds on March 6, 2020 at Sheraton Hotel and Towers, Ikeja, Lagos. Gboyega Akosile, chief press secretary to https://www.

Lagos State Governor, Babajide Sanwo-Olu will be the special guest of honour at the occasion.

The lead paper for the evening will be presented by Lanre Adisa, chief creative officer, Noah’s Ark Limited. Meanwhile members of the panel who will discuss the Adisa’s paper include: Onyekachi Onubogu, CEO, Frutta Juice and Services; Amaechi Okobi, Group Head, Communications and External Affairs, Access Bank Plc; Emeka Oparah, Vice President, CSR and Communications, Airtel Nigeria; Martin Mabutho, Chief @Businessdayng

Commercial Officer, Multichoice Nigeria, and Jaiye Israel Opayemi, chief executive officer, Chain Reactions/ president, Public Relations Consultants Association of Nigeria, Others include Felix King Eiremiokhae, chief executive officer, Oracle Experience/ convener The Startups Africa; Ijedi Iyoha, acting Registrar/ CEO, Advertising Practitioners Council of Nigeria (APCON); Odion Aleobua, CEO, Modion Communications and Lekan Lawal as the moderator for the segment.

Tuesday 25 February 2020

BUSINESS DAY

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ADVERTISING Asharami Synergy enters lubricants’ market with high performing engine oil Daniel Obi

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here is hardly anyone that would balk at the opportunity to experience peace of mind when it comes to what people receive in exchange for their hard-earned income.

This becomes more instructive when the product in question is one that safeguards the well-being and performance of all manner of engines.

Lubricants, widely known as lubes, help to reduce the effect of wear and tear on engines. In order words, the more effective the lubricant, the greater the chance of having the engine performs optimally, over a longer period of time. What else would ensure peace of mind, than being sure that one’s exotic car or generator doesn’t cave in whilst in motion.

Asharami Synergy, a Sahara Group Downstream Company, has made a bold entry into the lubes market with what the firm describes as a “gold standard among lubricants” in the Nigerian market. “In a market contending with quackery, consumers can now move with Asha to safeguard and optimise the performance of their engines.

The Asha Engine Oil range can be applied to all manner of engines in generators, light and heavy-duty machines, cars, trucks, motorcycles, among others. We are delighted to give Nigerians the ultimate choice of engine oil that is pocket-friendly and outstanding by all parameters,” said Moroti Adedoyin-Adeyinka, MD/ CEO, Asharami Synergy at the launch of the lubricants in Lagos.

Given the huge amount of new

and ‘tokunbo’ engines in circulation, choosing the right lubricant is arguably, the most important decision one has to make to ensure long lasting performance. In addition, the potential negative impact of counterfeit engine oils in Nigeria should elicit more robust reaction from all stakeholders to address the menace. According to auto experts, the right oil for cars are specified in vehicle manual and vehicle users should take notice of American Petroleum Institute (API) and Society of Automotive Engineers (SAE) original codes.

Consumers need to get involved in the selection of what lubricant matches their engine – and not leave

this all-important decision to the discretion of mechanics or ‘engineers’ who are out to make a kill.

The Asha engine oil range which includes Asha Crest, Asha Xtra, Asha Trans and Asha HD Premium which Adedodoyin-Adeyinka said have undergone extensive quality tests and have been certified for distribution across the country. This should give consumers seeking pocket friendly, safe, durable, affordable and high performing lubricants a huge dose of “peace of mind” and make the decision to “Move With Asha”.

With the deregulation of lubricants market and little government interference, a lot of sub-standard lubricants have entered the market

but it is hoped that other quality products including Asha oil produced with international standard and with much awareness among consumers, the sub-standard products will be crowded out of market, for long lasting engines. According to AdedoyinAdeyinka: “Asha Engine Oil is here to give consumers the right option for ultimate protection and performance of their engines.”

The new Asha Engine Oil range come in different sizes. For instance, Asha Crest comes in one and four litres respectively; Asha HD: 4 and 25 litres while Asha Trans comes in 1 litre.

The company said Asha Crest is superior quality multi-grade engine

L-R: A member of Nigerian Automobile Technicians Association, NATA; Julius LawaL, Chairman of Lagos State chapter of NATA and Ifeoma Ezurike, a distributor displaying the Asha product to consumers recently in Lagos

oil made from the highly redefined paraffinic base oils. It is particularly suited for petrol and diesel passenger cars, 4-wheel drive vehicles, light vans, generators and motorcylces.

On the other hand, Asha HD is a top quality high performance mono-grade lubricant specially formulated to provide the ultimate all-round performance in diesel engines. Asha Extra is high quality mono-grade oil for both petrol and diesel engines and it is suited for turbo-charged passenger cars, light vans four-wheeled vehicles while Asha Trans is a premium transmission fluid, developed to meet the requirement of General Motors Dextron IIID. It is suitable for most automatic power steering units and certain hydraulic systems.

The Asha Engine Oil Marketing and Sales Manager, Seun Yussuf disclosed at the launch of the lubricants that Asharami Synergy was working with top distributors and other stakeholders to ensure seamless access to the engine oil across the nation.

“Asha Engine oil is here to give all consumers peace of mind whenever they are looking to buy lubricants for their engines. We urge everyone to move with Asha for ultimate protection of their engines.”

Asharami Synergy’s operations and processes have earned the company several ISO certifications for quality and safety.

Folusho Sobanjo, the company COO said Asharami Synergy is engaging in robust marketing strategy to create brand awareness of product.

“We don’t shy away from competition as we are driven by consumer satisfaction to launch the products into Nigeria market”

Assessing LASAA’s critical role in environment regeneration, greater Lagos Agenda Olawole Ademola

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leaner environment is among the yardstick for ranking cities and for attracting multinational companies as well as investors. Ranking of cities is helpful in terms of employment and development opportunities. Multinational companies are attracted to set up their offices in the cities with good rankings. Avoidance of degradation is another benefit of a clean city.

It is, therefore, with a view to promoting environmental regeneration in Lagos State that Governor Babajide Sanwo-Olu made Health and the Environment a major pillar of his administration’s THEMES Agenda.

Indeed, one of the earliest actions of the governor was the signing of his first Executive Order to address sanitation as well as cleaning of drainages in the State.

Since it came on board, the Sanwo-Olu administration has demonstrated the zeal and willingness to enhance improvement in the state’s waste management system.

The administration is resolved to rid the state of waste, necessitating

the introduction of “Lagos at 4 am” operation and other laudable initiatives aimed at improving the state’s environmental architecture. “Lagos at 4 am” is an initiative to ensure wastes are evacuated and carted away in the early hours of the day as it is done in major global cities.

Also, it is important to understand that Lagos State occupies an important position in outdoor advertising practice in Nigeria, having been in the lead by accounting for about 70% of advertising spend and revenue in 2017 alone. The State is playing a critical role by pioneering technological advancement in many fronts; from the establishment of an autonomous agency for the control and regulation of advertising to the introduction of several innovative platforms for the growing community of advertisers in Nigeria. Lagos State is the commercial nerve centre and economic capital of Nigeria Recently, in a chat with journalists in Lagos, the newly appointed Lagos State Signage and Advertising Agency LASAA managing director, Prince Adedamola Docemo said he is fully prepared to bring considerable improvements to the quality of advertising practice and display structures in www.businessday.ng

Lagos environment in line with global best practice and smart city initiative of the government.

“My agenda is to find a critical balance between helping the State government to attract investment to the outdoor adverting subsector and improving aesthetics and city architecture of Lagos State.

Explaining further, “my plan is to align our Agency’s policies and programmes with the administration’s agenda on one hand by ensuring that the environment is clean and devoid of visual blight by working with other relevant ministries and departments so as to create an enabling environment which is clean, safe and conducive for consistent growth and investment in the outdoor advertisement industry in Lagos State. As you may be aware, there are many outstanding projects which are currently being executed by the State. These include the recently commissioned LAGFERRY boats, Lagos Bus Services Limited, Lagos Rail Project and ongoing transformation in the transportation sector, urban renewal and other infrastructural development projects.”

On how to make the SMART city

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concept of the government achievable through the agency he recently appointed to head, Docemo said, “As an agency of government saddled with the responsibility of controlling and regulating the operation of signages and advertsing billboards, we have identified the need to participate in the process of deepening the conversation around the SMART city concept where outdoor advertising plays a critical role.

Yes, since we assumed office in the last quarter of 2019 we have made giant strides to reposition LASAA. We are making deliberate efforts to forge a new level of collaboration with all stakeholders by creating a win-win situation where investment will grow, business will thrive and the economy will experience a quantum leap within the shortest time possible. Under my leadership in LASAA, we are introducing corporate governance to ensure transparency and accountability.”

“In order to increase our contribution to the Internally Generated Revenue, IGR in the State, we must devise smarter ways of doing business, adopt a seamless operation through the use of ICT which will improve efficiency in the entire business process. In this @Businessdayng

dispensation, I expect practitioners and partners to conduct their businesses with a mindset of a smarter future, he added.

Based on his background in outdoor advertising technologies, Prince Docemo encourages investment in outdoor advertising where billboards will not only display brands but also carry out diverse functionalities like collecting data, supporting intelligence for the industry on traffic count, audience measurement, as well as the security architecture.

Apart from being a regulator, the agency must give back of to the community, and the new agency head confirmed that as part of its CSR initiative, LASAA engages in corporate philanthropy by means of sponsoring events that promote social causes like breast cancer, walk against domestic violence, sporting events etc. by giving discounts or sometimes wave applicable fees completely for the display of advertising materials.

As regulators, we must always find a balance between regulation and revenue and I think it is important for practitioners to make our job easier by paying amount due based on approvals,” he advised.

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Tuesday 25 February 2020

BUSINESS DAY

Branding Partner Mobile’s EV1 keys into Nigeria’s drive for Smartphone, Broadband penetration

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L-R: Anthony Iloh, GM direct sales, ntel; Ifeoluwa Molokwu, chief operation officer, Partner Mobile; Olusola Akintola, chief technology officer, Partner Mobile; Babatunde Omotoba, MD/CEO, ntel; and Joshua Ajayi, CEO, Awesome Communications at the Media Launch of Partner Mobile’s EV1 Smartphone held in Lagos.

purchase of the EV1 in its stores.

Speaking at the launch of the new smartphone, Olusola said he is confident that the new smartphone will delight smartphone users, considering its stylish design, Al Triple camera, quality and pricing.

He added that the device runs on Android 9 pie operating system and comes with face and fingerprint sensors, water resistant features, ground-breaking innovations in display, camera and performance.

“Among other wonderful features, the phone comes with a triple camera and a flash form a square design, the overall appearance exhibits wonderful relationship between geometry and aesthetics incisively and vividly -- from the proportion of segmentation, geometric curves and other aspects. It shows the geometric aesthetics. The whole architecture is romantic, classy and absolutely fashionable.”

Furthermore, he stated that the “5MP front camera, the background blur effect will no longer make you afraid of all kinds of scene-stealing. With beauty algorithms supports, specific to beautify details of face, skin, eyes, to diminishes appearance of blemishes.”

In the same vein, Ifeoluwa Molokwu, Chief Operation Officer, Partner Mobile said “The launch of EV1 into the market signifies our unrelenting efforts to introduce to the market value-for-money products in order to satisfy our customers. EV1 is a reliable phone that will surely satisfy the customers who have been looking for a phone that will suit all purposes.”

She added that the new smartphone is distinctively manufactured to meet today’s smartphone market and at an affordable price, www.businessday.ng

so consumers can do more of what they love with smartphone.

Correspondingly, in furtherance of its commitment to making quality smartphones and boosting smartphone penetration in the country, it also unveiled its partnership with ntel, Nigeria telecommunication provider, on providing data bundle of more than four Gigabytes for free to buyers of the smartphone.

The ntel Partnership Commenting on the partnership with Partner Mobile, the MD/ CEO of ntel, Babatunde Omotoba said that ntel has been working assiduously with Partner Mobile for sometimes to introduce a budgetfriendly smartphone targeted at the consumer market.

He explained, “Following months of compatibility tests, we are delighted to announce that the ntel network is now compatible with the EV1 smartphone. This means that anyone who owns this smartphone can now call and browse at a superfast speed, in

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Our network supports crystal clear high definition voice calling as well as has LTE advanced features which combine to enable downlink speed of up to 150megabits per second on our network

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s expectations are high for the launch of 5G smartphones and data network in Nigeria and many other countries, there is a growing concern that smartphones and the existing 4G LTE are under-utilised.

Also there are issues that smartphones and broadband have yet to reach significant part of the population amidst growing concern that there is influx of cancerous phones into the country.

The Chief Technology Officer of Partner Mobile, Olusola Akintola at the unveiling of Partner Mobile’s Evolution 1 (EV1) into the Nigerian market, urged the Nigerian Communications Commission (NCC) and others to do more in the area of monitoring the phones that come into the country.

He added that a lot of devices that come into the country are harmful to health because of the radiation they emit.

He stated further that a lot of the devices that are shipped to densely populated markets of Lagos and Kano are hardly seen anywhere, adding that the radiation from some of these mobile phones are cancerous making them harmful to the human body system.

However, NCC latest data recently approved 1,492 mobile phones for use in the country.

These devices are of different brands and models and have been tested to have met the industry regulator’s Standards Type Approval required for them to be approved for Nigeria.

The new EV1 smartphone from the stable of Partner Mobile is one of the quality phones that have met industry standards and it is pushing for smartphone penetration across urban and rural areas with its affordable pricing.

Similarly, its partnership with ntel availing Nigerians 4G Long Term Evolution (4G LTE) is another strive to achieving Broadband penetration which is also in line with NCC’s plan to grow the country’s broadband penetration to 70 per cent by 2021.

Interesting to note, the number of smartphone users in Nigeria is forecast to grow to more than 140 million by 2025. Currently, estimates from different sources put the number of smartphone users in Nigeria at roughly 25 and 40 million, Statista, an insight and research platform, reports on its website.

The Evolution The new Partner Mobile’s Evolution 1 (EV1) smartphone was unveiled at a media launch in Lagos recently. The new device is compatible with 4G LTE network, and was designed to run on ntel’s 4G LTE network and other telecoms network that are 4G LTE compliant. Also, ntel will be offering end users 4.5 gig data upon

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fact, that is the fastest speed you will see in the Nigerian market.

“Our network supports crystal clear high definition voice calling as well as has LTE advanced features which combine to enable downlink speed of up to 150megabits per second on our network.

“To demonstrate our commitment to this partnership in driving internet penetration in the country which is in line with the National Broadband Plan, ntel will be offering end users 4.5 gig data upon purchase of the EV1 in our stores.”

He added that the collaboration with Partner Mobile signals a new dawn in the evolution of Nigerian 4G LTE segment which has been impacted by concern that most people don’t have phones that can work on 4G LTE. “But now we have EV1 which everyone can afford and be on the 4G LTE,” he concluded.

Interestingly, the UHD mode of EV1 combines 4 pictures into a single photo, allowing users to create a whole new high-quality photo, which will reach up to 52MP super pixel effect, brings an impressive experience that lets users keep clarity of their memories.

Also, the AI portrait recognition is applied to both front and rear cameras, it automatically recognizes faces and jumps to portrait mode, blur the background naturally. Another feature is when the owner light up the screen, Face ID will unlock the phone instantly.

EV1 also supports fingerprint unlock on the back when Face ID is inconvenience for the owner.

The smart antenna tuning of EV1 integrated tunable capacitors offer excellent RF performance, low power consumption and high linearity required in adaptive RF tuning applications, almost insensitive. @Businessdayng

The phones are available in retail outlets across the country and leading mobile phone stores.

Future Plans Ifeoluwa explained that the company has remained innovative since it commenced operation and won’t rest on its oars. She added that it will constantly search to bring innovative, ground-breaking technology to market and ensure excellent customer care is actualised.

“You all know that since Partner Mobile came into this market, we have successfully introduced PS1, PS2, PS 3 and PS Power among other features phones into the market and the launch of EV1 today is to consolidate on the innovative ingenuity of the brand following the success of our other phones.

“It will be recalled that we released three android phones when we entered the market and quickly followed them up with a straight forward feature phone.

The PF1 proved so popular that three months later, we released similar models of increasing specifications: the PF2, PF3, PF4 and a heavy duty PF-P1 with the capability of a power bank,” she said.

On the expansion plans, Ifeoluwa stated, “We are committed to constantly innovate and evaluate to bring to our teeming Nigerian customers only the best mobile devices at affordable prices. This is why we will be launching new mobile phones into the market every other quarter.

“As we continue to grow our brand, Partner Mobile, to be established throughout the African continent and equally trading in continents including Middle East, Europe and the United States of America, we will take our customers and you, our media partners on the journey.”

Tuesday 25 February 2020

BUSINESS DAY

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Tuesday 25 February 2020

BUSINESS DAY

EDUCATION

Weekly insight on current and future trends in education

Primary/Secondary

Why entrepreneurship-based curriculum should hold sway for Nigeria education KELECHI EWUZIE

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tatistics has shown that majority of Nigerian universities are still stocked with curriculum not driven by entrepreneurship. Rather, they centre on producing graduates that find it difficult to compete globally in the knowledge economy.

A cursory look at Nigerian education system today no doubt reveals a most worrying dimension in the process of knowledge impartation as most tertiary institutions award certificates to students who are ill-equipped to perform optimally when faced with the harsh realities of life.

Unlike most developed nations that make huge budget allocations to their education sectors, Successive government in Africa largest economy have consistently and consciously denied this pivotal sector the needed funds required to groom globally competitive human capital.

Those who know in the education space opine that entrepreneurial training is essential now more than ever before, if the intellectual and creative capacities of students must be given a boost.

Moreover, they add that professionals with industry experience should form the bulk of lecturers that take some practical-oriented courses in tertiary institutions.

Alero Ayida-Otobo, chief executive officer, Incubator Africa, a development agency that focuses on education and other key sectors said the

David Alao, (2nd left), Chief of Staff to President/ Vice Chancellor, Babcock University presents a plaque to Kayode Oyesiku, guest lecturer, (2nd right) as Adegbemi Onakoya, chairman, Babcock University Public Affairs Forum, (left) and Olajumoke Haliso, Dean of Veronica Adeleke School of Social Sciences, (right) watch.

quality of the teachers, the quality of the learning experience in colleges of education in the country is poor, adding that “we need a complete revolutionary change and turnaround in the way our teachers are taught.”

“Unless we transform our colleges of education, we are going to have a pipe line that is bringing out defective products (teachers) and hope they will perform in a wonderful way when they get to the classroom.

What the government should do is to fix the source which is the colleges of education. It has to be a two prone approach,” she said.

In her words, “I will say that educating and developing our

teachers is the key to the transformation of our school, it is a critical key to unlock the transformation of our schools.”

Ayida-Otobo further suggested that rebranding teachers and making the teaching profession more attractive through proper remuneration and competitiveness will spur them to perform at their best.

Aderinkomi Akinsola an education resource person notes that it is sad that the policies establishing most tertiary institutions do not provide for entrepreneurial education.

This anomaly, he insists, can only be corrected if policymakers formulate procedures that incorporate entrepreneurial

education into the school curriculum, beginning from primary school.

Akinsola insist that government should pay more attention to education. It should be interested in what is taught in school by ensuring that the content of education is changed to meet present realities. Only then can our graduates and students across all levels of education derive the all-important benefits of education.

For Harrison Nwanyanwu, an educationist, Universities’ curriculums today focus only on the theoretical aspect of education. They fail to address the current issues that will meet the global needs of students in the international market.

Grange school beats off competition to emerge Kids’ Lit Quiz winner consecutively …to represent Nigeria in New Zealand, July MICHEAL ANI

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or the second time in a row, Grange School, Ikeja, has emerged winner of the Kids’ Lit Quiz Nigeria competition that will see it represent Africa’s largest economy in the world final in New Zealand.

The school came first after beating seven others at the second edition of the literature quiz held recently in Lagos. The school will represent Nigeria in the world final, July, where it will go head to head with 10 other schools from different countries.

The Kids’ Lit Quiz is an an-

nual literature quiz for students aged 10 - 13 years. The quiz was founded by New Zealand quizmaster Wayne Mills, who reads enough books to write several thousand questions each year.

Quizzes are held in Australia, Canada, Hong Kong, Indonesia, New Zealand, Nigeria, Singapore, South Africa, Thailand, United Kingdom and the USA. Wayne Mills, founder of kids lit Quiz and international Quizmaster said before when he started in 1991 in New Zealand, people were rewarded for playing sports and games, but no one got rewarded for being a reader hence, he started the completion so that children can be rewarded for their readwww.businessday.ng

ing ability.

Speaking on the performance of the school, Chinyere Udunwa, representative of Grange school said the position shows the efforts and handwork that was put into the preparatory process by the school.

“For us, we see it as a leap and a great achievement that our school displayed an outstanding result by coming out top in the competition, which means we are on the right track,” she said.

The 2020 edition of the national Kids’ Lit quiz contest came with a lot of intrigue with the various schools showing prowess in answering questions in literature.

Unlike in 2019, this year’s contest featured schools from Nigeria’s capital, Abuja, who contested; as well as students from several other schools who came to observe the competition. This year, eight schools and 20 teams participated, an impressive number when compared with the maiden edition were only 10 teams from five schools participated.

“There were several improvements in this year’s challenge as we received entries from more schools that showed interest in participating in the competition, said Maluchi Chukwuemeka, national coordinator of Kids’ Lit Quiz Nigeria told BusinessDay.

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Higher

Human Capital

Educationist calls for holistic implementation of sustainable development strategies

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ormer Vice Chancellor, Tai Solarin University of Education, Kayode Oyesiku said Nigeria’s march into the future was hinged on a holistic implementation of sustainable development strategies.

Delivering a paper, entitled, Sustainable Development and Nigeria’s March to the Future, at the 2nd Babcock University Public Affairs Forum, the Professor of Development Studies said one of the strategies is the wholesome implementation of agricultural policies that would aid mechanised agriculture.

Oyesiku also said government needs to build infrastructures, rehabilitate health institutions and revive vocational and technical education to aid sustainable development in the country.

He said, though the sustainable development goals’ implementation was still sketchy, there was need to entrench some of these goals that would guide Nigeria’s development into the psyche of people.

“If we then understand those goals and what they stand for, we would then also support the policy makers, the government, the people in the state assemblies and so on, to ensure that they ingrate these ideas into various policies,” he noted.

Oyesiku, who said there was a positive attitude of Nigerians towards ensuring that the achievement of the SDGs, noted that President Muhammed Buhari stated at the last UN general meeting that not only had Nigeria endorsed the sustainable development goals but that government had also started its implementation.

Oyesiku noted that, though the economic growth recovery programme that started four years wasn’t much of a success, he was hopeful that much would be achieved now that government has brought up the sustainable development goals as the rolling development strategy for the country.

“They have started doing that and they have brought some egg heads together to give them a road map in achieving this. Let us give them about two years and see how it goes. I am an unrepentant optimist who believes that it would work out fine” he said.

He also disclosed that Nigeria would be among countries that would meet in New York for about two weeks in July this year to bring up the review of the achievement so far, of the SDGs and identify the challenges that they have so that they can get best practices across the world in respect of how to resolve some thorny issues

Search for the next Interswitch SPAK 3.0 national science champion commences KELECHI EWUZIE

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he search for the next best student to be crown the Interswitch national science champion has kickstarted as Interswitch has announced the commencement of another edition of its National Science competition, InterswitchSPAK 3.0 in Nigeria.

Students from Senior Secondary Schools are now free to register for the competition on the InterswitchSPAK portal henceforth. The competition is an annual Pan-African competition aimed at re-igniting STEM (Science, Technology, Engineering, and Mathematics) subjects among secondary school students.

Cherry Eromosele, Chief Marketing and Communication Officer, Interswitch expressed her excitement about the last edition. She also encouraged more girls to participate in the on-going registration. She said: “We at Interswitch are committed to inculcating knowledge, coupled with improving the standard of education in Nigeria. We are very passionate @Businessdayng

about encouraging more girls to take up STEM subjects. The good thing is, there has been an increase in the number of girls participating in the competition. We commend the relentless effort of the entire team that ensured the previous edition was successful.

It is our belief that this year, more girls will register for the qualifying exams and make the top 81 list.”

There is a N12.5 million university scholarship prize available to the winners. The first prize in the InterswitchSPAK competition is N7.5 million spread over 5 years in the university. The second prize is N4 million which spreads over 3 years and the third prize is N1 million for 1 year.

For the registration, each school is required to present its best six (6) science students in SSS2. However, for mixed schools, at least two female students must be among the best six (6). Every registered student will participate in the qualifying examination at any of the centres across Nigeria.

The top 81 students will proceed to the finale to battle for the crown of Nigeria’s Best Science Student.

Tuesday 25 February 2020

BUSINESS DAY

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EDUCATION How cut off marks for Nigeria’s Unity Schools may be destroying quality STEPHEN ONYEKWELU

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ast week, cut off marks for admission into Federal Government Colleges or Unity Schools received new attention on Twitter as Nigerians criticised the selection system, arguing that it destroys competition and affects the quality of learning.

The cut-off marks referred to here was for the 2018/2019 academic session reportedly released by the National Examination Council of Nigeria.

There is an alleged disparity in the cut off marks for different states. The disparity in cut-off marks is creating a divide.

Some pupils are admitted into unity schools with as low as two marks in the common entrance examinations while some can only get into the same schools with at least 130 marks. Slowly mediocrity has crept in.

Out of 300 possible points, the cut of mark for candidates from Anambra State is 139, Imo 138, Enugu 134, Delta 131, Lagos 133, and Ogun

State 131. For a candidate from Kebbi State the cut off mark is 9 for male and 20 for female. Sokoto is 9 for male and 13 for female. Taraba is three for male and 11 for female. Yobe is two for male and 27 female. In Zamfara, a male candidate that scores four qualifies and a female candidate that scores two

qualifies too.

This is an offshoot from Nigeria’s quota system, which pervades Federal Governmentowned learning institutions at practically every level. This applies to the tertiary institutions of learning too where the quota system operates and has been criticised as keeping out brilliant students simply because

Why Kwara should have more colleges of Health Technology - Don SIKIRAT SHEHU, Ilorin

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hehu Adaramaja, a professor and president of Health Education Practitioners of Nigeria, an affiliate of Association of Health Educators of Nigeria has advocated for the establishment of more colleges of Health Technologies in Kwara State to address the shortage of middle levelled manpower in the health sector.

He says medicine and nursing professionals can hardly cope without enough middle levelled manpower whose services are mostly required in rural areas and basic primary health centres.

Adaramaja, who lectures at the University of Ilorin spoke at the second matriculation ceremony of King Leo College of Health Technology, Okolowo Ilorin.

The ceremony which was conducted for 35 new intakes of the college was held at its

permanent site, Lamba, near Alapa, a suburb of Ilorin.

The establishment of the institution according to him will go a long way in addressing emerging health challenges which ought to be nipped in the bud in the primary health care centres.

He says: “Many people may be asking that what are we doing here today. The establishment of this school is important to address the gap in the shortage of middlelevel manpower in primary health care.

“Medicine and Nursing can hardly produce manpower that will go into rural areas to render required health services.

“We only have one College of Health Technology established by the Kwara State government and that is the one located in Offa and its products cannot serve the population of 16 Local government areas of Kwara State.

“If you go far north, you will see multiple of this type www.businessday.ng

of Schools that are established”.

The Don, however, admonished the community to ensure “social security for the school’s infrastructures, its staff and students for them to enjoy the benefits of establishing such in the community.”

He also urged the school proprietor to float a medical centre in the area to provide medical services to the host community.

Proprietor of the school, Olakunle Abideen disclosed that the institution has recorded major growth, a reason for which he says promoted its expansion to a new site.

Abideen explained that he invested in the school as parts of his contribution to the health sector development.

Sunday Alabi, provost of the college, said the school has recorded increased enrollment because of its” rising profile”.

they are from a certain part of the country and want to study in another. The quota system in its design philosophy is meant to give educationally disadvantaged regions of the country an opportunity to access quality education.

The first set of unity schools were established by the British colonial masters;

three new ones were added in Warri, Sokoto, and Enugu in 1966 while General Yakubu Gowon, in 1973, ensured there such schools in all the 12 states back then.

For at least two decades, the schools brought about cultural and religious integration, on the one hand, academic excellence on the other.

“I am privileged to have attended one of the oldest of these schools, Federal Government College, Odogbolu, established in 1973. Till the early nineties, admission into the schools were very competitive though consideration was also given to students in the catchment area of each school,” Omoniyi Animasaun, an alumnus of Federal Government College, Odogbolu, in Ogun State told a local newspaper in an interview.

“Merit was the foremost consideration. This ensured that each college admitted mostly brilliant students, precipitating healthy academic competition which helped the average students to up their ante,” Animasaun said.

The ethnic, cultural, religious and social backgrounds

of the students were diverse with pupils from wealthy and influential families mingling freely with pupils from humble homes.

The full list of cut-off marks for the 36 states and FCT in the 2018 academic session will perplex any optimist in the unity arrangement actually. Abia 130; Adamawa 62; Akwa-Ibom 123; Anambra 139; Bauchi 35; Bayelsa 72; Benue 111; Borno 45; Cross River 97; Delta 131; Ebonyi 112; Edo 127; Ekiti 119; Enugu 134; Gombe 58; Imo 138; Jigawa 44; Kaduna 91; Kano 67; Katsina 60; Kebbi 9 (male) 20 (female); Kogi 119; Kwara 123; Lagos 133; Nasarawa 58; Niger 93; Ogun 131; Ondo 126; Osun 127; Oyo 127; Plateau 97; Rivers 118; Sokoto 9 (male) 13 (female); Taraba 3 (male) 11 (female); Yobe 2 (male) 27 (female); Zamfara 4 (male) 2 (female) and FCT Abuja 90.

