Financial Vanguard

JULY 16 , 2012 185.50

+3.45

2,213.00

+24.00

22.69

+0.23

CURRENCY BUYING CFA 0.2704 KRONER 25.3781 EURO 188.7246 POUNDS 239.2742 RIYAL 41.2965 SDR 232.2585 FRANC 157.1487 DOLLAR 154.87 WAUA 232.3625 YEN 1.952 RENMINBI 24.2974

102.20

+1.13

87.25

+1.17

CENTRAL 0.2804 25.4601 189.3339 240.0467 41.4298 233.0084 157.6561 155.37 233.1127 1.9583 24.3763

SELLING 0.2904 25.542 189.9432 240.8192 41.5631 233.7582 158.1634 155.87 233.8629 1.9646 24.4552

CBN Exchange rate as at 13/07/2012 N recent times, the major con cern of stakeholders in the man ufacturing sector has been how to accelerate development in the sector and raise its contribution to the Gross Domestic Product, GDP. However, several problems bedeviling the sector have kept it from rising beyond its present state. While sectors like Agriculture contribute 39.5 per cent, telecom 5.6 per cent, crude oil and natural gas 13.6 per cent, manufacturing sector contributes a mere 4.5 per cent to gross domestic product. This is despite federal government’s intervention funds through the Central Bank of Nigeria and the Bank of Industry.

In the past eight years alone, more than N800 billion was made available to operators in the sector for them to re-tool their machines and increase productivity. The impact of these intervention monies have not manifested as the sector 's contribution to the GDP has been hovering between 4.5 to 4.8 per cent per annum over the last ten years.

Recently, the Federal Government through the Minister of Trade and Investment, Dr. Olusegun Aganga, charged the Organised Private Sector, OPS, to ensure that the manufacturing sector contributes 10 per cent to GDP in the next three years, precisely by 2015. Aganga said he believes the figure was attainable

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From left Mr. Tom Frtunik, Director, Great Place to Work , Australia, Mr. Kunle Malomo, CEO/GMD, Great Place to Work Nigeria and Mr. Reginald Ihejiahi, MD & CEO Fidelity Bank Plc at the presentation to Fidelity Bank as one of the world’s great place to work by the GPTW International.

How to achieve 10% real sector contribution to GDP by 2015 — Stakeholders

By FRANKLIN ALLI through concerted efforts by the private sector. He asserted that since other economies have achieved success in that respect, the success story can also be replicated in Nigeria.

He told the business leaders: “The key to economic transformation is in your hands to drive the economy of this country if you really want to. Our overall aspiration is to increase man-

ufacturing contribution to GDP to 10 percent from 4 per cent.”

H

e drew inferences from Kenya that increased its manufacturing contribution to GDP to 6 per cent, Malaysia 26 percent; Indonesia also jerked its manufacturing GDP, from 17 to 27 per cent and Cameroun from 25 to 34 per cent. “These countries have done it, why can’t we? It’s in your hands. You have the power to drive the economy, to create demand.

It’s my job to create enabling environment. We just have to get the courage and the will to do it,” he stated.

Aganga assured that government was doing all in its power to ensure that it addressed all lingering problems impeding progress in the sector. He noted that 500 megawatts of power supply would be channeled to industries in Lagos and Ogun State, adding that the government was also Continues on page 18

18 — Vanguard, MONDAY, JULY 16, 2012

Cover Story How to achieve 10% real sector contribution to GDP by 2015 — Stakeholders Continued from page 17

H

e explained “The doc ument is based on an integrated approach that addresses the important role of manufacturing, particularly SMEs in the generation of substantial employment.

“This document reviews the status of the manufacturing sector in Nigeria and identifies the extent of the burden that manufacturers have carried over the years. It sets out an action plan that would accelerate the development of the manufacturing sector in the context of vision 20:2020, provides a framework and formulates a vision for the sector in the short medium to long term.

“The document also provides general sector-specific action plans and addresses critical questions relating to the manufacturing sector as well as proposes a bold set of reforms which if embraced, are capable of unleashing the full potentials of manufacturing in the economy.”

He noted that there is an urgent need for the restructuring of government spending in favour of capital expenditure in view of huge infrastructural deficit confronting the nation, as part of recommendations contained in the blueprint. “To facilitate free flow of goods and persons, government should rehabilitate the existing road network, construction of new

The Basic Guide to Starting your Business Part 2 L-R:Class Governor, School of Management and Security (SMS), Mr. Ifejika Ikechukwu; Chairman, Dr. Ona Ekhomu; Managing Director, TransWorld Security, Chief (Mrs.) Victoria Ekhomu and Head, Investigations, Mr. Nwabor Nathaniel, during the Security Protection course (EP 101) at Edowaye Hall, TransWorld Towers, Lagos.. ones should be given priority and the railway system should be completely overhauled and privatised.

“The federal government should put in place a revolving intervention fund to meet the long-term funding needs of the manufacturing sector which Deposit Money Banks are unwilling to provide.”

Other recommendations made by the association include push for patronage of Made-in-Nigeria products, channeling more efforts to tackle security challenges,

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addressing lack of access to credit among other challenges.

In a swift reaction, Chief Kola Jamodu, President of Manufacturers Association of Nigeria (MAN), said the private sector can achieve the target and even surpass it if only government would implement the recommendations in a blueprint the association just finished working on termed, “Strategies For Accelerated Development of Manufacturing in Nigeria: The Way forward.” Jamodu noted that since his exit as the then Minister of Industry, succeeding administrations have introduced policies that are inimical to development of the sector. For instance, he noted that duty on machineries was zero per cent, but “today, it is five per cent.”

According to him, the manufacturing sector’s contribution to GDP could actually improve significantly to between 15 and 18 per cent in the next five years, if recommendations in the Blue print are considered and implemented.

But the question is, can the Organised Private Sector (OPS) deliver on the federal government’s target of 10 percent manufacturing contribution to the country’s gross domestic product over the next three years

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and pursuing of power sector road map with greater vigour.”

The question is can the Organised Private Sector (OPS) can deliver on the federal government’s target of 10 percent manufacturing contribution to the country’s gross domestic product over the next three years?

Commenting, President of Lagos Chamber of Commerce and Industry, Mr. Goodie Ibru, said for the target to be met, there is need for government to tackle the problem of high exchange rate because the Nigerian economy is very sensitive to developments in the Foreign Exchange market.

This, he said, is so because of the structure of the economy which is still heavily dependent on imports.

“This in itself is a major weakness of the manufacturing sector and our economy.

In the first half of this year, the economy has witnessed 5 per cent depreciation in the exchange rate of the naira against the dollar. The rate was N157 to the dollar in January and currently ranges from N162-N165 to the dollar, in the interbank and parallel market. The trend is yet to abate and has negative implications for business performance in terms of: higher production and operating cost as the cost of raw materials and other imported inputs increase and inflationary pressures induced by higher production cost.”

D

r. Ademola Ajayi, Pres ident of NACCIMA, affirmed that the target can be made a reality through the joint efforts of Governments and the private sector operators. He pointed out that infrastructural development is key to boost the performance of the real sector. “However, we are still worried that not much has been achieved; as less than 30 percent of the nation’s roughly 200,000 kilometers of road network coverage, are in good condition while 60 percent of Federal and State roads are in poor condition, resulting in an increase of about 60 percent of the cost of production in Nigeria due to delays and losses incurred from breakdowns, accidents, wear and tear.

“In particular, most federal roads, especially in the South West, South East and SouthSouth of the country are in very bad and deplorable state.

This has continued to hamper Continues on page 48

a) What is not business?

One might wonder the importance of knowing what is not business, but this is necessary because you need to know the kind of business you should not go into, and businesses that are prohibited by law. Not every business is a genuine one and I will be taking you through a list of businesses you must not be found doing. b) The mentality of a business man: There’s a saying in the good book which reads thus “by their fruits you shall know them”. The same applies to business men; they possess certain qualities and mind sets that make them stand out. Consequently, before you start a business you need to be adequately sure that you possess the die-hard mentality of an entrepreneur to withstand the challenges that will arise. c) Who is an entrepreneur?

Over time various definitions have been given to the term, but I will be teaching you the difference between an entrepreneur and a businessman, the boundless and countless opportunities open to an entrepreneur, the traits and characteristics of a successful entrepreneur. In short, everything you need to know if you want to be not just a business man but also an entrepreneur. d) Your readiness to be your own boss: A lot of people embark on a journey without fully preparing for it, and as such they are knocked off balance by the slightest wind that blows. No warrior goes to war without his arms and it’s only a stupid farmer that goes to farm without his hoe. At the end of this topic, you would know if you are ready to start a business and peradventure you are not, you would be taught steps that will help you to be both mentally and financially ready. e) The basic steps: In this chapter I will be taking you through the steps that you cannot overlook, if you want to have a successful business. These include: conceiving an idea, planning, funding, structuring, location, training and so much more.

I am of the sincere opinion that this would be more than just a book for you and your loved ones; it will be a compass that will guide you on your journey into the world of entrepreneurs. There is no better time to start your own business than now. These same steps have worked for me and I dare say are still working for me, and I am confident they will work for you and everyone that reads this book.

WHAT IS BUSINESS? Before you start a business, it is very important to understand what a business is in order to avoid making mistakes that can be very detrimental. The term business is very broad and can be vague; for some it is any activity or trade with the sole aim of making profits. On the one hand, it can be said to be the occupation, work or trade in which a person is engaged in. On the other hand, a business can be defined as “an organization that provides goods and services to people who want or need them”. When many people think of business careers, they often think of jobs in large wealthy corporations, but for the entrepreneur, a business is any activity aimed at creating and keeping customers. There are basically two ways to carry out a business: 1.

Sell goods (physical things like books, toys, cars, houses, etc).

2.

Sell services (intangible things like nursery education, legal services, health care, insurance, etc).

Many business-related careers though, exist in small businesses, non-profit organizations, government agencies, and educational settings. Conversely, your business may consist of selling both goods and services; for example if you are a computer dealer, you may sell goods (hardware and software) and services (maintenance, troubleshooting, or consulting). While it is very important to get a degree or some level of academic qualification, you can still go into business if you do not have one. Starting and growing your business is very much like having a baby and bringing up the child.

Vanguard, MONDAY, JULY 16, 2012 — 19

Developing Nigeria’s non oil revenue sources: The right way to go P

erhaps, a revolution of Nigeria’s fiscal federalism is in the offing.

May be, just may be, if the power that be can see it and tap into it to develop Nigeria’s non oil revenue sources. The only good news that has come into focus in Nigeria public finance is the one informing the nation that FG, States; Local Government Councils are billed to share N1.7billion revenue from solid mineral.

For a long while now, it is either there is a verbal war on sharing of oil revenue among the three tiers of government or there is bickering among the governors on which state is entitled to have a lion share of the oil revenue.

None of the federal, state or local government politicians has been stateman enough to canvass increased efforts in baking the proverbial Nigerian national cake.

Nigeria has always been taunted as being endowed with enormous natural resources that have remained in the raw form without being

exploited.

In the time past, Nigeria boasts of its resources from export of coco, cotton, rubber and ground nuts. From 1967 to 1970, Nigeria fought a civil war without going into debt.

After the civil war, developments plans were

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government and people of Nigeria focused only on easy money and threw the baby and the bath water through the window by neglecting its traditional sources of revenue.

Chairman, Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC), Mr Ellias Mbam, recently said that over N1.7billion revenue from solid minerals will soon be distributed among the

None of the federal, state or local government politicians has been stateman enough to canvass increased efforts in baking the proverbial Nigerian national cake

embarked upon, Nigeria’s public finance was sound and healthy. But with the oil boom in the late seventies, the

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three tiers of government.

Mbam made this known in an interview in Abuja. Revenues from crude oil sales account

for nearly 90 per cent of monthly allocations to federal, states and local governments by the Federation Accounts Allocation Committee (FAAC).

Mbam described the revenues from solid minerals as very positive in the present administration’s bid to diversify the economy.

The significance of this development may be lost to many Nigerians. For the first time in years, the solid minerals sector is contributing to the federation account. To have generated N1.7billion from solid minerals waiting for distribution among the three tiers of government is an opportunity the nation should grab and encourage a further development of the sector.

Luckily enough, the derivation principle also applies here as the Chairman said “What is holding us from forwarding the sharing is the 13 per cent derivation. We have asked the Mines and Steel to provide us the states where these revenues were generated so that they can get their 13 per cent derivation.”

The RMAFC boss explained that the 13 per cent derivation was not exclusive to oil-

producing states. According to him, any revenue from natural resources from any state entitles the producing state to derivation. He also stated that the Accountant-General of the Federation had opened a dedicated account for the solid mineral revenue with the Central Bank of Nigeria (CBN).

This is an opportunity for states in the federation to compete in the development of the resources in their domain.

Even states with large deposit of oil wells can benefit more by looking outside oil.

Agriculture can generate more revenue than oil if properly exploited. The value chain in the various product lines should be the focus of development. The amount of agricultural resources wasted every year can be tapped into through the setting up of light industries across the agricultural belt to process and package products for export.

Solid mineral development can earn Nigeria billions of dollars every year.

Nigerians must wake up and learn to live outside oil. This is the future of this nation.

BUSINESS & ECONOMY

FG to engage telecom sector over contract staffing

By LAZARUS IBEABUCHI and WILLIAM JIMOH

M

INISTER of Labour and Productivity, Chief Chukwuemeka Wogu said that the Federal Government is set to engage stakeholders in the telecommunication sector over

the issues of contract staffing and outsourcing.

Giving this assertion at the th 55 Annual General Meeting of the Nigeria Employers’ Consultative Association, NECA on “Industrial Harmony as a Panacea for Sustainable Economic Development: Government’s Blueprint” in

Lagos, the Minister said this is borne out of the relative success recorded in regulating and reducing the number of disputes on Contract Staffing/ Outsourcing in the oil and gas sector.

He said, “Our plan is to identify and articulate similar consensus building in other

From right Prince ben Onuora, Chairman, Institute of Director Research and Advocacy Committee; Otunba Gbenga Daniel, former Governor of Ogun State; Arch. Thomas Awagu, President/Chairman of Council, Institute of Directors and Professor Ukachukwu Awuzie, Immediate Past President, Academic Staff Union of universities ASUU during the Institute of Directors Advocacy Roundtable Forum on Security Vote held in Lagos on Thursday. Photo by Lamidi Bamidele.

sectors so that the economy can generate the required steam for development and growth. We are broadening the base of our consultation on policy options.”

Speaking on the large recurrent expenditure, Chief Wogu said that the N18000 minimum wage caused the increment in the 2012 fiscal year recurrent expenditure to 72 per cent.

Currently, the Federal Government wage bill is N1.66 trillion out of N2.7 trillion budgeted for recurrent expenditure in 2012 fiscal year; while the capital expenditure is N1.34 trillion. This shows that the government is spending more on wage bill which surpasses money appropriated for infrastructural development, in an economy that projects to be among 20 best economies in year 2020.

Chief Wogu said though the government is the highest employer of labour in the country, it has no plan to downsize because the President Jonathan’s transformation agenda places emphasize on employment creation.

The Minister however said the government is doing a lot to reduce the cost of governance. He said the government is not happy that capital budget is just about 28 per cent, adding that the recommendation of the Presidential Advisory Council (PAC), chaired by General Theophilus Danjuma, on the need for effective and optimal management of national resources, is being implemented.

On industrial harmony, he enjoined employers of labour to often abide by rule of law.

“There are many cases where employers of labour failed to obey court orders on labour issues. If you say government should always obey the rule of law, then other social partners including employers of labour and labour unions must do same to bring about industrial harmony and better welfare for the Nigerian citizenries.”

Earlier in his remark, the President of NECA, Chief Richard Uche had said the casualty of industrial disharmony is the Nigerian economy.

20 — Vanguard, MONDAY, JULY 16, 2012

Business & Economy BRIEFS Agric Ministry extends subsidy to fisheries, aquaculture to boost export

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he Federal Ministry of Agriculture and Rural Development will soon provide subsidies to operators of the fisheries subsector as already being done to crop farmers. The Minister of Agriculture, Dr Akinwunmi Adesina said this in a statement signed by his Special Assistant on Media, Dr Olukayode Oyeleye in Lagos. The minister made this known at Oko-Oba, Agege, during the roll out of the Growth Enhancement Support Scheme (GESS) in Lagos State. Adesina, while unveiling the plan told the participants at the aqua culture value chains meeting that the intervention was targeted at small-scale fisheries and aqua culture operators. He said that the basic inputs would be subsidised under the scheme. The minister said that the operators could use their cooperatives within the artisanal fisheries to access support. He promised to provide service for mechanisation, adding, ‘We will also look into how we can structure affordable financing mechanism, specifically for that including outboard engines.”

Association plans to facilitate indigenous production of gas cylinders

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he Nigerian Liquefied Petroleum Gas Association (LPGA) has reiterated its plan to collaborate with foreign investors to facilitate indigenous production of gas cylinders. The President of the association, Alhaji Auwulu Ilu, told the News men in Lagos that it would also facilitate the production of affordable gas cylinder accessories to promote the use of cooking gas in the country. He said: “The process would also create the enabling environment to make Nigerians use more of cooking gas instead of kerosene, charcoal and firewood in their homes.” Ilu said his association would put up a proposal for a pilot scheme that would promote LPG usage, adding that in the next one month, a comprehensive plan on the project would be ready.

L-R: Professor Adebowale Adefuye, Nigeria Ambassador to the United States of America, Laurent Philippe, P&G Group President, Central Eastern Europe, Middle East and Africa (chief host); Olusegun Aganga, Minister of Trade and Investment and Manoj Kumar, Managing Director, P&G Nigeria at the P&G’s new Plant Ground Breaking Ceremony in Agbara, Ogun State.

OPS urges FG to tighten control on CBN …Says firms losing 30% sales revenue to insecurity

BY MICHAEL EBOH

I

ndustrialists and members of the organized private sector have called on the federal government to tighten its control over the Central Bank of Nigeria, CBN, and the Governor of the apex bank, by increasing the number of independent director on the Board of the bank.

Speaking at its second quarter press conference on the economy, President of the

Lagos Chamber of Commerce and Industry, LCCI, Mr. Goodie Ibru, however, warned against the removal of the autonomy of the CBN, saying it would hinder it from effectively and promptly discharging its functions.

He said, “However, we concede that the autonomy cannot be absolute. In any events, no institution should have absolute powers.

Therefore, what is necessary is to strengthen the existing structures of controls within

the framework of the CBN Act 2007.

“We know for instance that the CBN Governor is an appointee of the President; therefore the President has some oversight responsibilities over the CBN Governor. The Board of directors also has powers of checks and balances even though the governor is the chairman of the Board.

“To make the Board play this role effectively, the number of independent directors, (who are also appointees of the president) could be increased.

Tinapa gets N1bn International Conference Centre

By JOHNBOSCO AGBAKWURU

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HE management of Tinapa Business and Leisure Resort has built an International Conference Centre with a sitting capacity of 600 and modern communication facilities that could host international organisations or any event of international standard.

Managing Director of Tinapa, Chief Bassey Ndem, who disclosed this when the executive members of the Correspondents Chapel of Nigeria Union of Journalists, Cross River State Council paid him a courtesy visit in his office, said that it took over

N1 billion to put in place the befitting edifice that could host any international events.

