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Jonathan, Saraki, Tambuwal, Lamido, Kwankwaso present as Atiku kicks off campaign ... asks crowd to vote out Buhari INIOBONG IWOK

wo weeks after the official lifting of the ban on campaigns for the 2019 presidential election, the presidential candidate of the main opposition party, the People’s Democratic Party (PDP), Atiku Abubakar, yesterday officially kick off his presidential campaign at the Shehu Kangiwa Square, Sokoto, in the presence of a mammoth crowd. Atiku who emerge d the presidential candidate of the PDP after defeating about fourteen other aspirants for the party’s ticket, recently launched his policy document in which he also addressed Nigerians via the social media

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NGUS MAY 29 2019 365.70

NGUS NOV 27 2019 366.60

Investors eye Santa rally as UBA, Access, FBNH, GTB, Zenith near 1yr low S

BALA AUGIE & LOLADE AKINMURELE

t o c k s may b e d u e for some kind of December rally as major large cap names trade at the lowest valuation in 12 months. The Nigerian Stock Exchange (NSE) All Share Index has averaged a return of 2.8 percent

in the final month of the year since 1998- second only to May which has averaged 5.30 percent, according to analysts at United Capital Research in a recent note. According to United Capital, in the past 21 years, the market has only seen four negative monthly returns in December, specifically, in

2001, 2005, 2008 and 2009. “Thus, the probability that there would be a December rally is whopping 81.0 percent. Added to this, the market clearly looks attractively valued in the light of the selloff we have seen this year,” said Wale Olusi, equity research analyst with United Capital Research. “This clearly offers an inter-

esting entry point ahead of the upcoming presidential elections,” Olusi said. Nigeria’s largest banks have their stocks trading close to a one-year low in what opens a window of opportunity for long-term investors to swoop on fundamentally sound com-

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Inside OPEC’s future on shaky ground as Qatar pulls out of oil cartel P. 2 MTN Nigeria launches 4th edition of ‘Season of Surprises’ P. 39

Atiku Abubakar, presidential candidate of the People’s Democratic Party and former vice president of Nigeria, acknowledging cheers from the crowd of supporters at the party’s North West zonal rally and flag-off of the party’s 2019 presidential campaign in Sokoto, yesterday.

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Passengers knock NCAA over old aircraft, poor inflight experiences ...Lives may be at risk as Christmas nears IFEOMA OKEKE

T L-R: Adekunle Awojobi, managing director, FBNQuest Trustees; Ikemefuna Mordi, lead partner, Desarrollar Group, and Olufunke Aiyepola, managing director/CE, UTL Trust Management Services, at the official All Parties Signing Ceremony between Desarrollar Group, a leading lifestyle and real estate solutions company and its partners in Lagos, at the weekend.

OPEC’s future on shaky ground as Qatar pulls out of oil cartel

he failures of the Nigeria Civil Aviation Authority (NCAA) to properly regulate local airlines in Nigeria may be putting passengers’ lives at risk, BusinessDay’s findings have shown. A source close to the airlines say the situation may get worse as the busy Christmas flight season nears and airlines are trying their best to recoup as much money as possible, which may be at the expense of proper routine checks and maintenance on aircrafts. Anthony Chike, one of the passengers who recently flew on Arik Air recounted his experience of discomfort on a 5.30pm flight from Abuja to

Lagos last Thursday because the air conditions were barely functional. Chike went on to disclose that he overhead some of the cabin crew discussing among themselves of how they had requested for spare parts to replace the bad ones on the aircraft but still haven’t gotten any response from those responsible. “If the NCAA cannot see to it that the air conditions of an aircraft are working, how are we sure they will ensure that the engines and other parts the passengers cannot see are actually in good working condition and safe for flight operations?,” he queried. However, Banji Ola, Arik Air communication manager

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UNILAG medical, pharmacy students in face-off with school authorities

... Signals growing dominance of Saudi Arabia, Russia, US ... Brent rebounds to $61.7 per barrel ... over only 4-hour daily power supply; proposed energy bill which is still heavily reliant than 25 percent since climbminister, insisted the deciDIPO OLADEHINDE on petrodollars. ing to a four-year peak in early sion to quit OPEC, which the ... forced to sleep outside “With the decision of Qa- October, amid intensifying country joined in 1961, was he future of the