However, the Federal Ministry of Education had insisted that the selection employed the national merit criteria of 60 percent, with a cut-off score of 146 and above and equality of state of 30 percent of the colleges’ carrying capacity.

Mathematics failure: UI don invents Hip-hop song as solution REMI FEYISIPO, Ibadan

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ue to dismal performances of students in mathematics examinations, a lecturer in the department of Early Childhood Education, University of Ibadan, Ishola Akindele Salami has invented hip-hop song to solve mathematics problems.

The hip-hop song invented tagged MATMUSIC comprises of tracks of songs with Mathematics ideas, principles and procedures as the messages.

Salami, a doctorate degree holder whose primary interest is in early childhood education stated that the hiphop song developed is aimed at enhancing knowledge of pupils at the primary school foundational level.

According to Salami, the failure of dreaded mathematics is attributable to poor childhood learning friendly tool to enable students grasp the right formula to use in solving mathematical questions.

He pointed out that a person who can solve simple

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mathematics problems can quickly reflect on how to solve societal problems adding that Nigerian government should embrace more child-friendly strategies who make dreaded subjects simple.

The 2019 WAEC results released indicated that out of the 11, 892 candidates who sat for the examinations, only 3, 102 obtained five credits which include English and mathematics.

The results of WAEC published by the National Bureau of Statistics covering 2016 and 2018 indicated that candidates with five credit and above with both Mathematics and English in the southwest zone was less than 40percent.

According to the university don however, learning Mathematics has always been a serious challenge for many learners starting from primary school level across the whole world. One of the reasons for this is the nature of the subject which is rule-governed and abstract. To do well in mathematics, one has to remember a lot of rules and procedures.

While speaking with newsmen on the invention, the University of Ibadan don stat@Businessdayng

ed that past efforts to make the subject learning-friendly focused largely on preparation of effective teachers and methods of teaching it.

“Songs have also been used as instructional strategies to teach mathematics but there is dearth of information on effort targeting child-friendly music to teach mathematics.

It was discovered that one of the music types children love to listen to, is hip hop music.

This is because of the beats, rhythm and the danceable melody it has.

Salami noted that it was also discovered that when children love a given music, they tend to remember all the lyrics. So, if Mathematics principles, formulae, ideas can be put into a child-friendly music like hip hop, this should enhance the learning of the subject. It is against this background that hip hop music on primary mathematics was written and composed. We are still hoping government in southwest will see this invention and embrace it for adoption in primary school level. The song incorporates the curriculum at the primary basic level”

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Tuesday 25 February 2020

BUSINESS DAY

Career advice all too often equips people for dependable, steady jobs that don’t exist © Fairfax Media via Getty Images

The best career advisers know our plans aren’t built to last Too many people still assume it is possible to control working lives Pilita Clark

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he other week I got an email from a management magazine that asked an irritating question: Where are you in your career?

I couldn’t put my finger on what was annoying about it at first. The sender was only trying to flog another bit of advice on managing a career and I have seen plenty of that before.

Eventually it dawned that I had three answers to the question and all were dispiriting. For a start, I am closer to the end of my career than the beginning of it. Worse, if I had to say where I am in it, I am not entirely sure.

I am very lucky to have an enviable job I enjoy. But I never take it for granted in a media industry that lost an estimated 7,800 jobs in North America alone last year. I also live in London where last week’s news that HSBC would axe 35,000 jobs in one of the deepest restructurings in its 155-year history means European banks have set out plans to cut almost 100,000 jobs since the start of last year.

This explains the main reason that question needled me: too much career advice still assumes it is possible to control working lives in an age of remorseless downsizing and gig economics. In an odd sense, the history of the word “career” almost predicted this. The idea of a career is so entrenched it is hard to remember it is a relatively recent concept. When the word appeared in English in the 16th century it meant gallop or race, as in careering about.

It was not until the 19th century that it began to be widely used to mean progress in some sort of vocation. That century ushered in large employers, such as railway companies, that needed a knowledgeable and stable workforce, says sociology professor Tim Strangleman.

Employees were therefore lured with the promise of a decent pension and steady promotions in a job for life, all distant memories for the workers Mr Strangleman interviewed for his latest book, Voices of Guinness.

It charts the fate of workers whose jobs disappeared with the 2005 closure of a Guinness brewery in west London and www.businessday.ng

‘‘

It charts the fate of workers whose jobs disappeared with the 2005 closure of a Guinness brewery in west London and one man’s story in particular stands out today

one man’s story in particular stands out today.

He had two sons, both of whom studied engineering. The

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younger son was a worry: he kept getting jobs then quitting after 18 months to go travelling. The older son followed his father’s safer path and went for a career with Nestlé, the big Swiss food and drinks group.

But just as Guinness pulled the plug on the father’s job, Nestlé made the son redundant — after 11 years at the company.

The experience left the father rethinking the idea of getting “stuck in the groove” of corporate commitment. Yet he still worried that his itchy-footed younger son should try to stick at jobs for longer.

In other words, the urge to stay committed to a company remains powerful, despite the evidence that the reward is likely to be redundancy, or a lot more “careering about”.

That may be one explanation for our endless interest in career advice.

The other is the entirely understandable fact that the more chaotic the career landscape, the more we seek help to navigate it. That applies to all sorts of jobs today. Last week British university lecturers went on strike for the second time in two @Businessdayng

months over pay, pensions and the rise of short-term teaching contracts.

Still, university is the one place where thinking about a career still makes sense. Studies show that two and a half years after graduating, students with clearer career plans are more likely to be employed or doing further study, as opposed to standing in a jobcentre.

Ultimately, I suspect the answer to career uncertainty is to do what people have always done: try to be paid to do something you like and then just muddle along.

Also, read books like the recently published memoir, Motherwell, by the late journalist Deborah Orr. It includes a horribly familiar discussion with the sort of career adviser I remember well from the 1970s.

“Well,” said the adviser, glancing at Orr’s impressive exam grades, “with these results you could do anything. Nursing or teaching.”

It may not be much comfort, but for a lot of us it is still true that things used to be far, far worse.

Tuesday 25 February 2020

BUSINESS DAY

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Harvard regains crown as top MBA provider in FT rankings Demand has been falling at most US business schools since 2015 Jonathan Moules

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a r v a rd Bu s i n e s s School has recovered its crown as the world’s top MBA provider, highlighting the importance of global brand recognition in the market for elite management training.

The school, credited with creating the first MBA class in 1908, was last in the highest spot in the annual Financial Times ranking of the top 100 business schools in 2015. It was then overtaken by Insead, the first nonUS school to head the list. Insead came top of the rankings in 2016 and 2017, an indication of how business education has become a more global market, followed by Stanford Graduate School in 2018 and 2019.

Five years ago, there were just four Chinese schools in the top 50 of the FT list. This year there are seven, led

by Shanghai-based China Europe International Business School.

Demand has been falling at most US business schools since 2015, forcing several institutions to end full-

Last year Harvard acknowledged that cost might be an issue when it froze tuition fees for the 2019 intake at the previous year’s levels © Dreamstime.com

time campus-based MBA courses and switch to online-only provision.

The decline has been blamed on a tightening of US student work visas and anti-immigrant rhetoric from the White House, deterring overseas students. Such candidates are often key to making courses viable by paying the full tuition fees rather than receiving scholarships.

“Applicants want to be convinced that an MBA is going to offer them overwhelming value, and they want it on their terms Lawrence Linker, founder of admissions consultancy MBA Link Those that are applying to business school are being more picky about their choices, focusing on brand-name institutions, accord-

ing to Lawrence Linker, founder of admissions consultancy MBA Link.

“Applicants want to be convinced that an MBA is going to offer them overwhelming value, and they want it on their terms,” he said.

The combination of a strong jobs market and inflation-busting increases in tuition fees has also discouraged US nationals from undertaking postgraduate study, particularly if it means interrupting an already lucrative career in banking or software engineering.

Last year Harvard Business School acknowledged that cost might be an issue when it froze tuition fees for the 2019 intake at the previous year’s levels. Only one other top 10 institution followed suit: the University of Chicago’s Booth School of Business.

Falling demand has hit even wellregarded brands, such as Stanford Graduate School of Business, which was last year’s most highly ranked school but still suffered a 6 per cent drop in applications to its full-time MBA last year.

These premier league MBA pro-

viders are better able to cope with such declines, however, since they still receive many more applicants than they have places available on their courses.

Outside the US, the MBA market looks far healthier, particularly in Europe and the south-east Asian markets of Singapore and China, where applications have been rising even as the American market declines.

The highest climber in this year’s FT ranking is HEC Paris, which moved from 19th to ninth place, largely thanks to its value-for-money ranking and internationally diverse class. Only 6 per cent of its intake are French.

“We are proud to be recognised as one of the top 10 MBA programmes in the world,” said Peter Todd, dean at HEC. “Our revamped curriculum launched in 2018 [with] a focus on providing students with up-to-date, impactful, and innovative knowledge grounded in the research of our faculty,” he added. “All this in combination contributes to the value our students bring to employers.”

Why UK university spinouts are courting overseas investors There are plenty of discoveries to bring to market but domestic funding has been squeezed Owen Walker

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t the front line of the global fight against the spread of coronavirus is a device, not much larger than a mobile phone, that was developed in an Oxfordshire business park and backed by Neil Woodford, the fallen star UK fund manager.

MinION, manufactured by Oxford Nanopore, is being used to sequence the DNA of the virus to help identify it and track its spread.

The device is one of the main reasons scientists are able to map the virus’s genes in a matter of hours, as opposed to the days it took to identify Sars in 2003.

Since launching in 2005, Oxford Nanopore has enabled several scientific breakthroughs through DNA sequencing of a range of organisms from rare cancers to tulip flowers.

In doing so, it has emerged as one of the UK’s few private companies with a valuation over £1bn. At its most recent fundraising in January, the figure was £1.7bn. It is also the leading business in an increasingly crowded field of university spinouts — tech start-ups that commercialise academic research.

But while the sector has no shortage of scientific discoveries to bring to the market, a squeeze on domestic funding has meant the executives running the businesses have had to court big investors from Asia, North America

and Australia — including Google Ventures, Huawei and Temasek.

“The likes of Huawei and other big investors such as SoftBank have an active presence in the UK — they are constantly looking at little tech companies,” said Simon King, a partner at Octopus Ventures, one of the few UK investors in this market.

The high number of research universities in the UK means it has a long history of scientific discoveries that have become commercial successes. Manchester university helped develop computer memory in the mid-20th century, while academics at the universities of Nottingham and Hull pioneered technology behind MRI scanners and LCD screens, respectively.

But unlike their US counterparts, UK universities have generally lacked the infrastructure and inclination to pursue huge profits from discoveries.

That began to change in 2001 with the formation of IP Group, an intellectual property commercialisation business that sought to attract capital from UK investors and inject it into spinouts based on university research. The company signed several universities up to deals where it would have the first option to commercialise their discoveries, floated in 2003 and is now in the FTSE 250.

Soon, the universities themselves started setting up their own spinout businesses, including Manchester, Cambridge and www.businessday.ng

Oxford Nanopore devices have been used to sequence the DNA of the coronavirus

Imperial College London. In 2015 came the launch of Oxford Sciences Innovation, with ties to Oxford university, which would grow to £600m in size. Nearly half of all the spinouts created in Oxford’s long history have launched in the five years since OSI started.

Initially, funding came mainly from a small group of UK investors, with three managers in particular backing many of the deals: Invesco through funds formerly managed

by Mr Woodford; the stockpicker’s new venture, Woodford Investment Management; and the hedge fund Lansdowne Partners.

But it became increasingly difficult for this small group to support the growing number of start-ups and their funding needs. From late-2017, investors also started to pull their money out of Invesco and

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Woodford funds, which made it harder for them to commit capital.

In an attempt to take more control of a fragmented market and attract overseas investors, IP Group made a hostile bid for Imperial’s spinout business, Touchstone, in 2017.

The takeover was inevitable.

Invesco, Woodford and Lansdowne, who between them owned half of IP Group and 74 per cent of Touchstone, all backed it. The deal allowed IP Group to sign agreements with universities in Australia and attract investment from Asian sovereign wealth funds and Australian pension schemes.

Businesses such as Oxford Nanopore and OSI — both of which are backed by IP Group and its shareholders — also began looking overseas for new investors. The implosion of Mr Woodford’s business @Businessdayng

last year and heavy outflows from Invesco meant the hunt for external funding became even more urgent.

Each year, IP Group holds a conference in China to showcase the start-ups it owns and it introduced China Construction Bank International and Hostplus, the Australian sport and hospitality pension fund, to Oxford Nanopore.

Both participated in a 2018 funding round, along with GIC, Singapore’s sovereign wealth fund.

Gordon Sanghera, chief executive of Oxford Nanopore, said: “It’s been important to have local partnership [in China] to help us understand the market and business culture” and that the relationship with CCBI had made it easier to work with the government on tackling the coronavirus outbreak.

OSI, meanwhile, has attracted funding from some of the biggest tech investors in the world, including Google Ventures, Temasek, Tencent and Huawei. It is now the world’s biggest standalone university spinout business.

“Rather than four companies a year, we are now spinning out 20 — the amount of money we think we are going to invest in these businesses is significant,” said Jim Wilkinson, interim chief executive.

“When we started out we expected that most of the money would come from the UK. But nearly all of it comes from abroad now.”

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Tuesday 25 February 2020

BUSINESS DAY

Investments

ENERGY INTELLIGENCE

Market Insight Companies Commodity Tracker Policy

OIL

GAS

PETROCHEMICALS

POWER

POLICY

Buhari maintaining minister of petroleum position encourages undue political interference – Report DIPO OLADEHINDE

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he decision by Presid e n t Mu h a m m a d u Buhari to retain his position as Minister of Petroleum Resources is causing too many political interferences in state behemoth Nigeria National Petroleum Corporation (NNPC).

According to the biennial Benchmarking Exercise Report (BER) of the Nigerian Natural Resource Charter (NNRC) released in February 2020, the current corporate governance structure of NNPC remains susceptible to excessive political interference and limits accountability through checks and balances.

“Under the current arrangement, the decision-making is vested in a strong single state actor –the President, which allows for coherent strategic choices. It, however, encourages undue political interference and limits checks and balances,” the report said.

The paper from NNRC, a nonprofit policy institute on natural resource governance admits that NNPC continues the practice of disclosing selective unaudited operational and financial information in the review period, a development which is not good for accountability in the oil and gas sector.

“Lack of underlying legal instruments to ensure the sustainability of this practice and failure to enact

the necessary legislation to kick start petroleum industry reform constraints transparency and accountability in Nigeria’s national oil company,” the paper argued.

The report noted that the minister, who is responsible for policy in the industry, being Chairperson of the board, maybe driven by policy considerations at best and political considerations at worse.

“While the current constitution of the does not violate the Act, NNPC corporate governance might improve if board members are largely independent and se-

lected based on technical capacity and competence which can be done by recruiting board members from outside the government to bring the right skills needed for effective decision-making,” the report said.

The report noted that the lack of a culture of openness and disclosure within the system is partly responsible for the poor record-keeping, lack of check and balance, ineffective performance reviews and audits, as well as the absence of transparency and accountability in NNPC.

Although the report admitted that some things have changed, slightly for the better since the last benchmarking report (BER 2017).

In the past three years, the government had moved to ensure that the NNPC has a workable funding mechanism. The cash call budget previously approved along with the federal annual budget is no longer funded directly by the federal government.

Instead, NNPC relies on aggregate revenues from its subsidiaries and business units, deductions from oil revenue due

to the Federation, and third-party financing for approved projects to finance its operations.

But there are still no clear rules governing the amount NNPC can withhold from production to cover production and operating costs and this still provides an avenue for creation of wastages and inefficiency in spending.

According to Tengi GeorgeIkoli, the Program coordinator at NNRC, “the release of the Report comes at an opportune time given the recent reforms instituted by the government and the omnibus reform in the form of the Petroleum Industry Bill (PIB) being championed by the Ministry of Petroleum Resources.

The biennial Benchmarking Exercise Report (BER) of the Nigerian Natural Resource Charter (NNRC) looks at the entire Nigerian petroleum sector and its linkages to the wider economy through a set of principles framed around how best the government and the citizenry have harnessed the opportunities created by the country’s petroleum endowment.

The charter identifies 12 broad precepts, covering the main decisions required to transform assets under the ground into development above ground.

The precept that focuses on NNPC examines the accountability of the corporation as a StateOwned Enterprise and explores the definition of its mandate as well as its commercial efficiency.

INSIGHT

How Nigeria can speed-up industrialisation with natural gas N STEPHEN ONYEKWELU

igeria has an opportunity to leverage its vast gas resources to quicken industrialisation if the countries over 200 million people are to enjoy the quality of life those in the league of the first global 20 economies have.

The unexploited opportunities in Nigeria’s gas-based industries have the capacity of leapfrogging Africa’s most populous country’s quest to further diversify its economy away from crude oil and uplift over 86.9 million Nigerians now living in extreme poverty since industrialisation correlates with manufacturing and job creations, elements Nigeria needs to become the giant it has continuously failed to be.

Natural gas has a multitude of industrial uses, including providing the base ingredients for such varied products as plastic, fertilizer, anti-freeze, and fabrics. The industry is the largest consumer of natural gas, accounting for 43 percent of natural gas use across all sectors. Natural gas is the second most used energy source in industry, trailing only electricity.

In a study conducted by the

United Nations Industrial Development Organisation (UNIDO) in 2017, as far as developing countries are concerned, both the data and the existing empirical evidence seem to support the belief that industrialisation drives economic growth.

Industrialisation also promotes savings, boosts the process of capital accumulation and offers higher investment opportunities.

Policies obviously play a decisive role. Sustainable industrialisation rides on a robust manufacturing sector.

Traditions of endogenous growth, evolutionary economics, and institutional econom-

ics recognise manufacturing (industrialisation) is important for economic development. Successful industrialisation needs technological progress.

Here is how gas can drive a manufacturing boom and spur technological progress in Nigeria: Gas-to-power: average energy consumption per head in Nigeria for a year is 126 kWh as against Brazil’s 2, 516 kWh and Indonesia’s 1, 058 KWh. Energy consumption is a window into the quality of life obtainable in a country. The lower the energy level consumed, the poorer a country is. Gas utilisation among households, businesses, and

industries to power equipment will lead to more reliable, cleaner energy. This has the potential to increase energy consumption per head in Nigeria. Nigeria’s domestic gas sector is struggling to capitalise fully on the potential of its sizable gas reserves even though some big-ticket projects are emerging in the country.

Seplat Petroleum’s planned $700mn gas joint venture with the state-owned Nigeria Gas Company in Imo state is emblematic of what the government would like to happen more often – a high impact project run by a homegrown company. The Assa North-Ohaji South plant will process wet gas from Niger Delta crude producing blocks 21 and 53. It is slated to have a capacity of 300mn cubic feet a day (f3/d) with the first supply due in 2021.

The Assa North/Ohaji South Gas Development Project ranks top among the Federal Government’s Seven Critical Gas Development Projects aimed at accelerating Nigeria’s aspiration for energy sufficiency and diverse industrial growth.

Green revolution: Fertilizer, made with natural gas, has lifted nations out of near starvation,

and made modern lifestyles possible. Bangladesh, a south Asian country used gas to drive its green revolution in the 1950s. The natural gas value chain is versatile.

Ammonia is the second-largest chemical product produced in the world, behind sulfuric acid. The demand for ammonia is driven by the demand for fertilizers. Of the world’s nitrogen demand, 85 percent is for fertilizer primarily derived from ammonia. Natural gas is the preferred feedstock.

Nigeria can create a green revolution in agriculture through clear policies that incentivise investors.

In Nigeria, the world’s largest single-train urea plant has created over 50,000 jobs across the agriculture value-chain, while its affordable fertilizer is boosting farm yields and putting big smiles on farmers’ faces.

The benefits that come from higher-yield farming are increased food, education for the children of farmers and the ability to pay medical bills. Low productivity brings despair. Local production of fertilizer helps shore up foreign exchange reserves, and some of Nigeria’s previously flared natural gas will be channeled into fertilizer production.

Tuesday 25 February 2020

BUSINESS DAY

27

ENERGY INTELLIGENCE Investments

Nigeria’s aggressive revenue hunt may be stalling deep-water investment decisions STEPHEN ONYEKWELU

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nternational oil majors have in recent times indicated Nigeria government’s race to reform the deep-water tax regime and the implications of the new Finance Act for the sector risk impairing future production.

This shows in the recent investment decisions some of the big international oil companies have made recently. Total wants to sell its 12.5 percent stake in the Bonga deep-water project. The viability of the Shell-operated $9.7 billion Bonga Southwest/Aparo project was directly linked to Nigeria not deteriorating commercial terms for drillers. The Total-operated Preowei project seems to have its final investment decision (FID) delayed into 2021, despite being a tie-in to the Egina floating production storage and offloading (FPSO) vessel. Exxon’s $8.2 billion Owowo West was postponed indefinitely.

This might not be reflected in any sharp reductions in crude production or export volumes in the short term. Besides, the 10-12 percent per year decline in hostagetaking and infrastructure-targeted attacks that have been taking place since 2017 has contributed to an uptick in crude exports (massively boosted by the Egina startup in early 2019), with 2019 average levels being on the verge of rising above the 2 million barrels per day (mbpd) threshold, at 1.99mbpd.

Two years ago, Nigeria Extractive Industries Transparency Initiative (NEITI), an agency enabled by law to promote accountability in the management of oil and gas revenue stated in one of its reports that the old agreement used in computing revenues to be shared between the government and oil companies was no longer acceptable and called for an urgent review. Oil revenues between 2015 and 2017 were estimated at

$104.484 billion.

NEITI affirmed that the loopholes in the 1993 Deep Offshore and Inland Basin Production Sharing Agreement (PSC) Act. This determined revenue sharing formula between Nigeria and oil companies. The country’s revenue from the PSC was $35.893 billion against the oil majors who earned about $68.591 billion. This generated a fury, setting the country on a quest to plug the loopholes and recover apparently lost revenues.

The Act provided two conditions under which it can be amended. When oil prices exceed $20 per barrel or 15 years after the initial contracts were signed.

Crude oil prices averaged $16.33 in 1993 and had risen to $17.44 by 1999 which was the last time efforts were made to amend the decree.

This forms the backdrop under which the Nigerian government is going after international oil majors

Experts call for collaboration between sector investors, practitioners ... as NNSL alumni launches quarterly thought leadership series

operating in the deep-waters of the country. Last year, Nigeria ordered several major foreign oil and gas companies to pay nearly $20 billion in taxes it says are owed to local states, industry and government sources told Reuters.

Armed with the new Finance Act, the government now has legal backing to enforce new taxes across the value chain in the oil and gas sector which may further discourage investments.

The new has repealed section 60 of the Petroleum Profit Tax Act (PPTA) and Section 43 of Company Income Tax Act (CITA), this means the dividend distributed from profits already charged to Petroleum Profits Tax would be subject to withholding (WHT) up to 10 percent. This could be quite adverse for the upstream oil and gas exploration and production sector which is chargeable to the highest tax rate (up to 85% in some instances).

Comment

Insight into Disruptive Digital Transformation Technologies, and the Common Enemy in the Oil & Gas Industry in Nigeria JUSTICE O. DEREFAKA

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usinesses thriving in the digital era (i.e. Apple, Amazon, Google, etc.) have shown that distinction from competition is achieved through the use of an ecosystem that enables data-driven insights. This has now shifted the perspective in the oil and gas industry to view digitization as a critical component of core business.

The Oil and Gas industry is no stranger to big data, technology and digital innovation. The industry was the pioneer of the first digital age in the 1980s and 1990s.

Long before phrases such as big data, advanced analytics, and the Internet of Things became popular.

Lately, digital disruption is now seen as a force that is altering the corporate landscape like no other.

Nowadays businesses are not just being driven to transform to meet the demands of digital. Connectivity has shown the potential to empower millions of people, while providing businesses with unparalleled opportunities for value creation and capture.

By 2025, it is anticipated that there will be more than 50 billion devices connected to the internet.

This is having a disruptive impact on many industries, including the oil and gas sector, among others.

Digital is a key enabler in the oil and gas industry to lessen costs, make faster and better decisions, and to increase workforce productivity.

The overarching upside is that, the use of technologies now unleashes new hydrocarbon re-

Justice Derefaka

sources and deliver operational efficiencies across the value chain by rapidly shifting from being the legacy enabler to being a game changer. On the downside, whereas digitalization could be a source of positive change, there are a number of challenges that need to be overcome to realize its full potential for both business and society.

The exponential increase in global information flows have created new risks around data privacy and security and businesses across sectors are grappling with challenges related to changing customer expectations, cultural transformation, outdated regulation, and skill shortages – to name a few.

These challenges have made the traditional business practices of scanning the environment and managing the emergent information more complicated and difficult; thereby creating higher www.businessday.ng

levels of uncertainty/operational unpredictability. Aside the positives, digital also connects us all in a web and renders the whole web only as strong as its weakest point – a significant weakness that allows attackers of various sorts to use them for any number of goals.

This growing complexity even makes businesses more vulnerable as hackers are honing their skills, declaring the cyberspace a battlefield where they choose the time and place of attack as well as the target - hence the attackers have the advantage of surprise.

Several of the world’s major oil and gas producers have fallen victim to cyberattacks since 2008.

Some damage was done in each of these cases, but the costs of future breaches will be much higher.

Successful cyberattacks threaten the competitiveness of the global oil and gas industry, one of the most technically advanced

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and economically important sectors. Hardly a day goes by without a breach or cyber incident being reported. Understanding what is coming towards the industry will help it to better prepare.

In 2020 more than ever, cyberattacks are no longer a question of if, but of how and when our common enemy (hacktivist) will strike. This is a concern that applies to the oil and gas industry. Agreed, digital transformation plays an instrumental role in enabling innovation and prosperity globally but a major obstacle to society’s continued path to development are the everincreasing cyberattacks carried out by malicious actors taking advantage of a borderless playing field, and the challenges to digital trust that this represents.

This paper believes that enhancing collaboration between public- and private-sector partners, civil society and academia is of paramount importance to counterbalance the trend.

In Nigeria, it is the collective responsibility of the government and the oil and gas industry players to take full ownership of the cyber challenge and to work out a remedy together. Which is why this paper’s aim is on the readiness approach to offer an understanding of the risk picture, find existing gaps and propose actions to strengthen cyber security.

Derefaka is the Technical Adviser (TA) – Gas Business & Policy Implementation, to the Honorable Minister of State, Petroleum Resources and Program Manager, Nigerian Gas Flare Commercialization Programme (NGFCP). @Businessdayng

IFEOMA OKEKE

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xperts in energy business have charged investors seeking to enter into the Nigerian Oil and Gas sector to build capacity via collaborations with industry experts and subject matter specialists as a means to reaping long-term benefits on their investments.

This was the highlight of discussions at the inaugural edition of the Nigerian Navy Secondary School Alumni Thought Leadership Series held recently in Lagos, themed: The Energy Business in Nigeria.

While giving the opening address, Ladipo Adedeji, member of the Graduating Class of ‘93 and alumnus, stated that the Thought Leadership Series was inaugurated as part of efforts to improve discussions towards actionable steps to achieve the vision behind the independence of Nigeria.

According to Adedeji, “For over 37 years, the Nigerian Navy Secondary Schools have raised outstanding leaders in every sphere of society. As alumni of the institution, we hope that the outcomes from the Thought Leadership Series serve to fulfil part of our responsibilities in nurturing leaders in Nigeria and harnessing the collective successes towards a course for the next generation.”

Gboyega Apata, the General Alumni President opened with a keynote speech on the Vision of the TLS, powered by the alumni and the conviction that when a country places a premium on its people and ideas as assets, it sets a path to growth and development at a mercurial pace.

He succinctly stated the intention of the TLS was to marry intellectualism with pragmatic solutions worthy of advisory note in policy making and investment decisions.

He noted that the TLS was the alumni’s contribution to changing society, ‘One idea at a time’.

Panel guest speakers included Tayo Ogunbanjo, Femi Odusote and Dipo Olasebikan who occupy various positions in the energy sector and spoke to the wealth of opportunities available.

Tayo Ogunbanjo elucidated that the while Oil and Gas contributes less than 20 percent of National GDP it provides over 90 percent of foreign exchange earnings, making it key to Nigeria.

Recent key developments provide increasing opportunities for local participation, including the current Local Content Policy, centralization of procurement tenders through NIPEX, swift permits and licensing through DPR, OGISP e-portal, and upcoming PIB and Nigeria Gas Flare Commercialization Programs.

Femi Odusote spoke on the global trends of increased oil supply coupled with the decreasing global demand for oil, leading to lower oil prices which will persist medium term, so companies and countries need to adopt strategies for this environment.

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Tuesday 25 February 2020

BUSINESS DAY

OFFGRID BUSINESS

Offgrid sector attracted more than $1.5 billion investment in 2019-World Bank report DIPO OLADEHINDE

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2020 edition technical report released

by World Bank on Off-Grid Solar Market Trends Report has revealed the off-grid sector have attracted more than $1.5 billion in investment as at the end of 2019 with growth in the early years primarily driven by equity, and debt becoming more common recently.

“As the sector matures, debt will continue to drive the total value of investments into the sector, though equity demand remains strong.

Equity investments dominated transaction value in the sector’s early stages, as companies raised funds to test their business models,” the report said.