Chief Ndem noted that Tinapa had hosted many events which included the World Tourism Organization conference at the Lake Tinapa hotel, adding that the new conference centre which is fully air conditioned has banquet chairs and exhibition hall. The MD said that there was an air of confidence at the resort and that within January and March this year about 173 containers entered into Tinapa and that many more investors had indicated interest in doing business in the resort.

He said that the Governor Liyel Imoke’s led

administration had been supportive and had done much to ensure that there was boom in economic activities. Earlier in his remarks, Chairman of Correspondents Chapel, Mr. Bassey Inyang, said that the executive members of the chapel decided to visit the resort to know the level of economic activities going on, some of the challenges if any and the way the chapel and management of Tinapa could work together to promote the multi-billion naira outfit. Other executive members of the chapel include Increase AbasiUbong (Vice Chairman), Johnbosco Agbakwuru (Secretary), Mike Abang (Treasurer) and Sunday Bassey (Internal Auditor).

And they should be men and women of high intellectual and moral standing and truly independent.

“We are of the view that the Deputy Governors of the CBN should remain on the board in order to provide the desired technical input into the board’s deliberations.”

Ibru further lamented the spate of insecurity in some parts of the country, saying it is negatively affecting companies, especially in the area of sales, raw materials sourcing and funding, among others.

According to him, many firms have lost up to 30 per cent of their sales as they can no longer access most part of the northern market while manufacturing firms sourcing raw materials from the north are now facing serious challenges.

He further stated that projects funded by banks in the affected states are now at risk; while inventory and stocks of many companies have been trapped in some locations in the affected states.

“Serious perception problem has been created for the country; many bank branches have been closed, while the working hours for others have been drastically reduced; sales representatives of many companies have fled the affected states; many projects under construction in the north have been abandoned; while security budgets have been scaled up by many firms,” he maintained.

Continuing, Ibru declared that the current dearth of credit facilities for investors is putting the economy of the country in jeopardy, saying that the situation will worsen the country’s unemployment condition.

According to him, the situation has been further compounded by the fact that government treasury bills and bonds have returns of between 13-17 per cent, declaring that the consequence is that available funds have been mopped up by government.

He said, “It is clearly more attractive now to invest in government securities than invest in ventures that would create jobs.

“Even banks now would rather buy treasury bills and government bonds than give loans to investors. This credit and interest rate structure would continue to create distortions in the economy, which will only perpetuate the phenomenon of jobless growth and further depress the stock market.”

Vanguard, MONDAY, JULY 16, 2012 — 21

Business & Economy

NCS assures on job creation, combating terrorism through IT

By EMEKA AGINAM

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he Nigerian Computer Society (NCS) has reassured that it would use Information Technology to create millions of jobs across the country and also combat terrorism.

The NCS President, Sir Demola Aladekomo, while unfolding details of its 2012 annual general meeting (AGM), recently emphasized the utilization of

local content development through IT would meet the need for massive job creation in Nigeria.

According to him, NCS and its members can play a massive role in state of security nationwide and terrorism and job creation.

“NCS is the largest group of Information Technology Professionals, Interest Groups and Stakeholders in Nigeria.

NCS is the national platform for the advancement of

Information Technology Sciences and Practices in Nigeria. There’s no doubt about it. IT is the major tool for change and innovation today with massive potential to contribute to economic growth and development, and to improve the lives of people.

“For Nigerians to fulfill their potentials and diversity the economy away from oil, Nigeria needs to move beyond consumption and activity” he explained. According to him,

From left CEO, AMMASCO Oil, Alh. Ado Muhammed, Director General, SON, Mr. Joseph Odumodu and CEO, A-Z, Dr. Chukason Okafor during a courtesy visit by LUPAN committee to SON headquarters in Lagos.

NCS engages in several activities and organizes important events to promote local content development in IT in Nigeria. In carrying out its advocacy efforts, he disclosed that NCS adopted a national outlook in line with its commitment to accelerating the pace of IT development and promoting digital inclusion.

“It is committed to facilitating the development of information and knowledge based economy in which all the people of Nigeria deploy and exploit IT to gain significant social, economic and educational benefit and fulfill their potentials’ He further emphasized the need for government to support and encourage IT driven projects such as outsourcing and call centre operations to generate massive employment opportunities here in Nigeria.

While insisting that government agencies should use Nigerians and local firms to execute projects instead of always importing products and solutions and creating jobs in other countries, he noted that , ”importing payroll software into Nigeria is a crime against humanity.

Any government agency doing that is working against the interest of Nigerians. It is a massive concern and all of us should condemn it”.

Analysts foresee marginal increase in June inflation

BY NKIRUKA NNOROM

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nalysts from FSDH Securities Limited have said that Nigeria’s inflation rate for the month of June is expected to rise by 20 basis points to 12.9 per cent from 12.7 per cent in the month of May. They made the remark in their review of the economy for the month of June.

The analysts noted in their report that hike in import duty on rice in June, the depreciation in the value of the Naira, increase in the prices of some food items, particularly vegetables and tubers and the partial impact of the new electricity tariff on consumption expenditure would all combine to effect an increase in the Composite Consumer Price Index

(CCPI).

The National Bureau of Statistics (NBS) is expected to release the inflation figure for the month of June 2012 on Wednesday, July 18, 2012.

“The latest inflation rate for the month of May 2012 stands at 12.7 per cent, a decrease from 12.9 per cent recorded in the month of April 2012. We expect the CCPI to increase by 1.2 per cent to 135.4 points in June, which will produce a year-on-year inflation rate of 12.9 per cent,” FSDH said.

“The monthly Composite Consumer Price Index (CCPI) for All Items for the month of May stood at 133.8 points, a marginal increase of 0.75 per cent between April 2012 and May 2012. On a month-onmonth basis, prices remained fairly stable between April 2012 and May 2012.

“The Food and Agriculture Organization (FAO), notes

that food prices fell slightly in the month of June 2012 from a slight upward revision in May, the lowest level since September 2010,” the report added.

According to FAO, the FFPI released on July 5, 2012, which measures the monthly change in the international prices of a basket of food commodities, depicted an average of 201 points in June 2012, down for the third consecutive month by 1.8 per cent from May. In addition, FAO said that, continued economic uncertainties and adequate supply prospects kept international prices of most commodities under downward pressure, although growing concerns over adverse weather sustained prices of some crops toward the end of June. It is also of note that international rice

prices remained largely stable, with large differences across origins.

Meanwhile, the price of rice that FSDH Researchers monitored in different parts of Nigeria increased by about 2.04 per cent following the imposition of import duty by the Federal Government of Nigeria (FGN) in the month of June 2012.

The analysts further stated in the report, “The unresolved and worsening security challenges in the northern part of the country also puts upward pressure on basic food items such as vegetables and tubers, thus escalating the general price level. Also, the new Multi-Year Tariff Order (MYTO) for electricity consumers which commenced in June 2012 contributed to the general price increase in June.

BRIEFS PAN African competitive forum set to reposition SMEs

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AN African Competitive Forum (PACF) says it will reposition Small and Medium-Enterprises (SMEs) clusters to make them more competitive. Prof.

Peter Onwualu, made the disclosure, when he led a delegation of the forum to visit Dr Samuel Ortom, the Minister of State for Trade and Investment in Abuja.

Onwuaui, who is also the Director-General of the Raw Material Research and Development Council, said that they were in his office to brief him on the forthcoming meeting of the forum. He said that the event would enable members to share “experiences to drive technology into SMEs clusters to make them more competitive”. The directorgeneral said, “We have been meeting and we have been doing joint projects, we are working to drive the emergence of SMEs clusters that produce goods and services that are competitive.

“We have a major event coming up in November, to host the PAN African Competitive Forum, where we will bring together cluster operatives all over the world.”

Ecobank suspends migration over customers’ outcry

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cobank Plc on Thursday suspended, indefinitely, migration of former Oceanic Bank accounts from finacle to flexcube software. The suspension was due to the inability of customers to access their funds. The suspension was as a result of various threats from customers across the country, especially in the North. The bank had resorted to Pasys, an application device, developed for posting in both Ecobank and the defunct Oceanic Bank database But customers of the defunct Oceanic Bank could not access their funds since the migration to the flexcube.

While the Oceanic Bank was using finacle software, Ecobank is using flexcube.

22 — Vanguard, MONDAY, JULY 16, 2012

Banking & Finance institutions, they would understand the essence of the ethics of the banking profession; but where every Dick and Harry that can mobilize fund get to the pinnacle of the banking career, the purpose of banking would be defeated.

BRIEF Unity Bank road show to receive customer’s feedback NITY Bank Plc said that its on-going road show is aimed at getting feedback from customers on the ways it can serve them better.

Meanwhile, the bank has commenced the South West zone edition of the road show using it as opportunity to connect with customers in the zone.

The Regional Manager, Ikeja and Abeokuta zone, Mrs. Yemi Adeyinka who spoke at the activation trains of the Unity Bank Aim, Save & Win Promotion, explained that the promo, together with the road show was part of the bank’s idea aimed at obtaining first-hand feedback from the customers and other people needing banking services.

Adeyinka said, “With the road show the bank will be able to connect with its customers and also obtain feedback from them on how to serve them better. It goes beyond just road show, we are using this to get more information from our customer and potential ones on how to serve them better and have a mutually beneficial relationship together.

In his remark, Regional Manager Minna Zone, Mr. Kabir Adamu said that the road show was part of the bank’s philosophy to connect with its customers at the grass root level and to sensitize them about the ongoing promo in order for them to benefit from it.

The ancient city of Ilorin, Kwara State and Abeokuta in Ogun State came agog with the activation trains of the Unity Bank Aim, Save & Win Promo team that storm the two cities in the last week during the ongoing promo the bank has put in place to reward its loyal customers.

In Ilorin, the promo activation train painted the city in red as hundreds of fun loving people stormed the major street like Muritala, Taiwo, Unity, Maraba, Ipata market to see what was going on and to know more about the promo mechanisms, while the train in Abeokuta dance through the popular Sapon market, Omida Market, Kuto market and Lafenwa market.

The crowd that greeted the activation train in Ilorin and Abeokuta made it center of attraction as on lookers couldn’t help but be drawn to see what was going on.

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L-R: Mr. Clive Horwood, Editor, Euromoney; Mr. Segun Agbaje, MD, GTBank Plc. and Mr. Miles Jupp at the presentation of the 2012 Euromoney Awards for Best Bank in Nigeria to GTBank.

Banking must be returned to the professionals — University Don

By AHMED IBRAHIM HE practice of banking should be restricted to professionally qualified bankers, so as to safeguard the industry from further crisis, says Dr. Bode Ayorinde , Pro Chancellor/Chairman of council, Achievers University, Iwo. “You cannot give what you don’t have. For as long as carpenters continue to occupy our banking halls, many of the banks would continue to close shop as we have witnessed in the last few years”, he said.

Speaking at the 2012 Graduates Induction/prize awards ceremony of the Chartered Institute of Bankers of Nigeria (CIBN), Ayorinde said, “Ultimately, it is the commerce and industry and the Nigerian people that will suffer. A stitch in time saves nine; therefore it is high time that the trend is reversed so as to place the banking industry in a proper shape towards savaging the Nigerian economy”.

In a paper titled, The Future Workforce of the Nigerian Banking Industry”, he said, “Nigeria has in place various laws relating to banking operations and practices, so are a number of institutions and government agencies saddled with the responsibilities of implementing these laws.

However, these laws as many as they are, and the regulatory agencies established by the laws had failed woefully to achieve a successful reform of the banking industry.

“Perhaps the major reform that is required to be done, to ensure stability and sustainable development in the Bank-

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ing Industry, is to require, statutorily, essential bank workers to be qualified professional bankers certified by the Chartered Institute of Bankers of Nigeria.

“Really, what the nation lacks is the will to allow professionally qualified personnel to man the banking industry as well as the regulatory institutions towards effective implementation of the various laws in other to achieve their

desired goals.

“The financial services sector generally and the banking industry in particular are special areas that require qualified personnel to formulate and execute policies and manage. It should not be all comers affair.

There is no gainsaying in the fact that when properly trained professionals are saddled with the responsibility of managing the banks and the regulatory

erhaps only profit would matter. “It is therefore astonishing that professionally qualified bankers are not statutorily required for the position of the Governor of CBN or the top hierarchy of licensed banks. The consequence of this lacuna is of course the crisis in the banking industry and shoddy consolidation exercise which led to unsavory consequences.

It can be seen from the foregoing that the major challenge facing the banking industry is the ‘disconnect’ between the industry and the institute.

Until both are connected so that the professional bankers trained by the institute are in position to positively affect the banking industry, no meaningful reform can take place in the industry.

“If there is any future for the bank industry, which is the future of genuine effort to develop commerce and industry in this country, the future belongs to professionally trained bankers. And the future is now. Our Institute must work in tandem with the Central Bank of Nigeria and the Nigerian Legislature to ensure that necessary statutes are put in place to return the bank industry to the professionals.”

Green economy vital to economic growth in businesses — ACCA “

HE distinct and credible reporting of ESGs – environmental, social and governance disclosures – have an important part to play in encouraging a positive approach to sustainable development by business and the adoption of long-term and socially responsible investment strategies by investors” said Martin Turner, ACCA’s Vice President.

Martin Turner’s comments were aired at a session which ACCA had co-sponsored with Aviva Investors, organised ahead of the full Earth Summit or the Rio+20 conference..

ACCA is focussing its hopes on a positive outcome regarding paragraph in the ‘zero draft’ about the integration of sustainability information into the corporate reports of listed and large private companies.

While pointing out the need for consistency in ESG reporting, Mr Turner also said that sustainability reporting needs global buy-in, adding: “We

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have to move forward on the basis that we aim to achieve a reporting framework which provides meaningful information to users everywhere and is also flexible enough to accommodate substantial differences in cultural and legal practices which may exist in different countries.

“To get to the point where we have a framework that all countries can sign up to, we therefore need to ensure that we engage actively with regulators and investors – to ensure that we require the sort of disclosures that will make a difference to them – and also involve as broad a geographic spread of stakeholders as we can manage in the process of developing standards.

“ACCA believes there is a positive and vital role for accountants to play in ensuring that ESGs provide meaningful information to stakeholders, with the aim of encouraging a more holistic ap-

proach to risk management by reporting companies.”

Along with Martin Turner, representatives from Aviva Investors, the Istanbul Stock Exchange, CERES and Banco de Brasil DTVM were on the panel, with James Gifford, executive director of Principles for Responsible Investment as the moderator.

ACCA recently published a paper which looks at the possible changes to the ‘zero draft’. The paper also includes a series of expert views on this issue from our Global Forum for Sustainability members and other voices from the accountancy profession. The Forum was established in 2011 to bring together leading thinking on sustainability and the role of accountants.

Martin Turner concluded: “Accountants can play a major part in ensuring ESGs are worthwhile and meaningful to stakeholders so they can see exactly how beneficial this information is.

Vanguard, MONDAY, JULY 16, 2012 — 23

Banking & Finance

Okonjo calls for specialised bank for women *CBN to launch MSME Fund in October

By BABAJIDE KOMOLAFE OORDINATING Minis ter for the Economy and Minister for Finance , Dr (Mrs) Ngozi OKonjo-Iweala has called for the creation of a bank that will cater exclusively for the financing need of women.

She made this call in a keynote address at the 2nd African Women Economic Summit in Lagos last week.

Meanwhile, The Central Bank of Nigeria (CBN) will launch a special fund for micro, small and medium (MSME) enterprises in October. CBN Governor, Mallam Lamido Sanusi disclosed this saying fund will replace the old agricultural credit guarantee scheme and 60 per cent of it will be dedicated for women entrepreneurs.

Reiterating the apex bank’s support for women in businesses, he said, “I am not one of those that believe that all men are better than women or that women are better than men.

You need to both to have diversity on the board. Any board that has a combination of men and women is better than any one that has men only or women only.

The central bank has proposed to set up a micro small and medium enterprises (SME) fund which 60 per cent will be for women empowerment. This fund is expected to replace the old agricultural credit guarantee scheme that we have had. When this fund is launched, at least 60 per cent of the loan will go to women business owners at single-digit interest rate. Hopefully, by October this year, when we all come back from the World Bank meetings, it will be inaugurated.” In her address, OkonjoIweala said it is no longer a debate on whether there should be any investment on women, since such investment is the only way to sustain current growth across Africa.

She said even though Africa has produced two women Presidents in Liberia and Malawi, women’s participation in politics and governance is still too low, giving their strategic role and number. “Women are the third largest emerging markets in the globe. (They are) the third largest sources of growth.

One of the fastest ways to sustain current growth is to invest in women, at least this will grow the Gross Domestic Product (GDP),” she said.

She said while the global economies were experiencing

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greater uncertainties as manifested in the economic crisis in Europe, United States and other emerging markets like China, Brazil and India, African economy is growing at 5%.

As a way out of the financial exclusion being experienced by women, she advocated for a specialised bank that will cater for the financial interest of women alone.

“Let’s us be creative, let’s join hands together in other to solve women’s problems in financing. ...Lets come together, because we are used to solving

and coming together to empower ourselves,” OkonjoIweala said.

Also speaking at the summit, Vice-President, African Development Bank (AfDB), Cecilia Akintomide, who represented AfDB President Donald Kaberuka, said that participants at the summit should focus on solving other problems confronting women, including education, access to health and capacity building, saying without addressing these issues, women would continue to be relegated to the back-

ground. “More than half of women who died during birth are from Africa. African women hold only 26% of small size businesses in sub-Saharan Africa, and on the global front only 15%, which is very low.

‘We are not going to participate fully in growing the economy without access to financing. Inclusion is very important. Unless we do the right thing, we may not be able to move forward as we want.

Each one of us here has a responsibility to promote women empowerment,” she said.

L-R: Dr. Nkosana Moyo, Executive Chairman Mandela Institute for Development Studies; Okey Nwuke, Executive Director, Access Bank, Nomkhita Nqweni, Chief Executive, ABSA Wealth South Africa and Mizinga Melu, Managing Director , Standard Chartered Bank Zambia at the ongoing African Women’s Economic Summit today in Lagos.

Women empowerment critical to Access Bank — ED …advances N2bn to women SMEs MPOWERING women entrepreneurs is a critical aspect of Access Bank business philosophy says, Okey Nwuke, Executive Director, Institutional banking He spoke during the CEO Roundtable session at the just nd African concluded 2 Women’s Economic Summit (AWES) with the theme: “African Women Financing the Future”.

He said the bank in recognition of the importance of women in economic development deliberately enshrined gender sensitivity as one of the key drivers of its business. The bank’s commitment to supporting women, he said led to the development of dedicated products and services such as its Gender Entrepreneurship Markets (GEM) Program, through which it has advanced N2 billion to about 5000 small and medium enterprises

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(SMEs) owned by women.

Since, its launch in 2006. The Bank under the GEM initiative has trained over 500 female entrepreneurs on how to grow their businesses successfully, assisted women- owned businesses to overcome the major challenges of growth and access to Finance. Nwuke said that that as a Bank committed to partnership and entrepreneurial development, Access Bank has grown its loan portfolio of women-owned businesses from US$500,000 to over US$18 Million in less than 5 years. Access Bank GEM made disbursements to microfinance institutions such Catholic Institute for Democracy, Justice and Peace (CIDJAP) in Enugu State to finance microenterprises via the women cooperatives with whom CIDJAP works.