Organization of Petroleum Exporting Countries (OPEC) may be on shaky grounds as politics is gradually ripping apart the oil cartel formed in 1961 that has survived extreme events such as the Iran-Iraq war in the 1980s or Saddam Hussein’s 1990 to 1991 occupation of Kuwait. This comes after member country Qatar abruptly announced it would sever ties with the influential oil cartel after almost six decades. Qatar’s Energy Minister Saad al-Kaabi said at a news conference Monday that Doha would leave OPEC on January 1, 2019. The decision comes just days before OPEC and its allies are scheduled to hold a much-anticipated meeting in Vienna, Austria. It’s a further question mark for Nigeria’s economy

tar, global oil supply will continue to increase and demand will likely remain relatively stable in the interim. We need to look at diversifying our revenue base as a country,” Adeola Adenikinju, Director at Centre for Petroleum Energy Economics and Law, University of Ibadan said. Qatar an official OPEC member since 1961, is on course to produce more than 6 million barrels of oil equivalent per day by 2022. Emmanuel Afimia an energy analyst at Afimia Consulting Limited said Qatar’s exit from the group will lead to an increase in OPEC members’ crude oil production allocation. “Qatar’s exit means more crude oil production allocation for the country; hence, higher revenue for Nigeria,” Afimia told BusinessDay. Oil prices have fallen more

concerns of oversupply and worries over slowing economic growth. However, the prospect of a fresh round of production cuts later this week and a temporary trade truce between the U.S. and China has helped crude futures pare some of their recent losses. International benchmark Brent crude was trading at $61.79 a barrel at around 10:35 a.m. London time, yesterday. Jubril Kareem energy analyst at Ecobank said the move is more politically motivated as Qatar has been having issues with Saudi Arabia and other neighbours over its stand on some regional issues. “Saudi Arabia and other neighbours imposed a blockade on the country months ago, but the blockade has failed technically,” Kareem said. Saad al-Kaabi, Qatar’s oil

not linked to the political and economic boycott. In a statement, Qatar’s oil minister said Qatar, the world’s largest exporter of Liquefied Natural Gas (LNG), planned to increase its exports from 77 million tons of gas per year to 110 million tons. He also said Qatar wants to raise its oil production from 4.8 million barrels of oil equivalent a day to 6.5 million barrels. “In light of such efforts and plans, and in our pursuit to strengthen Qatar’s position as a reliable and trustworthy energy supplier across the globe, we had to take steps to review Qatar’s role and contributions on the international energy scene,” al-Kaabi said in a statement. Qatar’s wealth has seen it take on a larger importance in international politics. Its

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Invisible sector gulped 64.7% of forex supply in October – CBN HOPE MOSES-ASHIKE

he Invisible sector accounted for 64.7 per cent of the total $4 billion foreign exchange disbursed in the country in the month of October this year, the Central Bank of Nigeria (CBN) has said. The total utilisation of foreign exchange for the month declined by 11.2 per from its level in the previous month, the central bank said in its monthly economic report for October released Monday. The invisible sector consists of services that involve mon-

etary exchange such as healthcare services abroad, education and financial services. Components of the visible sub-sector such as the industrial sector accounted for 17.0 percent, manufactured products (6.7 per cent); minerals and oil (5.3 per cent); food products (4.7 per cent); transport (1.0 percent); and agricultural products (0.6 per cent). The report also shows that total foreign exchange inflow into the economy during the month fell 8.6 percent to $8.82 billion, from its level in eh previous month, and 7.8 percent from the value a year earlier.

CBN blamed this fall on 13.1 per cent and 3.0 per cent declines in inflow through Autonomous sources and the Bank, respectively. Total foreign exchange outflow from the economy fell 15.2 percent to $5.56 billion, compared with the level in September, 2018. CBN attributed this largely to a12.1 per cent decline in outflow through the Bank. However, it represented a significant increase of 113.8 per cent above the level at the end of the corresponding month of 2017, the bank said. Similarly, the inflow

through autonomous sources fell 13.1 percent to $4.64 billion in October, relative to its level in September. However, outflow through autonomous sources rose marginally by 0.6 per cent, on month on-month basis, to $0.29 billion, reflecting the rise in visible import. However, foreign exchange flow through the economy, resulted in a net inflow of $3.26 billion in the review period, compared with $3.09 billion and $5.89 billion in September 2018 and October 2017, respectively.

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IHEANYI NWACHUKWU

he students of the College of Medicine and Faculty of Pharmacy, University of Lagos are at loggerheads with the school authorities due to decision of the later to supply only four hours of power for the students to use. “This is to inform all the students of the College of Medicine and the Faculty of Pharmacy that with effect from 1st December 2018, power supply in the hostel will until further notice be rationed as follows: Morning: 7am to 8am- 1hour; Evening: 7pm to 10pm- 2hours. The Management therefore implores all students for under-

standing,” the notice seen by BusinessDay reads. The notice was signed on November 30 by A.O. Adeyemo, principal assistant secretary of the College of Medicine. The provost, deputy provost, acting college secretary, director of engineering services, director students affairs unit, chairman male hostel management committee, chairman female hostel management committee, chief house keeper –male hostel, principal executive officer –female hostel, and faculty managers were copied in the notice. On Monday December 3, 2018, the medical and pharmacy students held a meeting with