The detaile d World Bank’s Energy Sector Management Assistance Program (ESMAP) noted that in recent years, debt has become the most frequently utilized financing instrument in terms of both value and number of transactions which is especially true for First-Generation companies

Collaborations to power Nigeria. L-R: Abu Ahmed, Shell Business and Govt Relations; David Raggay, MD, Mohammed Indimi Foundation; Ahmad Salihijo, MD, Rural Electrification Agency (REA); Anita Otubu, Acting Programme Director, Nigeria Electrification Programme; Wiebe Boer, CEO, All On; Goziem Okubor, Investment Associate, All On during a courtesy visit to the REA in Abuja--

that have greater working capital requirements and whose cashflows can support larger amounts of debt.

“Equity investment has remained relatively constant in recent years, as few new investors enter the sector and others have already chosen players to back and have not yet seen a return

on this capital through exit.

Grants remain an important but small percentage of the total capital deployed to the sector,” the report said.

ESMAP analysis revealed From 2012 to 2018 capital investment in the off-grid sector grew at a 50 percent compound annual growth rate, with investments in

2018 reaching an all-time high at $352 million which later fall to $259 million in 2019.

“The decline in 2019 should not be cause for concern but is rather symptomatic of the concentration of investments in First-Generation companies, which raise debt funds cyclically, and the

long time horizons on debt deals,” the report said.

First-Generation companies are companies in the oil and gas sector founded in the early stages of the sector and have since dominated the affiliate market in terms of sales, geographical reach, and value of investments raised.

The report noted that a number of First-Generation companies raised significant debt within 2017 and 2018, so the decline in 2019 is unsurprising with several first-generation companies expected to close large debt financing rounds again in 2020.

In addition, increasingly large and complex debt deals are taking longer to close, with the anticipated announcement of around $100 million in debt delayed from 2019 to early 2020. This puts 2020 on course to be a bumper year for debt investments, potentially driving total annual investment to an estimated all-time high of $ 385–420 million.

“Only by crowding in commercial finance at scale can we reach the target of

achieving universal access by 2030,” added Paulo de Bolle, Sr Director, Global Financial Institutions Group for IFC. “We are eager to work with our local bank partners in the more mature off-grid markets where commercial debt can drive the next stage of market growth” the world bank report noted.

Meanwhile, another renewable source, wind energy, is also enjoying success, according to a new report

by BloombergNEF (BNEF).

In 2019 the industry commissioned 61GW of wind turbines, up from 50GW the year before, with the offshore installation of turbines rising to 12percent, up from 8percent in 2018. Europe and the Americas accounted for over 22GW of onshore wind additions last year, with 30.4GW in Asia Pacific and 0.5MW in Africa and the Middle East.

“This bumper year for offshore wind is just the start. If you look past a likely blip in 2020, installations are set to accelerate, breaking the 10GW-a-year barrier in 2023,” said Tom Harries, head of wind research at BNEF.

Cash-strapped farms are growing a new crop: Solar panels

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he Kominek family farm is a green expanse of hay and alfalfa in northern Colorado. The family has planted and raked crops for half a century, but as yields declined over recent years, the farm began losing money. In late 2017, Byron Kominek went looking for more profitable alternatives, including installing solar panels and selling electricity to the utility. But Boulder County’s land-use codes made it difficult to use their 24 acres for anything but farming.

So the Komineks found a compromise: a solar array with plants growing beneath, between, and around rows of photovoltaic panels.

Construction is slated to begin this spring on a 1.2-megawatt solar array on the Kominek farm. Some 3,300 solar panels will rest on 6-foot and 8-foot-high stilts, providing shade for crops like tomatoes, peppers, kale, and beans on a five-acre plot. Pasture grasses and beehive boxes are planned for the perimeter.

“Now there will be potentially more food grown in the community, more

renewable energy, and more revenue to local farms,” said Kominek, 37, whose late grandfather Jack bought the farm in 1972.

If successful, the project could serve as a model for other cash-strapped farmers, by transforming underperforming fields into potentially money-making hubs of clean energy and fresh food.

Xcel Energy, the state’s biggest utility, has agreed to pay for each kilowatthour delivered from the Kominek’s solar array to the grid. Their neighbors can buy into the project, too. Participants invest in a percentage of the array, then receive credits on their monthly utility bills. Their investment also helps defray some of the farmers’ upfront construction costs.

The vegetables will be sold through a community farm-share program, which allows neighbors to invest in the project in exchange for boxes of produce.

This marriage of agriculture and solar photovoltaics — known by the awkward name “agrivoltaics” — is an emerging niche within the

broader solar power industry.

In the United States, less than 5 megawatts’ worth of solar arrays have crops planted beneath them, according to the National Renewable Energy Laboratory, or NREL. That’s barely a speck of the country’s 71,300 megawatts of installed solar capacity. The farm-plus-solar sector is relatively bigger in Japan, where the concept first emerged over a decade ago.

Hundreds of projects now exist, including a 35-megawatt solar array that hovers over fields of ginseng, herbs, and coriander.

Proponents say that this approach could allow for widespread renewable energy development without displacing much-needed land for food. Recent studies suggest that it could lead to more efficient energy and crop production by creating a cooler, moister microclimate.

In a recent test in Arizona, scientists compared crops planted under solar panels with those grown in direct sunlight. They found that total fruit production for red chiltepin peppers was three times higher on the plots

under the panels, and cherry tomatoes doubled production. Some of these plants used significantly less irrigation water, in part because the shaded soil retained more moisture. Solar panels placed with plants were also substantially cooler during the day — and therefore operated more efficiently — than the usual ground-mounted arrays, according to the study last year by NREL and the Universities of Arizona and Maryland.

A project in South Deerfield, Massachusetts, delivered similarly promising results. Early field tests showed that Swiss chard, broccoli, and similar vegetables produced about 60 percent more volume compared to plants beneath a full sun.

K o m i n e k ’s p r o j e c t , called Jack’s Solar Garden, will provide more opportunities to study agrivoltaics.

NREL, in nearby Golden, Colorado, plans to track how plants and panels perform together in Boulder County’s hot, dry climate. “If the structures help keep in moisture, and we have less evaporation, we’ll need less water to grow

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

the same amount or even more [crops],” said Jordan Macknick, the lead energywater-land analyst for NREL. Macknick leads NREL’s low-impact solar initiative along with biologist Brenda Beatty. Since 2015, researchers have developed more than 25 sites around the country that combine solar panels with food crops, native vegetation, or pollinatorfriendly plants.

Jack’s Solar Garden will be the biggest of the group and the first to include all three types. NREL is also adding solar projects in Puerto Rico, including one on a coffee plantation and another one on pasture lands for cattle.

“We’re really just at the very beginning of understanding the benefits of agrivoltaics and what they could mean not only for the energy sector but also for the agricultural sector,” Macknick said.

Agrivoltaics, also called “solar sharing,” first took off in Japan in 2004, after an engineer, Akira Nagashima, developed a stilted steel structure that raises panels 10-feet high. Available land is scarce in Japan, a country

with ambitious targets for developing renewable energy.

(Not coincidentally, floating solar arrays — which sit atop irrigation ponds and reservoirs — also got their start in Japan, in 2007.) Recently, Nagashima has begun studying how shade-intolerant crops might fare beneath solar arrays. His research team recently found that corn yields slightly improved in a solar-sharing system.

Beyond research sites, however, pairing corn and other cash crops with solar may present significant challenges. On existing plots, smaller tractors can navigate the narrow spaces between rows of panels. But combine harvesters and other industrial equipment are too wide and bulky to fit through the gaps. Most crops grown beneath panels must be picked by hand. The work is manageable at the scale of a community garden, but it can be grueling, back-breaking work at an industrial scale.

Farmers are developing machines to pick strawberries, melons, and tomatoes, which also might bump against the panels.

Feedback: 07037817378, 08137433034, 08135447789

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

Tuesday 25 February 2020

BUSINESS DAY

BDTECH

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In association with

E-mail: jumoke.akiyode@businessdayonline.com

The growth of social media as a business platform Jumoke Akiyode-Lawanson

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igeria has 29.3 social network users. This figure is projected to grow, reaching 36.8 million or more by 2023. This is a massive leap in numbers from only about 16million social network users in 2016.

Having been declared as a mobile first nation with over 184 million active mobile lines as at December 2019, according to data from the Nigerian Communications Commission (NCC) website, Nigeria has over 80 percent of its internet users on at least one social media platform as a result of easier access through mobile devices.

As a result of this rapid growth, social media is seen to be creating more online businesses and has become a crucial aspect of most businesses today.

Experts are of the view that social has become business globally and Nigeria is starting to realise this and adopt these business trends on social media. They say that it is more likely for people to visit company and retail websites by clicking on advertorial links on social media and be more interested in things being discussed on social media platforms.

Funke Opeke, CEO of MainOne who gave a presentation on ‘social media businesses’ at a Nerds Unite forum said; “77 percent of people

use their mobiles to discover products and services online, 60 percent of social traffic to retail sites originates from Facebook so it is indeed generating significant revenue for some businesses and 85 percent of all orders from social media come via Facebook.”

“When you look at the younger generation and the reach and valuation of some of these social media companies then you will know that they are more than just platforms where you connect to your friends to share jokes, pictures and mes-

sages,” Opeke said.

In the past few years, social media has been steadily growing in popularity and apart from individuals setting up businesses and marketing goods and services on social media platforms such as Facebook, Twitter, Youtube and Instagram most corporate organisations have also increased their social media presence in order to connect with and sell to the general public.

Research data from statcounter. com shows that Facebook takes 49.8 percent of the social media market

share in Nigeria while Twitter has 24.38 percent, Instagram has 11.26 percent and YouTube had 2.19 percent of Nigeria’s social media market share from January 2019 to January 2020.

Online statistics show that internet penetration in Africa has seen rapid increase in the last one year and Nigeria leads the way with the highest number of internet users, Facebook users and active mobile subscriptions.

Opeke said that the sales through social media keeps rising and half

of social media driven purchasing happens within one week of sharing, liking, tweeting or favouriting a product.

“I get all my customers and sell all my products via Instagram and Whatsapp. With an active social media page and customer referrals, I’ve been able to turnover profit for my online retail business without having a physical store offline,” Chidinma Nwobodo, CEO of @shop_bodelle on Instagram told BusinessDay. The total social commerce sales at the end of 2014 was about $20 billion and 2015 end of year report saw about 50 percent increase to $30 billion for retailers worldwide. This number is believed to have multiplied in 2020.

“Africa is a vast continent with millions of people. It possesses a huge market potential for trade and investment. A huge opportunity for growth and improvement and our youth are beginning to rise up to explore the power of ICT and social media to create a new lifestyle for themselves. As we all know, IT offers a tremendous opportunity of job and wealth creation. Building the value chain that will deliver these end results should become the collective responsibilities of many players across the world,” Peter Jack, the former director general of National Information Technology Development Agency (NITDA), previously said.

Interswitch, American Express partner to foster ease of digital transactions Jumoke Akiyode Lawanson

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n a bid to enhance digital transactions and boost foreign investments in Nigeria, Interswitch Limited, a renowned technology-driven company focused on the digitisation of payments in Nigeria and other countries in Africa has partnered with American Express (AmEx), to expand the usage and acceptance of American Express Cards across Nigeria.

Speaking recently at an event organised to announce the new development, Akeem Lawal, divisional chief executive officer for payment

processing at Interswitch said that the partnership with Interswitch will enable American Express Card members to transact using a wide range of merchants.

“This partnership will process payments through the Interswitch platform, for a range of travel, retail, hospitality and dining expenses, as well as Automated Teller Machine (ATM) withdrawals. More to this, the partnership will also allow Interswitch to integrate its network of merchants in Nigeria into the global American Express network,” Lawal said.

He further said that as part of the agreement, Interswitch will assume re-

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sponsibility for managing American Express merchants in Nigeria, while bringing new merchants onto its platform.

“Previously, American Express Card members could only use their cards at select locations across Nigeria. This new partnership broadens that acceptance to Interswitch merchants, ATMs and websites nationwide,” he said.

According to Lawal, “AmEx and Interswitch are aligned in our desire to provide fast and secure payment solutions and transactions across Nigeria. With this new partnership, we are improving AmEx card member access to a convenient and secure

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network, which also benefits our merchants who will gain new opportunities presented by an expanded user base. By remaining card scheme neutral, Interswitch will continue to explore innovative partnerships that will benefit consumers and retailers alike.”

He also reiterated the commitment of Interswitch to reliably cater for its valued merchants, to reinforce the company’s mantra of transaction solutions you can depend on. He recommended new merchants join the Interswitch platform, highlighting that the addition of American Express cards can help to expand their businesses.

Also speaking at the event, Vivi

@Businessdayng

Galani, vice president and general manager, global network partnerships EMEA for American Express said that the new partnership reinforced American Express’s role as a leading global network.

“We are excited to be partnering with Interswitch, a well-respected pan-African financial technology company, to continue to grow our presence in Nigeria. As we partner with leading banks and financial institutions around the world, we are bringing the powerful backing of the American Express network to Card members and merchants by expanding acceptance of our Cards,” she said.

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Tuesday 25 February 2020

BUSINESS DAY

BDTECH

E-mail: jumoke.akiyode@businessdayonline.com

Up-skilling workforce is critical for the future of work - Tomi Otudeko

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uring one of the breakout sessions at the recently held Lagos State Employment Trust Fund (LSETF) Employment Summit, Tomi Otudeko, head, innovation and sustainability, Honeywell Group, a panelist, while speaking on the theme, “Jobs for the Future: Leveraging Technology for Job Creation”, reiterated the need for continuous upskilling of the workforce as technology presents new opportunities and also leads to new ways of doing existing jobs.

According to Otudeko, “the best way of ensuring that the workforce of an organisation does not become redundant in the advent of artificial intelligence and machine learning is that there should be adequate training for the changes to come”.

Illustrating her position through the operations of Honeywell Flour Mills Plc. a Honeywell Group Company, she noted that, “Our processes are increasingly automated and this has led to a change in the expectation from our millers. Our milling staff are continuously being trained and have adapted to these changes,

working seamlessly with processes that a driven by technology” “Today’s leading organisations are deploying solutions that will automate their business, reduce turnaround time and make business delivery consistent. The workforce needs to be willing to learn and be innovative in their value addition to their organ-

isations. Embracing technology gives room for people to learn new skills”, she added.

It was agreed at the session that there is a need for a change in our education system to ensure it provides the requisite skills (both technology and soft skills) needed by the next generation. Organisations also need

L R: Umar Garba Danbatta; executive vice chairman/CEO Nigerian Communications Commission (NCC), Maimuna Yahya Abubakar; chairman governing board, Nigeria Postal Service, Adeolu Akande; board chairman, NCC, Ismail Adebayo Adewusi; postmaster general/CEO Nigeria Postal Service, during the courtesy visit to NCC headquarters in Abuja recently.

MDXi unveils first locally available Microsoft Stack Cloud offering at Nerds Unite 2020

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DXi, MainOne data center subsidiary, announced the local offering of Microsoft’s Azure Stack to its customers as part of its ‘Managed Cloud Services’. The Stack platform provided in partnership with Microsoft and HPE was unveiled at MainOne’s 5th annual gathering of customers, partners and tech professionals, called Nerds Unite.

With the introduction of the local offering of Microsoft’s Azure Stack services, MDXi is the first data center in Nigeria to offer the Cloud service commercially to customers in Nigeria. This latest Cloud offering by MDXi into the Nigerian market reinforces MainOne’s leadership positioning in the Cloud market, enabling the company to offer its customers a broader suite of cloud solutions.

Ranging from managed Cloud deployment on public and private Cloud services in the MDXi data center, to management of offshore deployment on Amazon Web Services (AWS) and Azure, in addition to Express Route services that enable secure, reliable communications to cloud services offshore.

Some of the benefits of MDXi’s Azure Stack in processing incountry data and applications thereby reducing customer la-

to change their business models so as to stay competitive for the future as skills are evolving at an accelerated rate.

Other panelists at the session include, Lars Johannisson, country manager, Tek Expert; Olufemi Osinubi, partner, experience centre & emerging technologies, PwC; Nkem Begho, managing di-

tency to under 10ms and resulting in better experiences for end users were showcased at the launch.

The demo also showcased cost effective data storage solutions that allow businesses meet all their data sovereignty requirements with locally domiciled infrastructure.

The new Cloud services platform will offer enterprises and businesses the choice of a scalable, flexible computing platform to enable them to migrate critical applications from legacy technology to modernised and more efficient technology without having to go offshore.

“MDXi has been in the business of providing Cloud services to its Enterprise customers for over five years, with skilled and certified engineers. We are the data center of choice for Enterprise looking to host data locally in the Cloud. With the introduction of the Azure Stack solution, we further demonstrate our commitment to investing in Cloud infrastructure in order to continually meet the changing and growing requirements of our customers in Nigeria, and indeed across West Africa. Our partnership with Microsoft and investment in HPE infrastructure to deploy the Cloud platform continues to position www.businessday.ng

MDXi as the West Africa’s leading communications solution provider, delivering world-class quality services to our local customers,” said Gbenga Adegbiji, general manager, MDXi. Nerds Unite, held on Friday February 21, 2020 is MainOne’s flagship annual event. It brought together IT professionals, influencers, and decision makers in an environment for one full day to connect, discover opportunities, collaborate, and learn new techniques and breakthrough trends in the global IT industry.

This year’s edition featured presentations and panel discussions on Cloud adoption, Cloud migration and all things Cloud with global leaders across West Africa, making it the perfect platform for MDXI to unveil its new Cloud services.

MDXi builds and operates Tier III data center campuses across West Africa to meet the rapidly expanding global demand for certified data centre facilities. Its Tier III data center in Lekki, Lagos-Nigeria, is the largest purpose-built commercial data center in West Africa, designed with a strong focus on high availability, security, and open access connectivity. Its facilities have operated with 100 percent uptime since inception.

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rector, Future Software Resources Limited.

Last year, Honeywell Group partnered with the Lagos State Employment Trust Fund (LSETF) to aid youth in Lagos State acquire relevant skills required to compete in today’s technology driven, global marketplace.

The Talent Development Programme, which runs under LSETF’s Lagos Innovates Programme, provides student loans that covers up to 80 percent of training cost for beneficiaries, who are then trained by any of LSETF training partners, for up to three months. Some of the courses offered are Full Stack Development with JavaScript (React JS, NodeJs, Express and Mongo DB + API Development), Full Stack Development for Mobile Applications (React Native, API Development), Python Programming for Web and Data Science. (PYTHON OOP, DJANGO & Data Science, and Frontend Design & Engineering: (UI/UX, HTML, CSS, ES6 & React JS). The first set of beneficiaries are due to complete their training courses in February 2020, while applications for new loans will be opening in the coming weeks.

Tecno rewards students with N10m scholarship, cash prizes, others in campaign Jumoke Akiyode-Lawanson

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ecno, a mobile technology company that develops and distributes mobile devices targeted at the youth population in Africa has rewarded Nigerian students across different universities with education scholarships worth N10 million, cash prizes of one million naira each, as well as pocket money for one year, internship opportunities, smartphones and other prizes in new campaigns.

Tecno awarded six people, one million naira each in its Light Up Your Dream campaign, and in the recent scholarship award during the 2019 AcadaFest, 20 students also became beneficiaries of scholarship worth 10 million Naira.

After weeks of undiluted fun, six finalists across campuses from different regions were chosen.

Asides performances from the six finalists, people were randomly picked from the audience at FCE Akoka, to showcase their talents and dancers, rappers and comedians came on stage to wow the crowd. These talented students got goody bags while the winner of the segment got a Tecno @Businessdayng

Spark 4 courtesy HiOS in partnership with Tecno.

Palmplay, who also partnered with Tecno, shinned its huge benevolence on Kareem Usman, a student from University of Ilorin after a segment that Palmplay sponsored. He was immediately presented with a letter of paid internship.

As a partner, Malta Guinness made sure that the audience had a non-stop flow of their delicious malt all through the party.

To judge their performances were; on air personality, Folu Storms, Tecno’s PR manager Jesse Oguntimehin, and Boomplay’s MD, Dele Kadiri.

Musician, Victor AD came on stage to entertain the students and Stephen Maiangwa, the freestyle rapper from ABU Zaria was announced winner of the competition.

He immediately went emotional and very excited as he realized that Tecno had just taken him to a huge milestone in his life.

To top off the fun filled night, Slimcase came on stage to thrill the crowd with his hit songs.

The smartphone brand says it will continue the provide for, and celebrate Nigerian youths, promising a lot more in 2020.

Tuesday 25 February 2020

BUSINESS DAY

31

property&lifestyle Property market boom: Only for small unit apartments ENDURANCE OKAFOR

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o n e a re t h e days when demand for Nigeria’s residential real estate was largely driven by four-bedroom apartments.

New studies have shown a positive relationship between Nigeria’s growing young population and the demand for small unit apartments.

Nigeria’s young professionals, 60 percent of whom are within their first 3 years of employment, coupled with the high rate of urbanization are the reasons for the surge in the demand for small units apartments, a survey by BusinessDay shows.

The average rate per month at which studio apartments are rented increased by 24.16 percentage points from 42 percent in 2017 to 66.16 percent in 2019, BusinessDay survey shows.

According to Northcourt, a Lagos-based real estate advisory firm, the surge in urban growth (at 4.3%, H2 2019) places pressure on real estate infrastructure, and as successful cities attract more population, the price of urban real estate will increase due to demand.

“Gone are the days when young people would want to stay at their parents’ house while working. A city like Lagos has continued to attract a chunk of that population and when they come they are in search for small unit apartments,” Chukwudum Muoneke, MD of Adudu, a real estate firms said.

Nigerian tertiary institutions produce about 500,000 graduates every year, this is

excluded from those who study abroad and return after obtaining a foreign degree to search for a job.

Providing accommodation for Nigeria’s young professionals who are at the early stage of their career is an area that is still underserved, industry analysts have said. “ W h e n e v e r w e t a ke properties from developers and put it up for notice, say about 30 units of studio apartments, we usually have a lineup of a thousand plus young professionals waiting to take up the property,” Tunde Balogun, CEO of Rent Small-Small said.

According to industry statistics, the vacancy rate has dropped in a city like La-

gos because developers are now a bit more thoughtful about the kind of products they put into the property market.

“If you build five-bedroom apartment now, you will be the one to live in it as one-bedroom and two-bedroom are the products that are driving demand in the market,” Ayo Ibaru, COO / Director of Northcourt said.

Faced with opaque land laws, infrastructure challenges, lack of development expertise and financing opportunities, real estate developers in Nigeria had in the past developed mainly large unit of residential properties with the hope of getting a quick return on investment.

“Developers are beginning to look into the small unit apartments especially because it has huge potential and from our data, we have a chunk of request for one-bedroom and studio apartments,” Balogun said.

A successful investment in small units of residential real in Nigeria can earn returns as high as 30-35 percent, while rental income yields in cities such as Lagos can easily reach 10 percent, developers and estate agents say.

According to industry sources, the rental aspect of the small unit apartments is getting more attention than the one that is put up for sale.

This is due to the low

earning capacity of young Nigerians who are in demand for the kind of properties.

“Even if you put a house at N7 million, how many young Nigerians who have been working for 5 years can afford it at that amount,” Muoneke questioned.

Only 5 million of the 69.54million Nigerians reported by the National Bureau of Statistics (NBS) to have been gainfully employed as at third quarter of 2018 earn a salary of N3 million and above per year, as compiled from data by Graeme Blaque Group, a Lagos-based advisory firm.

If that number of people can afford to buy a house which is very unlikely due

the lack of a functioning mortgage the data will put employed Nigerians who can buy affordable housing at only 7.19 percent, meaning as much as 64.54 million people who earn less than N3 million cannot afford to buy a house except of course there is an increase in their income level.

Cribbed by a housing deficit of more than 20 million units, Nigeria with one of the least homeownership rates in Africa requires in monetary terms, between N170trillon to N200trillion to bridge the housing gap if each unit is estimated to cost N10million.

According to the Association of Housing Corporation of Nigeria (AHCN), an umbrella organization for all federal and state housing agencies, the underdevelopment of Nigeria mortgage sector in driving homeownership is worrisome as more than 90 percent of new homes utilise funds from personal savings for incremental construction.

“The structure of the mortgage industry is the problem; there is the highinterest rate and this is on the back of the economic condition,” Adeniyi Akinlusi, president of Mortgage Bankers Association of Nigeria (MBAN) and CEO, Trustbond Mortgage told BusinessDay. The high mortgage interest rate in Nigeria is considered as one of the key culprits responsible for the country’s housing crisis.

The typical mortgage rate in Nigeria ranges between 7-10 percent for Federal Mortgage Bank of Nigeria (FMBN) and between 1525 percent for commercial mortgage institutions, making it one of the highest in the world.

Factors that will shape Nigeria’s commercial, residential real estate in 2020 ENDURANCE OKAFOR

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he Nigerian real estate industry is gradually recovering from recession and holds prospects to exit contraction in 2020, a survey by industry sources shows.

After exiting 12 consecutive quarter of recession in the first quarter of 2019, Nigerian real estate industry was hit by slow economic growth, lack of liquidity and dampened purchasing power and thus, ended the year on a negative but stabilising mode.

Ni g e r i a’s e c o n o m i c growth of 2.28 percent eluded the real estate sector which contracted by 2.31 percent in the third quarter of 2019, the best growth in

six months.

On the factors that are likely to shape Nigeria’s property industry in 2020 Tope Runsewe, MD, Dutum Limited said that state governments are exploring partnerships towards increasing the housing stock in their respective states.

“Developers are integrating technology in property development to achieve cost-saving and quality price of residential properties has been on the increase with some locations experiencing substantial value appreciation,” Runsewe said.

Whereas homeownership level is 84 percent in Indonesia, 75 percent in Kenya and 56 percent in South Africa, it is only 25 percent in Nigeria whose population is estimated at 200 million. Going by

United Nations projection, the country’s population will be as high as 400 million in 2050.

According to the Association of Housing Corporation of Nigeria (AHCN), the underdevelopment of Nigeria mortgage sector in driving homeownership is worrisome as more than 90 percent of new homes utilise funds from personal savings for incremental construction.

While Lagos remains the commercial nerve centre of Nigeria and the most vibrant property market in the country, industry sources see emerging markets such as the Sangotedo residential market as a hub in Lagos that is yielding a good return on investment.

“The surge in the population of young adults cou-

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pled with reduced spending power has increased demand for smaller units of accommodation in Lagos,” Ayo Ibaru, COO, Northcourt said.

On the commercial sector of Nigeria’s real estate market industry survey shows that there have been high rates of conversion of larger units accommodation such as 4-bedroom and above to commercial use within the Lekki axis.

“Co-working and co-living arrangements have been on the increase owing to the high cost of real estate.

The commercial property market in Lagos is performing well. Average prices of grade A office ranges from $450psm and $700psm in Victoria Island and Old Ikoyi,” Adejumoke Akure, Partner, Estate Links said.

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With new construction projects on the pipeline, it is expected that Grade A office supply would increase between 2020 and 2023. The completion of the Apapa road, although still has the challenge of gridlock is expected by industry sources to improve traffic within the axis and ultimately increase demand for industrial properties in Apapa.

“Inflation rate stood at 12.13% as of January 2020.

Investors need to increase their investment in the real estate sector to avoid the effect of inflation on capital,” Akure said.

The surge in urban growth at 4.3 percent in the second half of 2019 places pressure on real estate infrastructure and it would require that new dwellings be provided to accommodate @Businessdayng

the growing population and businesses. This makes real estate an attractive investment media, as compiled from industry sources.

According to Runsewe, investors are faced with the problem of making the right choice of investment and considering real estate investment is known to be an edge against inflation, “it has the potential to protect against the decrease in purchasing power due to inflation. Certain investments might provide a decent return on capital, but can be sold at a loss,” Runsewe said.

Ibaru recommended that investors and developer should consider exploring the untapped potentials in the market especially in smaller unit accommodations and student housing.

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Tuesday 25 February 2020

BUSINESS DAY

property&lifestyle Nigeria’s grade-A office records largest take-up in 5years at 20,100m2 in 2019 … driven by tech, oil & gas industries

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or the first time since 2014 Nigeria’s grade-A office reported the largest take-up of about 20,100m² in 2019 on the back of increased demand from tech and oil & gas industries, data from Nigeria’s Office Market Viewpoint H2:2019 by Broll Nigeria shows.

While the bulk of the grade-A office space was delivered in the first half of 2019, around 45, 000m² of office properties entered into the A-grade market last year. The most noteworthy of the major transactions that occurred in the year under review was the sale of the Cornerstone Tower Development (GLA of 12,040m²) in the second half of last year.

“The bulk of concluded transactions were driven by the tech and oil & gas industries. The level of enquiries in the second half of 2019 remained generally unchanged relative to the first half of the year,” Broll Nigeria said.

Apart from the oil & gas and tech industries which dominated the sectors that enquired about the grade –A office properties, industries such as business services, diplomatic institutions and media were also mentioned on the list.

While the last-minute transactions that were concluded towards the end of

L-R: Managing Director, Family Homes Fund; Femi Adewole, Managing Director, Nigeria Mortgage Refinance Company plc; Kehinde Ogundimu, Managing Director, Eximia Realty Company Ltd; Hakeem Ogunniran, President, Real Estate Developers Association of Nigeria; Ugochukwu Chime and Managing Director, Innovative Risk and Investment Solutions Limited, Charles Inyangete, at the official unveiling of The Mews, an estate built by Eximia Realty Co Limited in Katampe Extension, Abuja.

2019 were added to the total number of square meters leased in the review year, Broll stated that about 20 percent of the take-up comprised of the expansion of existing tenants within their current buildings of occupation.

Vacancy levels, however, have declined on average following the take-up in new buildings. Vacancy levels in Ikoyi have declined to 25 percent, while remaining unchanged at an average of 57

percent in Victoria Island as at the end of 2019, the result of Broll’s survey shows.