He said, “ As a Pan-African financial inclusion strategic,

Access Bank’s GEM has already been deployed to Gambia and Rwanda to contribute to the development of the existing dedicated women market. Based on the successes recorded in Nigeria, Gambia and Rwanda, efforts are in top gear provide GEM services to women entrepreneurs in Zambia, Sierra Leone, Ghana and Congo DRC. Commenting on the challenges confronting women entrepreneurs, Nwuke revealed said, “some weaknesses observed in relation to female run enterprises includes; limited or non-existent financials on their businesses, lack of sufficient collateral for loans, weak business management and strategic planning, poor business plans a combinations of these factors made female run enterprises generally unattractive for financing.”

BRIEF Firstbank enhances service delivery with Finacle 10 IRST Bank of Nigeria Plc (FirstBank) has concluded plans to migrate its current core banking application, Finacle 7 to a more robust and secure platform, Finacle 10.

The Bank’s management said this upgrade from Finacle 7 would transform its service delivery process and facilitate the introduction of innovative products specially designed for different customer segments.

According to Folake AniMumuney, Head, Marketing and Corporate Communications, the decision to upgrade to Finacle 10 was borne out of the desire for continuous improvement, adding that the new platform will simplify end-user interfaces, support the latest database technologies and improve functional and operational capabilities.

Ani-Mumuney said the Bank’s Finacle 10 platform would also drive multi-entity operations as it is capable of supporting new lines of business, including wealth management, financial inclusion, and Islamic banking.

“A periodic review of our service delivery process to seek ways of enhancing customer experience is an activity that we are passionate about in FirstBank. With Finacle 10, the Bank is even better positioned to offer improved customer service, easy access to account details, enhanced customer experience with a platform that allows the customer transact in multiple currencies with a single reference/account number,” she said.

The Bank’s spokesperson said the leading financial institution continues to invest heavily in technology in its bid to drive service excellence and product innovation across its branches and electronic channels.

“The bank has significantly improved the reliability of its delivery systems and deployed new products to simplify the process of banking with FirstBank. Another key area of our IT dominance is in the empowerment of our employees with new tools to facilitate work in and out of the office.

This ensures speedy response to customer requests, while giving all tiers of management hitch-free access to qualitative and timely information for decision-making’, she added.

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24 — Vanguard, MONDAY, JULY 16, 2012

Micro-Finance BRIEFS Microfinance companies take over industry with low cost loans MIDST the regulatory upheaval and scramble for fresh capital that defines India’s microfinance sector, a new breed of micro lenders are quietly challenging the conventional norms of the industry with an internetbased funding model and lowcost loans.

By charging significantly lower interest rates made possible through crowd sourcing or a peer-to-peer approach of raising money from socially conscious individuals, these fledgling ventures are aiming to reach communities where traditional microfinance has failed to make an impact while also providing a return to investors.

“Our operating costs are half of traditional microfinance companies, because we are not dependent on banks for capital and do not have a brick and mortar structure,” says Rangan Varadan, founder and chief executive of MicroGraam, one such startup that lends money to rural entrepreneurs at interest rates ranging between 10 per cent and 15 per cent as compared to traditional microfinance rates of 24 per cent to 36 per cent.

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Lafarge launches microfinance programme for affordable housing AFARGE has launched a microfinance programme for affordable housing. This represents an initial concrete response to one of the nine main ambitions of the sustainability ambitions 2020 plan announced by Lafarge.

The objective is to enable 2 million people to have access to affordable and sustainable housing between now and 2020.

The microfinance programme is targeted at people in emerging markets with low purchasing power to help them finance the construction, extension or renovation of their homes. The programme will be first launched in Indonesia, Honduras, Zambia, the Philippines and Nigeria.

For the project, Lafarge has joined forces with CHF International (Cooperative Housing Foundation), an NGO with more than 40 years’ experience in housing microfinance and 60 years in urban and housing solutions.

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Viable institutions to access developmental funds Stories by PROVIDENCE OBUH CCESSING the Microfi nance Development Fund (MDF) and the N200 billion Small and Medium Enterprises Credit Guarantee Scheme (SMECGS), will be based on the viability of the applying institutions, says Minister of State for Finance, Dr Yerima Ngama.

Speaking at the Annual Lecture of the National Association of Microfinance Banks (NAMB) Abuja, Ngama said that the development funds and the N200 billion SMECGS, established for the sub sector is now available for institutions who meet eligibility criteria.

The Minister who spoke through the Managing Director, Nigeria Deposit Insurance Corporation (NDIC), Alhaji Umaru Ibrahim also noted that the Central Bank of Nigeria (CBN) and other relevant agencies of government would have to come out with a clear framework for qualified institutions.

He said, “I am aware that participants are eager to hear and obtain my commitment on behalf of government on when it will make the development funds and the N200 billion SMECGS established for the sub-sector available to eligible institutions. The good news is that, indeed both funds have been established, but the drawing rights for both funds will be based on viability of the applying institution. Despite the September 2010 mass liquidation of 103

microfinance banks, the challenges are still visible.”

Speaking on the challeng-

es of the sub-sector, Chief Executive, Bank of Agriculture, Dr. Mohammed Santu-

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•An Artist at work. Pix Foluke Odebiyi

NSE calls for new funding structure for power projects

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he Nigerian Society of Engineers has called on the Federal government to remove procurement of infrastructure for Power projects from the normal Annual Budget funding structure and rather institute a five to ten years funding cycle saying

that would be the only way to sustain investment in the sector and ensure completion of projects to bring power to Nigerians.

Speakingwhen he paid a courtesy call on the Chief Executive Officer of the Transmission Company of

NAMB leverages on Int’l MFBs investors forum ATIONAL Association of Microfiannce Banks (NAMB) is leveraging on the forthcoming International Investors conference to make funds available to local microfinance banks, and in turn make them available to the rural poor at very small interest rates.

The conference would be used to raise stabilisation funds for Nigerian micro-finance banks, and also expected to enable Nigeria through Rural Finance Institution Building Programme RUFIN, to access fund that would be made available to local microfinance banks that would in turn make them available to the rural poor, says President of the Association, Mr Jethro Akum

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raki said that the major challenge of the Nigeria MFBs has been the absence of a development fund where the MFBs could access cheap funds. To this end, Santuraki lamented that the MFBs have been forced to engage in unfair competition for deposits with commercial banks in the urban and semi-urban areas.

“Except the MDF was launched without delay, the MFBs would be unable to play their required role by supporting MSMEs which currently accounts for over 70 per cent of employment in the country.”

On the other hand, the Central Bank of Nigeria (CBN) Deputy Director in charge of microfinance issues, Mr. Akintunde Sowunmi explained that the apex bank established the MSMEs Development Fund to provide liquidity support for MFBs. According to Sowunmi, “The funds will cover refinancing, guarantee and wholesale facilities through various windows to support the MFBs to lend to entrepreneurs.”

Akum made this statement at a briefing with newsmen on the forthcoming conference billed th th for 18 and 19 July, an initiative of the Rural Finance Institution Building Programme (RUFIN) supported by the International Fund for Agricultural Development (IFAD).

“The funds from the investors would be registered as private funds that would be accessed by microfinance institutions dealing with grass root people as well as Non Governmental Organizations (NGOs).

The goal of the programme is to improve the income, food security and general living conditions of poor rural households, particularly women-headed households,

youths and the physically challenged.

As a platform for attracting foreign investors, he said that it would also enable the international micro-finance investors’ communities that have interest in Nigeria, to have firsthand experience of the sector.

In the same vien, Mr Nuhu Danjuma, a consultant with RUFIN, said that research has shown that that the microfinance sector could be developed through a string of initiatives and partnerships by various stakeholders and actors. “Some of the initiatives include: ensuring a sound macro environment by sound regulations and development strategy.”

Nigerian, Engr. Olusola O. Akinniranye, Engr. Shehu said Annual Budgeting structure does not allow the power projects to be funded properly.

“The nature of power projects is such that designs and construction stages normally exceed 2 to 3 years and the whole project cycle can be up for 5 years conservatively from feasibility to detailed design and construction. The annual budget for projects in Nigeria comes with great deal of uncertainty in the allocation and amount thereby resulting in the following scenarios - Delayed Payment to contractors and consultants; Frequent project argumentation; Delayed completion and therefore utilization of the project; Late payment penalties,” he said.

In his reaction, the Chief Executive Officer of TCN, Engr. Akinniranye said he was elated that the President of the Nigerian Society of Engineers completely understands the problems facing the power sector and assured the company will continue to encourage local contractors where they have the capacity, although, he observed that they have been cases where some local contractors have failed due to various reasons.

Vanguard, MONDAY, JULY 16, 2012 — 25

26 —Vanguard, MONDAY, JULY 16, 2012

Corporate Finance BRIEFS Ackman buys into P&G, shares rise

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ctivist investor William Ackman appears ready to shake up management at yet another major company, building a stake in the iconic U.S. household products company Procter & Gamble Co (PG.N), a person familiar with the matter said.

Ackman’s Pershing Square has been building a position in P&G for the last few weeks and may grow its stake further, said the source who was not permitted to speak publicly. There was an indication of Ackman’s interest in P&G in a regularly issued list of deals passing U.S. antitrust muster.

Thursday’s list, issued by the Federal Trade Commission, mentioned two Pershing entities in connection with P&G but gave no details.

Word that the well-known activist investor is now circling the company pushed its shares up more than 4 percent before the gains were pared slightly in later trading.

News of Ackman’s stake comes just weeks after P&G Chairman and Chief Executive Bob McDonald frankly acknowledged that the company needs to do better as analysts have long criticized its high costs and the lack of popular new products.

Activist shareholders raise stakes in Navistar

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hree big investors have increased their stakes in embattled U.S. truck and engine maker Navistar International Corp (NAV.N ), which last month surprised Wall Street with a quarterly loss and has since backed down from a new engine technology it was pushing.

Asset manager Franklin Resources Inc (BEN.N) is now Navistar ’s largest shareholder, with an 18.8 percent stake, topping MHR Fund Management and billionaire Carl Icahn. MHR last month took a significant stake in the company and now holds 14.95 percent; Icahn holds 13.19 percent.

Together, the three top shareholders hold almost 47 percent of the outstanding shares of the maker of International-brand heavy trucks and school buses.

Those larger stakes could set the stage for investors to pressure Navistar — whose market value has fallen almost 40 percent this year — to move quickly to improve its performance in a year when analysts expect it to lose money.

EQUITY MARKET:

There is hope for positive returns in second half —FBN Capital boss

BY PETER EGWUATU

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ichael Oyebola is the Senior Vice President and Head of Asset Management of FBN Capital Limited, a part of the Investment Banking and Asset Management business of the FirstBank Group. He has wealth of experience spanning 18 years both locally and abroad. Until his appointment in January 2011, Michael worked as the Chief Investment Officer of Guaranty Trust Assurance Plc for 4 years and was pioneer Head of Investment, Crusader Sterling Pensions Ltd In this interview with few capital market correspondents, he spokes on issues in the financial market, the projection in the financial market for the next half year, the apathy of investors in equity market, why FBN Capital introduces fixed income funds and lots more.

Excerpts: What would be your projection in the financial market for the next six months of the year? Should we expect any major change from the pattern seen in half year?

On the equity side, we believe there will be a brief market rally in third quarter, the result of companies releasing their second quarter results. Thereafter it’s expected to drift again once the reporting season is over and the holiday season takes hold. Fourth quarter will bring another respite from the lull.

For Fixed Income, we expect the Monetary Policy Rate (MPR) to remain unchanged, as the CBN continues its bit to defend the local currency. Bond and Treasur y Bill rates will fluctuate, but we expect interest rates to remain at their current levels.

How would you describe the performance of the financial markets in the first six months of the year?

It was mixed. The year began with more of hope than total conviction. The hope

•Oyebola was that with AMCON cleaning up the final pieces in the banking sector and the implementation of IFRS by the end of 2012 and relative cheapness of listed Nigerian equities there was hope for positive returns on the equity market. The rally peaked by 2nd week of May. In the Fixed income space,

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Add to that the decline in oil prices and this has put pressure on the currency with the naira depreciating against the dollar.

Currently, there are no new positive catalysts to cause a sudden change in direction.

Is the performance in line with your expectations?

For the equity market, no.

The two mutual funds give clients this access and allow them to maximize their returns while minimizing their risks due to the diversification benefit of the funds

having seen rates rise late last year, international inflows to take advantage of high yields and a stable currency the market had remained a delight for fixed income investors.

However, the global economic crisis especially in the Eurozone has led to a rerating of risk and investment destinations and the Nigerian financial market has felt its impact.

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Whilst the rally at its peak got overdone, the current pull back is also overdone.

Investors’ confidence needs to return to the market.

For the fixed income, yes.

Though we believe rates may have peaked.

Some capital market operators have said that the high yields on fixed income securities have contributed to the low patronage of the

equities market, what is your opinion?

Investors will always gravitate toward where the best returns are and with the least amount of risk. Whilst the statements you just made may be partly true, all investors have their own investment targets and each allocates capital accordingly. Fixed income investments are an integral part of any portfolio.

Currently the risk free rate for a 1 year instrument ranges between 15% and 16% any riskier asset will have to generate returns in excess of that. But we also need to realize that equity investments are not short term investments.

Why has FBN Capital come up with two mutual funds targeted at the fixed income markets?

As mentioned earlier, the retail investors do not have direct access to the fixed income market. By creating funds we are indirectly giving them access to these markets as well as the returns that ensue.

A Collective Investment Scheme (Mutual Fund) is the bringing together of a group of people with common investment goals to buy securities such as stocks, bonds, money market instruments, the collective holdings of these securities being known as its portfolio.

Each share or unit holding represents an investor ’s proportionate holding of the portfolio and their proportionate entitlement to the income generated by those holdings. The two mutual funds give clients this access and allow them to maximize their returns while minimizing their risks due to the diversification benefit of the funds.

Tell us more about the Fixed Income Fund and the Money Market Fund?

The FBN Money market fund is a collective investment scheme that pools money from investors that share a common investment objective and invests it in money market instruments of less than one year such as fixed or term deposits and certificates of deposits with banks, Bankers Acceptances, Commercial Papers and government treasury bills of various tenors.

The FBN Fixed Income Fund is also a collective investment scheme that pools money from investors that also share a common investment objective and invests the money this time in longer term fixed income instruments such as FGN Bonds, State Government Bonds, Corporate Bonds, Eurobonds and to a lesser extent money market instruments just for liquidity.

Vanguard, MONDAY, JULY 16, 2012 — 27

Corporate Finance

NASS vows to restore confidence in capital market

By MICHAEL EBOH HE National Assembly has promised to assist the capital market in restoring investor confidence in the market and sustain improvement being witnessed in the market in recent times.

Speaking at the Capital Market Committee (CMC) meeting held at Securities and Exchange, SEC, Lagos, the leadership of the national assembly promised to be part of confidence building efforts in the stock market.

Specifically, Mr. Herman Hembe, Chairman of the House Committee on Capital Market, promised that the house will help the capital market in ensuring sustained growth in the market.

He said, “We are very happy with what we are seeing here today and we, on our part, will do whatever is necessary to support the capital market.”

Chairman, Senate Committee on Capital market, Senator Ayo Adeseun, represented by the Clerk of the Committee, Mr. Sammy Efetia also disclosed that the various confidence building strategies recently embarked upon by the new management at the Securities and Exchange Commission (SEC) has started to yield positive results as the market performance on the Nigerian Stock Exchange (NSE) has been on the increase in recent times.

According to him, apart from the NSE All-Share index which went up drastically in the last two weeks, the market capitalization which was around N6 trillion has went up to N7 trillion in the period while volumes of share traded upon in the period also increased.

Market operators at the meeting, linked the performance to a number of reasons, including the new posture and actions taken by the new management of the Commission.

These, according to them, include the recent registration meeting the commission held in Lagos, timely treatment of requests being made to the commission and various meetings the new management held with various stakeholders in the market For instance Emeka Madubike, President Association of Stockbroking Houses Owners of Nigeria (ASHON) said if sustained, the confidence build posture of the new team in the Commission will surely put the market on the part of

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growth.

“You can see the atmosphere of the meeting. It is very friendly, open, people are freer to express themselves and this will result in positive ways to move the market forward.

The Acting Director General is also very positive because he knows where shoes pinches” Madubuke declared.

“The issue of Registration in Lagos is also a big plus for the Acting DG, Ibrahim Bolaji Bello. This is what we have been advocating for because it is means of reducing cost of getting more operators into the market and also mark us meet some regulatory requirements.

“In fact, his initial steps are very good and we hope he sustains it. It is impact positively on the market. The market is

all of us and unless we work together, it may be difficult to sustain improved performance. The more you and us mentality, the worse we shall be but when we try to build the gaps like he is doing now, the market will grow” Corroborating him, Tunde Ayeni, Managing Director, Union Registrar, said we have a new SEC. We are happy.

When you take someone who knows the market, you get the type of what we are getting here today. This is not academic but practical and we are really impressed and the impact will be glaring very soon” he declared.

Earlier, the Director General of the NSE, Mr. Oscar Onyema in his report said the NSE has met with the new leader-

ship at the Commission and has started to enjoy some of the posture of the leadership and asked that the trend be continued. “This will create sustainable growth in wealth” he explained as he added that the NSE now gets prompt response to its request from SEC. Kyari Abba Bukar, Managing Director/CEO of the Central Securities Clearing System (CSCS) said the type of interaction with the SEC was what he has been looking for in the past.

“The importance of this interaction cannot be over emphasized and we are very happy over it”. The CMC meeting is a quarterly meeting of SEC in which operators and the regulators in the market parley to move market forward.

BRIEFS RBS adds 8 banks to Direct Line IPO OYAL Bank of Scotland (RBS.L) has added eight banks to help with the initial public offering of its Direct Line insurance arm later this year, one of the biggest planned listings in London, two people familiar with the matter said on Friday.

RBS has said it wanted to list Direct Line in the fourth quarter. Analysts have estimated it could be valued at around 3 billion pounds.

The sale of a minority stake is being run by Goldman Sachs, Morgan Stanley and UBS, who are acting as joint bookrunners.

Bank of America Merrill Lynch, BNP Paribas, Citi, Commerzbank, HSBC, Investec, KBW and RBC have now also been added to the syndicate in junior roles, the people said.

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NIIT launches employability programs in Nigeria IIT has announced the 13th NIIT Nigeria IT Scholarship 2012, to reward meritorious students enrolling for training programs at NIIT. These students, post successful training, according to the company, will go on to join the fast emerging IT industry in Nigeria and become a part of global skilled IT Talent pool.

The Scholarship Test will be held on July 21, 2012 and the last date of application is July 20, 2012. With thrust on Employability of youth in the Nigerian IT industry the Scholarship will help students get skilled for a Global career through training in technology.

According to industry sources IT industry in Nigeria is estimated to be one of the fastest growing IT industries in the world. To meet the demand of trained manpower for this fast evolving IT industry, NIIT has designed and developed a range of Employability Programs - Rapid Employability, Industry Competitiveness and Career Builder programs.