A grade –A office is the kind of commercial property that represents the newest and highest quality building in their market. They are generally the best looking buildings with the best construction and possess high-quality building infrastructure. Grade-A offices are also well located, have good access, and are professionally managed. As a result

of this, they attract the highest quality tenants and also command the highest rents.

According to the survey

by Broll Nigeria, the standard transaction timelines, from initial search to lease execution, ranged from 12 to 18 months with some transaction taking longer to conclude.

Although, the report also stated that “some of the completed transactions recorded in the second half of the year, were remarkably faster to finalize.”

Analysis of the report by Broll revealed that occupier requirements remained fairly unchanged in the market with the top factors driving building selection (outside of costs) being location, security, building efficiency, Health, Safety & Environment (HSE) features, and onsite amenities.

“The nature of transactions closed in 2019 was a hybrid of large space requirements of over 2,000m² to smaller requirements of about 250 to 500 m²,” the report read stating that the expected deliveries in the market total 130,000m² and include developments such as Trinity Tower and Famfa Oil Tower.

Broll expects 20 percent of grade-A office property to be delivered in the first half of 2020 and they also include GLA of the Eco Bank Waves project, which began construction activity in the second half of 2019 following some period of inactivity.

“Although there has been a decline in the total vacancy in A-grade facilities in the market, Landlords still view the market as a tenants’ market. Competitive leasing terms are still being offered on a case-by-case basis conditional on the impact of the prospective tenant on existing tenant mix and the size of take-up,” Broll said.

Further analysis of the report revealed that asking rents have generally remained

unchanged in the market, however, as a result of Broll’s categorization of A-grade buildings in Victoria Island, whereby some older buildings have been downgraded, rents appear to be slightly higher in VI while rents in Ikoyi have remained steady at $700/m²/ annum, and average rents in VI was put at $698/m²/ annum.

On the outlook for grade-A office apartments, Broll said with no significant movement upwards in the level of enquiries, it does not expect demand to increase in the near term.

On the supply side, the Lagosbased real estate firm said even though near-term deliveries in the market are small, it expects the market to feel the real injection of space in the next 8 to 24 months.

“The market is also going to see a less speculative building as investors become more risk-averse and indigenous developers become more cash flow sensitive. Rents are to trend steady, conditional on the health of the economy and in turn the real estate market,” Broll said.

With the outlook of the economy mixed, many landlords remain on the fence or cautiously optimistic about the performance of the real estate market in 2020 and therefore do not foresee any real capacity for rental growth in the near term, the report read.

Lagos proffers local financing solutions to housing deficit challenge Chuka Uroko

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inancing housing development and empowering people for accessibility are the twin issues hampering the impact of government intervention in the housing sector.

This was the assertion of Moruf Akinderu-Fatai, Commissioner for Housing, Lagos State, at a recent engagement meeting with representatives of various development partners in Lagos.

Speaking at the forum, Akinderu-Fatai pointed out that the housing challenge in Lagos is complex because of the continued and uncontrollable influx of people from all over the nation.

He noted that given the rate at which the population of the state is increasing, there must be proactive measures to ensure that governmental interventions result in substantial positive impacts in the lives of the people.

He also reiterated that the Lagos State government is working hard to map out Housing financing products that are domesticated to solve the peculiar housing challenges of the State.

“We have to formalize the

informal sector so that majority of our people can take advantage of a financing product that supports instalment payments”, he said.

He said while global financing models are attractive, they may not address the unusual problems of Lagos State.

He pointed out that provision of mass and social housing is a key agenda of the State government but the impact can only be felt when there is a structured financing mechanism that is based on predictable population growth.

Apart from the Rent to Own scheme which gives the opportunity of repayment over a period of 10 years, the State government is also looking at more workable financing options that will help the informal sector.

The Commissioner also said that more vertical construction of homes will take place both by government and private investors to optimize the land space available in the state.

He then concluded that a viable housing development fund is one that will address the issue of financing both the supply and demand angles of Housing development.

Akinderu Fatai seized the opportunity to point out that www.businessday.ng

the commitment of the State government is unequivocal and that “Lagos State will continue to work relentlessly until more Lagosians are brought on the homeownership ladder”, he added.

Akinderu-Fatai noted that 492 Allottees of the Alhaji Lateef Kayode Jakande Gardens, Alimosho area were given keys to their homes while in a few weeks the Igbogbo 11b housing scheme in Ikorodu local government area will be ready for 360 homeowners.

Other schemes in the pipeline for 2020, according to Akinderu-Fatai include Sangotedo Scheme in Eti Osa local government with 774 home, Odo Onosa /Ayandelu in Epe local government area with 668 homes to mention a few. He also unravelled the State Government plan to upgrade some slums in the area to liveable cities as part of a global plan to transform the State into a 21st-century economy that is distinct and comparable to others in the world.

“In with our passion for great progress in the sector, funding is needed and assistance from our development partners will be highly appreciated,” he said.

Earlier at the engage-

ment meeting, the Project Manager of Arctic Infrastructures, Lookman Oshodi had made a presentation on the proposed Lagos Affordable Housing Development Fund, a financing product which promises relief to both developers and aspiring homeowners both in the formal and informal sector.

According to Oshodi, the uniqueness of the financing package is the fact that it is targeted at low-income earners, it can also be accessed by both construction companies and home-seekers and will be made up of contributions made by both government and private sector.

The fund will also cater to training and capacity building and upgrading of artisans and mortgage operators, development of innovative building technology, sustainable housing developments and renewable of slums.

The suggested funding from the government is expected to be sourced from contributions by local governments, subventions, infrastructure development charge, Housing fund surcharge and Lagos Pension fund. Private sector contributions can be in the form of grants and donations from

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both local and international organizations.

In disbursing the fund, Oshodi said, “part of the financing will serve as a Habitat fund which will be given as loans to those earning between N20000 and N59000 with a repayment plan of 20years.”

This will be channelled through microfinance banks with cooperative societies serving as intermediaries”.

“Construction fund will also be granted to developers having vertical construction with sustainable energy ideas. This class of support is repayable within 3 years,” he discloses.

While the fund is the product, Oshodi also proposed a Trust that will ensure accountability, credibility and sustainability.

There was a robust and enriching discourse on various issues pertaining to an affordable shelter by all the partners. Top on the list was the provision of workable structure to reach the masses so that homes are not hijacked by the rich, continued maintenance of existing schemes to prevent rapid dilapidation, provision of homes for young professionals, the introduction of cost-saving techniques to reduce the cost of building homes and increasing sus@Businessdayng

tainability of future cities.

In summing up the deliberations, the Permanent Secretary Ministry of Housing Lagos state, Wasiu Akewusola appealed for greater collaboration with the government on developing and implementing a financing document that will be apt for Lagos State.

At the end of the meeting, it was agreed by all present that financing Housing development and homeownership are the missing links in the Affordability paradigm. It was also confirmed that providing a workable financing solution to the problem of Housing deficit is very crucial.

Also present at the meeting were Monica Ummuna, Project director of projects, Heinrich Böll Stiftung, Jurgen Anderson, an architect and urban planner from Dept of Architecture University of Denmark, Head of Prosperity Fund; British Deputy High Commission, Economic Trade Advisor for Netherlands Consulate, CEO, National Future Cities, Nigeria, Head; Giz Nigeria, Project Manager; Friedrich Ebert Stiftung, Head; Nigeria Slum Informal Settlement, and CEO; NISA Housing amongst others.

Tuesday 25 February 2020

BUSINESS DAY

33

POLITICS & POLICY PDP seeks review of 2019 presidential election, petition tribunal judgment

...asks for Kano, Kaduna, Katsina, Osun election judgments too Solomon Ayado, Abuja

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he People’s Democratic Party (PDP) is seeking the review of the judgment of the 2019 Presidential election petition tribunal that validated election of President Muhammadu Buhari.

This is just as the party has asked the Supreme Court to review the judgments on the Kano, Kaduna, Katsina and Osun governorship elections.

Specifically, the PDP said the judgments should be reviewed because the issue of certificate forgery and presentation of false information in aid of qualifications was clearly established against the APC and its presidential candidate, Buhari.

Kola Ologbondiyan, who briefed journalists in Abuja on Monday said the PDP is concerned that the APC has hurriedly headed to the Supreme Court in attempt to

arm-twist the justices and to effect a “forceful reversal of the valid, flawless and faultless judgments on Bayelsa and Zamfara states governorship elections.”

According to Ologbndiyan, the APC is simply all out to destabilise the nation and destroy its democracy.

He said it was high time the citizenry stand in unity and defend the nation so as to salvage it from the hands of persons he described as “political marauders and oppressive elements.”

“Our nation is already aware of the desperation by the APC to annex the Supreme Court, subjugate and browbeat the justices and direct judicial determinations to suit their selfish ends.

“The public space is already awash with reports of how the APC has been threatening and piling pressure on the justices of the Supreme Court to force a reversal of valid judgments already delivered on the Bayelsa and Zamfara

Kola Ologbondiyan

governorship elections, where the party (APC) suffered selfinflicted losses.

“Nigerians know that the APC has been going through a hemorrhage since the Su-

preme Court delivered valid judgments on Bayelsa and Zamfara and as a result, they are no longer interested in the logic of these judgments.

“They have since thrown

caution to the wind to destabilise our nation and destroy our hard-earned democracy especially the judiciary. The APC federal government is leading all forms of battles against the rule of law and constitutionalism.

“Consequently, the National Working Committee of the PDP, after comprehensive consultations, states that our party has no choice left, given the manner with which the APC has conducted itself, than to ask for a review of the judgment of the Presidential election petition tribunal, where the issue of certificate forgery and or presentation of false information in aid of qualifications was clearly established against the APC and her presidential candidate.

“The same applies to the judgment on the Katsina governorship election petition, where lawyers also established similar issue of certificate forgery.

“The PDP equally has no choice than to ask the Su-

preme Court to review the Kano, Kaduna and Katsina election judgments, because of manifest violence and substantial non-compliance to our electoral law.

“The PDP also asks the Supreme Court to review its judgment on the Osun governorship election in view of manifest, complete and total disregard to our electoral rules in the conduct of the elections,” Ologbondiyan said.

Stating further, he insisted that the PDP cannot sit and watch enemies of the nation’s democracy to destroy it.

“The PDP finds it ludicrous, ridiculous and insulting to the sensibilities and respect of the Supreme Court Justices for the APC to hurriedly and malevolently head to the Supreme Court to attempt to arm twist the lord justices to effect a forceful reversal of the valid, flawless and faultless judgments on Bayelsa and Zamfara states governorship elections,” Ologbondiyan stated.

Religious bodies, PDP, civil society, others support ‘Amotekun’ in Lagos

Group calls for entrenchment of internal party democracy in Nigeria

…Call for proper recruitment, training of personnel

Innocent Odoh

Iniobong Iwok

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takeholders across Lagos State and environs have pledged their support for the creation of Amotekun in the state.

They spoke Monday during a stakeholders’ forum on a bill for a law to amend the Lagos State Neighbourhood Safety Corps (LNSC) Agency Law, 2019 aimed at establishing the Amotekun Corps on Monday at the pavilion of the State Assembly premises.

The representative of the Christian Association of Nigeria (CAN) stated that the church is in support of Amotekun and that they would pray for the success of the corps, while commending the proponents of the concept.

Also supporting the project, a Security Consultant and Analyst, Dickson Osagie urged the government to emphasise proper training of the personnel of Amotekun, adding that insufficient parenting has been contributing to the high rate of insecurity in Lagos State.

In his comment, the chairman of the chairmen of the People’s Democratic Party (PDP) in Lagos State, Sunday Olaifa, who spoke on behalf of the party’s chairman in the

state, Adedeji Doherty said that the party is in support of Amotekun.

He, however, said that the party would want the state government not to employ personnel on party, religion or ethnic basis.

He said that qualified people should be employed and that there are enough charms in Yoruba land to ensure the success of Amotekun.

In his contributions, a security expert, Gboyega Alowonle said that the state assembly should look at the recruitment of personnel and training.

“Let us ensure that the personnel go through due diligence. You cannot rule out Nigerian Police in the area of security, and Community Policing is also important,” he said.

Also contributing, Lekan Otukoya advised that the government should give consideration to those who started neighbourhood watch in the state then.

Otukoya said that members of the neighbourhood watch were laid off in 2016 without compensations, but that they had been doing good jobs since 1996, when they started.

Babatunde Adetunji, in his view suggested that irrespective of the qualification of the www.businessday.ng

personnel, they should be people who understand the terrain, and that there should be penalty for erring officers.

Ibrahim Abubakar, who spoke for the Seriki Hausawa of Alimosho suggested that people should be careful about provocative statements.

The Chairman of Agbekoyas in Lagos State, Davis Ogun said that they had the ability to fight crimes without using arms or weapons.

“Let us employ those who know the job rather than using enemies. We should not use just anybody. Agbekoyas have the power to cope and fight criminals,” he said.

Gbenga Ekundayo from the Trade Union Congress (TUC) said that there could not be economic growth without security.

Ekundayo said that there was need for creativity to ensure security in the state.

Earlier in his welcome address, Chairman of the House Committee on Information, Publicity, Strategy and Security, Tunde Braimoh said that Section 14 (B) of the 1999 constitution of the Federal Republic of Nigeria stated that security is the number one job of the government.

Braimoh stressed that citizens enjoy all the amenities provided by the government

only if they have life.

“I welcome you all to the Lagos State House of Assembly, where we emphasise your interest. What is being done is an amendment of Lagos State Neighbourhood Safety Corps (LNSC) Law of 2016, Lagos State.

“The law came from the Speaker of the Lagos State House of Assembly, Mudashiru Ajayi Obasa,” he said.

The Speaker of the House, Mudashiru Ajayi Obasa stated that the meeting was called to talk about security.

According to him, “We can recall the killings, raping, armed robbery that have been happening all over the country.

“Our governors came together to form an outfit that could combat crimes, which was what brought about Amotekun. The constitution of the country talks about protection of lives and properties.

“We came up with LNSC law to support our police in crime control and prevention.

All the states of the country have been copying this. The LNSC Law will be amended to accommodate Amotekun.

“Security in Lagos State is different from those of other states. Amotekun has come to stay in Lagos State,” he said.

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political pressure group, the Movement for the Advancement of Internal Democracy (MAID), which was inaugurated on Sunday, February 23, has called for the entrenchment of internal democracy in political parties in Rivers State in particular and Nigeria in general.

While inaugurating the Port Harcourt branch of the movement, the Coordinator of MAID, Livingstone Wechie, in a statement during on Monday, decried the lack of internal democracy in political parties in Nigeria. He lamented that the lack of this priceless virtue has led to the hijack of Nigeria’s political system by the wrong people who sit back to impose decisions on the rest of the members without recourse to stakeholders and identifiable members of the parties.

According to him, “The legitimacy of party supremacy is rooted in the observance of democratic culture and consultation.” He added that “party supremacy will lose its steam if ordinary members are not given the opportunity for popular participation from the units, wards, local @Businessdayng

government areas (LGAs) to the national levels in the pursuit of political interest.”

Wechie, who is a political activist, warned that if the excesses of certain overlords in the polity who have privatised political parties are not curtailed, the politics will be anything but people oriented because people are fast losing interest and resorting to self-help.

He further queried that Rivers State as being a major victim of this ugly trend, particularly the All Progressives Congress (APC) and other parties in various states where stakeholders and aggrieved members have been involved in a running endless battle in their parties with multiple litigations. He pointed out that these have resulted in the denial of the parties from participating in elections at various levels even as the political destinies of many people were destroyed just because of the failure to allow the will of the people to prevail.

The inauguration which he promised will be done in all the Local Government Areas of the state and country will serve as an opportunity to sensitise the public on the importance of internal party democracy as a pivot for good governance, the statement said.

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Tuesday 25 February 2020

BUSINESS DAY

Live @ The Exchanges Market Statistics as at Monday 24 February 2020

Top Gainers/Losers as at Monday 24 February 2020 LOSERS

GAINERS Company

Company

Opening

Closing

Change

N24

N22.4

-1.6

NB

N48.45

N47

-1.45

0.04

GUARANTY

N27.95

N26.9

-1.05

N0.45

0.02

CADBURY

N9.1

N8.2

-0.9

N4.51

0.01

ZENITHBANK

N19.85

N19.1

-0.75

Opening

Closing

Change

LAWUNION

N0.73

N0.8

0.07

JBERGER

MAYBAKER

N1.82

N1.87

0.05

STERLNBANK

N1.46

N1.5

LINKASSURE

N0.43 N4.5

VITAFOAM

ASI (Points) DEALS (Numbers) VOLUME (Numbers)

27,041.03 4,533.00 429,003,016.00

VALUE (N billion) MARKET CAP (N Trn)

7.298

Global market indicators FTSE 100 Index 7,146.34GBP -257.58-3.48%

Nikkei 225 23,386.74JPY -92.41-0.39%

S&P 500 Index 3,242.23USD -95.52-2.86%

Deutsche Boerse AG German Stock Index DAX 13,032.70EUR -546.63-4.03%

Generic 1st ‘DM’ Future 28,124.00USD -857.00-2.96%

Shanghai Stock Exchange Composite Index 3,031.23CNY -8.44-0.28%

14.087

Nigeria stock market defies analysts’ sentiment …starts week on a negative note Stories by Iheanyi Nwachukwu

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i g e r i a’s s t o c k market started this week on a negative note, thereby defying some analysts’ earlier sentiment in favour of bargain hunting.

The market decreased by 1.27percent at the sound of trade closing gong on Custom Street, Lagos.

Following four weeks of consecutive losses, Afrinvest research analysts expected to see some bargain hunting in early trades this week. However, they maintained a bearish outlook in the near term “as overall investor sentiment remains weak.”

Only this month, the market has decreased by 6.25percent.

This negative has almost wiped off the record positive returns year-to-date (ytd), which now stands at a record low of 0.74percent. The Nigerian Stock Exchange (NSE) All Share Index (ASI) which opened this week at 27,388.62 points decreased to

L-R: Akeem Shadare, managing director, Chapel Hill Denham Securities Limited; Muyiwa Ayojimi, company secretary; Oscar N. Onyema, chief executive officer, The Nigerian Stock Exchange (NSE); Olutoyin Odulate, independent non-executive director, International Breweries Plc; Bruno Zambrano, finance director, International Breweries Plc and Otunba Michael Daramola, corporate affairs director, International Breweries Plc during a Closing Gong Ceremony to commemorate the successful listing of the N165billion rights issue at the Exchange in Lagos.

27,041.03 points.

The record dip on Monday was driven by sell off in some largely capitalised stocks like Julius Berger Plc, which decreased from N24 to N22.4, after losing N1.6 or 6.67percent.

Also, Nigerian Breweries

SEC restates commitment to resolve ‘Dantata Success’ subscribers’ issues

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he Securities and Exchange Commission (SEC) has assured subscribers of defunct Dantata Success and Profitable Company (DSPC) that it is discussing with all parties with a view to settling claims of subscribers.

The SEC had sealed off the premises of DSPC for engaging in illegal capital market activities. Dantata Success reportedly solicited funds from unsuspecting members of the public and did not register with the commission before going into investment operations that fall within the purview of fund management.

It sold registration forms to prospective investors according to their investment plans, ranging from N1,000 to N3,000, with the minimum amount investable being N50,000 and a maximum amount of N5million, luring unsuspecting investors with returns of monthly interest on the investment of between 25 percent and 50percent, depending on the nature and type of the investment.

The said investment period of the scheme was pegged at a minimum of 30 working days and a maximum of 12 months with an offer of interest rates on a short and medium-term basis.

According to the SEC, the verification has been completed and the Commission is discussing with the Administrators/Trustees and the Management of the DSPC with a view to settling the claims of subscribers.“The Commission urges members of the public who subscribed to the schemes to be calm as all efforts are being made to resolve the matter.

“The Commission remains committed to its core mandate of protecting investors and assures the general public that it shall perform this function in line with extant securities legislation” the Commission stated.

The Commission stated that information about registered entities and investment schemes approved by the Commission can be found on the Commissions website or at any of the Commission’s offices www.businessday.ng

Plc stock price decreased from N48.45 to N47, shedding N1.45 or 2.99percent; while GTBank Plc was down, from N27.95 to N26.9, losing N1.05 or 3.76percent.

C a d b u r y Ni g e r i a P l c decreased from N9.1 to

N8.2, shedding 90kobo or 9.89percent, while Zenith Bank Plc declined from N19.85 to N19.1, losing 75kobo or 3.78percent.

On the gainers table, Law Union & Rock advanced most, from 73 to 80kobo, adding

7kobo or 9.59percent. May & Baker followed, after moving up from N1.82 to N1.87, gaining 5kobo or 2.75percent. Others are: Sterling Bank Plc which increased from N1.46 to N1.5, adding 4kobo or 2.74percent; Linkage Assurance Plc which also rose from 43kobo to 45, adding 2kobo or 4.65percent, and Vitafoam Plc which moved up from N4.5 to N4.51, gaining 1kobo or 0.22percent.

“We expect bargain hunting activity in some dividend paying stocks as investors seek to take advantage of high dividend yield environment”, according to research analysts at Vetiva Capital. The value of listed stocks on the Bourse printed lower at N14.087trillion as against preceding day high of N14.268 trillion. Investors lost N181billion at the close of trading.

“Given that this week is the last week for companies that did not submit their unaudited results to submit audited results; we expect an increased influx of audited financial reports and possible dividend pronouncements.

Avuru increases his equity interest in Platform Petroleum to 37.11%

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ustin Avuru, CEO, Seplat Petroleum Development Company Plc has now increased his equity interest in Platform Petroleum from 23percent to 37.11percent interest.

Platform Petroleum Limited is an indigenous oil and gas company that is into exploration and production of crude oil and gas. It is the current operator of the Egbaoma field joint venture with Newcross Petroleum Limited.

Avuru, a pioneer Managing Director and later CEO of Seplat will be retiring in July 2020 after 10 years of leading the company.

In these 10 years, Avuru led the development of a strong organisation, the deployment of agile systems, processes and stakeholder relationships that allowed the organisation to grow rapidly from a gross production of 22,700 barrels of oil equivalent per day

(boepd) as at December 2010 to peaks of 111,368boepd gross production as at December 2018 through major drilling campaigns and major new Oil and Gas plants development.

Seplat told the Nigerian Stock Exchange (NSE) that it received notification on February 21, 2020 of a transfer of 7,831,534 ordinary shares held by Platform Petroleum Limited (an entity in which Austin Avuru has an equity

Austin Avuru, CEO, Seplat Petroleum Development Company Plc

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interest) to Professional Support Limited (an entity wholly controlled by Austin Avuru).

Similarly, a transfer of 12,828,161 shares held directly

by Platform Petroleum was made to certain shareholders of Platform Petroleum and they are therefore no longer considered to be connected persons.

“A further 95,933 LTIP awards for Austin Avuru were released to him and transferred to Professional Support on 24 January 2020”, Seplat added.

Following these transfers, Platform Petroleum holds 20,000,000 shares (3.40percent) and Professional Support holds 38,970,463 shares (6.62percent); based on the Issued Share Capital of 588,444,561.

Avuru now holds nil direct interest and an indirect interest of 58,970,463 ordinary shares (10.02percent) of N0.50k each of the Company. @Businessdayng

Uduk, Onyema, Koko others conferred ICMR honorary fellowship awards Michael Ani

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he acting directorgeneral of the Securities and Exchange Commission (SEC), Mary Uduk; and the chief executive officer, Nigerian St o ck E xc ha ng e ( N S E ) , Oscar Onyema, were among recipients of the honorary fellowship awards by the Institute of Capital Market Registrars (ICMR).

Bola Onadele. Koko, chief executive officer, FMDQ OTC Securities; Daisy Ekineh, one time acting, SEC and chief executive officer DSE Advisory Services Limited; Henry Olayemi, chairman, R e w a rd I nv e s t m e n t s & Services Limited; and Olutola Mobolurin, chairman Capital Bancorp Plc, were also among the renowned capital market figures conferred with the honorary fellowship awards The ceremony happened in the late hours of Friday last week in Nigeria commercial city, Lagos; and graced the presence of both regulators and players in the Nigerian capital market space, including Abimbola Ogunbanjo, who chaired the occasion.

The event also saw the conferring of 22 fellows for investiture and the ushering of the new governing council that will steer the ship of the Institute and the Registrars industry to a new, greater height.

The institute bestowed on Seyi Owoturo, as the new president and chairman of the council, to pilot its affairs, even as Bayo Olugbemi, steps aside as president. Owoturo in his acceptance speech noted that as the new president of the council, his main objective would be to educate and inspire. “ To c o n t i n u e f r o m where my predecessor Bayo Olugbemi stopped, ensuring that as registrars, we leave a positive mark in the minds of our various stakeholders. It is imperative we elevate our thinking and our mindset,” he said.

Members of the institute were tasked to implore “integrity” in their dealings as that is the only way that trusts can be instilled in the capital market.

Tuesday 25 February 2020

BUSINESS DAY

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news

ICPOSSP tasks inductees on rofessionalism JOSHUA BASSEY

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nstitute for Certified Business Process Outsourcing and Shared Services Professionals (ICPOSSP) has tasked members to exhibit the highest level of professionalism in their practice and conduct.

President of the institute, Peter Akindeju, gave the charge at the first induction of members of ICPOSSP, held in Lagos, last weekend. Four members were inducted as fellows, one as expert, 16 as specialists, and 60 as associates, totalling 81 inductees across the country.

According to Akindeju, as the business of outsourcing gains footing in the Nigerian economy, it should be expected that certified practitioners embraced professionalism and work with the institute to address emerg-

ing challenges, as the sector expands.

Part of the strategies, he said, would be education, self-development and knowledge upgrade through seminars, conferences and advocacy.

Akindeju, who described outsourcing as a global economic enabler, said Nigeria cannot afford to lag behind.

He disagreed with the notion that outsourcing puts outsourced staff at a disadvantage, insisting rather, that it’s a 21st Century trend with economic benefits to companies and countries.

“In the emerging freelance economy, the dominant employment model will consist of a collaborative, transparent, technology-enabled, rapid-cycle way of doing business through network and ecosystems of workers who work as intellectual mercenaries.

Education Policy: We’re committed to securing our children’s future - Oyetola Mark Mayah

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sun State governor, Adegboyega Oyetola, says his administration is resolved to repositioning the state for the betterment of all the citizens, saying he is committed to securing the future of the children and those unborn.

Governor Oyetola said government remained committed to improving every sector as its policies and programmes were driven by citizens’ needs.

Oyetola stated these on Monday while receiving the report of the panel of the Education Policy Review Roundtable Summit at the Governor’s Office, Abere, Osogbo.

… receives panel’s report The governor had earlier constituted the Panel led by an educationist, Professor Olu Aina, to look at some extant education policies in the state, with a mandate to review and come up with workable recommendations that could further improve the state’s education system.

Quoting an American author, John C. Maxwell, who has written several books on leadership, Oyetola, who noted ‘a man must be big enough to admit his mistakes, smart enough to profit from them, and strong enough to correct them,’ further said every responsible and responsive government must make people’s demands the basis of its policies and implementation.

He said the need to review

the education policy was informed by the people’s demand, saying the government would ensure full implementation of whatever that would improve the lots of the people and protect the future of its children.

“It was our desire to hearken to the yearnings and aspirations of the citizenry that necessitated this review in the first instance.

“As a government, our policies and programmes are driven by citizens’ needs. These needs which were further validated by the United Kingdom Department for International Development’s (DFID)- funded Citizens Needs Assessment exercise in Osun, were harvested during the Thank You Tour/Town Hall Meetings, where the people

told us in plain language that they wanted some aspects of our educational policies removed, adjusted or improved upon.

“That was what led to the Policy Review Roundtable Summit, the report of which we are receiving today. We are prepared to do what will improve the lots of our people and protect the future of our children.

“As a leader therefore, I am conscious of the need to be just and fair to all manner of people regardless of their leanings in the discharge of my duties. This I will always uphold.

“Finally, let me once again thank the Chairman and members of the Policy Review Panel for investing their time in the future of our children and those unborn.

AXA Mansard sponsors hosting of global culture expert - Dave Eaton

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XA Mansard, a member of AXA, the global leader in insurance and asset management, is partnering Smithworks Limited in hosting a live session and workshop with a global culture expert – Dave Eaton.

The event, geared towards providing insights into key cultural dimensions and how businesses can leverage renewed culture to attract and retain top talents, is slated for Wednesday, February 26, 2020 at the Nigeria Stock Exchange office by 10am with the theme “Leveraging Culture for Driving and Sustaining Growth”.

Speaking ahead of the event, Akinlolu Akinyele, group head of SME & Energy at AXA Mansard Insurance, said, “We at AXA Mansard are excited and proud to be a part of an event like this and we believe that culture at either individual, team or organisational level can drive growth and sustainability and that is why we are hosting Dave Eaton who is

a thought leader in human side of any culture change”.

Also speaking, CEO of Smithswork Limited, Kayode AjayiSmith, said, “Culture plays a huge role in any organisation irrespective of their size or vision. Culture helps to define clearly the vision of any organization. It drives and sustains performance along the same path. Given our mandate, promoting culture helps us to drive home our mandate. With small businesses playing a major role in employment and GDP contributions, unlocking their potential with the purpose of putting our young workforce to work and enabling Nigeria succeed is a fulfilment of our mission. That’s why we have partnered with AXA Mansard to host Dave Eaton”.

The event will have in attendance small business owners, heads of public institutions, leaders of professional associations, human resources managers, project managers, as well as leaders of private institutions and non-profit organisation.

Bismarck Rewane to headline Rotary’s World Peace Day ceremony in Lagos Amaka Anagor-Ewuzie

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otary International, District 9110, which covers Lagos and Ogun states, has concluded plans to host the 2020 World Peace and Understanding Day ceremony in commemoration of the organisation’s 115th anniversary.

According to Jide Akeredolu, district governor, the event, scheduled for Wheatbaker Hotel, Ikoyi, Lagos, February 25, 2020, with the theme, ‘Promoting World Peace and Understanding through Food Security’, will have Bismarck Rewane, a financial expert, as keynote speaker.

Discussants include Biodun Adedipe, chief consultant, Adedipe Associate Limited; Mezuo Nwuneli, managing partner, Sahel Capital Agribusiness Managers Limited; Aliyu Samaila,

director, Agribusiness Feed the Future Nigeria, and Navy Commodore Daniel Atakpa, blue economy expert.

According to Larry Agose, chairman, Organsing Committee, the ceremony will be chaired by Olumide Phillips, chairman, Board of Governors, Dowen College, while Tunji Funsho, chairman, Nigeria National Polioplus Committee, will be the special guest of honour.

Agose further said the ceremony was aimed at discussing the different aspects of the agribusiness sector with a view to highlighting strategies that will be beneficial to governments and help them attain food security.

“We want to showcase how governments can impact society through proper exploitation of the agriculture industry; it will be an intellectuallyengaging ceremony,” he said. www.businessday.ng

L-R: Seyi Osunkeye, national council member, The Nigerian Stock Exchange (NSE); Catherine Nwakaego Echeozo, second vice president, NSE; Oscar Onyema, CEO, NSE; Abimbola Ogunbanjo, president, national council, NSE; Zainab Shamsuna Ahmed, minister of finance, budget and national planning; Sarah Alade, special adviser to the president on finance and economy; Mary Uduk, acting director-general, Securities and Exchange Commission (SEC); Oluwole Ololade Adeosun, national council member, NSE, and Bola Adeeko, head, shared services division, NSE, during the closing gong ceremony to commemorate the visit of the minister of finance, budget and national planning to the exchange in Lagos, yesterday.

Edo establishes sexual assault referral NSACC to hold breakfast forum in Lagos he Nigeria-South Africa from University of Stellenbosch centre for rape survivors, others Chamber of Commerce Business School (USB) in South

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do State government has concluded plans for the establishment of a Sexual Assault Referral Centre (SARC), as part of efforts by the Governor Godwin Obaseki-led administration to tackle the incidences of rape and other sexual assaults as well as cater for the needs of survivors in the state.

Commissioner for Social Development and Gender Issues, Maria Edeko, said this during a five-day training course in Sexual Assault Trauma Counselling (SARC) organised for counsellors attached to the ministry to fast track the delivery of SARC services in the state.

The training course was supported by the Rule of Law and Anti-Corruption (RoLAC) Programme and funded by the European Union, and held in Benin City, the Edo State capital.

Speaking during the flagoff ceremony, the Commissioner noted that setting up the centre will make it easier for survivors (victims)

of defilement/rape to come forward for treatment and advice, which will eventually boost the conviction rate of rapists.

According to Edeko, “Survivors (victims) referred to the centre will undergo a forensic examination, receive counselling, psychosocial support and be advised on and supported in the process of pressing charges as the centre is designed to render multiple services as a one-stop-shop.”

As part of the programme, medical personnel from government-run hospitals in the state received specialised trainings in forensic medical examination, treatment and documentation as parts of efforts by the state government to address shortcomings in the medico-legal response to rape cases.

The training also featured keynote address delivered by the state coordinator of Child Protection Network, Stella Ojeme.

Participants were presented certificates for satisfactorily completing the course.

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(NSACC) will hold its February 2020 breakfast forum scheduled for February 27, at Fantasia Hall, Eko Hotel and Suites, Victoria Island, Lagos by 7.30am prompt.

Olusegun Zaccheaus, associate director, Management Consulting, KPMG Advisory Services, will be the guest speaker for this month’s edition.

Zaccheaus is a management consultant and strategy professional with several years of experience in advising regulators, major corporate organisations and new entities in financial services, consumer market and the public sector.

He has advised clients on enterprise and corporate strategy, growth strategy, operations strategy and improvement as well as macroeconomic and sectorial policy issues and their impact.

He also leads various discourses on global, African and Nigerian macroeconomic issues and its implications for businesses in Nigeria, and has spoken at several fora and taught about businesses and strategies to various audience.

He has an MPhil in Development Finance (Cum Laude) @Businessdayng

Africa. He is keenly focused on ideas, insights and strategies to drive Africa’s economic and financial system progress.

He will share insights on the topical issue: “Nigeria in a New Decade: Navigating the Fault Lines ‘’ in our ever evolving society.

Iyke Ejimofor, the executive secretary, states that the event is primarily for captain of industries, business owners and top level executives as well as other interested parties. He adds that the chairman of the Chamber, Foluso Phillips and other executive directors are expected to attend the forum, noting that as in previous times, this edition will be educative and also insightful.

Ejimofor, on behalf of the Chamber, encourages everyone who wants to grow and strengthen his or her business or gain insights on how to thrive globally to make effort to attend.

He says the meeting is a “great door opener and participants will benefit in many ways, including: finding personal contacts for future follow-up and initiate new vendor relationships, and so on.”

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Tuesday 25 February 2020

BUSINESS DAY

news

Apapa jetty footbridge, structures on RoW demolished for Lagos-Ibadan rail project MIKE OCHONMA, JOSHUA BASSEY & FRANK ELEANYA

… commuters walk longer distances to offices, homes

ommercial and private ferry operators and passengers coming by ferry into Apapa boathouse jetty at Flour Mills plc from the different parts of Lagos State were on Monday left bemused, as the pedestrian bridge that takes commuters out of the boathouse has been demolished to give way for the engineering work and laying of the tracks for the ongoing Lagos-Ibadan standard gauge railway construction.

The development comes weeks after the Lagos State government banned the operations of commercial motorcycles (Okada) and tricycles (Keke) drivers plying on specific roads within the commercial city.

Following the state government pronouncement that

came into force on February 1, 2020, the ban had left commuters coming from CMS-Apapa or Apapa-CMS with only two options; either take a bus or a boat, even as the ferries were in most cases the preferred means of assessing routes due to the consistent traffic situation that has become the hallmark of Apapa as a result of the daily port activities.

On Monday, as commuters were left with no other alternative than to alight from the boats at Apapa ferry service jetty to climb the pedestrian bridge and set out for a long walk to their respective offices only to discover that a large portion of the bridge had been destroyed, leaving a portion that leads to a road far off from many people’s destination.

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There was also a noticeable presence of heavily armed security men stationed along the standard gauge railway construction corridor.

Lagos State Ministry of Transportation, when contacted, denied knowledge of the closure of the ferry route.

According to an official of the ministry who craved anonymity, the state government would always alert the general public whenever the need arose to close any route in the state to allow for the ongoing upgrade of the Nigerian Railway Corporation (NRC) Lagos-Ibadan rail track.

“We’re not aware of the closure of the route leading from the Flour Mill of Nigeria’s premises to the Apapa Jetty.

We didn’t close it. Any time

the state has need to close any street or railway level crossing, we often announce days before the closure and provide alternative routes. We have not closed any road in Apapa for now,” the official said.

Fidet Okhiria, managing director, Nigerian Railway Corporation (NRC), did not respond to calls and text messages to his phone, while Yakmud Mahmood NRC deputy director, public relations, said he was not in a position to respond to BusinessDay’s enquiries as he was not aware of the development.

When contacted, Jerry Oche, Lagos district manager of NRC, referred BusinessDay to China Civil Engineering Construction Company (CCECC), the contractor handling the project.

L-R: Bello Aminu Masari, governor, Kastina State; Benjamin Kalu, chairman, House Committee on Media and Public Affairs; Lai Mohammed, minister of information and culture; Femi Gbajamiala, speaker, House of Representatives, and Ovie Omo-Agege, deputy Senate president, during the unveiling of Green Chamber Magazine by the House of Representatives in Abuja.

AFC invests $63m in Djibouti’s First IPP, Why Nigerians must pay taxes, say KPMG, FIRS has been troubled by multiple renewable energy project ODINAKA ANUDU taxation. Tax collection has DIPO OLADEHINDE

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frica Finance Corporation (AFC) has announced a $63 million strategic investment to construct and operate a 60mw wind project in the Ghoubet area, near Lake Assal in Djibouti.

This wind project will be a key contribution to the electricity demand as the country aims to transition towards 100 percent-renewable energybased electricity production by 2030.

“We are delighted to have the opportunity to invest and develop such a significant renewable power project in Djibouti; we see renewable and green projects as a key part of our investment strategy as we look to support a sustainable future in Africa,” Samaila Zubairu, CEO of AFC, said in an emailed statement.

AFC has made this investment as lead developer together with Great Horn Investment

Holdings (GHIH) and inviting further investment from Climate Fund Managers (CFM), and FMO, the Dutch entrepreneurial development bank.

AFC has led the development of the project since 2017, developing it from concept to bankability, securing a 25-year take or pay power purchase agreement with Électicité de Djibouti as the off-taker, an implementation agreement and with the Government of Djibouti backed by a Government Guarantee.

Oliver Andrews, chief investment officer of AFC, said the project is a significant project for Djibouti as its first renewable energy project and signifies the country’s efforts to establish its own energy production from its own resources.

“By taking this position on the board, I am delighted to be adding my expertise to the development of the project with my colleague Amadou Wadda,” Andrews said.

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igerians must take paying taxes more seriously to facilitate the execution of infrastructure projects and build a resilient economy, experts have said.

Speaking at an interactive session organised by the Professional Practice Group of the Lagos Chamber of Commerce and Industry (LCCI) in Lagos, Ajibola Olomola, partner, Tax, Regulatory and People Services, said Nigeria needed a bullet-proof tax system to boost its gross domestic product and cut the unemployment rate of 23.1 percent.

He said Nigeria’s tax to GDP of 6 percent (2018) was one of the lowest globally, as the ratio across African countries hovered between 12 and 17 percent.

“Tax and non-tax revenue of N2.18 trillion are insufficient to close the projected 2020 budget deficit,” he said.

Africa’s largest economy

www.businessday.ng

been marred by uncertainties, inconvenience and lack of economy - in contradistinction to key canons of tax proposed by Adam Smith, a Scottish economist.

The Federal Government, in realisation of the weaknesses, recently sponsored a Finance Bill, which has been assented to by President Muhammadu Buhari.

The now Finance Act has an early tax payment bonus and eliminates potential double taxation with the new Excess Dividend tax rules, Olomola said.

Apart from simplification of Minimum Tax Rules, there is a five-to-eight-year tax holiday for agricultural business, including a change in conditions for tax-exempt export profits.

“The proposed changes in Finance Act will ensure that dividends that had been subject to tax are not subjected to CIT upon re-distribution to shareholders,” he explained.

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Africa partners UNWTO on tourism investment, security OBINNA EMELIKE

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ourism ministers across the African continent are seeking further partnerships with the United Nations World Tourism Organisation (UNWTO) to boost tourism investment, ensuring security and growing tourists’ receipts in Africa.

The ministers, who gathered for the UNWTO Global Tourism Investment Forum In Africa, whichheldatSofitelAbidjanHôtel Ivoire, Côte d’Ivoire, from February 20-22, 2020, put their heads together on ways to attract and grow investmentsintheAfricantourism sector while the UNWTO offered to support where necessary.

One of the highlights of the tourism investment forum, held for the first time in Africa, was a Ministerial Conference on the theme “Fostering African Tourism through Investment” and was chaired by Siandou Fofona, minister of Tourism and Leisure, Côte d’Ivoire, amid the presence of Abdoul Karim Sango, vicechair, Regional Commission for Africa, and Zurab Pololikashvili, secretary-general, UNWTO. According to Fofona, the conference was necessary to identify measures to facilitate access to African destinations and to highlight the conditions needed for the proper control of threats in order to better attract and secure investments.

Fofona led other ministers to discuss topical issues affecting African tourism development, including; air connectivity, difficulties in obtaining visas for tourists in most of the states, high cost of African destinations, improving Africa’s image in the media, creation of a Community Fund for Tourism and Hotel Investment and Development, among other issues.

In proffering solutions, the

ministers recommended the institutionalisation of the Single African Air Transport Market (SAATM) by establishing the legal and regulatory framework necessary at the national level to allow its full establishment; cooperation among transport authorities, tourism authorities and other ministries; formulate a marketing and promotion strategy supporting the development of tourism products, adopt solutions for opening up visa regimes, among others.

As well, in a communiqué they reached at the conference on security, the minister recommended the establishment of a reference system compiling good practices and the best responses, use of Toolbox for Crisis Communications, creation of tourism police, among others.

In his remarks at the forum, Zurab Pololikashvili, secretarygeneral, UNWTO, expressed his appreciation to Alassane Ouattara, president of Cote d’ivoire for the support to host the maiden event which aimed at selling bankable African tourism products to the world. He re-echoed the need to develop the sector and create employment opportunities with investments into the sector Pololikashvili reiterated that the working relationship and vision of Siandou Fofana, the host country’s tourism minister have been extremely valuable, especially for his leadership both in Cote d’ivoire and at the regional level.

The conference witnessed over 800 delegates comprised of experts, investors, public officials including tourism ministers from Mali, Democratic Republic of Congo, Sierra Leone, Gambia, Senegal, Burkina Faso, South Africa, Central African Republic, and Gabon, with Zimbabwe and Zambia as observers.

South Africa’s Brenthurst partners Nigeria’s Obasanjo on population control in Africa … as 3 former African heads deliver lectures at Obasanjo’s 83 birthday

RAZAQ AYINLA, Abeokuta

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oing by the geometric increase in human population across 55 independent states in Africa, which has created abject poverty, unemployment, insurgency, hatred, political instability, among other challenges, the Centre for Human Security and Dialogue of Olusegun Obasanjo Presidential Library has partnered Johannesburg-based, South African thinktank, Brenthurst Foundation to undertake survey and control of African population.

The partnership between the South-African Brenthurst Foundation and the Olusegun Obasanjo Presidential Library becomes imperative considering negative impacts of the increasing population, which could have been tailored towards positivity instead of current grievous consequences staring people of the continent on the face. The two organisations are therefore working in the directions of turning the huge population to assets.

Speaking at a press conference to herald the 83rd birthday anniversary of former President @Businessdayng

Olusegun Obasanjo in Abeokuta on Monday, Peter Okebukola, a professor and director, Centre for Human Security and Dialogue of Olusegun Obasanjo Presidential Library, said strategic efforts must be undertaken to change the bad narratives as regards the population of Africa, as issues and challenges of growing population would be converted to desired benefits that have positive impacts of people’s lives.

He said, “The support that we receive from Brenthurst Foundation; we have received support for 2019 Report on African population as asset. You know African growing population at annual rate of about 2.9% - 3%, and there is danger there, because if we do not harness the huge youths population, then there is tendency of poverty.

“If unemployment is creeping in, poverty is creeping in, we are going to have a phenomenon where seed of terrorism, seed of hatred, seed of political violence will begin to germinate.

So, Brenthurst Foundation gives us some fund to support the project where we look at different dimensions of population growth.

Tuesday 25 February 2020

BUSINESS DAY

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news

Migration: ILO charges member countries on labour statistics JOSHUA BASSEY with agency report

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nternational Labour Organisation (ILO) says member countries must have reliable labour statistics for effective implementation of the relevant migration policies, laws and certification programmes with the organisation’s convention.

Dennis Zulu, director, ILO country office in Nigeria, said timely and reliable labour statistics remained an essential requirement for evidence-based policy-making in any given society.

Zulu spoke at a recent threeday capacity building workshop in Lagos with the theme, “Labour Migration Statistics in Nigeria” with participants drawn from National Bureau of Statistics (NBS), National Population Commission (NPC), Nigeria Immigration Service (NIS), Federal Ministry of Labour and Employment.

According to Zulu, represented by Augustine Erameh, ILO’s national project coordinator, it is essential to produce reliable and timely labour statistics for research and information.

He said there was the need to produce sound evidence-based policy-making for the residents and migrants in a given country.

“Accurate and current sta-

tistics are necessary to describe and analyse prevalence, determinants and consequences of labour migration in the country,” he said.

The ILO director noted that the workshop was also to facilitate engagement with stakeholders to better understand the underlying causes of poverty and social exclusion in Nigeria. He said also it formed part of ILO’s efforts toward responding to country needs in capacity building to enhance the engagement of relevant state actors in the area of labour migration statistics.

“As an evolving phenomenon, labour migration continues to remain a feature of modern day labour markets that requires stakeholders’ participation to facilitate development and implementation of effective governance frameworks. Globally, millions of migrants leave their country of origin in search for better employment opportunities.”

He further noted that a better understanding of the phenomenon through evidence-based lenses will go a long way to address challenges associated with irregular migratory flow of labour migrants.

He added that the area of labour statistics would support in-country efforts for improvements in the labour markets.

Service chiefs meet Buhari, chief of staff Financial empowerment: UBA launches ‘Click ... as president sets up National Humanitarian Committee Tony Ailemen, Abuja

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resident Muhammadu Buhari on Monday met for several hours with top echelon of the nation’s security operatives at the Presidential Villa, Abuja.

Like other recent meeting since the crisis between the National Security Adviser (NSA), Babagana Mongonu and Chief of Staff to the President, Abba Kyari, the NSA was conspicuously absent at the meeting.

The Service Chiefs later proceeded as a group to meet with the President’s Chief of Staff in his office located few meters away from the President’s office.

It was however not immediately clear what the meeting discussed, but BusinessDay Villa sources said it was part of “regular security briefings to Mr. President.”

The Service Chiefs refused to entertain questions from the State House correspondents after the meeting.

It was however curious to see the Service Chiefs moved as a group to meet with the Chief of Staff to the President and came out together before proceeding to enter their different vehicles.

But the special adviser to the president on media and publicity, Femi Adesina, in a statement, said the president approved the constitution of a National Humanitarian Coordination Committee (NHCC) to oversee all humanitarian actions in the country.

The committee is expected to among other things provide a national vision for humanitarian actions, advise on coordination between the security services and humanitarian actors, settle disputes that may arise from interactions between security services and the humanitarian community.

Other functions include: propose policies that enhance coordination and seamless delivery of humanitarian aid to affected communities, facilitate delivery of humanitarian interventions to vulnerable persons, and promote transparency and accountability in all aspects of humanitarian delivery in the country.

The NHCC will be chaired by the minister, Federal Ministry of Humanitarian Affairs, Disaster Management and Social Development (FMHADMSD), and the NSA, as co-chairman.

Credit’ to ease access to cash for customers

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nited Bank for Africa (UBA) plc has launched ‘Click Credit’, a time loan designed to address the urgent needs of customers whose salary accounts are domiciled with the bank.

As a bank backed by a strong retail franchise with over 1,000 business offices serving 19 million customers, UBA has introduced this product in line with the bank’s mission of creating value for its customers while assisting them to meet up with their urgent needs. The loan product, already being enjoyed by millions of customers in Nigeria will be extended to the bank’s other franchises in Africa.

Click Credit, which has been carefully crafted to improve the lives of the UBA customers, is a superfast loan product which will allow qualified customers to apply for up to N5 million loans and pay back over 12 months at an interest rate of 1.58% per month, with no hidden fees.

Specifically, salary earners from N25,000 per month who fall between the ages of 18 and 59 can benefit from this facility with no extra fees; no need for collaterals, no paper-work or other difficult issues when it comes to this facility; as customers can even apply via LEO, UBA Mobile Banking and UBA

Nigeria’s 104 unity schools urged to participate in FLL Robotics Competition ... as 2020 national championship winners emerge Jumoke Akiyode-Lawanson

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he Federal Ministry of Education has indicated that from next year all the 104 Unity Schools in Nigeria will participate in the FIRST LEGO LEAGUE (FLL) National Robotics Championship Competition.

FLL was brought to Nigeria

by Coderina Education and Technology Foundation, a not-for-profit organisation and supported by SAP. Now in its sixth edition in the country, the 2020 competition themed: “City Shaper” was organised by Coderina in collaboration with the Ministry and the National Association of Proprietors of Private Schools (NAPPS) with supports from SAP; National Information Technology Development Agency (NITDA); Irish Aid, and the Baze University in Abuja.

Chukwuemeka Nwajiuba, minister of state for education, speaking through Sonny Echono, the permanent secretary, said the decision to allow all Unity Schools’ participation was meant to strengthen critical and computational thinking among students.

Children aged 9 to 18 years numbering about 1000 and 50 teachers drawn from 60 schools participated at this year’s national championship where Metra 101 Team, an

all-girls team from FGGC, Ikot Obio Itong, Akwa Ibom State, emerged overall champions.

Other winners include: Robot Design (2nd place) Award – Tech Gears X; Against All Odds Award – FGGC, Bauchi; Mentor/Coach Award – FGGC, Kabba; Core Values Award - Airol Unilag; Robot Performance Award - Bred Hub; Glistobots - Robot Design - Glisten School and Robot Performance (2nd) - FSTC Orozo, Project Award - Technobots - Vivian Fowler School.

Metra 101 Team scooped the top position by embodying the programme’s core values of teamwork and mutual respect while achieving excellence and innovation in both robot game and innovative project.

Feeling excited by the students’ performances, the permanent secretary said: “This marks a significant first step in our work in ensuring the infusion of coding in our school curricula to strengthen critical and computational thinking as a key skill set that students in secondary education must have. This will ensure that we broaden the base by making sure that the opportunities of this preparation are made possible today even though the manifestations of the series of efforts we are making now will come tomorrow.

“Our efforts are in line with Ministerial Strategic Plans, the SDGs 4; which is provision www.businessday.ng

of quality education for all…

The world of today and that of the foreseeable future is one where individuals move between digital domains and offline reality with the use of technology to enable and manage life”.

Kashifu Inuwa Abdullahi, director-general, NITDA, represented by Vincent Olatunji, the director of eGovernment Development and Regulation (eGDR), said NITDA was saddled with the responsibility of developing and regulating the use of information technology in the country, which has contributed immensely to the country’s Gross Domestic Product (GDP).

He said, “Building creative young minds will bring out the potentials embedded in the teeming youths, making them to have the basic Information Technology foundation at an early stage”.

According to the directorgeneral, “Information and Communication Technology (ICT) is one of the fundamental pillars and the next oil of the nation that will play a pivotal role towards the growth of the economy.

“The Fourth Industrial Revolution has brought about the concept of smart things, digital platforms and digital economy, stating that the difference between third and fourth industrial revolutions is the disruptive nature of the emerging technologies”. https://www.facebook.com/businessdayng

@Businessdayng

internet banking.

UBA’s group head of retail banking, Jude Anele, who revealed that qualified customers have begun to enjoy the service, explained that the loan provides immediate access to funds once eligibility is confirmed in less than a meeting He said, “As Africa’s most innovative and technologydriven financial institution with an array of novel products and services tailored to the needs of its millions of customers, we have launched Click Credit, which is straightforward and more affordable than many other loan products in the market. Its unique feature is that it meets a critical credit need for our customers”.

Anele, while emphasising the critical role that credit plays in any developing and developed society, said that it is part of the customers’ financial power where they can be assisted to get the things they need, when they need them without hassles.

While explaining that this product is being rolled out first in Nigeria and subsequently in the rest of UBA’s countries of operations; he explained that UBA is committed to ensuring that Click Credit helps the bank’s customers to cover critical needs and set them up for success, having moved past that moment of need.

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Tuesday 25 February 2020

BUSINESS DAY

news Port congestion persists on mounting...

Continued from page 1

Dapo Abiodun (l), governor, Ogun State, exchanging pleasantries with Mele Kolo Kyari, group managing director, Nigeria National Petroleum Corporation, at the NNPC Towers in Abuja, recently.

Nigeria’s economic growth surges to fastest...

Continued from page 1

investing more.

Developments in the oil sector have been a major determinant of the direction of economic activities in Africa’s largest economy which depends largely on the sector to rake in about 70 percent of its revenue and 85 percent of its foreign exchange earnings.

The GDP figures outperformed various predictions of sluggish growth. World Bank had estimated Nigeria’s economy to edge up to 2.0 percent, while IMF projected a 2.1 percent growth in 2019.

Nigeria’s fortunes are still closely linked to oil markets and growth could be threatened this year if oil prices continue to fall the way they have done in 2020 so far.

Brent crude traded at $55.61 per barrel Monday following a surge in new coronavirus cases, highlighting the severe risk market volatility poses to oil-dependent economies like Nigeria.

What analysts say The non-oil sector remained the major driver of growth in the fourth quarter of 2019, as it improved 2.1 percent in 2019, although this was a little change from 2.0 percent in 2018. Aside from the ICT and agriculture sectors, there was a broadbased underperformance in major sub-sectors.

“In our view, this suggests that the economic recovery would continue at a sluggish pace without the implementation of reforms and market-friendly policies,” said analysts at Afrinvest.

“Beyond cheap credit, there has been little progress towards boosting agriculture yields, helping farmers adapt to a changing climate and curbing insecurity. In manufacturing, the weakness in consumer purchasing power remains the major theme as growth slowed to 0.8 percent in 2019 from 2.1

percent in 2018,” the analysts said.

The financial services grew faster at 2.4 percent in 2019 from 1.4 percent in 2018.

“We suspect this was driven by the raft of policies rolled out by the CBN in H2:2019, particularly the 65.0 percent increase in loan-to-deposit ratio. We retain our growth forecast of 2.4 percent for 2020 as we do not expect significant improvements,” Afrinvest analysts said.

Omotola Abimbola, a macro and fixed income analyst at Chapel Hill Denham, said the GDP was a positive surprise as it was much higher than what the market expected but that’s because of the CBN’s policy, particularly on the LDR as seen in the massive growth in the financial services level due to the increased lending by the banks in the period.

“We saw a very strong pick-up in credit when banks where rushing to meet the LDR requirement and as a result of this, we saw a very strong growth in that sector that then had an impact on the aggregate GDP numbers,” Abimbola said.

However, Abimbola noted that the real economy was flat going by the agric and manufacturing sectors despite all the rhetoric on how the border closure would help the sectors.

“We are yet to see the positive impact of the border closure on both sectors. We need to attack the competitiveness of the economy in terms of infrastructure and ease of doing business environment. There’s need to focus more on structural reforms to drive growth,” Abimbola said.

Gbolahan Ologunro, a research analyst at Lagosbased CSL Stockbrokers, said the growth in the oil sector is quite impressive helped by stable or relative www.businessday.ng

peace in the Niger Delta region and oil price that remained favourable supporting the performance of the sector.

“We still have the PIGB hanging in the air, and that is the bill that has the opportunity to open the economy to attract FDI. The non-oil sector growth was slightly better showing that the performance of the sector is still weak, a reflection of weak macroeconomic fundamentals in the broad economy,” Ologunro said.

“The current macro-economic structure does not support the growth prospect of the economy so we just need to implement those reforms that would remove those barriers that have affected the productivity of the non-oil sector,” he said.

2019: The year of economic improvement Thanks to a combination of relative higher oil production of 2 million barrels daily and favourable average oil price of $57.05 in 2019, Nigeria’s oil sector grew by 4.59 percent compared to 0.97 percent last year.

Oil sector GDP grew by 6.36 percent in Q4 2019, compared to 6.49 percent recorded in Q3 2019 and 7.98 percentage points increase compared to -1.62 percent in Q4 2018.

In terms of contribution, the oil sector contributed 7.32 percentage to the total real GDP in Q4 2019, up from 7.06 percentage recorded in the corresponding quarter. Meanwhile, the sector’s contribution to GDP went down when compared to 9.77 percent recorded in the third quarter of 2019.

Also, oil production improved slightly due to relative stability in the Niger Delta region and that’s despite shortfalls across key pipelines in the sector and the force majeure on SPDC Bonny Light Export Terminal.

As a result, oil production volume averaged 2.01 mbpd in 2019, 1.93 million

barrels daily in 2018, from 1.88 mbpd in 2017.

The agricultural sector grew by 2.36 percent annually in 2019 compared to 2.12 percent in 2018 with crop production remaining the major driver of the sector.

Human capital indicators such as education, health and five other sub-sectors such as coal mining, motion pictures, non-metallic products, motor and vehicles assembly, other manufacturing all exited recession.

For full-year 2019, the education sector grew by 0.80 percent from -0.03 percent in 2018 and -0.72 percent in 2017. Health and social services grew by 0.31 percent in 2019 from -0.32 percent, -0.31 percent and -1.79 in 2018, 2017 and 2016, respectively.

Education sector had been in recession since 2017, while the health and social services sector was in recession since 2016.

Manufacturing sector grew by just 0.77 percent in full-year 2019, sliding from 2.09 percent in 2018, though some improvement from an -0.21 percent contraction in 2017.

For full-year, manufacturing real contribution was 9.06 percent in 2019 as against 9.20 percent contributed in 2018, the NBS said.

The non-oil sector grew by 2.06 percent in real terms in 2019 compared to 2.00 percent in the previous year which was driven mainly by Information and Communication (telecommunications), agriculture (crop production), financial and insurance services (financial institutions), and manufacturing.

In real terms, higher crop production, telecoms, and trade helped non-oil sector in contributing 91.22 percent in 2019 compared to 91.44 percent in 2018.

Crop production, trade and telecommunications contributed 22.67 percent, 16 percent and 10.30 percent in 2019.

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days earlier in the year, according to German shipping line Hapag-Lloyd.

The waiting time at Tin-Can Island Container Terminal, however, has remained at over 10 days, same as last month’s figure as contained in Ha p a g - L l o y d ’s Ja n u ary operational report published by Container News, a shipping and maritime news portal specialised in liner shipping and its container applications.

In the last quarter of 2019, shipping liners waited an average of 1015 days to have access to the ports to discharge their cargo, as against the seamless process that obtained at the ports before the congestion began.