Ajai Manohar Lal, Sr. Vice President, International Education Business, NIIT Ltd, said, “Over the years NIIT has played a key role in developing manpower for the fast growing IT industry in Nigeria. In an endeavour to give Nigerian youth an edge in the competitive global IT industry we have now introduced cutting edge employability programs in the country. ”

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From left: Yinka Sanni, Deputy Chief Executive Officer, Stanbic IBTC Bank Plc; Dr. Akinwumi Adesina, Minister for Agriculture and Mr. Oscar Onyema, CEO, Nigerian Stock Exchange, at the CEO Sectoral dinner organised by the Nigeria Stock Exchange in Lagos.

Federal Palace flags off new promo OURIST Company of Ni geria Plc’s Federal Palace Hotel & Casino, Nigeria’s has flagged off a new promotion, titled ‘Elegant Thrill.’

According to a statement by the company, the promotion rides on the back of the just concluded Spin &Win promotion, which produced a brand new Toyota Corolla car winner among other prizes in the car draw held on 30 June 2012.

Uche Ogbu, Marketing Manager for Federal Palace Hotel & Casino said, “We’ve seen a tremendous response from the public to these promotions mainly due to the fact we’re giving away such huge prizes and winning is as easy

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as playing.”

He added that the casino has also remained consistent in providing up-market entertainment for its most valued guests with the constant introduction of exciting new games such as Pick a Box, Horse Racing and Baccarat machine among others.

The “Elegant Thrill” promo will give 10 lucky winners a chance to drive home in a brand new 2012 Hyundai Elantra Elegance supplied by Hyundai Motors Nigeria Ltd. Highlights of the promo; $5000 will be available for grabs via mystery jackpots every Saturday throughout the promo period and a car jack-

pot will be held on Saturday, 25 August 2012 where one car and other cash prizes will be won. It’s a unique promo where every finalist gets a prize Federal Palace Hotel & Casino gives all players the opportunity of playing modern casino games in an extremely comfortable and secure environment The Casino houses both slots and tables games operated in US Dollars. Naira can be exchanged for Dollars at the casino cash desk. There’s also a Prive’ section of the casino which is exclusive for platinum guests and celebrities.

28 —Vanguard, MONDAY, JULY 16, 2012

Stock Market last week at N9.618 billion was recorded in 18,276 deals; in contrast to the previous week’s turnover of 1.007 billion shares valued at N8.507 billion recorded in 18,352 deals.

BRIEFS Wall Street rallies, S&P, Dow up for week TOCKS surged on Friday, lifted by economic figures that eased concerns about growth in China and earnings at JPMorgan that eased fears about the impact of failed trades that cost the bank billions.

The Dow Jones industrial average .DJI rose 203.82 points, or 1.62 percent, to 12,777.09. The S&P 500 Index .SPX gained 22.01 points, or 1.65 percent, to 1,356.77. The Nasdaq Composite .IXIC added 42.28 points, or 1.48 percent, to 2,908.47.

For the week, the Dow edged up 0.04 percent, the S&P rose 0.15 percent and the Nasdaq lost 0.98 percent.

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Non-oil export commodities record N13.94bn forex earnings

By LAZARUS IBEABUCHI OUR non-oil export com modities, Cocoa, Sesame seeds, Cashew nuts and Finished Goods have accounted for N13.94 billion ($89.44 million) inflow of foreign exchange into the domestic nd economy in 2 half year 2011.

In a report of value of goods exported for the period of July to December, 2011

by Nigerian Association of Chambers of Commerce Industry, Mines and Agriculture, NACCIMA, commodity performance during the period under review showed export values as followed: Cocoa recorded N6.84 billion ($43.67 million); Sesame Seeds transacted N1.693 billion ($10.86 million); Finished Goods gulped N4.96 billion ($31.79 million); while Cashew Nut traded N486.31 million ($3.12 million).

The data presented was facilitated by NACCIMA through the issuance of Certificate of Origin (C of O) to genuine exporters of non-oil products in the country.

NACCIMA said it believed that some of the export products may have either recorded increase or decrease, which is mainly attributed to increase in global demand/ favourable season or global externalities arising from low demand/ off season, which impacted negatively on capacity of industries optimally produce for export markets.

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L-R: Dr. Akinwumi Adesina, the Minister of Agriculture and Rural Development, Oxford Business Group Country Director, Brooke Butler and OBG Editorial Manager, Rob Withagen at the Minister’s office.

Upward trend continues, investors gain N201bn on NSE

By MICHAEL EBOH

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HE upward trend on the Nigerian Stock Exchange, NSE, continued last week, as investors recorded an appreciation of N201.164 billion on their investments in the secondary segment of the capital market.

In particular, investment value, represented by the market capitalization, appreciated by 2.85 per cent to close the week at N7.259 trillion from N7.059 trillion at which it opened.

The All-share index also appreciated by 2.85 per cent to close at 22,741.06 points, rising by 630.15 basis points from 22,110.91 points at which it opened the week.

The improvement in the market indices was engendered by renewed interest in the capital market, spurred by the low prices of majority of the listed equities.

Another major factor responsible for the upward trend recorded in the indices was the activity of foreign investors, seeking to increase their presence in the Nigerian capital market.

Dangote Cement Plc recorded the most share price gain, leading 31 other companies in the week under review, with a gain of N8 to close at N116 per share from N118 per share at which it opened the week; Nigerian Breweries Plc followed with a gain of N4.31 to close at N110.01 per share and Guinness Nigeria Plc garnered N3 to close at N228 per share.

Other share price gainers include: Seven-Up Bottling Company Plc N2, UACN Property Development Company Plc N1.03, Conoil Plc

N0.93, Union Bank Nigeria Plc N0.84, Lafarge Cement WAPCO Plc N0.49, Unilever Nigeria Plc N0.44, Dangote Sugar Refinery Plc N0.42 among others.

On the contrary, Flour Mills Nigeria Plc led 32 other companies on the price losers’ category, dropping by N3.80 to close at N53 per share; Nestle Nigeria Plc followed with a loss N3.04 to close at N495 per share and Arbico Plc

shed N1.11. Other share price losers include: Roads Nigeria Plc N1.05, Chemical and Allied Products Plc N0.86, Cement Company of Northern Nigeria Plc N0.61, Cadbury Nigeria Plc N0.59, Forte Oil Plc N0.57, Beta Glass Company Plc N0.55, PZ Cussons Nigeria Plc N0.50 among others.

Equity trading appreciated by 44.89 per cent in the week under review, as a turnover of 1.459 billion shares valued

he Financial Services sector was the most active with 1.145 billion shares valued at N5.403 billion traded in 10,393 deals. This was followed by the Conglomerates sector with 77.79 million shares valued at N140.502 billion traded in 680 deals.

Two sub-sectors both from the financial sector were the most active during the week with 1.137 billion shares worth N5.398 billion exchanged by investors in 10,340 deals. Volume in the sub sectors was largely driven by activity in the shares of United Bank for Africa Plc, Diamond Bank Plc and Sovereign Trust Insurance Plc. Trading in the shares of the companies accounted for 473.165 million shares, representing 41.62 per cent, 41.32 per cent and 32.43 per cent of the turnover recorded by the sector, sub-sector and total equities turnover for the week, respectively.

The NSE also changed the name of one of its sub-sectors under Construction/Real Estate sector from Non-Building/Heavy Construction to Infrastructure/Heavy Construction. The NSE disclosed that the change took effect from 11th July, 2012.

IMF approves $178.74m disbursement for Ghana E

xecutive Board of the In ternational Monetary Fund (IMF has said that it has completed the sixth and seventh reviews of Ghana’s performance under the program supported by the Extended Credit facility (ECF). In completing the reviews, the IMF sad it approved waivers for nonobservance of three performance criteria: the net change in domestic arrears for end-December 2011, the fiscal balance target for end-March 2012, and the floor on net international reserves for endMarch 2012 for Ghana.

This decision will allow for the final disbursement of an amount equivalent to SDR 119.14 million (about US$178.74 million), bringing total disbursements under the arrangement to an amount equivalent to SDR 387.45 million (about US$581.28 million). The Executive Board also said it approved the government’s request of an extension of the program by about two weeks until July 31, 2012 for making the final disbursement. Ghana’s current threeyear ECF arrangement was

approved on July 15, 2009.

Following the Executive Board’s decision on Ghana, Mr. Naoyuki Shinohara, Deputy Managing Director and Acting Chair, said “Ghana’s economic performance was strong last year and medium-term growth prospects remain favorable, but short-term risks to macroeconomic stability have risen. A rapid depreciation of the cedi is fuelling inflation and reserve cover has fallen below comfortable levels. Furthermore, spending overruns at the end of 2011, large public wage increases, and reemergence of energy subsidies have created the need for corrective actions to achieve fiscal targets. The authorities’ 2012 economic program focuses appropriately on measures to preserve hard-won stabilization gains. On the fiscal side, this implies greater revenue mobilization and expenditure restraint. In particular, savings identified by the pension and payroll audits must be realized and spending pressures in the run up to elections need to be resisted.

“The authorities will need to accelerate their ongoing efforts to complete the fiscal reform agenda. Priority areas include tax administration and public financial management. In addition, given Ghana’s increasing reliance on nonconcessional financing, it is critical to develop a robust and transparent framework for public investment prioritization and debt management.

“Monetary policy has reacted slowly to the sharp cedi depreciation and the associated inflation risks. Loose conditions have now been tightened and will need to remain tight to preserve the credibility of the inflation-targeting regime. The authorities should stand ready to raise the policy rate further, if needed, and manage liquidity tightly, while restoring foreign exchange reserves to more comfortable levels. Financial sector reforms continue to be a priority. The authorities should sustain their efforts to strengthen the legal and regulatory framework and improve supervisory capacity.

Vanguard, MONDAY, JULY 16, 2012 — 29

30 —Vanguard, MONDAY, JULY 16, 2012

Homes & Housing Finance BRIEF NHF: Cooperative society collaborates with FMBN

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xecutive Housing Cooperative Society Limited (EHC) and the Federal Mortgage Bank of Nigeria (FMBN) have announced a collaboration that would ensure homeownership artisans.

The housing scheme which is known as Artisan Scheme will enable groups of artisans, as members of EHC, access mortgage loans payable on long term basis from FMBN at six per cent interest.

President of the society, Mr. Gboyega Fatimilehin, made the disclosure during EHC’s second Annual General Meeting (AGM) held in Lagos recently.

According to him, “EHC has registered with FMBN as a Housing Cooperative Society to give members access to National Housing Fund (NHF) mortgage loans. Through EHC, members will have the opportunity to access mortgages through the NHF platform at six per cent interest.” The scheme would have the artisans register with EHC as a group and contribute a token for about six months before they can access loans.

Confirming the benefits of the scheme, a representative of FMBN, who was present at the AGM, Chika Ngene, said the collaboration would see FMBN give members support for building and mortgaging, and give loans of up to N15 million depending on individual funds generation and the building type.

Fatimilehin said the cooperative society, which was registered in 2008, has the vision to provide a friendly and flexible means by which average income Nigerians can acquire affordable homes with minimal stress.

He also disclosed that the society has instituted a joint venture partnership with the Lagos Cooperative Building Society to develop an estate in Ayobo comprising three-bedroom bungalows (all ensuite), which members could benefit from, assuring that the society was focused on delivering affordable housing to its members.

The organised private sector (OPS) has enumerated the challenges that confronted the construction and real estate sector of the Nigerian economy in the second quarter of 2012.

Speaking at a press conference to review the performance of the economy in the second quarter of the year, President of the Lagos Chamber of Commerce and Industry (LCCI), Mr. Goodie Ibru, noted that the sector was mainly impacted by issues relating to macro economic variables and the operating environment for business.

“The challenges of the operating environment for business intensified in the second quarter. Across all sectors, there were concerns over weak consumer demand reflecting the general down tur n in the economy.

Structural and institutional problems persisted as well,” he stated.

Ibru lamented that the downturn in the economy could not make the construction industry fulfill its potentials of job creation.

According to him, “the construction industry has very profound potentials to create jobs. But the recent downturn in the economy has taken its toll on this sector.

More importantly however, there are other specific challenges highlighted by the operators in this sector in the last quarter.”

He listed the challenges facing the sector to include: High cost of building materials- cement, iron rods etc; Low indigenous participation in infrastructure project; High cost of funds as well as access to credit and; Inadequate technical skills due to the collapse of technical education in the country. He further noted:

•A private estate in Abuja

LCCI enumerates challenges for real estate in Q2 Stories by YINKA KOLAWOLE On-going projects in the Northern parts of the country have been badly affected by the security situation; along with, Problem of corruption both in the process of securing contracts and getting paid of the contracts; Demand for high end properties declined sharply; Absence of long-term affordable credit and; Lack of adequate information on ownership of land.

The LCCI president further

noted that the credit situation in the economy is still a major challenge, in two dimensions namely access to credit and cost of credit. “The summary is that the economy is in a quandary as far as credit conditions for investors are concerned. It will be difficult to stimulate job creating growth if this situation persists.

“The situation has been further compounded by the fact that government treasury bills and bonds have returns of between 13-17 percent. The consequence is that available

funds have been mopped up by government. It is clearly more attractive now to invest in government securities than invest in ventures that would create jobs. Even banks now would rather buy treasury bills and government bonds than give loans to investors.

This credit and interest rate structure would continue to create distortions in the economy, which will only perpetuate the phenomenon of jobless growth and further depress the stock market,” he asserted.

Housing rebounds as banks resume foreclosures US lenders are notifying more delinquent homeowners they face foreclosure, a step toward clearing a backlog of properties and helping to accelerate a housing recovery.

Initial notices of foreclosure, the start of the process, jumped 6 percent in the second quarter from a year earlier, the first annual increase since 2009, according to RealtyTrac Inc., a seller of housing market data. Banks at the same time found alternatives to the final step of seizing the home, either by working with the borrower or by agreeing to sell properties for less than what was owed, with repossessions

falling 22 percent.

The housing market’s rebound has been restrained by the so- called shadow inventory of homes with mortgages at least 90 days delinquent, in foreclosure or already owned by banks, while foreclosures had been stalled since late 2010, when state attorneys general and federal regulators began investigating abuses by banks, including lost or doctored paperwork. They started to pick up again after the nation’s five biggest banks settled the probe for $25 billion in February.

Mortgage delinquencies are dropping, with the share of home loans at least 30 days

late dropping to 7.4 percent in the first quarter from 7.58 percent in the prior three months, according to the Mortgage Bankers Association. Demand for real estate is rising amid recordlow borrowing costs and tight inventories of available real estate. Contracts to buy previously owned homes rose 5.9 percent in May, matching a two-year high reached in March, the National Association of Realtors said.

The shadow inventory of homes fell in April to the lowest level in more than three years as delinquencies improve and banks find alternative means of disposing of properties,

CoreLogic Inc. said last month. Lenders increasingly are able to avoid taking possession of homes by modifying mortgages, reducing principal or refinancing loans, and short sales, in which banks allow delinquent borrowers to sell properties for less than they owe, according to RealtyTrac.

The foreclosure process in the U.S. increased to an average of 378 days in the second quarter, the highest in records dating back to 2007, RealtyTrac said. In New York, the state with the slowest process, the average time to foreclose was 1,001 days, down 5 percent from the first quarter.

Vanguard, MONDAY, JULY 16, 2012 — 31

Homes & Housing Finance

Housing policy: Expert charges FG on sincerity of purpose Stories by YINKA KOLAWOLE N expert in the built environment and President of Nigerian Institution of Building (NIOB), Mr. Chuck Omeife, has questioned the sincerity of the federal government in implementing the new housing policy.

Omeife who was speaking at a recent media event, said while the effort of government at formulating the new policy is commendable, the willingness to initiate and provide the necessary interventionist programmes as enunciated in the policy is

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doubtful. According to him, “lack of implementation has always been the crux of the matter. Our prayer is that this time, government takes the bull by the horn and put the issue of housing on a roller coastal.”

He blamed the haphazard implementation of the National Building Code (NBC), since it was approved in 2008, on lack of enabling law to bring violators to book, adding that this has remained one big challenge for the built environment and has contributed to the incessant building collapse happening across the country. He lamented that non-

implementation of the building code has given quacks the courage to continue to create havoc, killing people and wasting resources with negative consequences on the economy.

Omeife recalled that the House of Representatives Committee on Housing and Habitat recently convened an interactive meeting with all stakeholders in the built environment. He urged members of the National Assembly to accelerate work on promulgating an enabling law that would make any contravention or noncompliance with the provisions of the National

From left: Minister of Lands, Housing and Urban Development, Ms. Amal Pepple; Chairman, Senate Committee on Housing and Urban Development, Senator Abba Bukar Ibrahim and; Managing Director/CEO, Federal Mortgage Bank of Nigeria (FMBN), Mr. Gimba Ya’u Kumo; with Managing Director/CEO, Nigerian Navy Post Service Housing Scheme, Rear Admiral Itunu Hotonou, at the background, during the unveiling of FMBN’s National Housing Fund ecollection platform in Abuja.

Building Code a crime punishable by law, assist in the fight against quackery in the built environment and stop further deaths as a result of building collapse. “This is one law that can assist to create sanity in built environment sector of the Nigerian economy and thus jump-start the sector ’s contribution to National development.” he said.

In a related development, Omeife has called on the federal government to take the issue of provision of mass housing beyond rhetoric, in reaction to the announcement earlier in the year by the Minister of Housing, Lands and Urban Development, Ms. Ama Pepple, that government plans to build one million houses every year. According to him, “the one million housing units being envisaged by government was ‘ideal’ but the problem is that of implementation”. He noted that the issue of mass housing goes beyond mere propaganda, noting that over the years successive governments at the centre had been talking about providing mass housing for the populace but, so far, nothing concrete had been done in that regard.

Omeife said that unless the core people who know something about building were put in the picture, it would be an exercise in futility. He called for active involvement of professionals in the built environment in the execution of the project in order to make it work, adding that the reason why similar projects or concepts had failed is not unconnected with the absence of the political will to make it happen.

Lagos creates department to regulate real estate business

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agos State government has created a new department in the ministry of housing to regulate the various rules guiding real estate business in the state, including the newly enacted Tenancy law introduced last year to regulate the relationship between landlords and tenants.

Commissioner for Housing, Mr. Bosun Jeje, who disclosed this, also ‘noted that in addition to challenges posed by non-availability of land and access to funding, the other major challenge to home ownership in the state is the financial incapability of

the masses to acquire their own houses. “It is in this regard that government resolved to apply the principles of real mortgage that will enable allottees spread the payment of their mortgage over a period of 10 to 15 years as a lasting solution,” he said.

Jeje said the state government is working towards evolving a ‘ real’ mortgage scheme in the country that is patterned in line with global best practices. He noted that what is presently obtainable in the nation’s real estate sector can best be described

as “flexible payment of housing loan as against mortgage in its real sense of it.”

He remarked that in recognition of the vital role of the private sector in sustainable development of mass housing, government has commenced moves to partner with organised private sector on housing delivery in the state.