As at October 2019, APM Terminals had overtime containers numbering 2,259 boxes, equal to 3,000 TEUs, according to the Nigerian Ports Authority (NPA).

APM Terminals had in November 2019 raised alarm of an impending congestion in Nigerian ports which it said was due to substantial increase in volume of containers arriving through the seaports and presence of abandoned containers occupying spaces in the terminal.

At Ports and Terminal Multiservices Limited (PTML) located in Tin-Can Island, overt i m e c a r g o c u r re n t l y occupies more than 30 percent of the commercial space, BusinessDay check shows. Industry observers blame this on the failure of the management of Nigeria Customs Service (NCS) to auction such containers.

T h e s i t u a t i o n h a s, h o w e v e r, b e e n c o m pounded by the border closure.

“Congestion in the nation’s seaports in Lagos was escalated by the closure of Nigeria’s land borders by the Federal Government six months ago,” said Tony Anakebe, managing director, GoldLink Investment Ltd, a Lagos-based clearing and forwarding firm.

Since Nigeria closed its borders with Benin Republic in August last year, most ships with Nigerian-bound cargoes that previously berthed in ports in neighbouring countries and their cargoes subsequently smuggled into the country now come through Nigerian ports, Anakebe told BusinessDay on phone.

The container dwell @Businessdayng

time in Nigerian ports has also increased due to bottlenecks hindering importers and their agents from taking delivery of their consignment as and when due, he said.

“The Lagos State new polic y on motorc ycle (Okada) movement has limited movement in and out of ports. Most times, Customs officers resume work around 12pm and they would not work beyond 4pm. This, coupled with the persistent gridlock on port access roads, has reduced the official working hours of Customs officers and other agencies involved in cargo clearing,” he said.

Hassan Bello, executive secretary, Nigerian Shippers Council (NSC), said the port system, which is private sector-driven after it was concessioned over 12 years back, lacks efficiency in its operations due to logistics and infrastructure problems. He said cargo clearing delays also arises from the 100 percent manual examination of cargo at the ports by Customs due to absence of scanners, pointing out the need to automate the ports for faster clearance of cargoes.

Scanners and national single window are important to accelerate cargo clearing process, and the roads outside the port are also important for efficiency to increase, Amine Mati, senior resident representative and mission chief for Nigeria at the International Monetary Fund (IMF), said recently when he led a delegation of IMF on a visit to inspect port activities in Nigeria.

One possible way of ending port congestion and reducing gridlock at the ports is to put to use the Kirikiri Lighter Terminal which has the capacity to receive 15,000 containers, Lucky Amiwero, president, National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), said.

Amiwero, in a position letter to President Muhammadu Buhar i, said using the Kirikiri Lighter Terminal would eliminate the possible litigation that would be generated from import trading community for diverting Lagos-bound cargoes to other ports as proposed by the NPA. He listed Brawl phase 1 , Ba c o l i n e r, Ki r i k i ri phase 2 and Kirikiri phase 3 as idle terminals that have capacity to accommodate 2,000, 4,000, 3,000 and 2,000 containers, respectively.

Tuesday 25 February 2020

BUSINESS DAY

39

news

Litigation delays payment to depositors of Fortune, Triumph, Peak Merchant banks Onyinye Nwachukwu, Abuja

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ayment to depositors of failed Fortune International Bank, Triumph Bank and Peak Merchant Bank was put on hold as at the end of 2019 due to litigation challenging the revocation of their operating licences, the Nigeria Deposit Insurance Corporation (NDIC) says.

The Central Bank of Nigeria (CBN) revoked the licence of Fortune Bank plc on January 16, 2006, Peak Merchant Bank on February 28, 2003, and that of Triumph Bank on January 16, 2006, having found them insolvent to carry on banking operations.

The NDIC had said then that due to court actions instituted by some of the closed banks’ shareholders challenging the revocation of their banks’ licences, it was unable to conclude the closing exercise and initiate the payment of deposits to depositors of the banks.

But the Corporation has so far liquidated 425 financial

... as NDIC liquidates 425 banks in 32 years institutions since its incorporation in 1988.

John Abiodun, an assistant director, Insurance and Surveillance Department of the Corporation, who made the disclosure, said 51 of the liquidated institutions were Deposit Money Banks; 325 were Micro Finance Banks while 51 were Primary Mortgage Banks.

The liquidation of institutions through revocation of their operating licences becomes the last option when all resuscitation efforts by the shareholders and authorities fail, he said.

Abiodun spoke weekend at the 2020 Finance Correspondents Association of Nigeria forum in Abuja.

He said through efficient and diligent liquidation activities, the Corporation had successfully paid in full the deposits of customers of 18 DMBs that were both insured and uninsured.

“But payment to deposi-

tors of Fortune International Bank, Triumph Bank and Peak Merchant Bank was put on hold as at the end of 2019 due to litigation challenging the revocation of their operating licence,” he stated.

He said insider abuse, abusive ownership and weak board of directors, weak corporate governance, poor risk management process, inadequate capital, weak regulatory and supervisory measures as well as economic and political factors were primary reasons some of these banks failed.

“Once a bank’s licence is revoked, NDIC takes over for liquidation,” he noted.

But in the course of supervision, the corporation looks out for early warning signals that could eventually lead to a bank not being able to meet its obligations.

According to him, some of those signals include aggressive growth and excessive competition for deposits, shareholder’s squabbles, fre-

quent changes in management and ownership, change in major business lines.

Others are failure to meet the minimum Capital Adequacy Ratio of 10 percent, rising non-performing loans to total credit ratio of above five per cent, failure to meet the prevailing minimum liquidity ratio of 30 percent, high total expense to total income ratio and high incidences of fraud.

Speaking on the resolution mandate of the NDIC, Abiodun said the corporation had faced a lot of challenges in effectively carrying out this role.

He listed delays in revocation of the licenses of terminally distressed banks, depositor and creditor apathy and ignorance, delay in filing claims, and recovery of debts owed the failed banks as some of those challenges.

Delays in amending the NDIC which has dragged for a few years has also been another challenge, Abiodun mentioned.

Abuja gridlock: FCTA bans morning vehicle inspection, trucks movement James Kwen, Abuja

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s part of measures to ameliorate the acute problem of traffic congestion at peak periods in the nation’s capital, Abuja, the Federal Capital Territory Administration (FCTA) has banned personnel of the Directorate of Road Traffic Services (DRTS) from inspecting vehicle particulars on roads in the city before 10am each day.

The FCT Administration insists that there was no going back on its earlier decision to restrict the movement of heavy duty vehicles in the Territory to off-peak periods, warning of severe sanctions for those who violate the policy.

Before now, the FCTA had ordered that vehicle inspection should commence from 9am, but after series of meetings with stakeholders, an additional hour was added so as to avoid clogging the roads during the early morning rush hours.

Chairman, FCT Ministerial Taskteam on Traffic Management, Ikharo Attah, who disclosed this in a statement on Monday in Abuja, explained that the decision was borne out of complaints from residents that the checking of vehicles

from 9am had compounded the traffic situation in the Territory and led to loss of many hours.

Attah said, “By this, the road traffic officers of various agencies must focus on freeing traffic from 5am to 10am in the morning. They are to commence checking of vehicles and their particulars from 10am across the city.

“The enforcement does not affect the stopping and arrest of heavy duty vehicles driving during peak traffic periods. Any such vehicle must be stopped from plying the road in accordance with approved policy to avert fatal road crashes occasioned by break failures usually associated with such heavy duty vehicles.”

Attah also dismissed reports that traffic officials were causing traffic congestion by checking vehicle particulars in the evenings on the Abuja-Keffi road, explaining that, all traffic officers on evening duties do not check documents but were positioned to sustain a seamless flow of traffic.

He however warned that the shift in the commencement of vehicles inspection time was not a licence for drivers of rickety vehicles to flood the city in the morning.

Nigeria unlikely to meet 80% financial inclusion target in 2020 - EFInA ENDURANCE OKAFOR

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L-R: Kelly Amogu, head of marketing, House of Tara International; Cosmas Maduka JR, executive director, Coscharis (panellist); Linda Ochugbua, head of digital sales, BusinessDay (panellist); Kaylah Oniwo, OAP CoolFM (panel moderator); Tundun Aderigbigbe, operations director, House of Tara International; Abasiama Idaresit, CEO, Wild Fusion (panellist), and Obinna Anyaegbu, executive director, Chisco Motors (panellist), at the just concluded House of Tara Annual Distributors Conference held in Lagos.

Zenith, UBA, FBN make top 500 global valuable banking brands BUNMI BAILEY

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enith Bank, United Bank of Africa (UBA), First Bank of Nigeria and Guaranty Trust Bank (GTB) have again made it to the top 500 global banking brands, according to the 2020 top 500 global banking brands report.

The top 500 global banking brands is an annual report on the most valuable and strongest banking brands in the world published by United Kingdom-based Brand Finance, the world’s leading branded business valuation and strategy consultancy.

A breakdown of the valuation data which cover December 2018-December 2019 shows that though it made it to the top 500, Zenith Bank’s brand value declined marginally by 1.7 percent to $287 million from $292 million.

The bank fell in its ranking by one place to 392. It, however, still

remains Nigeria’s most valuable banking brand.

Access Bank came in second among Nigerian banks with $242 million. It had no previous ranking as it was just reintroduced in the new report.

UBA ranked third in Nigeria and 437th in the world, but dropped in its value by 16.9 percent to $231 million. It was followed by GTB, which improved by 8.8 percent to $222 million, ranking fourth (Nigeria) and 446 (globally). GTB was the only bank among the tier-one banks to improve in its brand value as its ranking improved to 446th position from its previous 474th position.

First Bank’s value declined by 25.4 percent to $194 million, ranking fifth (Nigeria) and 481 (globally).

Babatunde Odumeru, managing director, Brand Finance Nigeria, said the decline in brand value of Nigerian banks is bewww.businessday.ng

cause they are not exploiting their intellectual property enough, especially the brand, as they ought to.

“The ratio between their brand values and enterprises values is very low, like an average of 3.5 percent, which is extremely low for the sector,” Odumeru said.

“The strongest and most valuable brands in this sector are going to be the ones who can demonstrate the ability to adapt to the changing nature of the financial services especially in the area of technology – because the most effective route to financial inclusion is now through technology,” he said.

Ayorinde Akinloye, analyst at CSL Stockbrokers, said GTB has been creating a new tech hub in the bank such that they have been employing programmers and tech experts who would come together to think about ideas that can improve ban king.

“However, I feel UBA towards the end of last year have started building on their brand,” he said.

Brand Finance used the royalty relief approach, a brand valuation method compliant with the industry standards set in ISO 10668 (a standard for procedures and methods of valuing a brand), to calculate the values of the bank brands in its league tables.

It involves estimating the likely future revenues that are attributable to a brand by calculating a royalty rate that would be charged for its use, to arrive at a ‘brand value’ understood as a net economic benefit that a licensor would achieve by licensing the brand in the open market.

The tier-one banks were not the only ones to report a decline as for the first time globally, the total brand value of the world’s 500 largest banks declined yearon-year from $1.36 trillion in 2019 to $1.33 trillion.

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he target by the Central Bank of Nigeria (CBN) to ensure 80 percent of Nigerian adults have access to financial services by end of 2020 is unlikely to happen Enhancing Financial Innovation and Access (EFInA), the organization that conducts biennial report on Nigeria’s financial inclusion industry, has said.

Having covered Nigeria’s financial inclusion space in the last 12 years, EFInA said the 20 percent exclusion target is unlikely to be achieved as its data show that Nigeria’s exclusion gap was widening.

It said even though its 20218 data showed that more people became financially included the financial inclusion pace was however not matching the country’s population growth rate.

“What we saw between the 2016 and 2018 data was that more people were becoming financially included but not at the same pace as the population growth rate which is why the 80 percent target of financial inclusion for this year or conversely the 20 percent exclusion target is unlikely to be met if we are all particularly realistic,” Dayo Odulate-Ademola, Head of innovation at EFInA said on Monday at the Social Media Week.

The CBN through its National Financial Inclusion Strategy (NFIS) plans to ensure that 80 percent of Nigerian adults are included in the financial net by the year 2020.

The 2018 data by EFInA put Nigeria’s financial inclusion rate at 63.2percent, meaning that as much 36.8 percent or about 40 million adults still lack access. @Businessdayng

If the apex bank is to achieve its objective through the strategy launched seven years ago, it would have to bridge the 16.8 percent inclusion gap before year-end.

But the CBN had in a circular on July 2018, lamented that Nigeria was not meeting any of the financial inclusion targets agreed and contained in the 2012 Financial Inclusion Strategy.

Not only was the country not meeting its targets, but it was also declining in growth. For instance, while Nigeria achieved 60.3 percent in 2012, it declined to 58.4 percent in 2016 against a target of 69.5 percent translating to financial exclusion of about 41.6 percent.

To achieve a more inclusive financial system at an affordable rate, industry experts have advised that Nigeria would need to leverage technology to give access to its excluded population.

“To achieve financial inclusion target that the CBN by 2020 technology has to play a massive significant role and what I see technology doing in terms of Nigeria’s financial inclusion is actually to democratize access that is the first thing it does,” Wole Adeniyi, executive director at personal & business banking, Stanbic IBTC Bank said during a panel session at the Social Media Week on Monday in Lagos.

Telecommunication operators’ push to offer mobile money service, a financial inclusion model that has helped other Africa countries in their programme was recently given an official nod by the regulator, the Central Bank with the issuance of guidelines for players to apply for the licence to operate as payment service banks (PSB).

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Tuesday 25 February 2020

BUSINESS DAY

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Tuesday 25 February 2020

BUSINESS DAY

41

INSIDE NIGERIA’S GDP REPORT

Manufacturing sector slumps 0.77% in 2019, despite expanded economy ONYINYE NWACHUKWU

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ven though Nigeria’s economy accelerated to 2.55 percent in 2019, the manufacturing sector grew by just 0.77 percent in full-year 2019, sliding reasonably from 2.09 percent in 2018, though some improvement from and -0.21 percent contraction in 2017.

According to GDP figures released by the National Bureau of Statistics (NBS) on Monday morning, the Manufacturing sector grew by 1.24 percent in Q4 2019 from 1.10 percent in Q3 2019 but still less than 2.35% in Q4 2018.

The sector contributed 8.74 percent to overall real GDP in Q4 2019, lower than the 8.86 percent recorded in the fourth quarter of 2018 but the same as 8.74 percent recorded in the third quarter of 2019.

Nigeria’s Gross Domestic Product (GDP) grew by 2.55 percent (year-on-year) in real terms in the fourth quarter of 2019, representing the highest quarterly growth performance since the 2016 recession.

The NBS said this shows a 0.17 percent points increase from 2.38 percent in the fourth quarter of 2018 and also an increase of 0.27 percent points when compared with the third quarter of 2019.

Overall, this resulted in an annual 2019 real growth rate of 2.27 percent, compared to 1.91% in 2018. Quarter on quarter, real GDP growth was 5.59 percent.

For full-year, manufacturing

real contribution was 9.06 percent in 2019 as against 9.20% contributed in 2018, the NBS said.

The Manufacturing sector comprises thirteen activities: Oil Refining; Cement ; Food,

Beverages and Tobacco; Textile, Apparel, and Footwear; Wood and Wood Products; Pulp Paper and Paper products; Chemical and Pharmaceutical products; Non-metallic Products, Plastic

and Rubber products; Electrical and electronic, BasicMetalandIronandSteel; motor vehicles and Assembly; and other manufacturing. Oil Refining under the manufacturing sector contracted by -25.71 percent in Q4 2019 from -30.77 percent in Q3 2019 and 33.60 percent in Q4 2018.

Also, it contracted by -31.39 percent in full-year 2019 from – 3.97 percent in 2018 and -27.70 percent in 2017, according to the NBS numbers.

The NBS reported Nominal GDP growth of the sector in the fourth quarter of 2019 at 26 percent (year-on-year), -7.27 percent points lower than figures recorded in the corresponding period of 2018 (33.57%) and -13.40 percent points lower than the preceding quarter’s figure of 39.69 percent. Quarter on quarter, growth was recorded at –3.61 percent, and 34.73 percent for full-year 2019.

The contribution of Manufacturing to Nominal GDP in Q4 was 11.37 percent, higher than the figure recorded in the corresponding period of 2018 at 10.11% but lower than the third quarter of 2019 at 12.34%.

But annual contribution was was reported at 11.64 percent in 2019, higher than 9.75 pecent growth of 2018.

ICT sustains growth at 11.08% as construction sector growth weakens OLUFIKAYO OWOEYE

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h e In f o r mat i o n a n d Communication sector remains one of the main drivers of non-oil growth. Activities in this sector are Telecommunications and Information Services; Publishing; Motion Picture, Sound Recording, and Music Production; and Broadcasting. Telecommunications & Information Services under Information and Communication sector grew by 10.26percent in Q4 2019 from 12.16percent in Q3 2019 and 16.67percent in Q4 2018, it grew 11.41percent in full year 2019 from 11.33percent in 2018 and -2.04percent in 2017 In nominal terms, the fourth quarter of 2019 sector growth was recorded at 9.86percent (year-onyear), a –4.95percent points decrease from the rate of 14.82percent recorded in the same quarter of 2018, and –1.33percent points lower than rate recorded in the preceding quarter.

Th e Qu a r t e r o n Qu a r t e r growth rate recorded in fourth

quarter was 22.72percent, while 2019 growth stood at 18.67percent. The Information and Communications sector contributed

10.01percent to nominal GDP in Q4 2019, lower than 10.23percent recorded in the same quarter of 2018 but higher than the 8.54per-

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cent it contributed in the preceding quarter.

The sector’s contribution for 2019 was 10.68percent, higher than 10.16percent recorded in 2018. In the fourth quarter of 2019, the sector recorded a growth rate of 8.50percent in real terms, year on year.

Compared to the rate recorded in the corresponding period of 2018, this was a decrease of –4.70percent points. Quarter on quarter, the sector exhibited a growth rate of 22.20percent in real terms while 2019 annual growth rate was recorded at 9.17percent.

Of total real GDP, the sector contributed 13.12percent in Q4 2019, higher than in the same quarter of the previous year in which it represented 12.40perc e nt, a n d i n t h e p re c e d i n g quarter in which it accounted for 11.34percent. For full-year 2019, the sector contribution stood at 13.04percent which was higher than the 2018 rate of 12.22percent.

The construction sector real growth rate during the fourth quarter stood at 1.31percent year-

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on-year, a drop of 0.74percent points from the rate recorded a year earlier. Relative to the preceding quarter, it decreased by 1.06percent points, while on quarter on quarter, the sector grew by 20.45percent in real terms. Annual growth stood at 1.81percent in 2019 The construction sector accounted for 3.44percent of real GDP in the fourth quarter 2019, lower than its contribution of 3.48percent in the same quarter of the previous year, but higher than the preceding quarter’s 3.01percent. In 2019, Construction contributed 3.72% to real GDP. As at 30th September 2019, a total of about N294.63 billion had been released for capital projects out of the N2.09trillion approved in the 2020 budget. The gap in the amount may be unconnected with the late passage of the 2019 budget.

However, with the quick passage of the 2020 budget and government’s promise to prioritise spending on in favour capital projects in the power, roads, rail and agriculture sectors.

@Businessdayng

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Tuesday 25 February 2020

BUSINESS DAY

INSIDE NIGERIA’S GDP REPORT

Cement sector continues to suffer despite Nigeria’s exit from recession BALA AUGIE

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fter nearly four years that the Nigerian economy existed a recession in 2016, the cement sector continues to struggle.

The industry has been reeling from deteriorating cement volumes caused by weak spending on infrastructure and lack of transformation policy on the part of government.

The latest report by the National Bureau of Statistics (NBS) showed the cement sector grew by 3.11 percent in the fourth quarter of 2019, but the growth is lower than the 4.50 percent recorded in 2018.

Growth moderated at -2.20 percent and -5.36 percent in 2017 and 2018 respectively.

Onyeka Ifeoma, Industrial goods analyst at Ventiva said construction activities were slow due to heavy rains and that the demand for cement is usually low during an election year as the president will be busy with electioneering and cabinet reshuffle.

“We have not seen a lot of capital expenditure from the public sector, but there could be an improvement this year due to the speedy passage of the budget and investment drive of the present administration is a strong case for cement consumption,” Ifeoma.

Federal Government has earmarked N2.14 trillion for capital expenditure out of a total budget of N10.33 trillion. Despite the strong pace of growth and ambiguous government policies, analysts are betting that low per capita consumption in the country compared to the size of its economy, huge infrastructure deficit, and unimpressive road network and growing case for concrete roads will be major drivers of cement volumes.

According to the Centre for Affordable Housing and Finance

(CAHF), Nigeria has a low home ownership rate relative to peer countries such as Indonesia, Kenya, and South Africa.

The country has a housing deficit of 17 million and more worrisome is the at population growth rate of 2.70 percent, the deficit will widen by 900,000 and a sum of N22 billion is needed to bridge the gap over the next 20 years.

Nigeria’s total infrastructure stock is currently 35 percent of GDP, which is well below 70 percent average of peer emerging economies. It is further estimated that, at least, $3 trillion must be invested in infrastructure over the next 30 years to bridge the said gap. Some of Federal Government’s project that will add impetus to cement demand includes Mambila Hydro Power Project as at a sum of N1.02 billion, Rehabilita-

tion of Railway tracks: N27.1 billion, Construction of second runway Nnamdi Azikiwe Airport: NGN13 billion, Construction & Rehabilitation of Roads: N280.4 billion, and Federal National Housing Programme: N30.0 billion.

“In our view, the huge infrastructure gap in Nigeria provides legroom for strong cement demand in the near term,” said analyst at Cordros Capital Limited.

“While we acknowledge the robust appetite for infrastructural development of the present administration, the FGN has further stated that it will continue to leverage private sector capital, including FDIs to raise the required funds needed to bridge the gap,” said analysts at Cordros Capital Limited.

The country’s low cement consumption per capita strengthen case

for further upside Compared to economies such as Senegal (222kg), Ghana (202kg), Congo (349kg), and Mauritania (134kg), Nigeria’s cement consumption per capita (122kg) is relatively lower, on a GDP per capita basis, despite being the largest economy on that list. This further strengthens the case for stronger cement demand in the near term.

Cement players in Africa’s largest economy have been ingenious in the use cost cut strategy and the combination of organic and inorganic growth to stay afloat and surmount the macroeconomic headwinds.

Dangote Cement Plc, the largest producer of the building material, Lafarge Africa Plc, and OBUA Cement Plc have migrated from the use of the Low Pour Fuel (LPFO) and gas to coal to power plants at the facto-

ries to coal, a cheap source of energy.

The devaluation of the currency due to the recession of 2016 made the price of gas (priced in foreign currency to go up) balloon, and profit margins were undermined.

Companies are planning on embarking on aggressive expansion plans in a county where government is poise to spend on capital expenditure.

Dangote Cement, a company that runs at a current capacity of 29.30 million production capacity, is looking to expand cement capacity on the continent by 29 percent to 62 million tons.

The most capitalized firm in Nigeria, plans to add six million metric tons in its home country this year as it is investing heavily in markets including Tanzania and the Democratic Republic of Congo.

Trade sector suffers recession for 4 straight years BUNMI BAILEY

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rade sector, which comprises of wholesale and retail trade, remained in recession for four straight years over myriad challenges ranging from unpredictable government policies to weak consumer demand.

According to data released by the National Bureau of Statistics, the sector contracted by -0.38 percent in 2019, compared with -0.63 percent, -1.05 percent and -0.24 percent in 2018, 2017 and 2016 respectively. Ever since the Nigerian economy slumped into

recession in 2016, annual average growth of the trade sector has been negative.

‘Growth in the sector has been weak in recent years,’ said Damilola Adewale, a Lagos-based economic analyst.

‘The combined impact of high import duty, ports inefficiency and infrastructure challenges are affecting the sector and the land border closure further weighed on the already fragile growth of trade,’ Adewale said.

In June 2019, the Federal Government increased the exchange for customs duty by 6.5 percent to N326 per dollar from N306 www.businessday.ng

per dollar with aim of generating more revenue. This recent development implied that importers and exporters whose products are value and transacted in dollars will now have to pay additional N20 per dollar worth of goods.

Also in August 2019, Nigeria unexpectedly closed its land borders to trade in goods, explaining that it wanted to put an end to smuggling, particularly of frozen rice or chicken from Benin, which crosses the porous border illegally and in November, the government closed the borders completely to both imports and exports.

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Ayorinde Akinloye, a consumer analyst at CSL Stockbrokers said, “Growth in the trade sector has remained on a negative trend over the past four years. And furthermore, domestic consumption remains weak. Consumer income has virtually been stagnant in nominal terms while inflation remains in double digit territory.

Thus, once demand remains poor, trade would definitely be weak.

Data from the NBS on Gross Domestic Product (GDP) by Income and Expenditure approach at 2010 purchaser’s values show that consumption expenditure of households has been declining at @Businessdayng

varying pace since it rose by 1.5 per cent in 2015. Also, the country’s per capita income declined to $2,049 in 2018 from $3,268 in 2014, according to the International Monetary Fund (IMF).

The trade sector which is the second largest sector after agriculture contributed 16.01 percent in 2019 against 16.44 percent recorded in 2018.

According to a report by Afrinvest research, the sector has remained in a recession, although somewhat improving. “In our view, the unfriendly trade policies of the government continues to affect the pace of recovery,” the report stated.

Tuesday 25 February 2020

BUSINESS DAY

43

INSIDE NIGERIA’S GDP REPORT

Oil sector rising on a momentum, grows by 4.59% DIPO OLADEHINDE

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hanks to a combin a t i o n o f re l a t i v e higher oil production of 2 million barrels daily and favorable average oil price of $57.05 in 2019, Nigeria oil sector grew by 4.59percent compared to 0.97 percent last year.

O i l s e c t o r G D P g re w b y 6.36percent in Q4 2019, compared to 6.49percent recorded

in Q3 2019 and 7.98percentage points increase compared to -1.62percent in Q4 2018.

In terms of contribution, the oil sector contributed 7.32percenttage to the total real GDP in Q4 2019, up from 7.06percenatge recorded in the corresponding quarter. Meanwhile, the sector’s contribution to GDP went down when compared to 9.77percent recorded in the third quarter of 2019.

“The oil sector increased

its contribution to growth in 2019, expanding 4.6percent from 1.0percent in 2018, following stability in the Niger-Delta and new output from the EGINA FPSO. In this regard, oil production rose 5 percent to an average of 2.0mb/d in 2019,” Analysts at Afri-invest said in a research note.

Analysts at Afri-invest said oil production improved slightly due to relative stability in the Niger Delta region and that’s despite shortfalls across key pipelines in

the sector the force majeure on Shell Petroleum Development Company of Nigeria Ltd (SPDC) Bonny Light Export Terminal.

As a result, oil production volume averaged 2.01 mbpd in 2019, 1.93 million barrels daily in 2018, from 1.88 mbpd in 2017.

“The growth in the oil sector is quite impressive as we saw stable or relative peace in the Niger Delta region, an oil price also remained favourable which supported the performance

of the oil sector,” Gbolahan Ologunro, a research analyst at Lagos-based CSL Stockbrokers said.

“We still have the PIGB hanging in the air, and that is the bill that has the opportunity to opening the economy to attract FDI.” Ologunro said.

Experts in the oil and gas sector ranked reforming fiscal and regulatory terms by passing into law a competitive petroleum industry bill as the most urgent task needed to make an oil sector record a two digits growth rate. Next is domesticating the value chain and also ensuring the oil and gas sector provides linkages across the economy.

Nigeria’s oil and gas industry, remains it’s most lucrative and viable investment opportunities as stakeholders believe that the oil and gas sector offers consistent opportunities in solving Nigeria’s dwindling revenue.

Today, Nigeria is only capable of pumping some 2.5 million barrels of crude oil per day despite sitting on more than 40 billion barrels of proven reserves with its mid-stream and downstream infrastructure are arguably in worse shape than upstream production.

“In the past, the executive left the industry bill to the legislature, they need to show more interest this time around,” Taiwo Oyedele, head of Tax at PwC Nigeria said.

Since 2008, Nigeria has been attempting to pass the Petroleum Industry Bill (PIB), which seeks to incorporate and update 16 different laws that regulate the sector and enable the government reform its oil and gas legal framework.

The non-passage of the PIB has continued to create uncertainties that have delayed billions of dollars in potential investment in this sector. The National Assemble has now split the Bill into five sections and passed it as the Petroleum Industry Governance Bill (PIGB), which is expected to be ratified by the Presidency.

Finance, insurance sector growth rises to 2.56% in 2019 HOPE MOSES-ASHIKE

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inancial and Insurance sector grew by 2.56 percent in full year 2019 from 2.03 percent in 2018 and 1.26 percent in 2017, according to the National Bureau of Statistics (NBS).

In real terms, growth in the finance and insurance sector stood at 20.18 percent in the fourth (Q4) of 2019, NBS data revealed.

This was higher by 21.94 percentage points from the rate recorded in Q4 2018 and 19.11 percent points higher from the rate recorded in the preceding quarter.

The NBS report released on Monday show that quarter on

quarter growth in real terms stood at 35.00 percent. However, annual growth was 2.56 percent for 2019.

The contribution of Finance and Insurance to real GDP was 3.19 percent, higher than the contribution of 2.72 percent recorded in the fourth quarter of 2018, and 2.49 percent recorded in Q3 2019. The Finance and Insurance sector’s contribution to real GDP in 2019 was 3.01 percent, slightly higher compared to 3.00 percent in 2018.

The Finance and Insurance Sector consists of the two subsectors, Financial Institutions and Insurance, each of which accounted for 90.33 percent and 9.67 percent respectively of the sector output in real terms in Q4 2019. www.businessday.ng

The sector grew at 23.33 percent in nominal terms (year on year), with the growth rate of Financial Institutions at 25.54 percent and Insurance services at 5.92 percent. The sector growth rate was higher than that in Q4 2018 by 21.79 percentage points, and 19.61 percentage points higher than the preceding quarter. Quarter on quarter growth was 35.88 percent while annual growth for 2019 was 5.86 percent, higher compared to the previous year. The sector’s contribution to nominal GDP was 3.12 percent in Q4 2019, higher than the 2.84 percent it represented a year earlier, and the contribution of 2.40 percent recorded in the preceding quarter. The sector’s

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annual contribution for 2019 was 2.93 percent.

Updating its GDP model with the latest numbers as well as factoring the recent CBN’s progrowth policy drive, United Capital research expects the momentum in the Nigerian economy to improve relative to FY-2019, but remain at a sub-optimal level of 2.36 percent y/y in FY-2020 - below population growth of 2.6 percent.

“Our view is that the CBN’s unorthodox monetary policies will keep cost of capital low through 2020 and encourage domestic borrowings as well as investment by local corporates for expansion purposes. However, we believe faster GDP growth is unlikely in @Businessdayng

the near term, given the ongoing necessary but conflicting fiscal policy actions (e.g. the recent move to increase VAT, possible hike in electricity tariffs) may hurt consumption,” analysts at United Capital said on Monday.

The continued closure of the land borders may hurt aggregate demand as a result of increased prices but has a positive effect on local production, the analysts said.

In addition, subsisting concerns around policy unpredictability which has been one of the biggest impediments to FDI flows and investment generally, as well as the reluctance to implement reforms that will spur private sector growth is worrisome.

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Tuesday 25 February 2020

BUSINESS DAY

INSIDE NIGERIA’S GDP REPORT Nigeria making no headway in economic Education, health diversification, 2019 GDP shows sectors exit recession in 2019

MICHAEL ANI

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atest gross domestic figure (GDP) released by statefunded data agency, the National Bureau of Statistics, yesterday, shows that Africa’s biggest economy is still far from achieving its diversification plans as the growth of the economy is still driven by the oil sector despite the sector accounting about 9 per cent of the GDP The economy grew 2.27 per cent in 2019, to record its biggest annual growth in about three years, but this was largely driven by higher growth in the oil sector.

The oil sector expanded at an average of 4.59 per cent in 2019 from as low as 0.97 per cent in the preceding year, meanwhile, the non-oil sector which accounts for about 91.2 per cent of Nigeria’s GDP remained flat at 2.06 per cent from a 2.00 per cent growth in 2018.

This is despite the huge efforts been put in place by the government to achieve higher economic growth that is not dependent on the oil sector.

The flat growth shows that the performance of the non-oil sector is still very weak and a reflection of shoddy macroeconomic fundamentals in the broad economy, according to Gbholahor Olorungo, an equity research analyst at CSL Stockbrokers.

Since the discovery of oil in large quantities in the mid-50s, Nigeria has been largely dependent on the sector to attract revenue and grow its finances Despite employing less than 5 per cent of its labour force, the oil sector generates over 85 per cent of Nigeria’s foreign exchange and 70 per cent of the country’s revenue.

This has made the country susceptible to external shocks and developments in the oil sector.

On the other hand, the country gets less than 2 per cent of its revenue from the agricultural sector despite employing well over 40 per cent of

BUNMI BAILEY

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the labour force Nigerian President Buhari has vowed to diversify the economy away from the oil sector to lift on an annual basis 10 million of its citizens out from poverty through 10 years after a lengthy recession greeted his first tenure in office.

The country both from the monetary and fiscal side has rolled out various initiatives and pumped in billions of dollars in a bid to drive growth in the real sector which would, in turn, translate into higher economic growth.

Some of such policies initiated to growth in both the agricultural and the manufacturing sector include the Anchor borrower’s programme, commercial agricultural scheme and the ease of doing business committee.

The country has also shut its land borders against other African neighbouring countries to check commodities such as rice staples and oil which it says is smuggled in and out of its country.

From the monetary side, there has also been a policy restricting about 44 items from accessing dollars for import from the CBN’s window.

Commercial banks have also been forced to lend about 65 per cent of their deposits to the real sector.

Although the extension of credit helped in boosting financial services, evident in a massive 22.33 per cent growth recorded in the sector in the fourth quarter, growth in other sectors are still very weak.

The manufacturing sector slumped 0.77 per cent in 2019 from

2.09 per cent in 2019, while sectors like real estate and trade remain in recession, recording a negative growth of -2.36 and -0.38 respectively.

“Only a serious country can transit into an industrialized one and achieve very strong productivity,” said Omotola Abimbola, a macro and fixed-income analyst at Chapel Hill Denham. “There are a lot of things that need to be put in place for sectors like Agric and manufacturing to succeed because both are very competitive sectors” Abimbola highlighted structural reforms in infrastructure, human capital developments and land reforms system as major developments that must happen to drive productivity rather than focusing on closing borders and or boosting credit alone.

uman capital indictors such as e ducation, health and social services sectors of the Gross Domestic Product (GDP) existed recession in 2019, a BusinessDay analysis shows.

The educator sector grew by 0 . 8 0 p e rc e n t f ro m - 0 . 0 3 percent in 2018 and -0.72 percent in 2017 while health and social ser vices grew by 0.31 percent in 2019 from -0.32 percent, -0.31 percent and -1.79 in2018, 2017 and 2 0 1 6 r e s p e c t i v e l y , t h e Na tional Bureau of Statistics said Monday.

A f u r t h e r a na lys i s o f t h e data showed that the education sector had been in recession since2017, while the He a l t h a n d s o c i a l s e r v i c e s sector was in recession since 2016.

Analysts are of the opinion that the government’s investment in the sectors may have t ra n s l at e d t o t h e i mp rove d p e r f o r ma n ce. Bu t Da m i lol a A d e w a l e, a L a g o s - b a s e d economist and independent consultant said that the sectors might have improved but it has failed to translate to the realities on ground showed.

Education has always played a v i t a l r o l e i n a c o u n t r y ’s socio-economic development Health is a key driver of economic productivity and social well-being.

Agric sector grows 2.36% in 2019 on border closure GBEMI FAMINU

…experts expect sustained growth

he Nigerian agricultural sector grew by 2.36 percent in 2019 owing to the Federal Government closure of the Nigerian land borders with neighboring West African countries, data from the National Bureau of Statistics (NBS) states.

The sector recorded a marginal growth in 2019 after a slowed growth rate for two consecutive years (2017 and 2018).

O n a quarter- on-quarter basis, the sector grew marginally from 2.28percent in the third quarter of 2019 to 2.36percent in the fourth quarter, indicating a 0.06percent increase.

Experts say the border closure

exercise significantly impacted the sector especially the fishing sub sector which contributed the most to the growth of the sector, as the exercise limited the import and smuggling of fishes into Nigeria, thereby giving fishermen and fish sellers a wider reach in the local market.

“The border closure impacted the agricultural sector positively.

Demand from farmers and processors increased significantly as they started getting orders from those that ordinarily would not buy from them,”Fatai Afolabi, executive secretary, Plantation Owners Forum of Nigeria (POFON) said.

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www.businessday.ng

The agricultural sector was able to record an improvement though marginal on a yearly comparison despite the significant decline it experienced in the 2nd quarter of the year.

On a yearly comparison, the sector grew to 2.36 percent in 2019 representing 0.24 percent points increase from the 2.12 percent achieved in 2018.

Under the agricultural sector, the fishing subsector contributed the most with 3.3 percent, forestry and crop production contributed 2.59 percent and 2.51 percent respectively, however livestock contributed the least with 0.16 percent.

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In terms of value, the sector contributed N17.9 million to the total GDP in 2019 which signifies a minimal increase to the N17.5 million it contributed in 2018.

Emmanuel Ijewere, vice president, Nigeria Agri-Business Group (NABG) said to BusinessDay in a phone interview that the sector experienced growth because of the new entrants into the space.

“More and more people who were never in the agricultural space are coming in, so new ideas are coming in. young, educated and innovative people are changing the narrative, more importantly new technology is being @Businessdayng

introduced especially as regards funding,” he said.

He added that the growth and increase witnessed in the sector will continue to grow however he urged the government to accelerate the growth with beneficial policies, schemes and programs.

Despite the drop in livestock farming, players in the sector agree that the year was a good one for them.

“The demand for local chicken has increased tremendously since the border closure. Buyers are visiting our farms daily to make orders which we have not experienced before,” said Onallo Akpan, director-general of Poultry Association of Nigeria (PAN).

45

FT

Tuesday 25 February 2020

BUSINESS DAY

FINANCIAL TIMES

World Business Newspaper

Persecuted Muslims find an unlikely ally in Donald Trump’s envoy Sam Brownback decries China’s ‘war on faith’ as White House seeks to appeal to Christian evangelical voters

about 20 years ago, when he was a senator championing the rights of Christians imprisoned abroad.

“I didn’t know what a Uighur was . . . They said they’re Muslims, and I would just go, well . . . ” Mr Brownback shrugged to indicate his disinclination. “And then my office staff was very poignant about saying, ‘Look, we’ve got to stand up and fight for everybody’.”

Some observers suggest the administration is embracing the issue only because it dovetails with two others that are more valuable to the US president. The first is a broad push to counter what the administration sees as Beijing’s aggressive global posturing.

Although Mr Brownback said the Trump administration had “put more pressure on China than any prior administration”, the US has yet to impose so-called

Global Magnitsky sanctions that would designate Chinese leaders as human rights abusers. Several people close to the deliberations said such a move was under consideration but had been held up by efforts to strike a trade deal with China.

Mr Trump “obviously wanted to get a trade deal done and did,” said Mr Brownback, declining to comment on future sanctions. “That’s been his primary focus, but he’s let the rest of us be out there too.”

Mr Brownback’s boss, Mike Pompeo, US secretary of state, has also denounced Chinese actions against Uighurs as “the stain of the century”.

Analysts say the Trump administration is also seeking to focus on religion in a way that appeals to white evangelical Christians, who form a large part of the US president’s support base. Research indicates there are over 62m evangelicals in the US. Pew Research Center found 69 per cent of white evangelicals approved of Mr Trump, compared with only 12 per cent of black Protestants, 18 per cent of Muslims and 20 per cent of “religiously unaffiliated”.

“The Trump administration’s [religious] initiative is aimed at protecting the rights of Christians but is marketed as a commitment to religious freedom in general,” said Andrew Chesnut, professor of religious studies at Virginia Commonwealth University. “The support for persecuted Muslim groups in China and Burma is window-dressing to make it appear that there’s an overarching concern with religious freedom when it’s really about the freedom of Christians.”

Washington is offering instead.

Exhortations to stop using Huawei for telecoms infrastructure, for example, puzzle governments that see no obvious alternatives.

Rather than bringing rival proposals, Mr Pompeo’s visit came after his government had extended a travel ban on Nigeria, Africa’s most populous country, and threatened to slash aid. It is also considering withdrawing troops from the Sahel where a dangerous jihadi insurgency is brewing.

This does not mean the US has nothing to offer. The President’s Emergency Plan for Aids Relief, initiated by former president George W Bush, has saved millions of lives and has won the US much goodwill. China gives nothing comparable. Mr Trump rightly abandoned a plan to scrap

the Overseas Private Investment Corporation, instead doubling its budget to $60bn, even if few big investments have materialised.

Yet, with government encouragement, the US private sector ought — as Turkish, Indian and Brazilian companies have done — be able to do good business on a continent with seven of the world’s fastestgrowing economies. US venture capitalists could also do more to fund the inventive start-up culture sprouting up all over Africa.

Sadly, this has not been Washington’s emphasis. Instead, the US has fallen behind. Chinese trade with Africa, at $185bn in 2018, dwarfs that of the US, which was $41bn in the same year. Washington’s policy must go beyond Chinabashing. Without a change, its influence in Africa will wane further.

KATRINA MANSON

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am Brownback, Donald Trump’s ambassadorat-large for international religious freedom, said he “didn’t imagine” he would ever be defending Muslims.

When Mr Brownback, an evangelical Christian-turnedCatholic, was first nominated for the post in 2017, the social conservative drew opposition from Muslim rights groups and every Democrat in the Senate, where he once represented Kansas as a Republican. While governor of Kansas, he had signed legislation decried by some as Islamophobic.

And he has supported the Trump administration’s move to restrict entry for people from a number of Muslim-majority nations.

Yet Mr Brownback has emerged as the face of America’s support for Muslims in China and Myanmar, surprising some of his earlier critics even as others remain sceptical about the administration’s motives as he defends an estimated 1m Uighurs detained in what he referred to as “concentration-type camps” in China.

“When . . . China puts a rule in place that you can’t name a child Mohammed and you can’t fast and they force-feed people pork, you’re really going right into the face of the practice of the faith,” he told the Financial Times. He said Beijing’s “pernicious” measures were aimed at turning Muslims into “good placid Chinese citizens”.

Sitting in front of two stone tablets etched with the Ten Commandments and a book about the Gutenberg Bible, he said: “It is a

President Donald Trump greets survivors of religious persecution from 17 countries in the Oval Office last year. The survivors were in Washington to attend a State Department conference on religious freedom. Sam Brownback, Mr Trump’s ambassador-at-large for international religious freedom, is pictured second from the right © Chip Somodevilla/Getty

war on faith.”

Human rights groups say Mr Brownback’s work has pushed the US out ahead of a number of western governments when it comes to action over Uighurs.

In October, the US blacklisted Chinese entities involved in the surveillance or repression of Uighurs, preventing US companies from selling them high-tech wares. The US also imposed visa restrictions on Chinese officials implicated in the detentions.

Several people familiar with the matter said Mr Brownback had personally pushed for harsher measures and language. He has lobbied China’s neighbours to take a stand against Beijing and visited Bangladeshi refugee camps where persecuted Muslim Rohingyas have fled from neighbouring Myanmar.

The support for persecuted Muslim groups in China and Burma is window-dressing to make it appear that there’s an overarching concern with religious freedom Andrew Chesnut, Virginia Commonwealth University Robert McCaw, government affairs director at the Council on American-Islamic Relations, which opposed Mr Brownback’s nomination, said he had been “pleasantly surprised” by Mr Brownback’s support for Muslims.

“It appears he has come to the conclusion that in order to defend the rights of Christians he must defend the rights of all religious communities, which is a welcome change,” he said.

Mr Brownback recalled when he was first brought a case about maltreatment of a Uighur in China,

The US needs a coherent policy on Africa Washington can do better than China bashing and travel bans THE EDITORIAL BOARD

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n the third leg of Mike Pompeo’s recent Africa tour, which concluded last week in Ethiopia after stops in Senegal and Angola, the US secretary of state chose Addis Ababa to berate Beijing. “Countries should be wary of authoritarian regimes and their empty promises,” he told his audience in remarks clearly referring to China. “They breed corruption, dependency, they don’t hire the local people, they don’t train, they don’t lead them.”

The message — which echoes a policy laid out by former national security adviser John Bolton, who accused Beijing of using Africa “to pursue global dominance” — was tone deaf. It reinforces the view,

wholly offensive to most people on the continent, that the Trump administration sees Africa as little more than an arena of great power rivalry.

That Mr Pompeo chose to make his remarks in Ethiopia, a country that for all its problems has one of Africa’s most successful economies partly thanks to close ties with Beijing was particularly bemusing. Ethiopia is the secondbiggest destination of Chinese investment in Africa. It has grown at near double-digit rates for 15 years. Much of the infrastructure that has made this possible was built and financed by China.

The US, as laid out explicitly by Mr Bolton, sees a dastardly Beijing plot to ensnare African governments in debt and to exploit their workers. US companies are portrayed, by contrast, as benevolent www.businessday.ng

entities interested only in furthering African opportunity. These caricatures do not wash.

Certainly, China can be guilty of cozying up to dictatorships and turning a blind eye to corruption and the pillage of resources. Its finance is rarely concessional. Some of its infrastructure is shoddy. But the US, especially under Donald Trump, hardly stands out as a champion of democracy and environmental protection. Its companies build comparatively little in Africa. Contrary to the cliché that China ships in all its own workers, a recent study of foreign investors in Angola and Ethiopia found that Chinese companies’ employment policies were broadly similar to western counterparts.

Even if US criticisms contain some truth, it is not clear what

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@Businessdayng

Tuesday 25 February 2020

BUSINESS DAY

46

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

Wall Street opens lower after Italy’s coronavirus lockdown Investors around the globe shift away from riskier assets on signs outbreak spreading outside China FT REPORTERS

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all Street fell sharply in opening trading, extending a global wave of selling as the coronavirus that originated in China spread far beyond the country’s borders.

The S&P 500 dropped 2.7 per cent shortly after the opening bell and the tech-heavy Nasdaq benchmark lost 3.2 per cent, the worst showing since August for each benchmark. The Dow Jones Industrial Average was 2.8 per cent lower, shedding about 850 points after the opening bell.

The sell-off was led by microprocessor groups like Advanced Micro Devices, where supply chain concerns continue to weight, and travel companies like American Airlines and Norwegian Cruise Line.

The global drop in equities comes after Italy imposed a quarantine across at least 10 towns in an effort to contain the biggest outbreak of the virus outside Asia, with 219 confirmed infections and five deaths.

South Korean authorities reported 231 new cases on Monday, bringing the total number to 833 with seven related fatalities. The government added it had put 7,000 troops under quarantine after 11 had tested positive for the virus.

Iran said there had been 12 deaths and 61 confirmed coronavirus cases in the country, a sharp

Indices were lower across Asia as investors fretted about the global impact of the coronavirus © AP

rise from eight fatalities and 43 infected patients it had reported a day earlier. Turkey closed its borders with Iran, and Iraq, Afghanistan, Armenia and Pakistan have imposed restrictions on border crossings and trade.

Italian stocks led the global declines, with the country’s FTSE Mib index of shares dropping 5.6 per cent, the largest decline since 2016. The continent-wide Stoxx 600 tumbled 4.2 per cent, while the UK’s FTSE 100 dropped by 3.7 per cent, in its largest slide since 2015. Shares in European airline easyJet fell 16 per cent, while Ryanair slid 13 per cent.

The drops echoed falls in several major Asian markets.

Seoul’s Kospi fell 3.9 per cent, its worst day since late 2018, after South Korea on Sunday raised its infectious disease alert to its highest level.

“Markets [are] likely to show extreme caution in the face of [the] global spread of the coro-

navirus,” said Robert Carnell, chief Asia-Pacific economist at ING. “This is no longer solely an Asia issue.”

Despite the outbreak in Italy, EU authorities said they had no plans to suspend travel across the 26-country Schengen area of visa-free travel.

“We need to take this situation extremely seriously — but we must not give in to panic and of course to disinformation,” Stella Kyriakides, EU health commissioner, told reporters in Brussels.

Bruce Aylward, head of the World Health Organization team of foreign experts in China, praised the country’s response to the health crisis, telling a press briefing in Beijing authorities had implemented “the only successful measures we have seen”. He added that the turning point in Wuhan, the centre of the outbreak, had been reached with more people leaving hospital

than going in.

Mr Aylward also stressed the need to restart China’s economy, echoing calls by the President Xi Jinping for business to resume.

Worries about the impact of coronavirus in stunting global economic growth have had a negative effect on commodities.

The price of Brent crude, the global oil marker, fell 3.6 per cent to $56.36 a barrel.

The debt of energy companies has also been hit particularly hard, reeling from the fall in oil prices and continued low natural gas prices in the US. BlackRock iShares high-yield bond exchange traded fund dropped 0.6 per cent ahead of the market open in the US. China’s extended lunar new year holiday officially ended on February 10, but consumption of commodities such as coal for power generation was far below normal levels, analysts have noted. Steel inventories are at five-year highs because of a lack of demand, according to Mysteel, a consultancy.

“The coronavirus outbreak is starting to rattle asset markets and should keep weighing on commodities’ demand,” said Aakash Doshi, head of commodities research in North America at Citigroup. “If virus risks keep spreading outside of China, causing broader downturns in equities and [corporate bond] markets, commodities’ prices should face further shortterm headwinds.”

Central banks could provide one source of support. Over the weekend, Haruhiko Kuroda, Bank of Japan governor, said he was monitoring the impact of the virus and was “well prepared” to act to bolster the economy.

US Treasury secretary Steven Mnuchin said central banks would look into possible responses if needed. Analysts at Rabobank said the European Central Bank would “have” to present a monetary policy response.

China’s extended lunar new year holiday officially ended on February 10, but consumption of commodities such as coal for power generation was far below normal levels, analysts have noted. Steel inventories are at five-year highs because of a lack of demand, according to Mysteel, a consultancy.

At a State Council briefing, senior economic and financial officials estimated that more than 70 per cent of large manufacturers had reopened in most industrial areas, but admitted that smaller and medium-sized companies were struggling, with less than 30 per cent resuming operations.

“Consumption hasn’t disappeared; it has just been postponed,” said Cong Liang at the National Development and Reform Commission. The officials did not promise any large stimulus measures beyond Rmb300bn ($42.6bn) in previously announced central bank loans for struggling companies.

Jean Pierre Mustier rules himself out of HSBC running

UniCredit chief’s decision means search for CEO for Europe’s biggest lender continues DAVID CROW

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ean Pierre Mustier, the chief executive of UniCredit, has ruled himself out of the running to be the next chief executive of HSBC, with the race to lead Europe’s largest lender set to enter its seventh month without conclusion.

Mr Mustier had been identified as the preferred external candidate by HSBC’s board of directors, setting up what would have been a two-horse contest between the UniCredit CEO and internal contender Noel Quinn, who has been acting as interim chief executive since August.

However, Mr Mustier phoned Mark Tucker, HSBC’s chairman, on Sunday to tell him he was no

longer interested in the job and had decided to stay at UniCredit, Italy’s largest lender by assets, according to two people briefed on the discussion.

One person briefed on the talks said Mr Mustier had not been given a formal job offer by HSBC but had been identified as the preferred outside candidate.

HSBC has been searching for a permanent leader since August last year, when the board ousted John Flint as its chief executive because it was concerned that he did not have the right plan to turn the bank round. Mr Quinn, who had headed HSBC’s commercial bank, was immediately appointed as an interim replacement.

At the time, HSBC said it would name a permanent successor

within six months to a year.

Since then, HSBC has approached several executives about the job, including Mr Mustier, who emerged as the favoured external candidate last week.

The entrance of Mr Mustier into the frame to lead HSBC was greeted with scepticism by some rival CEOs, who questioned whether the French-born banker would want to work with Mr Tucker, a successful insurance executive who is known as a hard taskmaster.

A spokesperson for HSBC said that the process to find a new CEO “remains ongoing”, adding: “We said six to 12 months and we continue to work to that timeline.”

One of the people briefed on

the talks said UniCredit had not offered Mr Mustier a pay rise to persuade him to stay at the bank.

Unicredit said in a statement after this FT report was published that Mr Mustier had confirmed he would remain with the bank.

“UniCredit would also like to remind everyone that it has just launched a new strategic plan, Team 23, and that the whole management team, including Jean Pierre Mustier, is fully focused on its successful execution,” it said.

One of the people briefed on the race to lead HSBC said Mr Mustier’s exit did not mean Mr Quinn would necessarily win the job by default, adding that the bank was still in talks with at least

one other external candidate.

Last week, Mr Quinn unveiled what he described as one of the “deepest” restructurings in HSBC’s 155-year history, which will see 35,000 jobs cut from the bank’s 235,000 headcount within the next three years.

The bank is also planning to shed $100bn of assets from its balance sheet in underperforming markets — mainly Europe and the US — and hopes to use the extra capacity to pursue growth opportunities in China and emerging markets.

However, some investors have questioned whether the bank was right to unveil such a dramatic plan without a permanent leader, with one large shareholder describing it as “barmy”.

Tuesday 25 February 2020

FT

BUSINESS DAY

47

ANALYSIS

BlackRock’s black box: the technology hub of modern finance Used by rival fund managers, the reach of the Aladdin platform raises possible conflicts of interest RICHARD HENDERSON AND OWEN WALKER

A

s tox ic mor tgag ebacked securities tore through the financial system more than a decade ago, the US government turned to Larry Fink, one of their earliest pioneers, for help.

Mr Fink made a fortune packaging mortgages together and selling off slices of the combined pools in the 1980s before founding BlackRock, which today stands as the world’s largest asset manager.

As the crisis deepened, Mr Fink spoke to Hank Paulson, US Treasury secretary, more often than some chief executives of the big Wall Street banks, in brief, urgent calls. He offered the Treasury and Federal Reserve a powerful tool to gauge risk in the assets at the centre of the havoc. The arrangement would net BlackRock tens of millions of dollars in government contracts, awarded largely without a tender process, put it at the forefront of the fintech revolution and cement Mr Fink’s standing at the intersection of politics and finance.

At the heart of this exchange was Aladdin, BlackRock’s vast technology platform. The system links investors to the markets, ensures portfolios hold the right assets and measures risk in the world’s stocks, bonds and derivatives, currencies and private equity.

Aladdin’s influence has surged since the financial crisis. Today, it acts as the central nervous system for many of the largest players in the investment management industry — and, as the Financial Times has discovered, for several huge non-financial companies.

Vanguard and State Street Global Advisors, the largest fund managers after BlackRock, are users, as are half the top 10 insurers by assets, as well as Japan’s $1.5tn government pension fund, the world’s largest. Apple, Microsoft and Google’s parent firm, Alphabet — the three biggest US public companies — all rely on the system to steward hundreds of billions of dollars in their corporate treasury investment portfolios.

Yet the true reach of Aladdin is unknown outside of BlackRock.

The New York-based manager last revealed exactly how much of the world’s assets sit on the system in February 2017, when they reached $20tn. BlackRock told the FT that total assets do not reflect how clients use the system. One former employee says the figure is no longer disclosed because of the negative attention the enormous sums attracted. In the past three years, Aladdin has added scores of new clients, the stock market has gained a third in value and the bond market is 13 per cent larger.

Today, $21.6tn sits on the platform from just a third of its 240 clients, according to public documents verified with the companies and first-hand accounts. That figure alone is equivalent to 10 per cent of the world’s stocks and bonds.

“Aladdin has become a mainstay of the marketplace,” says Peter Kraus, chief executive of Aperture Investors and former head of AllianceBernstein, the $600bn investment group. “It has a huge historic client base.”

Aladdin has fuelled BlackRock’s all-conquering rise by tightening its links with customers and diversifying its revenues. But the platform’s success has opened up new challenges. Competitors are fast developing rival platforms that are taking some of its business. The system’s scale — unparalleled for technology offered by a fund manager — has also created possible conflicts of interest. Most of all, its importance as a fintech hub has raised the prospect of a regulatory backlash.

The world’s most powerful risk management system threatens to become a liability for its owner.

After the financial crisis, a US regulatory push sought to label certain large banks and insurers as systemically important. Asset managers were expected to be included in this list, but the larger companies lobbied hard to avoid the outcome. They were ultimately successful, based on one single argument — investors who entrust fund managers with their assets technically hold them with one of a small group of specialist banks, so the assets are never on fund managers’ balance sheets.

Platforms like Aladdin were not factored into the ruling, but as markets and investing become more reliant on technology the functions of these systems could play a role in future decisions.

“Regulators will have to confront

this issue as technology becomes more important and intertwined with the investment process,” says Monica Summerville, director of fintech research for Tabb Group, a consultancy. “They are going to have to take a stand.”

Aladdin’s sprawling influence has prompted fears that it, or BlackRock, could act as a chokepoint if either faced a shock — a cyber attack, a rogue line of code or a sudden crisis for the company — destabilising the financial system.

In January, the Financial Conduct Authority, the UK regulator, said the failure of a large portfolio and risk system, like Aladdin, “could cause serious consumer harm” or even “damage market integrity”.

“The industry is becoming reliant on a small number of players such as Aladdin,” says Jon Little, former head of BNY Mellon’s international asset management business. “Yet [regulators] seem reluctant to regulate or intervene to supervise these key service providers directly.”

Though Aladdin does not tell asset managers what to buy or sell, some argue that if a large portion of global assets respond to the warnings that Aladdin gives off, trillions of dollars will react to events — such as the outbreak of a pandemic or war in the Middle East — in the same way, causing dangerous herding behaviour. The more investment managers and asset owners rely on Aladdin to gauge risk, the less responsible they become for their portfolio decisions.

This concern was highlighted by the Los Angeles County Employees’ Retirement Association, the $58bn US pension fund, in January.

It cited the potential for “groupthink” as one reason it declined Aladdin’s risk capabilities.

“Anything close to an oligopoly in risk management would be especially dangerous if there were any weakness in the system,” says

Jim McCaughan, former chief executive of Principal Global Investors, the $476bn fund manager.

Aladdin’s critical role within high-profile companies also makes it a prime target for cyber crime.

Ryan Dodd, a former fund manager and founder of risk consultant Cyberhedge, says BlackRock and Aladdin are enticing targets for hackers, including those backed by nation states. “They provide a master key to unlock credentials of thousands of other high-value targets, such as the users of Aladdin,” he says.

These risks are compounded by Aladdin’s complexity. Moving on and off the system can take years, because it often entails replacing a range of different systems and users have to contort the way they operate to fit Aladdin’s model.

One recent client whose business transitioned to Aladdin over three years likened the process to “changing a tyre while speeding round a racetrack”.

Rob Goldstein, chief operating officer for BlackRock, says Aladdin’s risk tools are designed to support, rather than replace, portfolio managers, adding that rival platforms offer an alternative, negating the idea the financial system was overly reliant on Aladdin.

“Even though it’s a critical piece of infrastructure, there are many critical pieces of infrastructures that clients have in their inner workings,” Mr Goldstein says. “We live in an incredibly competitive environment.”