According to him, “the state government reckons that ultimately it is the private sector that has the capability and funding to provide housing needs while government plays a

regulatory role and provide the enabling environment for the industry to grow.” He added that this is evidenced in the delivery of the Elegant Court, Ikota with 72 units of three bedroom flats commissioned last year.

The commissioner noted that the state government is currently involved in direct construction of houses for now to help bridge the existing gap and make a statement as to the viability and workability of the concept, with a view to attracting private participation to drive the industry.

BRIEFS

FHA, NSE partner over engineering services

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igerian Society of Engineers (NSE), Abuja branch, is set to partner the Federal Housing Authority (FHA) over engineering services.

Engr. Emeka Ozioko, Chairman of the branch, stated this when he led a delegation of engineers on a courtesy call to the FHA Managing Director, Arc Terver Gemade, in his office.

He said the Abuja branch has over 3,000 members and some of their members have conducted industrial visits to several countries including Egypt, Japan, Brazil, Hong Kong and Italy.

In his response, Gemade said the Authority has many engineers as members of its staff who always keep abreast with new trends in engineering practices. He said though FHA has not received any financial grant from the federal government in the last ten years, it has stayed afloat through loans as well as internally generated revenue.

UK mortgage borrowing up in May

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ortgage borrowing by homeowners in UK bounced back in May, cutting short a slump in house purchases following the end of the first-time buyer stamp duty holiday, but housing market experts say that a recovery is still a long way off.

The Council of Mortgage Lenders (CML) said the amount of house purchase lending increased by 36 percent or £7.2bn compared to April – the month following the end of the stamp duty holiday – and 29 percent compared to May 2011. The number of loans also increased by 33 percent to 48,300 compared to April and by nearly 25 percent from a year ago.

The increase in the number of first-time buyer loans was even bigger, up 43 percent to 18,100 compared to April and 22 percent compared to May 2011. The value of these loans also increased by 53 percent on April’s lending figures and 28 percent on those in May 2011.

32 — Vanguard, MONDAY, JULY 16, 2012

Interview

BY FUNMI KOMOLAFE & VICTOR AHIUMA-YOUNG

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HE Managing Director of Lagos State Signage and Advertising Agency, LASAA, Mr. George Kayode Noah, hosted Vanguard team of journalists in his Ikeja office during which he fielded questions on the activities of the agency.

He spoke on the relevance of LASAA and why it cannot be ignored by Lagosians.

What is the relevance of LASAA to Lagos State Government?

Mr. Kayode George Noah: “ LASAA is related to Lagos State Government in the sense that Lagos State funded LASAA’s creation and has invested heavily in what LASAA has been doing in terms of infrastructure and funding. The job we do here in LASAA is divided into two parts.

One is the revenue we generate for local councils to execute their projects and the regulatory aspect of signage and outdoor advertising in the state. The state is more concerned about the regulatory aspect of LASAA. How outdoor beautifies the environment, how it adds to the aesthetics of the cityscape.

For the local councils, the job we do for them it is about revenue generation because the state has an overview and each local council deal with its area, we need a body like LASAA and the government to have a coordinated policy in terms of signage and outdoor. So, this is the relationship. The state ensures that what we do conforms to the general overview of outdoor and signage regulation. By law, outdoor revenue is the entitlement of the local authority.

You do not have any conflict with local government concerning revenue remittances?

Since I came here, I have had several meetings with some of the local government chairmen and I have had meetings with the chairman of the chairmen and I have stressed that my job is to review what we do in terms of revenue generation and to give them as much as possible.

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or example, one the first projects I embarked on when I came here was to set up census of signage and outdoor structures. We just started that project. I got approval from the State Executive Council to execute it. Part of the fund to do this thing was from the revenue that we generate. In the short term, medium and long term needs for the benefit of the local councils, because on our book for instance, we have less than 24,000 signage

structures on our data base. In comparison, you have places like Ondo State, they did a few towns and they found out that they have 240,000 signage structures. So, I looked at Lagos State, this is the commercial nerve centre of Nigeria, how can we have less than 24,000 signage structure? We did a pilot study on Awolowo road Ikoyi and we discovered that about 40 percent of the signs there are not on our book.

It looks as if we have been vindicated because we have done census on about four local councils and we have 35,000.

Just identifying these structures automatically means we will increase our revenue. What it means is that people are not being contacted in terms of, yes, you have this sign and there is a fear attached to it. So, we have automatically drawn them into the signage net. There is no conflict with the local authorities because my job is to give them value for money. My job is to make sure they do not have any regret that LASAA is doing previously what they used to do. So, if in the course of this I double and triple their revenue, I will be one of their greatest fans.

What you are saying is that with your efforts, they are smiling to the bank. You are boosting their income?

The result of what I am doing will manifest after we finish our enumeration by next year. Then our data base and everything will be set up and

by January next year, we will hit the ground running. By the end of next year, at the very least, they should be very happy with what we are doing.

Before you started your project, some local governments had done street naming; Mushin for instance. If go round Mushin, you would see well done signs of name of streets. Is there no conflict between what you are doing and that of Mushin for example?

The decision to do directional street signs is that of the state government in conjunction with

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it was agreed that a body working for the local councils like LASAA should undertake this activity and so, we have a uniformed street directional signs and uniformity. So, the ones you mentioned in Mushin have all been replaced. On the street directional signs, we have almost finished, we have about two local councils left and these are parts of Alimosho and Ojo. It is a very popular initiative and one of the things we are looking at is maintenance. We have realized that a lot of motorists damage these signs quite a lot. We want to maintain these structures because they are state assets.

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urrently, you have post ers around that says “Don’t mess with Lagos”, it all about posters. How sustainable is the campaign? We see officials of LASAA are seen removing posters?

The issue of posters we have to deal with from different fronts. One single strategy is not going to work. Take for example, we are going to do a press advert and we are going to name and shame some of these companies who are behind these things. They are mainly religious and educational institutions. If you look at the posters, these institutions are culpable.

We do everything, we will remove, they will put it back, we prosecute, they come back again and we put anti-posters signs there, they will go and paste posters on top of the signs. So, we have to try everything.

We have had meetings with those who print these posters in Somolu, you know that is where these things are printed. A lot of them agreed to cooperate and we just have to confront it from different aspects. Don’t mess with Lagos campaign is just to tell people that there is zero tolerance if

For the local councils, the job we do for them it is about revenue generation because the state has an overview and each local council deal with its area, we need a body like LASAA and the government to have a coordinated policy in terms of signage and outdoor.

the local councils. As I mentioned, if care is not taken, you will find different kinds of signs. If you to England for instance, if you see the way they name streets on houses. So, there is synergy. It is because there is a decision to make sure that it is coordinated properly otherwise, you will have different kinds of things. That is why

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On the street directional signs, we have almost finished, we have about two local councils left and these are parts of Alimosho and Ojo.

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you undertake this kind of activity and that if we catch any one, we will prosecute such a person.

Is it that posters are not allowed at all or it is for a fee?

No, posters are not allowed at all. What we are trying to do is that we realized that part of the reasons people do posters is because they want to cre-

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a t e awareness for some of the things they are doing and they may not have the resources to undertake proper outdoor activities. So, what we are trying to do is to designate certain areas where you can go and past posters. If you look at Lagos some seven, eight years ago, posters were a huge problem and they really messed up the environment.

The message has two meanings. Don’t mess with Lagos, means don’t deface Lagos and also don’t toy with the patience of Lagos because Lagos would not take nonsense.

In this regard, do you have work any working relationship with the Ministry of environment?

The supervisory ministry for LASAA is the Ministry of Environment. So, there is an aspect of what we do that affects

what they do. Outdoor and signage structures are all parts of environment and also physical planning.

Some business owners believe that LASAA charges as very high. Do you see this as disincentive for businesses especially the small and the medium scale businesses?

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art of the problems we have at LASAA was the issue of high charges. I commissioned an image audit report when I came in. I wanted to find out from stakeholders exactly what they thought; from staff, to the local council, outdoor practitioners and people who patronize outdoor practitioners and signage. I have discovered several things.

One of the results of that survey was that LASAA enforcement people behave like policemen and they do not show compassion at all, that our rates are very high and so on and so

Vanguard, MONDAY, JULY 16, 2012 — 33

Interview

orge Kayode Noah

people will still feel that you have done your job very well and it is important. Previously, people will not just happy and some removed their signages because they felt the way they were approached needed much to be desired. We want them to come back again, so we are appealing to them. Like I said, our enforcement people have undergone training so that wherever there need to enforce, people have to understand, they have to be polite and they still have to do their job.

Do you have a relationship with organized private sector?

We do, but not in a coordinated way. I have visited a lot of these companies and one of the things they told me was that it is unprecedented for people from LASAA to come and visit them. They said they thought LASAA was one big fortress.

What I wanted to do was to establish a very good relationship with

have changed for all our stakeholders. For our staff for instance, one of the things we have tried to establish is, fairness, accountability and things like that in the way we do things. For outdoor practitioners, the same thing too, promptness in dealing with applications, review of prices whenever we need to and things like that. So, we are trying to work in every area where things went wrong. Some of them were systemic for instance, not having a robust ICT infrastructure affected the way we did our work. In terms of management, like I have mentioned, the best way is to be open and accountable. So we work as a team and we all sit down and discuss issues and we take decisions collectively wherever possible. That is the new thinking in LASAA. What is the state of outdoor advertising in Lagos and your relationship with OAAN? I have a very good relationship with OAAN but the outdoor business in Nigeria is experiencing a lull. One of the reasons is that MTN used to account for almost 30 percent.

They were the biggest spender of outdoor activities and for almost six months they have not done much. So, if the person who controls 30 percent is not doing anything, you can imagine how it is going to affect those who are in that business.

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forth. So, I took them one by one.

For the rate for instance, we sat down, we looked at our rates and we have reviewed where we felt indeed that they were very high. Even before I came, my predecessor, the Honourable Commissioner for the Environment did undertake a price review. We want LASAA to be perceived as partners in progress. We do not want to be perceived as that agency whose job it is just to come and collect. That is why for small businesses for instance, we are undertaking seminars where we bring in consultants and the consultants will tell them how to do their businesses, that there is new in their sector and so on.

So that they feel we are not us just coming to collect N10,00 or N20, 000 , we are also giving something back to them.

That is the way we are trying to change perception.

For our enforcement people, they have all undergone training and know there is a way you can enforce something and

them. I wanted to understand their needs and for us to develop products and services that meet those needs. So, I have visited most of all these blue chip companies like MTN, Airtel, Glo and so on because they are those who bring business to us. We have to work together. I have regular meetings with the OAAN (Outdoor Advertising Practitioners of Nigeria) president and wherever possible, we discuss and review things and we work together.

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efore your and appoint ment and that of your predecessor, Mr. Tunji Bello, LASAA was in the news negatively. With the House of Assembly it became a political issue, allegations of mismanagement and all that. Have you put in place measures to correct that?

A lot happened, may be, in terms of processes and reviewing the ways we do things, what I have been doing is to consolidate on the things done by my predecessor. Things

e are hoping that they will come back and help alleviate this depression. There are certain changes that we need to make in this industry.

We want to work as partners as I said. So, we want to spearhead a lot of things. One, we are doing an outdoor master plan where defined special policy; this structure can go here and that structure can go here. Everybody is aware of what you can do, what you can apply for. This is what exists in most progressive societies.

So, we have been looking at this very critically. Once we finish that, we bring in our partners and give them the vision of what we are trying to do.

There is also the issue of change where practitioners are very reluctant to change, to new thing, new ideas. A lot of practitioners had been used to bring your pole, stick it to the ground and things like that.

We want to move beyond that.

Outdoor is not only putting the stick in the ground. You can do things on water, on air and so on. I am trying to encourage all these areas.

The other issue is that of having data for outdoor. Now, there is mass scramble for sites on the island and a lot of them have to do with ego. The Managing Director wants to drive and see his billboard as

he is going home or going to his office. Lack of data is not helping. We are trying to develop a situation where we have data. For instance, if you are selling consumer’s products why not go to Alimosho which has almost 50 percent of all the houses in Lagos State.

We can provide you with a data to say this is a social transfiguration of the people that live here, these are the numbers. If you put your ad in a particular street, this is the opportunity for this number of people to see it. So, we have facts like you have on radios and television today. We lack that for outdoor.

These are things we are trying to do.

For signage, we are developing various products. Products for market, we are developing composite for signage where on some buildings, you have almost 50 things littered. We want to do composite thing where one big structure will take everyone which makes the environment looks very nice.

The state of outdoor business has to do with what we do, the changes we make and we are trying to emphasis the use of light now, digital board, proper illumination for structures.

In general, the outdoor business is experiencing a little difficulty at the moment. If you look around you find billboards empty. Like I said, I think MTN is largely responsible for about 80 percent of that. But we have to change, practitioners have to develop new concepts, new structures and in some parts of Lagos, you see that they are places of high traffic. How come you have empty billboards. You

•George Kayode Noah

find out that the structures there are old fashion and advertisers are concerned about reflection of these things on their brands. So, if you go and put a rickety old structure on a road that is busy, those companies that take their brands very seriously, they are not likely to patronize the board. So, we are trying to encourage them to change their structures and bring new innovative ones and make this sector more vibrant than it is.

OAAN members have complained that they suffered untold hardship before you assumed office. Have been able to identify their grouse and show a way forward?

You must have basis for doing the things you do. That is why I did the image audit to find out what exactly each of these groups were thinking. I got to understand what their grievances were. Like if they applied for a site and they are rejected, can they appeal, if their boards are empty, do we continue to charge them rates and things like that. We sat down and we came to an agreement. For instance, we said look, when we give you a permit for you to put structure somewhere. It is like, we are the landlord and if you go and rent a house from the landlord.

If you say you are out of work, the landlord will still ask where is my money is. But we have to work out ways and say, look if your board is empty over a period; we give you a bit of concession. We tell them that there are ways we can cooperate with each other. Some of them know how to sell boards more than others.

34 —Vanguard, MONDAY, JULY 16, 2012

Insurance BRIEF Consolidated Hallmark flags off 2012 essay competition ONSOLIDATED Hall mark Insurance Plc has commenced acceptance of entries for its 2012 essay competition from interested participants.

In a statement to Vanguard, the company said that entries for the second edition of the Essay Competition are now open to interested participants from selected institutions of higher learning offering insurance across the country.

Sponsored annually by the Company, the maiden edition of the competition attracted participants from various institutions of higher learning in the country where Thomas Mayowa Daniel of the Polytechnic, Ibadan emerged First Prize winner.

He got a prize of N100,000 while the second and third prize winners smiled home with N60,000 and N40,000 respectively.

The topic for this year’s competition is “Social Media and its potential for the Nigerian Insurance Market.”

Entry for the competition closes on Monday 16th July, 2012 and essays which must be type written and double spaced are not to exceed 1000 words.

Copies should be addressed to The Managing Director, Consolidated Hallmark Insurance Plc, 266 Ikorodu Road, Obanikoro, Lagos and expected to reach him not later than 31st July, 2012.

Other conditions are that participants must be Nigerians who are resident within the country and currently studying insurance in the selected higher institutions of learning in Nigeria.

The annual competition according to the Managing Director, Mr. Eddie Efekoha is part of the company’s Corporate Social Responsibility and forms part of contributions to the development of the insurance profession whilst also encouraging productivity and hard work.

Prizes for this year’s competition remain unchanged while entries as usual would be graded by independent insurance industry technocrats.

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L – Mr. Bolaji Ladejobi, Mrs. Motunrayo Muibi, Mr. Kayode Osinuga, Executive Director, Roomans Insurance Brokers, Mr Oyebola Oyetunji, Mr. Shakiru Oyefeso, Managing Director, Staco Insurance Plc, Miss Khadijat Oyefeso, Mr. David Adeoye And Mr. Bamidele Isafiade, at the 33rd Graduation ceremony Of West African Insurance Institute, Banjul, The Gambia.

FG blames poor implementation of Group Life Scheme on improper documentation

By JOSEPH ERUNKE HE Federal Government has attributed the slow implementation of its Group Life Assurance Scheme for its workers to what it called “lapses in the processing and settlement of claims as well as proper documentation.”

To this end, it has commenced training of officers in the various Ministries, Departments and Agencies, MDAs, to enhance capacity and sustainability of the Scheme.

Head of the Civil Service of the Federation, Alhaji Bello

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Isa Sali who disclosed this last week in Abuja, at a three day seminar for desk officers in the various federal government MDAs on the enhancement of effective implementation of the Scheme, regretted that some lapses were observed in the processing and settlement of claims as well as proper documentation, which are capable of creating impediments in the efficient and effective implementation of the scheme.

Represented by the Permanent Secretary, Common Services Office, Alhaji Mo-

hammed Sambo Bashar, Alhaji Sali regretted that in spite of series of sensitization programmes on the scheme which were organised at its take-off to create awareness and understanding of the workings by all Government employees especially the Insurance Desk Officers in the MDAs, the scheme still experienced some lapses.

“The purpose of this enhancement training programme is to address these observed lapses. Papers have been carefully selected to include a balanced array of

Regency Alliance posts N2bn GPI

By RITA OBODOECHINA EGENCY Alliance Insur ance Plc has posted a gross premium income of N2.023 billion for the financial st year ended 31 December 2011. This is against the 2010 figure of N1.803 billion recorded in 2010, to represent an increase of 12.18 per cent.

Analysis of the company’s annual report shows that profit after tax stood at N247.2 million in contrast to N246.6 million recorded the previous year while net premium income dropped by 3.35 per cent

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from N1.453 billion to N1.404 billion due to increase in reserves for unexpired risks.

Underwriting profit decreased from N857.3 million to N822.4 million to represent a drop of four per cent.

Addressing shareholders at th the company’s 18 annual general meeting in Lagos last week, Chairman, Mr. A.G Karibi-Whyte, said that the company has continued to weather the storms notwithstanding the harsh economic climate it has been operating in.

Similarly, Karibi-Whyte on behalf of the board of the com-

pany proposed a dividend of 2kobo per every ordinary share of 50kobo, which amounted to N133, 375,000 and was approved by the shareholders.

He added that the company will continue to expand its operations, develop new products and provide quality service through staff training and development both internally and externally.

He said “Our company is also fully on track as regards the implementation of the international financial reporting standards.”

topics that would facilitate the attainment of the objectives of the Scheme”, he said.

The programme, according to him, was intended to avail participants the opportunities of clarifying issues that have been bothering Desk Officers regarding the implementation of the scheme which was flagged-off in 2008.

He urged participants to utilise the opportunity to acquire the knowledge that will enhance their performance in achieving the objectives of their mandate as Desk Officers of the Scheme in the MDAs. The Group Life Assurance Scheme is a statutory creation by virtue of Section 9(3) of Pension Reform Act, 2004, which requires that all employers of not less than five employees must maintain Life Assurance Policy in favour of each employee for a minimum of three times his/ her total emolument per annum.

The Scheme provides that, in the event of death of any serving officer, his/her next of kin would be given a relief equivalent to three times the annual total emoluments of the deceased, in addition to the deceased officer’s normal entitlement after service.

Vanguard, MONDAY, JULY 16, 2012 — 35

36 —Vanguard, MONDAY, JULY 16, 2012

Appointment & Promotions vicahiyoung@yahoo.com 08033348923

BRIEF NSITF, NECA partners on safety at workplace

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IGERIA Insurance Trust Fund, NSITF, and the Nigeria Employers’ Consultative Association, in a bid to enhance safety at the workplace, are partnering to ensure the smooth implementation of the Employee Compensation Act, 2010 and its full compliance.

Through “NSITF-NECA Safe Workplace Intervention Project”, the two organizations are aiming at making sure that employees look forward to retiring well and without incapacitation.

According to NSITF and NECA, “No employee wants to live with the fear of a disability, or worse still, death whenever at work. In spite of the provision made by the Employees’ Compensation Act, ECA, 2010 for the compensation of employees who sustain injuries at the workplace, it cannot substitute for an unscarred body or life.

This explains why the law has equally recognized the imperative to keep the workplace safe.”

Taking cognizance of this, NECA, umbrella body for private sector employers in Nigeria, “is partnering with the Nigeria Social Insurance Trust Fund, NSITF, to promote and ensure safe and healthy workplaces.

A good understanding of the application, procedure for reporting injuries and making claims and penalties for noncompliance, among others, will facilitate full compliance and benefits of the Act.” “To enlighten employees and employers on the provisions and operational modalities of the ECA, a oneday Interactive Enlightenment Forum on the Employee Compensation Act, 2010, has been scheduled for st July 31 and August 7 and 9, 2012 in 3 locations. The locations and dates are as detailed below: Lagos – 31stJuly 2012; Port-Harcourt – 7thAugust 2012 and Abuja 9th August 2012.”

The Interactive Enlightenment Forum, designed to provide the platform for the Organized Private Sectors, OPS, and other stakeholders to be enlightened on the implementation modalities of the Act, would also address employers’ concerns and challenges in complying with the new dispensation.

Chartered Institute of Stockbrokers elects officers T

HE Council of the Chartered Institute of Stockbrokers, CIS, has elected new officers to run the affairs of the institute for the next two years.

At its meeting the Council unanimously elected Mr. Muritala Olushekun, President of the Institute, while Emmanuel Ohanwusi and Emmanuel Abe were elected First Vice-President and Second Vice-President respectively.

Olushekun succeeds Mr. Michael Agbadun Itegboje, who served from May 2010 to April 26, 2012.

The new President/ Chairman of Council is a fellow member of CIS and the Institute of Chartered Accountants of Nigeria.

He has been actively participating and making contributions to the Institute’s activities since 2002 when he was first elected as a member of the Council, as Chairman and member of various committees.

Olushekun is also a Member of the Institute of Directors, the Chartered Institute of Taxation and the Nigerian Institute of Management and also, ViceChairman and Chief Executive Officer of Capital Assets Limited, a member of The Nigerian Stock Exchange.

Prior to that he trained and worked with Centre-Point Merchant Bank Limited before founding Capital Assets Limited in 1998.

With about 25 years experience in various aspects of investment banking, he is a former National Council member of The Nigerian Stock Exchange as well as a

Director of NSE Consult Limited, a subsidiary of The Nigerian Stock Exchange.

He currently serves on several committees of the Securities & Exchange Commission, the Nigerian Stock Exchange and the Association of Stock broking Houses of Nigeria as well as recently a member of the Business Support Group of The Nigerian Vision 20 2020.

Olushekun served on the Members Education Committee of The Institute of Chartered Accountants of Nigeria and also as the Director of Administration as well as the Chairman of the Technical Committee of the Association of Issuing Houses of Nigeria. He is on the boards of several companies in Nigeria.

For Ohanwusi, the First Vice-President, he was elected into the Council in 2005 and has served the institute in various capacities as the Chairman and member

of various committees including Finance, Investigating Panel, Disciplinary Tribunal among others.

He also served in various committees of The Nigerian Stock Exchange and was a member of the Investment and Securities Act Review Committee in 2005 and qualified as a stockbroker in 1990, and is currently the Chief Operating Officer of Maxifund Investment and Securities.

He holds a Bachelor degree in Linguistics from the University of Benin and has attendedvarious financial and management courses.

The Second Vice-President, Oluwaseyi holds a Bachelor of Science degree from the University of Ife and a Master Science from the University of Lagos.

He also holds an MBA degree and an alumnus of the Pan African University and New York Institute of Finance,

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TANDARD Chartered Bank, SCB, has

announced the appointment of Raheel Ahmed as Regional Head of Consumer Banking for the Middle East, Pakistan and Africa.

Ahmed took over from Vishu Ramachandran, now the Chief Operating Officer for Consumer Banking at Standard Chartered Bank.

The new regional head will report to Steve Bertamini, Group Executive Director and Chief Executive Officer, Consumer Banking and will be based in Dubai, the Bank’s regional headquarters.

Ahmed has over 20 years of

PENGASSAN congratulates Okuogbo, Ex-NUPENG scribe ETROLEUM and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, has congratulated the immediate past General Secretary of the Nigeria Union of Petroleum and Natural Gas Workers, NUPENG, Comrade Elijah Okuogbo for a meritorious career in trade unionism.

In a letter of Congratulation on behalf of PENGASSAN, its General Secretary, Comrade Olowoshile, said “The President, Comrade Babatunde Ogun, on behalf of the National Executive Council (NEC), Central Working Committee, CWC, members and Staff of Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, congratulate you on your retirement after a meritorious

•Olushekun

SCB appoints Ahmed Regional Head consumer banking for Middle East

•Raheel Ahmed

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and a fellow of the Chartered Institute of Stockbrokers.

Oluwaseyi is the Chief Investment Officer, AIICO Pension Managers and has over 21 years’ investment banking experience spanning over money and capital markets, treasury, asset management, corporate finance, wealth creation and pension management. He is a veteran in the Nigerian financial landscape.

service as the General Secretary of the Nigeria Union of Petroleum and Natural Gas Workers, NUPENG.Your immense contributions to the welfare

and growth of NUPENG and Trade Unionism in Nigeria as a whole were testimonies of your hard work and diligence while you were NUPENG General Secretary.”

experience in Asia, Europe, the Middle East and Africa and joined the bank in 2004 from Citi as Regional Head of Consumer Credit for Middle East and South Asia. He then moved with the bank to Pakistan to head Consumer Banking for Pakistan and Sri Lanka.

He took over as Regional Head of Consumer Banking Africa in January 2007.

In 2009, he became the Global Head of Distribution for the bank where he was responsible for building and implementing the Distribution Channels strategy across Branches, Phone Banking, ATMs & online banking.

Ahmed also led the development of Next Generation Banking capabilities for the Consumer Bank.

ECA announces Innovation Prize for Africa 2013

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NITED Nations Economic Commission for Africa ECA, has said the 2013 edition of Innovation Prize for Africa IPA, will support Africans’ efforts to develop new products, increase efficiency and drive cost-savings.

According to a release by the Programme Manager, Pauline Mujawamariya, the programme in conjunction with the African Innovation Foundation AIF, will attract researchers, entrepreneurs and innovators to propose projects that unlock new African potential under one of five categories which include agriculture and agribusiness, ICT applications, health and wellbeing, environment, energy and water and manufacturing and services industries.

He said the programme was open to Africans in the Diaspora to apply provided

their innovations are of significance to Africa explaining that “the winning proposal will be awarded a cash prize of $100,000 USD, with the two runners-up receiving $25,000 USD.” According to him, “the prize will also promote young African men and women in their pursuit of science, technology and engineering careers and business applications. The aims are to mobilize leaders from all sectors to fuel African innovation, promote innovation across Africa in key sectors of interest through the competition, promote science, technology and engineering as rewarding, exciting and noble career options among the youths in Africa by profiling success applicants and encourage entrepreneurs, innovators, funding bodies and business development service providers to exchange ideas and explore innovative business opportunities.”

Vanguard, MONDAY, JULY 16, 2012 — 37

38 — Vanguard, MONDAY, JULY 16, 2012

Vanguard, MONDAY, JULY 16, 2012— 39

People in Business ally thought about it as such because I feel that the way education is going in Nigeria is not the way education should go. The background I have is not that you open a nursery, primary, secondary and university. It doesn’t work that way.

Hardly do you see such in England. Private schools are very few and the students are so few because it is private and parents pay heavily so you do not see many children going there when there are a lot of state schools all over the place and actually, I have not seen much of private primary schools.

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RS. Meg Nwobia is the Director of Hallmark School, Lagos. In this chat with Vanguard in her office, the graduate of Education from the College of Education Abraka and Metropolitan University in London, speaks on her business and the challenges and says standard of education in Nigeria has not fallen. Excerpts:

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peaking on the journey so far, Mrs. Nwobia said: “Like any other business, even though this one has to do with human relationship/children, it is really challenging, rough sometimes, enjoyable; all the things you expect from a business, but most importantly, the joy of working with children and seeing them come out and go to secondary school, and come back to you each time.

You see them grow, you see how happy they are, that is the reward you get. When they leave here for secondary school, you find out that all their mid-term breaks, they want to come back to Hallmark School to see their friends, teachers and all that, and we discovered that they are doing extremely well in their various schools. Some of them are on scholarships in their different secondary schools,” she en-

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Poor infrastructure, lack of parental control bane of education in Nigeria — Meg Nwobia ….the way education is going in Nigeria is not the way education should go

By EBELE ORAKPO thused.

Mrs. Nwobia who noted that she has always been a teacher as she has not done anything work-wise apart from teaching, said she does not believe that the standard of education in Nigeria is falling, rather, it is parents and government that have failed the sector.

“People keep talking about falling education standard but I don’t believe standard of education in Nigeria has fallen because the children are so wise academically, they are doing well. What some children are doing in Year Five today, when I was in Form Three in secondary school, I did not know them.”

On the mass failures recorded in external exams, she said: “You see, most of those failures may be from the public schools but you still see that in internal competitions, the public schools also excel. The only thing that people can say is that there has been a kind of neglect in infrastructure and in monitoring what is happening in schools but not that the education standard has fallen, I don’t think so. Look at the way the children talk, the kind of answers they give you when you ask them questions. It doesn’t

,

After obtaining her National Certificate in Education from College of Education Abraka, Mrs. Meg Nwobia proceeded to Metropolitan University in London where she got her Bachelor of Education degree.

Upon her return, she did her national youth service at Air Force Primary School, Kaduna before getting married and relocating to Ibadan.

“When I got married, we moved to Ibadan and I taught at Loyola College. From there, we moved to Lagos and I taught at Stadium High School until 1989 when I went to England,” she said.

While in England, Mrs. Nwobia taught in various schools and returned to Nigeria in 1996 to establish a nursery school called Megdyke Nursery School in Lagos.

She said: “After a few years, the school metamorphosed into Hallmark School because the parents were so happy with what we were doing that they actually encouraged me to open a primary school because all the children who passed out from Megdyke, when they go to other schools, it was like a repetition of what they had done and they were all excelling and the parents had to put pressure on me to open a primary school. That pressure gave birth to Hallmark School which was opened on October 2, 2002. We will be celebrating our 10th anniversary on October 2 this year.”

Look at the way the children talk, the kind of answers they give you when you ask them questions, it doesn’t show that they are lacking in education, when children from Nigeria go abroad, you see them excelling

,

show that they are lacking in education. When children from Nigeria go abroad, they excel.

“Last year, I was in England when there was a report on countries that have students in England; they were looking at educational standards. Nigeria ranked very high, if not about the best. So what is going on here is lack of infrastructure. Again, we like paper qualification so parents are helping their children to obtain these things by unfair means.

That is the problem. If the children are taught well, they will excel. It is just that parents are not doing what they are supposed to do. If anything, I will say what has fallen is parental

•Mrs. Meg Nwobia control over the academics of their children because some parents don’t even look at what their children are doing at all.

This did not happen in our time.

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ur parents looked at our work, even those who were not educated, somehow, they ensured that the children did their work but now, you give children homework and they bring it back to you. This goes on through the week and month and you call the parents and they tell you they are too busy to even look at their children’s work. So, as far as I am concerned, the problem is parents’ lackadaisical attitude towards their children’s education and the failure of the state to look after schools. Some parents can pay high school fees but pay no attention to monitoring the children’s work.”

Asked whether she intends to open a secondary school in future, Mrs. Nwobia said: “There has been pressure too like they pressured me in nursery school. Even the children themselves want to continue in Hallmark but I have not actu-

hat I have seen are pri vate secondary schools and they are very few. For instance, in the whole of Ikeja, you can have just one. But if it is outside London, sometimes they have some private schools like Catholic schools so it is not something that is very common so that background is still what is keeping me because the proliferation of schools is not doing well to our education system where a school will have precrèche, nursery, primary, secondary and university. It’s like making a mockery of education. So I have not put my mind to it and if I am going to run a secondary school, I cannot run it in the same place where I have my primary school; it should be in a different setting so that the children will move from where they are to another place.”

Mrs. Nwobia said she will like to see Hallmark School reach its peak in the next five to ten years. “I’m hoping that Hallmark will be the watchword that when they talk about schools in the vicinity where I am, Hallmark School should rank first.”

Asked how she came about the name Hallmark, she said: “When I was thinking of a name for the school, I was thinking of a name that will ring a bell. The name of a school should give it carriage. So I was going out one day and I saw one very big billboard belonging to Hallmark Bank. The caption was what inspired me.

It went something like this: ‘If you are as good as we are, we can offer something that looks like you; or if you are as good as you are, you have to live up to that name,’ something like that. I told my husband I was going to call the school Hallmark. What Hallmark depicts is that you are there already and you must try and maintain that position.”

40 — Vanguard, MONDAY, JULY 16, 2012

Agric BRIEF Yam sellers in Lagos seek govt’s intervention on new levy at Mile 12 market

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am sellers in Lagos on Thursday called on the Lagos State government to take urgent steps to waive the new levy being imposed on them at the the Mile 12 market, Ketu.

The yam sellers said that the wholesalers at Mile 12 had engaged the services of middlemen who sell their produce to the buyers and collect a levy of N1, 300 per transaction.

They told the News Agency of Nigeria (NAN) that the state government’s intervention was now necessary to save the good image of the market and reduce the cost of yams in Lagos metropolis.

NAN reports that prospective buyers at the market now pay a certain amount called “Lada fee,” which depends on the size of each purchase, to bribe middlemen before they are allowed to take their yams out of the market.

Mrs Olamide Ayeni, a buyer, said that the development was making the yam business in Lagos unattractive.

Ayeni, who sells yams at the Oja-Oba market, AbuleEgba, Lagos, said that the situation had caused the prices of yam in the metropolis to soar.

“The objective of a business is generally to make profit and since most yam sellers are unable to sell below their cost price, they may be compelled to pass on such charges to their customers,” Ayeni said.

A 45-year-old buyer, Mrs Busayo Alao, said that it was inhuman for the middlemen to attempt “to eat from both sides” by collecting service charge from both buyers and sellers.

Alao, who claimed to have been in the business for the past 15 years, said that there was no reason whatsoever for paying the newly-introduced service charge to the middlemen at the market.

She frowned at the exploitative tendencies of the middlemen, saying that their activities were not helping the image of the market.

We 're targeting 100% agriculture production — Basorun … Lagos to invest N4b on Songhai prototype farm Dr. Olajide Basorun is the Permanent Secretary of the Lagos state Ministry of Agriculture and Cooperatives, charged with the responsibility of ensuring food security in the state. Basorun recently spoke with Vanguard’s Olasunkanmi Akoni on a number of issues concerning agricultural sector as it affects the state and the nation at large.

Excerpts: How has the ministry impacted on the agricultural sector in the last two years or so.?

We began the year with an interaction with the farmers to know their expectation from the government and the areas they will need the intervention of the government. This we usually do annually, review meeting, where we examine the activities for the past year and further map out what we want to do for the year.

We were able to develop areas of intervention for our farmers in all the various enterprises that are commonly undertaken by our people in Lagos state. This range between aquaculture, captured fisheries, poultry and vegetable farming, arable crops including cassava, maize and agro processing that is value added services which include marketing, transportation and others.

One will see that the state government approach now is to examine the entire value chain and work towards improving all the segments as against developing one segment of the production chain without allocating some funds for other segments.

Due to the state government initiative to consider all the entire segments, it has help to impact more on the productivity of the stakeholders in the sector.

First, we are adding value through capacity building of the farmers. We believe that if the farmers know more about what they are doing, they will be more productive.

That was why the state government built the farm service centres.

At this centre, we undertake periodic training for the farmers in the state.

At the centre, the farmers have access to regular information about the sector.

This information also allowed them to plan their season.

We have also been able to rehabilitate 13 old tractors that we have. And we have

•Dr. Olajide Basorun bought seven new ones which has increased the tractors to 20 that the state government has deployed since the onset of the rain.

The state government did this so that farmers in the state will have access to mechanisation at 50 percent subsidy. That was how we began the year. And we have also gone further to distribute farm inputs to the core farmers. The inputs are fertilizers, seeds and this is of course at 40 percent subsidy. For our captured fishermen, we gave them outboard engines, fishing nets, and floats, so that they can do what they know how to do best.

For our crop farmers, the state government gave them seedlings of high yield vegetable, we gave them cassava cuttings. We did these because we know that it helps the farmers a lot in their production.

For our poultry farmers, what we have done is to develop a poultry estate where we have major service centre. Whether a farmer is a prospective or practising poultry farmer, once he or she enters the poultry estate, he is entitled to farm inputs that he needs to set up his farm in the estate.

Also in the estate, the farmers have access to processing of farm produce because the state government has made provision for such service in the estate.

Another step taken by the government was the

engagement of services of extension workers who are scattered across the state to deliver information to farmers at their door step. We embarked on this in order to relief the farmers of the stress of searching for information on what is happening in the sector. All expenses on this service is paid by the state government.

While the extension workers inform and train the farmers on new developments, the state government also conduct training for the extension workers every 14 days.

However, every month, we engage in monthly technology review meeting where we invite lecturers, research experts to interact and train the extension workers. After this, the workers disperse to various parts of the state to inform the farmers of what they can do to improve their yield.

This they do every fortnight.

And every third Thursday of every month, we organise Monthly Technology Review Meeting (MTRM) at agriculture development training hall, Oko-Oba. The entire topic for this meeting is designed at the commencement of the year and it is based on the yearly review of the agricultural activities of the state in the just concluded year. During the review, we are able to know which area the farmers in Lagos require assistance of the government.

And where we were unable

to provide the solution, we develop what we called onfarm adaptive research. With this, we adapt what people in other states or country are doing that we have not been able to develop. We adapt them into what we already have in stock in Lagos state.

Where we adapt new technology from other countries and other states in Nigeria, we will bring it to Lagos and adapt it to our environment. And ones it is adapted, it becomes an extension message which would be sent to the farmers through the extension workers.

The workers would enlighten the farmers based on the condition of their environment on how they can plant the new adapted crop.

And we do it in conjunction with the farmers because we do not have our own farm. We do it on the farmers plot.

Sometimes, one out of the farmers in a particular area may be aware of such development, if he calls for such service; we use that opportunity to train other farmers in that location about the new development.

In the course of the year, we were able to rehabilitate two cottage processing centre for rice in Itoga and Itoi-kin, Epe axis of the state. These are cottage processing centre where we process our local rice.

During the rehabilitation, we installed new machines and building.

And final at that area, we commissioned 20, 000 tonne per annum capacity processing centre, Imota in Ikorodu. The centre is to produce polished rice that would compare favourably with imported rice.