The scale of BlackRock’s dominance in both the investment industry and in providing its plumbing has led to potential conflicts of interest. As the world’s biggest asset manager, BlackRock is among the top shareholders of most listed companies globally, including many Aladdin clients.

BlackRock is the largest shareholder of Santander, for example, whose asset management unit

joined the platform last year, and a major shareholder of HSBC and Credit Suisse, other recent clients.

This has drawn concern from rivals that BlackRock’s influence over the companies as a major investor has helped convince them to choose Aladdin, an idea BlackRock rejects.

In some cases, the potential conflicts are multi-layered. BlackRock is the third-largest shareholder in Apple, giving it clout over the tech company’s shareholder votes, while Sue Wagner, a co-founder of the fund manager, is a board member of both companies.

Ms Wagner is also on the board of Swiss Re, another Aladdin client whose former vice-chairman, Mathis Cabiallavetta, is a BlackRock board member. Mark Wilson, former chief executive of Aviva, which uses Aladdin, accepted a seat on BlackRock’s board in 2018 while in his former role. This decision angered the UK insurer’s shareholders who worried it created a conflict of interest, as Aviva’s investment arm competes with BlackRock. He left Aviva six months later and remains on BlackRock’s board.

Aladdin — which stands for asset, liability, debt and derivative investment network — began as a simple ledger for bond portfolios shortly after BlackRock was founded in 1988. As it grew, BlackRock extended its use for certain clients.

The first was General Electric, which in 1994 was selling Kidder Peabody, the beleaguered brokerage, but was unsure how to price the assets on its balance sheet. A series of similar one-off arrangements eventually led BlackRock to offer Aladdin as a product in 2000.

“When we did Kidder Peabody, it was an X-ray machine,” says Mr Goldstein. “When we had the opportunity to work on the most recent [financial] crisis, it was an MRI machine.”

The system has expanded rapidly. BlackRock’s 2015 deal to acquire FutureAdvisor spawned an offshoot of the platform for financial advisers today used by Morgan Stanley and UBS. BlackRock also offers a version of Aladdin for custody banks, including BNY Mellon, that safeguard assets managed by fund groups like BlackRock. Last year, BlackRock acquired eFront, a private equity tech platform, for $1.3bn, extending Aladdin’s reach into less liquid assets.

Powerful trends have buffeted Aladdin’s rise. Investing has become more electronic and reliant on big data. As the tools that process the information have become more complex, investors, fund managers and insurers have turned to larger platforms such as Aladdin to replace multiple specialised

Continues on page 48

48

Monday 24 February 2020

BUSINESS DAY

NATIONAL NEWS FT Wanted: new chief executive for Norway’s $1.2tn oil fund Key attributes: ability to steer world’s biggest SWF through critical period RICHARD MILNE

T

he deadline for applications for what one senior Norwegian businessman described as the country’s “most important job” closed on Friday.

On paper, running Norges Bank Investment Management, an arm of Norway’s central bank, falls short of that description. In practice, whoever secures the role will be the de facto head of the world’s largest sovereign wealth fund.

Since it was founded almost a quarter of a century ago to manage the wealth generated by Norway’s oil industry, the fund has ballooned from a $200m oddity to an investment behemoth with $1.2tn in assets. Its equity holdings alone equate, on average, to a 1.4 per cent stake in every listed company globally.

But the vacancy at the top of the NBIM — incumbent Yngve Slyngstad is stepping down after more than a decade — comes at a crucial juncture for the fund, its leadership and wider position in Norway.

After quadrupling in size over the past decade by surfing the global bull market in stocks, questions over its investment strategy, how it should wield its influence and its sometimes thorny relations with Norway’s politicians are becoming more urgent.

“The fund has become so big, and so important for Norway, this appointment is not just about finding the right person but a chance for the whole system to think what it wants the fund to be, how it wants it to work,” said one likely candidate for the position.

A final decision on Mr Slyngstad’s successor is expected this spring — a period that will also bring an unusually large number of personnel changes in the hierarchy that controls the fund.

For the first time in seven years, Norway has a new finance minister, Jan Tore Sanner, who in 2013

told the Financial Times that the country should consider breaking up the oil fund. There will also be a new deputy governor at the central bank, responsible for overseeing the fund directly and its operational management.

Hilde Bjornland, a Norwegian professor and periodic adviser to the government on the fund, said: “There is a lot to decide. Who is in charge, should the fund be taken out of Norges Bank, how should it invest?”

Mr Slyngstad has shaped the fund like no other, joining 22 years ago to lead the nascent equities portfolio and then taking the helm in 2008. As well as being the dominant intellectual force at the fund and shaping how it communicated with the public and policymakers, he also turned the fund into a much more activist investor.

It has regularly used its clout to register disapproval of management over issues, including at Apple and Goldman Sachs. It will soon announce how it intends to vote at annual meetings this year. More recently, it has started to tackle issues such as executive pay, board composition and climate change disclosure at thousands of compa-

nies worldwide.

Mr Slyngstad announced his resignation in October, days after the fund’s value reached NKr10tn, but is set to carry on working for NBIM, heading up its efforts to break into renewable energy infrastructure.

But some argue that under Mr Slyngstad, ties between the fund and the Ministry of Finance — which sets the policy and asset allocation for the fund, in conjunction with the Norwegian parliament — have become strained.

“The person who is appointed CEO must be able to reset the relationship and rebuild trust with the Ministry of Finance. During the past few years, the relationship has soured and trust has eroded,” said Espen Henriksen, an oil fund expert and associate professor at BI Norwegian Business School in Oslo.

The new chief executive will also face a growing debate over political influence in the fund. Although the fund’s mandate is set by parliament on advice from the finance ministry, Norwegian politicians have insisted it is run by investment professionals at the lowest possible cost and that its corporate governance is based

on the best international standards.

However, late last year, the main opposition leader Jonas Gahr Store said Norwegians should become used to the idea of the fund as a political tool as “NKr10,000bn is politics”.

He was implicitly slapped down last week by Oystein Olsen, the governor of Norges Bank, who warned the fund “should not be used to promote other objectives” than aiming for the highest possible return at an acceptable risk.

It is a view echoed by Ms Bjornland, who has advised the fund.

“To make the fund into a political tool is dangerous. One thing is to take ethical considerations, as the fund does today,” she said. “But some politicians suggest that the oil fund should invest to make the world greener. I think that is not the right way and could put us in difficult situations.”

The danger, according to government officials and fund insiders, is that global investors and boardrooms begin to see the fund as tool of Norwegian foreign policy. “At the moment, if we sell out of a company it is merely an investment decision, but if it were seen as political and a

Norwegian view, we are opening up Pandora’s Box,” said one Norwegian policymaker.

One of the likely candidates to become chief executive said the key requirement for the job is good communication. Concern exists that the fund has become so large — it is now three times the size of Norway’s economy — that the public and politicians are not fully aware of the risks it faces.

Ms Bjornland underscores how the fund “has not been fully tested” in a crisis. The last big stock market decline during the global financial crisis coincided with the fund stocking up on equities, so the steep fall was immediately followed by huge gains in 2009 as markets rebounded.

“I am worried that the politicians don’t fully understand what a 30 per cent fall in the fund would mean for them and the state budget, and in turn what that would mean for their trust — and that of the public’s — in the fund,” said one possible CEO candidate, pointing to the 2017 decision to increase equities’ share of the fund’s total assets to 70 per cent.

The threat to government spending is underlined by the fact that, without the fund’s contributions, Norway’s budget deficit would be 8 per cent. Norway’s government is set to take a record NKr243bn from the fund for this year’s budget, but in percentage terms this is just 2.6 per cent of the fund compared with the maximum of 4 per cent it was once allowed to use.

Another vexed issue is over the broad buckets the fund should invest in. It currently has a roughly 70:30 per cent split between equities and bonds, with its 3 per cent holding in property being counted as part of the latter.

But NBIM has recommended being allowed to invest in unlisted equities as well as the impending launch of renewable infrastructure, raising questions over whether the fund should stick to its approach of essentially being a very large index fund.

BlackRock’s black box: the technology hub of modern finance Continued from page 47 systems.

Aladdin’s growth is reflected on BlackRock’s balance sheet.

Technology revenue, dominated by Aladdin, hit $974m last year, just 7 per cent of the company’s total, but among the firm’s fastest growing areas. Analysts at Morgan Stanley predict this revenue will more than double in the next six years.

Mr Fink has said he wants a third of BlackRock revenue to come from technology by 2022. This includes money from Aladdin but also fees from funds that clients select on the platform. The company offers discounts to institutions that invest in BlackRock funds and sign up to Aladdin.

Aladdin’s income, locked up

in steady, multiyear contracts, diversifies BlackRock’s income away from the fees it charges on assets, which dip during a market downturn.

“It’s the tech subscription model that investors love,” says Kyle Sanders, an analyst at Edward Jones. “It’s not sensitive to the market.”

Aladdin’s dominance has attracted heightened competition.

State Street, which runs $3tn of assets, bought Charles River, a popular platform for fund managers, for $2.6bn in 2018. It has since signed up four new clients, including Lazard Asset Management.

Dimension, a platform from Copenhagen-based SimCorp, has also won a series of US clients, including the World Bank, and has a stable of European users, www.businessday.ng

such as the investment units of Axa and UBS. In January, MSCI, an analytics provider, paid $190m for a minority stake in Burgiss Group, which specialises in private asset data. The deal is a direct response to Aladdin’s push beyond stocks and bonds.

So far, BlackRock has conceded little ground to competitors, despite some offering cheaper and more flexible terms. Just one big client has publicly defected so far, the Italian fund house Pioneer when it was bought by Amundi, the €1.6tn French manager.

“We chose to have complete control of our software,” says Yves Perrier, chief executive of Amundi, Europe’s biggest investment group.

“I don’t want to be dependent on a

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competitor.”

Fink vs Ranieri: Wall Street rivalry was genesis for risk platform In 1986, Larry Fink led the mortgage department of First Boston, a large investment bank, and was on track to become its chief executive.

Then, he lost $100m and was soon pushed out. Mr Fink had joined a decade earlier as a graduate trainee and rose rapidly. He generated hundreds of millions of dollars in part by selling mortgage-backed securities, but then made a fateful error. He misjudged a fall in interest rates, which allow mortgages to be repaid quicker, reducing their value to investors.

The tale has become an origin story for Mr Fink’s second act at BlackRock and the genesis of its risk platform, Aladdin. But he @Businessdayng

leaves out one crucial detail.

The scale of the loss was driven by his desire to beat his counterpart at Salomon Brothers, Lewis Ranieri. Mr Ranieri was later immortalised as a “big swinging dick” by Michael Lewis in Liar’s Poker, and was aggressively selling mortgagebacked securities. As the rivalry deepened, Mr Fink issued more than First Boston could sell, ending up with a large inventory on its balance sheet that would lose value when rates fell.

For Mr Fink the episode proved the need for a portfolio management tool like Aladdin to assess risk. It also reveals the competitive drive behind Mr Fink and the group of First Boston colleagues who left to found BlackRock, many who remain today.

Tuesday 25 February 2020

BUSINESS DAY

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Tuesday 25 February 2020

BUSINESS DAY

51

Live @ The STOCK Exchanges Prices for Securities Traded as of Monday 24 February 2020 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. 312,797.99 8.80 -6.38 182 7,517,649 UNITED BANK FOR AFRICA PLC 234,266.04 6.85 -7.43 443 39,165,720 ZENITH BANK PLC 599,673.03 19.10 -3.78 993 56,152,768 1,618 102,836,137 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 190,245.05 5.30 -7.83 382 60,097,072 382 60,097,072 2,000 162,933,209 TELECOMMUNICATIONS SERVICES MTN NIGERIA COMMUNICATIONS PLC 2,361,123.51 116.00 - 38 48,673 38 48,673 38 48,673 BUILDING MATERIALS DANGOTE CEMENT PLC 2,896,886.26 170.00 - 108 1,385,682 LAFARGE AFRICA PLC. 249,670.83 15.50 - 63 1,212,672 171 2,598,354 171 2,598,354

EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 356,008.96 605.00 - 5 229 5 229 5 229 2,214 165,580,465 REAL ESTATE INVESTMENT TRUSTS (REITS) SFS REAL ESTATE INVESTMENT TRUST 1,539.00 76.95 - 0 0 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) 10,175.81 40.70 - 1 100 UPDC REAL ESTATE INVESTMENT TRUST 9,205.53 3.45 - 8 230,520 9 230,620 9 230,620 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 9 230,620 CROP PRODUCTION FTN COCOA PROCESSORS PLC 440.00 0.20 - 0 0 OKOMU OIL PALM PLC. 64,865.88 68.00 - 10 2,823 PRESCO PLC 49,850.00 49.85 - 2 2,500 12 5,323 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 8,500.00 4.25 - 0 0 0 0 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 2,010.00 0.67 - 14 142,577 14 142,577 26 147,900 DIVERSIFIED INDUSTRIES JOHN HOLT PLC. 217.92 0.56 - 2 2,590 S C O A NIG. PLC. 1,903.99 2.93 - 0 0 TRANSNATIONAL CORPORATION OF NIGERIA PLC 37,396.15 0.92 -1.08 54 11,156,732 U A C N PLC. 24,202.89 8.40 - 71 1,682,998 127 12,842,320 127 12,842,320 BUILDING CONSTRUCTION ARBICO PLC. 469.26 3.16 - 0 0 0 0 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 29,568.00 22.40 -6.67 44 800,547 ROADS NIG PLC. 165.00 6.60 - 0 0 44 800,547 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 2,338.56 0.90 -9.09 16 464,490 16 464,490 60 1,265,037 AUTOMOBILES/AUTO PARTS DN TYRE & RUBBER PLC 954.53 0.20 - 0 0 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 6,889.96 0.88 - 3 21,100 GOLDEN GUINEA BREW. PLC. 220.45 0.81 - 0 0 GUINNESS NIG PLC 55,197.65 25.20 - 13 26,097 INTERNATIONAL BREWERIES PLC. 189,377.58 7.05 - 15 179,570 NIGERIAN BREW. PLC. 375,854.40 47.00 -2.99 62 1,953,630 93 2,180,397 FOOD PRODUCTS DANGOTE SUGAR REFINERY PLC 145,200.00 12.10 - 93 636,609 FLOUR MILLS NIG. PLC. 94,308.73 23.00 - 48 357,900 HONEYWELL FLOUR MILL PLC 7,771.59 0.98 -2.97 13 517,648 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 34,442.70 13.00 - 17 93,007 UNION DICON SALT PLC. 2,993.06 10.95 - 0 0 171 1,605,164 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 15,401.26 8.20 -9.89 53 709,773 NESTLE NIGERIA PLC. 895,701.56 1,130.00 - 66 137,304 119 847,077 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 22.10 - 0 0 VITAFOAM NIG PLC. 5,641.31 4.51 0.22 46 2,002,965 46 2,002,965 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 19,852.39 5.00 - 15 82,458 UNILEVER NIGERIA PLC. 86,175.08 15.00 - 29 98,594 44 181,052 473 6,816,655 BANKING ECOBANK TRANSNATIONAL INCORPORATED 117,437.13 6.40 - 35 345,079 FIDELITY BANK PLC 59,398.33 2.05 -4.21 98 8,766,051 GUARANTY TRUST BANK PLC. 791,698.72 26.90 -3.76 342 177,129,738 JAIZ BANK PLC 18,562.48 0.63 -8.70 17 1,111,036 STERLING BANK PLC. 43,185.63 1.50 2.74 52 4,061,062 UNION BANK NIG.PLC. 200,933.19 6.90 -9.21 37 309,332 UNITY BANK PLC 6,779.82 0.58 -1.69 6 150,388 WEMA BANK PLC. 22,758.93 0.59 -9.23 43 4,273,731 630 196,146,417 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 0.20 - 0 0 AIICO INSURANCE PLC. 10,877.00 0.96 -4.95 50 3,550,362 AXAMANSARD INSURANCE PLC 18,900.00 1.80 - 5 82,397 CONSOLIDATED HALLMARK INSURANCE PLC 2,601.60 0.32 - 6 63,500 CORNERSTONE INSURANCE PLC 8,248.52 0.56 - 5 58,906 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. 1,904.09 0.26 - 7 131,500 LAW UNION AND ROCK INS. PLC. 3,437.06 0.80 9.59 18 528,855 LINKAGE ASSURANCE PLC 3,600.00 0.45 4.65 5 352,250 MUTUAL BENEFITS ASSURANCE PLC. 2,234.55 0.20 - 2 105,000 NEM INSURANCE PLC 10,983.45 2.08 - 13 222,630 NIGER INSURANCE PLC 1,547.90 0.20 - 0 0 PRESTIGE ASSURANCE PLC 2,960.40 0.55 - 3 950,000 REGENCY ASSURANCE PLC 1,333.75 0.20 - 0 0 SOVEREIGN TRUST INSURANCE PLC 2,272.89 0.20 - 2 57,494 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 - 0 0 UNIC DIVERSIFIED HOLDINGS PLC. 516.46 0.20 - 0 0 UNIVERSAL INSURANCE PLC 3,200.00 0.20 - 0 0 VERITAS KAPITAL ASSURANCE PLC 2,773.33 0.20 - 2 55,435 WAPIC INSURANCE PLC 4,282.48 0.32 -5.88 22 293,043 140 6,451,372 MICRO-FINANCE BANKS NPF MICROFINANCE BANK PLC 2,835.43 1.24 - 2 12,555 2 12,555

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MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 6,784.62 1.05 - 0 0 ASO SAVINGS AND LOANS PLC 7,370.87 0.50 - 0 0 5,796.93 1.39 - 0 0 INFINITY TRUST MORTGAGE BANK PLC RESORT SAVINGS & LOANS PLC 2,265.95 0.20 - 0 0 2,949.22 3.02 - 0 0 UNION HOMES SAVINGS AND LOANS PLC. 0 0 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 9,800.00 4.90 -5.77 58 1,928,212 CUSTODIAN INVESTMENT PLC 32,056.16 5.45 -3.54 9 304,413 540.00 0.36 - 0 0 DEAP CAPITAL MANAGEMENT & TRUST PLC FCMB GROUP PLC. 35,050.80 1.77 -9.23 84 6,527,774 ROYAL EXCHANGE PLC. 1,183.44 0.23 -8.00 5 524,000 404,441.24 38.50 - 8 3,926 STANBIC IBTC HOLDINGS PLC UNITED CAPITAL PLC 20,100.00 3.35 -2.90 249 18,479,976 413 27,768,301 1,185 230,378,645 HEALTHCARE PROVIDERS EKOCORP PLC. 2,592.72 5.20 - 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 5,299.36 2.54 - 5 94,200 GLAXO SMITHKLINE CONSUMER NIG. PLC. 5,381.44 4.50 -10.00 34 1,295,521 3,226.19 1.87 2.75 18 454,050 MAY & BAKER NIGERIA PLC. NEIMETH INTERNATIONAL PHARMACEUTICALS PLC 854.62 0.45 - 8 185,958 NIGERIA-GERMAN CHEMICALS PLC. 556.71 3.62 - 0 0 PHARMA-DEKO PLC. 325.23 1.50 - 0 0 65 2,029,729 65 2,029,729 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 781.44 0.22 -9.09 10 776,500 10 776,500 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 1,206.13 0.41 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 2.54 - 0 0 NCR (NIGERIA) PLC. 262.44 2.43 -10.00 2 199,790 287.07 0.58 - 0 0 TRIPPLE GEE AND COMPANY PLC. 2 199,790 PROCESSING SYSTEMS CHAMS PLC 1,267.94 0.27 -3.57 6 685,200 E-TRANZACT INTERNATIONAL PLC 10,962.00 2.61 - 0 0 6 685,200 TELECOMMUNICATIONS SERVICES AIRTEL AFRICA PLC 1,123,311.48 298.90 - 1 1 1 1 19 1,661,491 BUILDING MATERIALS BERGER PAINTS PLC 1,956.31 6.75 - 10 30,384 BUA CEMENT PLC 1,215,730.31 35.90 -1.51 54 848,000 CAP PLC 17,220.00 24.60 - 12 60,075 MEYER PLC. 244.37 0.46 - 0 0 1,769.32 2.23 - 1 1,111 PORTLAND PAINTS & PRODUCTS NIGERIA PLC PREMIER PAINTS PLC. 1,156.20 9.40 - 0 0 77 939,570 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,192.12 2.03 - 0 0 2,465.85 1.40 - 3 11,198 CUTIX PLC. 3 11,198 PACKAGING/CONTAINERS BETA GLASS PLC. 34,998.04 70.00 - 5 81,868 GREIF NIGERIA PLC 388.02 9.10 - 0 0 5 81,868 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 62.50 - 2 22 2 22 87 1,032,658 CHEMICALS B.O.C. GASES PLC. 1,685.79 4.05 -10.00 2 101,100 2 101,100 METALS ALUMINIUM EXTRUSION IND. PLC. 1,781.64 8.10 - 1 100 1 100 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 0.20 - 0 0 0 0 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 77.00 0.35 - 0 0 0 0 3 101,200 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,252.54 0.20 - 27 1,789,585 27 1,789,585 INTEGRATED OIL AND GAS SERVICES OANDO PLC 39,531.89 3.18 -3.64 55 1,442,582 55 1,442,582 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 48,031.29 133.20 - 13 21,506 ARDOVA PLC 21,751.43 16.70 - 11 88,728 CONOIL PLC 12,491.14 18.00 - 22 79,603 ETERNA PLC. 2,869.12 2.20 - 13 65,154 MRS OIL NIGERIA PLC. 4,206.05 13.80 - 5 4,211 TOTAL NIGERIA PLC. 36,328.84 107.00 - 21 8,324 85 267,526 167 3,499,693 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. 235.27 0.20 - 0 0 0 0 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 2,363.88 4.01 -9.89 9 166,549 TRANS-NATIONWIDE EXPRESS PLC. 421.96 0.90 - 0 0 9 166,549 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 2,515.34 1.21 - 3 24,600 TOURIST COMPANY OF NIGERIA PLC. 7,076.28 3.15 - 0 0 TRANSCORP HOTELS PLC 30,781.64 4.05 - 0 0 3 24,600 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 3,960.00 0.33 - 2 3,000 2 3,000 PRINTING/PUBLISHING ACADEMY PRESS PLC. 223.78 0.37 - 0 0 LEARN AFRICA PLC 956.60 1.24 - 10 427,469 STUDIO PRESS (NIG) PLC. 1,183.82 1.99 - 0 0 UNIVERSITY PRESS PLC. 539.26 1.25 - 2 139,750 12 567,219 ROAD TRANSPORTATION ASSOCIATED BUS COMPANY PLC 580.20 0.35 - 3 32,100 3 32,100 SPECIALTY INTERLINKED TECHNOLOGIES PLC 688.80 2.91 - 0 0 SECURE ELECTRONIC TECHNOLOGY PLC 1,126.31 0.20 - 0 0

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BUSINESS DAY Tuesday 25 February 2020 www.businessday.ng

Matthew Azoji: Steering Neimeth through turbulent times SEGUN ADAMS

I

n the quarter before Matthew Obi Azoji took over as MD/CEO at Neimeth International Pharmaceuticals Plc., the company, which had managed to return from a loss following a devastating warehouse fire accident in 2017, was facing another challenge - revenue decline that threatened another streak of losses.

Neimeth in the three months to the end of December 2018 (first quarter) recorded a revenue slump of about 42 percent to N227.07 million due to pressure on its Pharmaceuticals segment, even though animal health business almost doubled turnover.

This was the drug maker’s lowest quarterly turnover in two years, analysis of the company’s financial results showed.

As a result, the pharmaceutical company risked slipping into a streak of losses from which it had recently emerged when fire gutted its warehouse situated on Billings way, in Oregun, Lagos two year before.

Then, Neimeth had recorded losses of N64.2 million and N152.1 million in the last two quarters of 2017 before stepping into the path of profitability, recording four unbroken quarters of gains in 2018 financial year.

The underperformance in the first quarter of 2019 (three months to December 31) resulted in a loss of N139.16 million, thus a turnaround or averting a path of loss formed the top priority for Neimeth, and was Azoji’s first mandate when he assumed office.

Under the leadership of Azoji, whose role as MD/CEO was announced late January, Neimeth was swift in turning the corner to remain profitable, and by the second quarter, the drug maker bounced back with a 55 percent growth in turnover to N749 million.

The jump in revenue lifted half-year figure 11.25 percent year-on-year, mitigating the impact of a disappointing first quarter.

However, the profit in the period pared to N5.45 million on the back of the loss in the first

Azoji

quarter of the year, masking a 805 percent year-on-year surge in the second quarter profit which hit N144.61 million.

A resolute Azoji maintain positive outlook for the year during an interview with CNBC, unpacking of the 2019 half-year result.

“The outlook for the Neimeth business is good...,” said Azoji.

“We are investing in upgrading our facilities...and spending to promote our products.”

Amid a challenging pharmaceutical industry that weighed on performance of industry players, Azoji through his leadership steered Neimeth to profitability path.

By the end of the 2019 business year, Neimeth had grown its profit by 48.7 percent to N220.15 million to maintain its trajectory from 2017 lows.

The company saw slight growth in Pharmaceuticals which rose to N2.28 billion while its minor segment more than tripled to N90.114 raising year’s turnover by 4.5 percent to N2.37 billion.

Gross profit for the year rose

‘‘

Despite lower income from non-core business activities, exchange loss and increase in selling, general and administrative expenses, Neimeth grew operating profit by nearly 50 percent

almost 3 percent to N1.196 billion.

This meant Neimeth was able to retain N50.42 from every N100, a N1 decline from last year.

Despite lower income from non-core business activities, exchange loss and increase in selling, general and administrative expenses, Neimeth grew operating profit by nearly 50 percent.

Finance cost fell in the period to boost profit before tax by around 83 percent to N304.44 million.

Neimeth was able to post an earnings per share of 12 kobo compared to 8 kobo year-onyear.

Net margin of the company for the year rose to N9.28 per N100 sales, an improvement over N6.52 noted in the prior year.

The Return on Equity (ROE) for Neimeth rose to 20.53 percent in 2019 from 17.23 percent the year before.

Similarly, Neimeth’s Return on Asset (ROA) rose to 7.99 percent from 6.41 percent over the period under review.

This followed a 24.82 percent growth in total equity to N1.07 trillion with debt-to-equity ratio dropping to 0.61 from 0.63 yearon-year while total asset rose 19.3 percent to N2.75 trillion (Total liabilities rose 16%).

Neimeth was also able to hold on to the strong positive momentum which extended to the first quarter of the current 2020 business year (three months ended December 2019).

The pharmaceutical company in the recently concluded quarter saw turnover rise by 167

‘‘

Amid a challenging pharmaceutical industry that weighed on performance of industry players, Azoji through his leadership steered Neimeth to profitability path percent to N606.48 million.

Growth was on the back of better sales in Pharmaceuticals as the segment improved by 146.86 percent to N560.55 million.

Animal Health saw a ballooning of turnover by 7-folds to N46 million.

Gross profit in the quarter rose by more than 400 percent to N302.71 million with gross margin increasing by around N26 to N50 in the period.

There was significant improvement in Neimeth’s operating position which was a profit of N111.68 million compared to a loss of N139.16 million in the period of concern.

This resulted in a turnaround in Neimeth’s bottom-line from

a loss of N139.161 million to a profit of N82.65 million.

Earnings per share in the quarter rose to 4.35 kobo from a loss of 8 kobo.

The improvement in the pharmaceutical company’s performance is in no doubt reflective of the spiritedness and visionary leadership of its helmsman: Matthew Azoji, who is the recipient of the BusinessDay Top 25 CEO 2019 award.

Azoji began his professional career as a Hospital Pharmacist at General Hospital Saminaka in Kaduna state in 1986.

Prior to his appointment as MD/CEO Neimeth, Azoji was Executive Director at Biovaccines Nigeria Limited.

Before that time, the pharmacists and business strategist spent a decade and three years as MD/CEO at Chan Medi-Pharm Ltd. Azoji had also spent almost two decades with May & Baker serving in more than five different roles throughout his time at the firm.

Azoji holds a first-class honours degree in Pharmacy from Obafemi Awolowo University (OAU), an MBA (Marketing) from the Enugu State University of Science and Technology and an Advanced Management Programme (AMP) from the Lagos Business School; Pan Atlantic University, Lagos.

He obtained certificates in Pharmaceutical Policy & Pharmacoeconomics from Utrecht University in the Netherlands (a WHO Collaborating centre) and went on to get his M.Sc. in Public health from the University of London, International Programmes. He obtained his M.Phil in Pharmacy Administration from OAU and as of last year, was running a Ph.D. programme in Clinical Pharmacy and Pharmacy Practice from the University of Jos. Azoji is Fellow, Pharmaceutical Society of Nigeria (FPSN), and Fellow, West African Postgraduate College of Pharmacists (FPCPHARM).

He is also a member, International Pharmaceutical Federation (FIP), Founding Member, Health Systems Action Network (HSAN), Member, Nigerian Institute of Management (MNIM), Member, National Institute of Marketing of Nigeria and Member, Nigerian Association of Industrial Pharmacists.

Neimeth International Pharmaceuticals is a Lagosbased company founded in 1997. The firm focuses on manufacturing and marketing of pharmaceuticals, animal health products, and general healthcare products. It was incorporated on August 30, 1957, as a limited liability company and listed on the NSE on September 21, 1979.

Published by BusinessDAY Media Ltd., The Brook, 6 Point Road, GRA, Apapa, Lagos. Advert Hotline: 08033225506. Subscriptions 01-2950687, 07045792677. Newsroom: 08169609331 Editor: Patrick Atuanya. All correspondence to BusinessDAY Media Ltd., Box 1002, Festac Lagos. ISSN 1595 - 8590.