When do we see the rice processed in Imotan in the market?

We have started producing rice daily. Two days ago, I got complain about a parboiling machine and we quickly called the engineers involved to put it in order. And we have begun to send the rice to the market.

Our demand for rice in Lagos state is very huge, what the plant produces daily is small compare to the demands from the public. So, we need additional facility of that magnitude so that we will begin to substitute imported rice with the locally grown ones, that is, import substitution. That was the idea behind the rice processing mill.

The same strategy we have adopted for rice is what we have adopted for fish, poultry. These are the major food that we consume daily in Lagos.

Due to the cosmopolitan nature of the state, larger percentage of the state’s population eat rice, Chicken and fish. And these things cost billions of dollars

Vanguard, MONDAY, JULY 16, 2012 — 41

42 — Vanguard, MONDAY, JULY 16, 2012

Aviation BRIEFS Senate calls for periodic review of revenue allocation formula

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he Senate on Thursday advocated a periodic review of the current revenue allocation formula at present in operation to favour states and local governments. The Senate noted that the exercise was in accordance with sections 313 and 315 of the c o n s t i t u t i o n .

The upper chamber made the call following the adoption of the report of the Sen. Barnabas Gemade (PDP-Benue) led joint Committee on National Planning, Economic Affairs and Poverty Alleviation; Appropriation; Finance and States and Local Governments. The Senate had at its plenary on Oct. 27, 2011 mandated the committee to investigate the looming danger of bankruptcy in some states and the need for a fiscal evaluation.

Ministry to partner tractor manufacturer on first “Tractor Future Farm” in W/Africa

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he Ministry of Agriculture and Rural Development is set to partner AGCO, a leading U.S.based global tractor manufacturing company to set up the first ‘Tractor Future Farm’ in West Africa. The Minister, Dr Akinwumi Adesina, disclosed this on Thursday in Abuja when Mr Nuradin Osman, the Managing Director of AGCO for Africa and Middle East, led a delegation to his office.

Adewumi advised them to collaborate with the Central Bank of Nigeria (CBN), through the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) initiative, to enable farmers’ to access loans to purchase tractors.

NIRSAL is an initiative of the CBN to help farmers transit from subsistence farming to commercial farming through a Credit Guarantee Scheme that would address the risk of payment default. The CBN had approved N75 billion for the take-off of NIRSAL. The minister advised the group to incorporate tractor leasing into their operation to accommodate farmers who could not afford to purchase tractors. He gave assurance that the Federal Government would work out modalities to ensure that farmers could access the tractors through hire service.

L-R, Managing Director, Med-View Airlines, Alhaji Muneer Bankole, Snr. Special Assistant to the President on Aviation Matters, Capt. Shehu Usman Iyal, Director General, Nigerian Civil Aviation Authority, (NCAA) Dr. Harold Demuren and Managing Director, Kabo Air at the 2012 Umrah Aviation Stake Holders meeting with Nigerian Civil Aviation Authority (NCAA) held at Aviation House, Murtala Muhammed Airport, Ikeja, Lagos.

Federal government assures lesser hajj pilgrims hitch free trip Stories by LAWANI MIKAIRU & DANIEL ETEGHE

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he Federal Government has assured Nigerian intending pilgrims for this year lesser hajj (umrah) hitch free trip to Saudi Arabia and timely return to the country.

The Senior Special Assistant to the President on Aviation, Captain Shehu Iyal made this known on Wednesday in Lagos during a stakeholders meeting on how to airlift the pilgrims to the Holly Land.

Iyal said that he got briefing from President Goodluck Jonathan that the regulatory body must certify every airline that is involved in the air lifting and there should be special attention to security too “because we are in a very, very special time.”

According to Iyal “Everything must be certified and if we have any airport that does not meet the expected standard it should not be used. Operators must look at their system of operation and there should be maximum cooperation with National Hajj Commission of Nigeria (NAHCON). The message from the President is that the pilgrims should be taken to Saudi Arabia safely and brought back safely,” Addressing the stakeholders, the host of the meeting and the Director General of the Nigeria Civil Aviation Authority (NCAA), Dr Harold Demuren, said that there would be no compromise on the safety of the aircraft, the pilots, the engineers and the airports.

Demuren said that airlifting of 60,000 Nigerians to Saudi Arabia is a serious business so everything possible must be done to ensure their safety and to also ensure that they depart and arrive in time as scheduled.

He remarked that there is security threat all over the world and so the airline operators and the National Hajj Commission of Nigeria

(NAHCON) must be vigilant, while the regulator body must certify the aircraft and the airlines in terms of safety.

“We want to make sure that security measures put in place are strictly adhered to. Any airline that fails to meet this requirement will not operate.

The same with the aircraft, the pilot and the airports and we want to make sure that all the aviation agencies are

working; there is fuel available; the same with ground handling.”

An official of NAHCON who attended the meeting pointed that that there was need for the commission and the regulatory body to work together to ensure timely return of the pilgrims, noting that the number of Nigerians that go for lesser hajj had increased from 30, 000 to 60,000 and the Hajj this year would attract about 100,000 pilgrims.

Delta introduces full flat-bed seats for Nigerian business elite customers investing in our product out

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elta Airlines has announced it will be introducing full flat-bed seats in its Business Elite cabin on board its daily service between Lagos and Atlanta, effective 5 September.

The changes form part of Delta’s ongoing plan to invest more than $3 billion in enhanced global products, services and airport facilities through to 2013. Delta is the only airline offering yearround, daily nonstop service between Nigeria and the United States. The flight will operate with a 201-seat Boeing 767-300ER aircraft offering 36 seats in Business Elite.

Each seat converts to a 180degree fully flat-bed and offers direct aisle access in a 1x2x1 configuration. The new seats are forward-facing and 22 percent wider than the seats they replace. All feature a 10.6" individual screen and a broad range of on demand entertainment in addition to a 110v AC power

source and USB port.

Delta will offer more than 500 of these seats each week between Nigeria and the United States.

“Nigeria is an important market for Delta and we’re

of Lagos because our business passengers expect the comfort of a flat-bed seat when traveling to and from the United States,” said Perry Cantarutti, Delta’s senior vice president for Europe, the Middle East and Africa.

Obey traffic rules at airport —Bi-Courtney

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i-Courtney Aviation Services Limited (BASL), Operator of the Murtala Muhammed Airport Terminal Two (MMA2), has appealed to motorists visiting or making use of the terminal to always obey traffic rules.

The appeal, it said in a statement signed by its Public Relations Officer (PRO), Steve Omolale-Ajulo, had become necessary in view of the current security challenges facing the country and the rampant flagrant disobedience of traffic signs at the airport in recent times by many motorists.

The statement observed that

“some motorists are in the habit of just driving into the airport, parking indiscriminately at ‘drop-off zone’ or picking passengers at unauthorised places, thereby causing obstruction to the free flow of traffic at the terminal and inconveniencing other motorists”.

BASL said the current security challenges made it imperative for motorists and other terminal users to be thoroughly screened by the Security Department of MMA2 and urged the motorists to co-operate with the security agents in the performance of their duties.

Vanguard, MONDAY, JULY 16, 2012 — 43

44 — Vanguard, MONDAY, JULY 16, 2012

“The first part of this series on cassava bread appeared on Monday last week; it could not have come at a better time. On Wednesday, June 11, 2012, after the Federal Executive Council, FEC, meeting, the Minister of Finance, Dr Ngozi OkonjoIweala, announced that President Goodluck Jonathan had approved two major incentives aimed at encouraging the production of cassava in the country. First the Federal government had “agreed to make the importation of cassavaenhancing enzymes into the country duty-free. Second, the duty on wheat flour will be increased from 35% to 65%.

These are necessary measures in the right direction; not insufficient as will be shown presently. urthermore, cassava flour is not ideally suited for bread making; for that matter not all types of wheat are suitable for bread baking. That is why certain types of wheat flour are used for biscuits, cakes, etc. Cassava flour without glutamine would yield a brittle kind of loaf which crumbles easily, cannot be sliced and certainly unfit for sandwiches.

Given the massive amount of bread consumed in this nation of 160 million people, we will either have to invest heavily in glutamine factories or import millions of tones of it. To the best of my knowledge, nobody has addressed this critical issue. It is all well and good for UTC to carry out a pilot project; bring in the glutamine; produce the nice tasting bread and serve to the President – very hot. But, it amounts to dishonesty not to acknowledge the process which produced the bread or to pretend that any Nigerian bakery can adapt to cassava flour. Nothing can be further from the truth. In fact giving someone cold cassava bread would almost amount to giving the child who asked for bread stone according to the Biblical story. It becomes that hard and solid and so cassava bread cannot be preserved for long without further additives.

The typical Nigerian bakery is designed to bake conventional bread using wheat flour. In order

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Mistaken notions about food policy – Cassava bread as case study -2 to adapt to cassava flour, major changes would have to be made; all the staff would have to be trained and the cost structure would have to be reconsidered.

This is a monumental undertaking requiring several years of planning – if the entire initiative is not going to end up in fiasco; leaving us at a greater disadvantage than when we started. ut, the main obstacle is still the production of cassava in sufficient quantities to replace the massive wheat import.

Diversion of cassava on such a massive scale to bread making, without any alternative tuber or grain to fill the gap, will disrupt the food chain of most Nigerians and create hardship until such a time as the country is able to produce surplus cassava.

Unfortunately, massive increase in cassava production is not feasible at the moment. Most of the nation’s irrigation systems which can provide some measure of controlled water supply have broken down. For instance the Goronyo Fadama dam in Sokoto state which collapsed two years ago is still not functioning; the Bakolori dam project in Zamfara state is also in a state of disrepair, Kainji dam is suffering from water shortage etc. One thing the SURE document circulated by the Federal Minister of Finance, before it became clear, even to her, that there was no subsidy, only fraud, was that it listed some of the dams needing repairs.

However, even when they operated optimally, the nation was still incapable of growing enough cassava as to make it “dirt cheap”. One of the basic strengths of the United States,

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Canada and the major wheat producers lies in the fact that they have so much capacity to produce they even keep million of hectares out of cultivation.

Nigeria is so far from that stage of development such that it will be futile to attempt the conversion now. f our capacity to produce sufficient cassava in the short term – defined as five years – is not enough reason to shelve the idea for now; the widespread violence in the North – code named Boko Haram – is certain

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At the risk of being labeled prophet of doom, there is another variable to ponder. Climate change and the record level rainfall expected this year. In most places, especially areas benefitting from irrigation, the debris from last year’ destruction have not yet been fully cleared and we are into another year of heavy torrential downpours

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to result in massive food shortage next year. With over 75% of the nation’s agricultural land in the north; and, with the largest food producers under siege, it is unlikely that the harvest next year will be anywhere near anything we have experienced

in the past. Not only will productivity be lower; post harvest losses will escalate as farmers have continued to abandon farms and run for cover.

The shake-up in the top levels of security officers will not have an immediate impact; and even if it does, those fleeing for their lives will not be in a hurry to return.

Instead of a cassava surplus, shortage of cassava, as well, as other food items, seems more imminent. When general food crisis occurs, people tend to consume more carbohydrates than proteins because the latter is more expensive. So the pressure on cassava and yams will be more intense. There will be no surplus for bread.

At the risk of being labeled prophet of doom, there is another variable to ponder. Climate change and the record level rainfall expected this year. In most places, especially areas benefitting from irrigation, the debris from last year’ destruction have not yet been fully cleared and we are into another year of heavy torrential downpours.

Even the greatest optimist will have to admit that the near term is not hopeful. There will be water quite alright and it will even be plentiful. But, it will neither be controllable nor controlled. So we are at the mercy of nature for the year 2012 and the harvest for 2013.

The Minister of Agriculture deserves a great deal of credit for being the only one in the cabinet of President Jonathan drawing attention to the looming food crisis – famine really. He also should be commended for the initiative designed to reduce our unsustainable food import bill — especially as the price of crude oil keeps dropping. God knows we need the relief that lower food import bill will provide for this country, particularly if it means we can increase our food output and move towards self-sufficiency.

But, cassava bread is an idea whose time has not yet arrived; and will not arrive until we have cassava virtually littering the roads of Nigeria. In addition to that, we need to work out all the technical details and be sure that

we can afford the cost of conversion of our mills and bakeries nationwide. Otherwise, we will end up with no bread at all – cassava or wheat.

CONSEQUENCES OF THE NEW INCENTIVES s stated above, the Federal government rolled out two new incentives to foster its promotion of cassava bread as a substitute for wheat bread. Those two measures are the barest minimum interventions government can make; because without them cassava bread policy will soon become a joke – just as the wheat programme became an everlasting embarrassment to Babangida. If there is one thing most government measures have in common, apart from insincerity in execution and corruption, it is the failure to understand that ideas which are feasible in theory require technicians to translate them into reality. The Ministries of Agriculture at Federal and States’ levels have been occupied by academicians selected from various universities; they have uniformly failed to lift the production levels of crops because few of them ever owned or managed a farm before.

Unlike the controlled environment of university farm, the typical Nigerian farm, even at its best, can only be described as organized chaos. Very little is under control. So results are often unpredictable.

In the same week that government announced the new measures, Nigeria Cassava Growers Association, promised to increase the national output of cassava to 44 million tones annually; at an unspecified date.

The problems with that are twofold. Even 44 million tones of cassava, if made into bread is insufficient for 167 million people. Second, people don’t eat “in the long run”; they must have food now.

Finally, increasing import tariff on wheat will only encourage smuggling. The revenue expected might never be received. And, if received might be embezzled instead of going to promote cassava output.

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BUSINESS & ECONOMY

P&G flags off construction of N435bn plant in Nigeria

By NKIRUKA NNOROM

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rocter and Gamble, manufacturersof Pampers and other household consumables, has established a significant footprint in Nigeria with the flagging off of N435 billion state-of-theart baby care manufacturing plant at Agbara, Ogun State.

Speaking at the ground breaking ceremony, Group President, Mr. Laurent Philipee, said that the new Agbara factory, which will be constructed on six hectares of land, would help to

accommodate the company’s current diaper lines and other category growth.

He noted that the new plant investment showed how the company’s purpose compels it to partner in President GoodLuck Jonathan’s transformation agenda.

Philipee further stated that Nigeria has remained a focus area for the company ’s investment, adding that their various investments in Nigeria have continued to contribute to strong inclusive economic growth.

“Currently, over 85 per cent of P&G products sold in

Nigeria are manufactured in the country and Nigeria is our business hub for the entire West African region as we expand across the region.

“P&G is determined to expand our investments in the coming five years with our ambitious plans to invest hundreds of millions of Naira in expanding our production platform, in introducing new products and latest product strategy,” he said.

He noted that the new investment would further generate employment in Nigeria with thousands of direct and indirect jobs,

adding that the vision was to make Nigeria a major production, innovation and export hub for its African businesses.

The P&G boss explained that already, the company employs over three thousand direct and indirect workers through its offices, suppliers and distributors and has created over 200 small and medium scale enterprises in Nigeria so far. Flagging off the construction of the facility, President GoodLuck Jonathan, who was represented by Minister of Trade and Investment, Dr. Olusegun

Aganga, said that the project was a demonstration of P&G’s confidence in Nigerian economy.

Philipee stated that the investment will go a long way in strengthening the country’s goal economically, as well as open the economy for indigenous and foreign investments. He observed that the federal government sees the company as a formidable partner in the development of Nigeria, adding that its corporate social responsibility programme was worth emulating by other organizations.

Vanguard, MONDAY, JULY 16, 2012 — 45

Technology News & Reviews The Internet of things:

Ericsson's report reveals how internet determines success of mobile operators

By PRINCE OSUAGWU ORLD renowned tele communications infrastructure vendors, Ericsson, seems to be putting into good use the whopping 8 billion dollars it sets aside every year in Research and Development, R&D, to clearly understand the dynamic and change pattern of technologies that govern the telecommunications industry.

In a chance meeting in Ghana, recently, President of the company, Mr Hans Vestberg had told this reporter that in 2016 the world was going to experience two revolutions in deployment and installation phases of technology operations.

From his explanation, in the near future, the deployment phase may be tilted towards provision of unique equipment and infrastructure other than what is obtainable at the moment, while the installation phase, deals with a period when consumers would naturally use technology in different ways than they are used to.

The implication of these revolutions, according to him, was that only those who understood these dynamics, tailor services towards them, would remain relevant in business within the period.

However, it seems as if things are happening faster than Vestberg imagined. If Ericsson’s second traffic and market report , released last week, is anything to go by, the revolutions are already here.

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he report which was con ducted on the pulse of Networked Society, revealed that for many people around the world, the mobile phone has become a major means of accessing the internet and in the near future, may become the only means.

The report also predicted that 85 percent of the world’s population will have internet coverage via 3G by 2017 even as there will then, be close to nine billion mobile subscriptions, compared to six billion by the end of 2011.

Part of the predictions of the report included that mobile

*Mobiles, becoming only means of accessing internet * 85% of world population to be on internet by 2017

•Mobiledevices

broadband subscriptions, will reach five billion in 2017, as against the one billion mark attained by the end of 2011.

Presenting the report to the media in Lagos, last week, Ericsson Nigeria’s Government & Industry Relations Manager, Mr Olaseni Ashiru, noted that from the report, Ericsson discovered that people across the world, now see access to the internet as a prerequisite for any device, fuelling a growing demand for mobile broadband and increased data traffic.

For him, operators have also come to recognize the business opportunity in this mindset and are aiming to facilitate this growth by providing good user experience with fast data speeds through high capacity networks.

The result of this development is that today, around 75 percent of the HSPA networks worldwide have been upgraded to a peak speed of 7.2 Mbps or above and around 40 percent has been upgraded to 21 Mbps.

Consequent upon that, Ericsson sees half of the world’s population covered by LTE/4G networks by 2017,while Smartphone subscriptions will grow to around three billion.

As at end of 2011, there were about 700 million smart phone subscriptions around the world.

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ccording to the report, there was a continuous mobile data traffic increase, particularly, between Q1 2011 and Q1 2012, and the prime drivers were video and Smartphones . Yet, it is expected that the mobile data traffic will grow by 15 times between 2011 and 2017.

Between countries and regions, the report presented variations in data report. For instance, China added very significant subscriptions in mobile net for a single country in Q1 2012 with 39 million, followed by India with 25 million. The Asia Pacific

region added in total 93 million subscriptions, followed by Africa with 30 million.

Meanwhile.the report admitted that Central Europe, Middle East and Africa, showed strong growth due to population and GDP and will continue so till 2017.

However, the difference would be that while developed economies are migrating to higher technologies, like HSPA, LTE, reducing the subscription edge of GSM/EDGE, emerging markets like Africa would take a totally different growth pattern because new low end users entering the mobile networks would likely use the cheapest mobile phones and subscriptions available.

But the continouos trend thrown open by the report is the fact that everything is going mobile - An evolution said to be driven by video, cloud-based services, internet and machine to machine connectivity.

This trend according to the report has come to change the way people behave, leverage mobility to communicate and improve their understanding of using new and existing services to improve their daily lives.

This paradym shift seems to be leaving mobile operators , services providers, across the world, constantly wearing their thinking caps.

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ricsson's forecasts are based on historical data from various sources, validated with Ericsson internal data. Its forecasts on future developments are based on macroeconomic trends, end user trends, market maturity, technology development expectations, industry analyst reports , on a national or regional level.

BRIEF Akingbade retires from MTN TN Nigeria, has an nounced the retirement of its Chief Marketing and Strategy Officer Mr Bola Akingbade. The retirement, is said to have already taken effect end of last month.

Akingbade, according to MTN, had about six years of meritorious service. In the company, being an experienced Marketing strategist.

He joined MTN from Nigerian Breweries, where he rose to the position of Marketing Director.

MTN Nigeria and indeed the MTN Group have benefited immensely from Akingbade’s wealth of experience and his contributions to the growth and success of the business are well documented.

His leadership of the Marketing & Strategy Division, helped MTN Nigeria make significant strides, including playing significant roles in growing the market share from 45 percent in 2006 to over 50 percent at the end of 2011. This helped to entrench the MTN brand in

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•Bola-Akingbade Nigeria.

Under Akingbade, the Marketing & Strategy Division, contributed to the growth of subscriber numbers from 12.3 million in 2006 to 41.6 million by the end of the 2011 financial year, in spite of steep competition driven by frequent pricing changes and product innovation in the telecommunications industry.

The success of all marketing initiatives during Akingbade’s tenure are said to have contributed to enhancing the MTN brand strength and sustaining the company’s leadership position in the Industry.

He is to be replaced by Larry Annetts, another professional with over 16 years cognate experience in multinational organizations.

46 — Vanguard, MONDAY, JULY 16, 2012

Economy

NIGERIA: Let the sovereign wealth fund begin NE of the curiosities in our current national discourse is this argument over the desirability or otherwise of having a saving and investment scheme as a nation giving the realities of our national circumstance. A nation with so much money, habitually engaging in wastefulness and is somehow ambivalent about saving for the future or against the rainy day, must be a study in self-destruct tendencies.

The sovereign wealth fund (SWF) initiative which Nigeria embarked upon early last year is designed to help the country achieve a turn-around in fiscal attitude and help address our needless tendency to profligacy by setting aside some critical fund for the future. With the enabling legislation in place NSIA, 2011, Nigeria should truly be seen to have taken the right step forward just waiting for the fund to become fully operational.

Never mind the governors’ current challenge of the legality of the fund and by extension its necessity however much they deny the latter which is the subject matter of this discourse.

Basically, SWF are funds of investable foreign currency owned by sovereign entities usually managed separately official exchange reserve of the country. The practice and management of SWF have captured ample scholarly attention and a growing body of literature from the perspectives of legal, policy, finance, management to politics, all of which now exist on the subject matter.

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uthors like Balin B, Backer LC, Monk A, Bortolotti et al, Van der Ploeg et al, Gelpern A, to name a few scholars who have done notable works in this regards. SWF have a huge potential for public wealth creation once well managed. They are similar but different from state owned enterprises (SOE) which are more obvious as part of traditional state

ventures.

It used to be the case that governments kept excess foreign reserves as a measure to control unanticipated or anticipated financial crisis, for example, the sub-prime crisis that hit the US in 2008/2009 but now other financial structures have come into being like the SWF. And so when there is a windfall in national resource earning, a government would have some options open to it; (a) use the fund to manage domestic and external debt, (b) channel the surplus into short term public spending and consumption for example in health, education, agriculture, etc or (c) accumulate public and

The sovereign wealth fund ( S W F ) initiative which Nigeria embarked upon early last year is designed to help the c o u n t r y achieve a turnaround in fiscal attitude.

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private capital by transforming the exhaustible resource asset into interest earning foreign assets through setting up an SWF to enable long term financial stability and better fiscal responsibility.

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Nigeria’s financial system. Such a fund that can help to recondition our public finance mechanism from that of debtor nation steeped in debt management, debt servicing to wealth creation, asset management and a serious voice in the global financial system.

Having an SWF will further help Nigeria become a key player in the emerging platform on the global level where fund owners are earning ample returns from diverse investment portfolios. It will help Nigeria’s credit rating and facilitate foreign direct investments in all the sectors as a direct consequence.

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ith that conceptual background, one can understand why a sovereign wealth fund is imperative in our national circumstance with the best choice being for us to pursue option (c) above. Now, this writer was privileged to serve in the legal team, along with several Nigerian legal, financial and foreign experts that articulated the broad framework of the fund. There was the need to find additional use for the Excess Crude Account to limit predatory recourse to the account and create a fund that will be a regenerative and functional part of the fiscal architecture of

es, several issues had to be taken into consideration from the standpoint of our nation as a federal state for example with a maze of contending interests to a global environment in which the fund and its investment direction must wade through geopolitical and governance challenges. This is so because countries like the United States of America remain suspicious of foreign governments acting as state capitalists taking over firms and corporations through the existence of huge funds like pension funds as in Norway or sovereign wealth fund as in China and Venezuela. Other fears elsewhere include the possibility that such investments may carry with them disguised political purposes. In terms of axis shift, scholars are already beholding the spectre of London, New York, Rome yielding some grounds as global financial centres to Doha, Dubai and Shanghai.

To be sure, these and other legal issues naturally weighed on the minds of the legal team, which it deliberated, evaluated and proceeded satisfied to be pragmatic and progressive in order to produce the legal and governance framework of the fund. There were comparative perspectives to see how the SWF practiced by other nations fitted into their laws.

Vanguard, MONDAY, JJULY 16, 2012 — 47

Advertising, Media & Marketing BRIEFS Standard Chartered deploys new advertising campaign TANDARD Chartered Bank has launched an international advertising campaign encompassing TV, print, outdoor and digital to reinforce the Bank’s commitment to making a positive impact on the communities in which it operates. The campaign steps up a level in Nigeria with the broadcast of the new TV advert which illustrates Standard Chartered’s continued support for trade its impact on individuals across the bank’s network in Asia, Africa and the Middle East.

The campaign, which demonstrates Standard Chartered’s Here for good brand promise, also calls on people to visit the campaign micro site on Standard Chartered’s website and tell the Bank which issues are really affecting their lives. In this way, the Bank hopes to understand how it can deliver on its commitment to enhancing the communities in which it operates. The TV advert will be broadcast internationally on CNN, BBC, Discovery and TLC, as well as on major local channels in nine of Standard Chartered’s markets, including: Bangladesh, China, India, Indonesia, Malaysia, Nigeria, Taiwan Thailand and the UAE.

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Heroes Award: Search for 2012 winner gears up HE search for the 2012 edition of the Indomie Independence Day Award for Heroes of Nigeria, the flagship Corporate Social Responsibility (CSR) initiative of Dufil Prima Foods Plc, makers of Indomie Instant Noodles to reward acts of bravery and heroism among the Nigerian children has reached top gear as the Independent Research teams have recorded several stories for the Award.

To ensure better quality stories for this year’s Award which is the fifth edition of the prestigious initiative, the company has engaged two separate Research companies, Field Consult Limited and Market Probe Limited to comb the 10 states selected for this year which are; Oyo, Anambra, Bayelsa, Edo, Enugu, Lagos, Plateau, Benue, Kaduna and Kebbi.

Speaking during a telephone chat on the search process, the Chief Field Officer, Field Consult Limited, Mr. Yinka Williams confirmed that the search is ongoing simultaneously in Lagos, Plateau, Benue and Kaduna State.

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House to strengthen APCON’s powers on Ad regulation Stories by PRINCEWILL EKWUJURU EMBERS of the House of Representatives at the 2012 Advertising Forum have recommended that the Advertising Practitioners Council of Nigeria (APCON) be strengthened and given constitutional powers to guarantee its effectiveness in regulating all aspects of advertising in the overall interest of stakeholders and consumers.

The National Assembly members present at the forum tagged: Outdoor Advertising Regulation and Control in Nigeria include; Senator Ayogu Eze, Senator Enyinnaya Abaribe, Chairman Senate Committee on Information, Hon Nwabueze Okafor, Chairman, ALGON, Minister of Information Labaran Maku represented by Hon Mustapha Habib, Dr. Davis Sekote representing the Speaker of the House of Representatives.

Hon Aminu Tambuwal, gave assurance towards facilitating legislation on harmonizing the present multiplicity and conflict controlling influences on Outdoor advertising in Nigeria.

The legislators agreed that the legislation to be enacted will create a standardized regulatory regime that permits the effectiveness of outdoor advertising, satisfy a legitimate expectation of the government and the overriding concern for environmental safety, social and economic well being of the citizens.

The House member also advised APCON to strengthen the global competitiveness of Nigeria’s advertising, protect the right of Nigerian citizens, the interest of Nigeria’s security, the environment, tourism and culture and take steps to check the displacement of Nigerians by nonNigerians in the country’s advertising and marketing industry.

At the end of deliberations, the conference identified and analyzed areas of conflict and proposed some measures that need to be taken to achieve a better thriving and mutually rewarding outdoor advertising industry in Nigeria.

The conference regretted that outdoor advertising is faced with a threatening challenge arising from the actions of various tiers and agencies of the government who seek to boost their internally generated revenue through control of outdoor advertising.

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The participants also agreed that the development of outdoor industry is stalled by the impact of multiple and sometimes arbitrary control.

This has led to collapse of several SMEs who can no longer afford the huge cost of advertising displays and have massive loss of employment and other economic and social consequences.

Participants told government and their agencies to focus more on cost effective utilization of resources available to them rather than the prevailing persistent drive for in-

ternal revenue which has put outdoor advertising under pressure.

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n multiple taxation, the conference posited that a system should be developed to provide for a one stop clearance and approval for outdoor advertising structures in every state. Such a system should provide a central collection of revenue from outdoor business which is later shared by all relevant government agencies and tiers of government in the pattern of VAT system. FG should pro-

vide the support in standardizing the role of each tier of government.

Speakers who include Idigbe, a legal practitioner, Lolu Akinwunmi, APCON chairman, Bunmi Oke, President of AAAN, Charles Chijide, President of OAAN, Kola Oyeyemi, President of ADVAN, Tolu Ogunkoya, President of MIPAN, DG of Oyo Advertising Signage Agency, Yinka Adepoju, Chairman of OAAN, Charles Chijide and others identified challenges confronting outdoor business in Nigeria.

Shorungbe, Head, MobileMoney, channel, Stanbic IBTC, Mr. Thabo Makoko, Head, E-Business, Stanbic IBTC, Mr. Maxwell Loko, Director, NTASTAR TV Network at a briefing organized by StarTimes in partnership with Stanbic IBTC on its MobileMoney Service in Lagos.

Olympics sponsorship: Implication for FBN, Okagbare, NOC partnership N what appears like the global trend by brands, First bank has joined the fray of brands that cling to marketing activities whilst partnering Nigeria Olympic Committee (NOC) to push for the success of Team Nigeria at the Summer Olympics in London.

The unveiling of Blessing Okagbare, an Athlete, as its brand ambassador is more to it than meets the eye, coupled with the Bank’s web interactive platform for the Olympics.

The implication of this is what a brand analyst Cyril Moekeme, Managing Director Alpha Consulting referred to as “the unveiling of a big brand as a brand ambassador to a big bank brand. In addition, the bank as regarded as the official bank for the games puts more responsibility on the bank for more responsive banking transaction with its customers during and by extension after the games.”

With this support the Bank is placing more responsibility on the athlete, particularly as she wears the bank’s toga.

Conversely, the unveiling

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Okagbare as bank’s brand ambassador puts her in a precarious position, she has to deliver, particularly as she had recorded some firsts in her outings recently, “her performance has to align with the bank’s philosophy of becoming first in the financial market. This is good for the Okagbare’s brand; it will lift her spirit, because now she knows she cannot afford to fail.”

According to him, “In sponsorship, sponsoring brands are exposed to many potential consumers and possible trade partners. A brand that keys to an activity that connects its target audience, will definitely leverage on such sponsorship to win consumer loyalty. “It’s on record, if a brand supports the youth market; it is natural for it to attract many consumers.”

Mr. Bisi Onasanya, Group Managing Director, First Bank Nigeria, who spoke through Uk Eke, Executive Director, Public Sector South, said the bank is delighted to serve as the Official Banker

to the games in line with its values of determination, excellence, friendship, respect and courage that the world is set to witness at the Olympic Games.

He stressed that bank endorsed Okagbare as its Brand Ambassador to reinforce the importance of the Olympic values which the Bank subscribes to.

“We are glad that we made the right choice, as Okagbare has done the Bank proud, having defended her 100m title for the fourth consecutive time, while she also leapt to a new 6.97m personal best in the long jump.” To push the bank further, “We would facilitate cashless transactions and provide platforms for various financial transactions during the games through our alternative banking channels which include seamless internet banking services and mobile money services. 10 FirstBank customers are London bound in an all expense paid trip after emerging as winners of the Bank’s ongoing Save & Excel Promo.

48 — Vanguard, MONDAY, JULY 16, 2012

0817 002 3569

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The orphaned account at JP Morgan Indeed, Yakubu further testified that “the NNPC has no direct contact with the JP Morgan account; the account was opened by the CBN on behalf of NNPC; the account is operated for the NNPC by the CBN; CBN has its own correspondence bank to which NNPC isn’t a party; NNPC does not operate that account; NNPC operates domiciliary account with the CBN….

The CBN is the only signatory to the account and as such, we have no relationship whatsoever with JP Morgan; we don’t have the mandate. JP Morgan is a correspondent bank for the CBN on NNPC’s domiciliary account; NNPC cannot give instruction directly to JP Morgan, but through the CBN. “ The testimony of the Finance Minister, Dr. Okonjo-Iweala was equally discomforting, as she hesitantly parried questions on the JP Morgan account.

A

lthough the Coordi nating Minister of the Economy acknowledged the existence of the account, she admitted that she knew next to nothing on the account’s operations. She added that “…because the federal government does not maintain any foreign account… as

they rely on money either being transmitted to federation account… as the Ministry of Finance cannot go abroad to collect the money itself, so they rely on government agencies to do so”.

She regrettably ultimately succeeded in creating an unnerving feeling that she was not on top of her job with regard to the

,

HE probes by various committees of the National Assembly revealed the depth of the depravity and the reckless lack of accountability in the management of the proceeds from crude oil, which contributes over 80% of our national revenue. It was disturbing, for example, to listen to the incoherent responses of the management of NNPC and the Central Bank on the existence of a ‘secret’ federal government account with JP Morgan (international merchant bankers).

The Deputy Governor of CBN, Mr. Tunde Lemo, told the Senate Committee on Fuel Subsidy that the NNPC operated an account at JP Morgan to receive proceeds from sale of crude oil, contrary to the constitutional provision of Section 162(1) that all moneys should be paid into the federation account with the CBN. However, Lemo’s position was frontally contradicted the very next day by Mr. Bernard Otti, NNPC Executive Director of Finance, who maintained unequivocally that the JP Morgan account was actually opened by the CBN on NNPC’s behalf in 2002, and that the apex bank has remained the sole signatory to the account!!

Incidentally, the newly appointed NNPC Group Managing Director, Andrew Yakubu, who also appeared before the Senate Committee, corroborated Bernard Otti’s testimony.

paid into JP Morgan account since its establishment in 2002 and how much was received in the federation acount? If it is a savings account, how much interest had been paid into that account since 2002? How long does it take for the balances in the JP Morgan account to be captured in the federation account? Many other such questions remain largely unanswered.

counts exist in the name of the Federal Republic of Nigeria? Who or which agencies established these accounts and on what authority were the accounts opened? Furthermore, who manages and authorises withdrawals from these accounts, and for what purposes have the withdrawals been applied?

In the light of the contro-

I

n similar vein, Nigerians also recall the embarrassingly widely divergent statistics on fuel imports and subsidy payments from critical stakeholders like NNPC, PPPRA, CBN and the Finance Ministry, when the management of these agencies testified at the House of Representatives probe of the suspected ripoff in the administration of the fuel subsidy scheme. In the light of the above, the Senate Committee will fail in their duties, if they recoil from shinning more light on the foreign exchange and reserves management practices of the CBN. If simple accounting for commodity payments is so controversial, it is likely that the accounting process of reconciling dollar export revenue with naira substitutions at CBN’s unilaterally determined rates before allocation might also open a more horrid can of worms!!

The Deputy Governor of CBN, Mr. Tunde Lemo, told the Senate Committee on Fuel Subsidy that the NNPC operated an account at JP Morgan to receive proceeds from sale of crude oil, contrary to the constitutional provision of Section 162(1) that all moneys should be paid into the federation account with the CBN.

custody and management of our crude export earnings.

The question is if the Coordinating Minister of the economy does not have direct access to such information, then, how can she confidently present accurate and sustainable sources of funds statement in the preparation of the national budget? The question also arises, how many other such orphaned but lucrative bank ac-

,

versy, the Senate Committee has directed the NNPC and CBN, to submit a joint paper on transactions in the JP Morgan account, and further directed that the account be closed. However, some critics believe that the Senate Committee, itself, fell short in its recommendations; it probably would be much more rewarding if the House Committee demanded additional independent information, such as, how much had been

SAVE THE NAIRA, SAVE NIGERIANS!

BUSINESS & ECONOMY How to achieve 10% real sector contribution to GDP by 2015 — Stakeholders Continued from page 18 economic activities as most of the industrial/commercial nerve centres in the country experience heavy traffic, thereby constituting undesirable delays to motorists and other road users. The rail and mass transit schemes are also yet to receive the desired attention and growth needed to transform the transportation sector.

To address this problem, Government should continue to give priority attention to ensuring the provision of adequate and reliable infrastructure for road, rail, air and waterways transportation, including effective road transport system management in order to achieve supply chain efficiencies.

“For effectiveness, Govern-

ment should continue to explore the Public-Private Partnership (PPP) arrangement, in line with Build, Operate and Transfer (B.O.T) options/ models nationwide for the following: Rail (Interstate, EastWest to link Calabar with Lagos, and Lagos with Kano and Calabar with Maiduguri); Metro lines within cities to facilitate intra-city movement; Roads – Coastal Road from Lagos to Calabar, Lagos – Kano road and Calabar – Maiduguri road; Rural Road to support agricultural produce and evacuation to markets; Water Ways - Develop inland water ways and deep 17 to 20 metres ports to permit construction of local oil rigs., etc. We believe this will improve the operating environment for manufacturing to thrive, as well as positively

transform the economy and reduce the already high cost of doing business in the country.” “Finally, there is need for government to work on the power supply situation in the country. We have observed that despite the on-going Electricity Power Sector Reform and with huge allocation of funds to the power sector, the generation of power is presently far below 4,000 MW despite Government’s intention to increase power generation to 10,000 MW.

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he unabated incessant epileptic power outage in most parts of the country, especially in industrial zones has led to low capacity utilisation of manufacturers as well as continue to reduce productivity of the real sector operators who now depend

by contributing to the high cost of doing business,” he concluded.

mainly on private provision of alternative sources of electricity through generators, there-

Omoh Gabriel Babajide Komolafe Clara Nwachukwu Peter Egwuatu Yinka Kolawole Favour Nnabugwu Godwin Oritse Godfrey Bivbere Yemi Adeoye Oscarline Onwuemenyi Franklin Alli Michael Eboh Amaka Abayomi Ebele Orakpo Ifeyinwa Obi

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