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Tuesday 04 December 2018

BUSINESS DAY

Tuesday 04 December 2018

Rome Business School commits to providing solutions to Nigeria’s managerial challenges KELECHI EWUZIE

ome Business School says it will continue to provide the needed solution that will help tackle the managerial challenges developing countries like Nigeria face. Antonio Ragusa, founding president, Rome Business School, said the institution was established to create better manager for a better world, providing them with skills and competencies to achieve the best results. Ragusa, while speaking in Lagos at an inaugural party for Master’s Classes students, said the mission of the school was to build a community where we could be united with our cultures, different languages, and backgrounds, “a community where Education is the core value.” According to Ragusa, “The only way to create a successful business is by creating value for customers, organisation and community where you live. If we do that in some ways we are contributing to a better world.” He expressed the school’s willingness to impact the best of education into their students, adding that through various programmes, the school aimed to play a role in closing the gap between the academic world and the job market by providing managerial training courses suited to convey the knowledge necessary to kick off or develop professional careers or business activities. The school prides itself for its presence and relevance in over 140 countries, Nigeria inclusive, he said, saying majority of its courses are strategically designed with reference to globally accepted standards. “The idea of Rome Business School Nigeria is to tailor these global standards to a more unique grassrootsconcentrated business environment,” he said. In addition to creating an easier access, faster response and steady availability to the Nigerian students and prospects, Rome Business School Nigeria was established. Rome Business School Nigeria is not only charged with the responsibility to provide Support, advises and helps for prospective MBA and Master degree students but also imbedded with the capacity to carry out Short Executive Courses training peculiar to the Nigerian environment and targeted towards individuals, companies and the nation building at large.

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Governor Wike says his government will not bow to intimidation, after clash with army IGNATIUS CHUKWU

overnor Nyesom Wike of Rivers State says his administration will not succumb to federal intimidation in the face of clashes with the Nigerian Army, saying no level of illegal use of force by federal security agencies will intimidate the government and people of the state. Wike said the state government remained committed to the legal use of the people’s mandate to advance the course of development. Speaking during the commissioning of Anaka multi-

million naira multi-purpose community hall, Ogbogoro town, the governor, who was represented by his Chief of Staff, Chukwuemeka Woke, urged Rivers people to remain peaceful and calm despite the provocative actions against their interest. He regretted the invasion of the Rivers State Neighbourhood Safety Corps Agency training camp by the Army, saying that it was done in bad faith. He said: “The Rivers State House of Assembly passed a bill establishing Neighbourhood Safety Corps Agency. The Governor of Rivers state signed that bill and it became a law of the state. If

anybody or any organisation or institution has anything against that law, what is natural, is to go to Court of law and challenge that law. “You are aware and have seen the level of provocation by federal agencies. Only last week, they invaded the training camp of the Neighbourhood Safety Corps Agency. But we are urging Rivers people to remain firm and strong. I tell you as far as Rivers state is concerned, we cannot be intimidated. No amount of federal might can intimidate us.” He said the Rivers State Neighbourhood Safety Corps Agency had also created the needed employment and

empowered youths across the state. He charged communities across the state to remain peaceful and support peace initiatives that will engender development. He said: “I thank you again for the peaceful atmosphere that we witnessed here since the week-long celebration. It shows that this community is in peace and everybody is living in peace. There cannot be any meaningful development in any community where there is no peace. “Let me also thank the youths of this community because I am aware that this project would have not come to this stage of commissioning,

if the youths did not maintain peace in this community. I urge other communities in Ikwere ethnic nationality and indeed Rivers state at large to emulate the conduct of Anaka community.” He assured that his administration would continue to execute projects for the people as a means of boosting the economies of communities. Chairman of the occasion, George Ihuigwe, urged youths of the communit to desist from crime and cultism. He said he would contribute his quota to the development of the area by supporting the education of youths through the purchase of JAMB and WAEC forms.

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Tuesday 04 December 2018

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The present danger of relapse into recession

Mazi Sam Ohuabunwa OFR sam@starteamconsult.com

fter five quarters of economic contraction (Q1 2016- Q2 2017), Nigeria exited recession. With a % positive 0.72% GDP growth in Q 2 2017, economic recovery has been slow and grinding, reaching 1.9 % in Q1 2018 and declining to 1.5 % in Q 2 2018. Consequent on this, the economic wellbeing of many Nigerians has been unsatisfactory. Indeed for many, there is actually no evidence that the recession was over. And this is understandable because unemployment and underemployment continued to grow reaching 40% in Q2 this year (unemployment =18.8%: underemployment = 21.2%). Because inflation, though moderated remains at double digit, combined with the high unemployment rate to precipitate a misery index of 30% (the eight highest in the world, behind Argentina, Kosovo, South Africa, Mozambique, DRC, Yemen and Venezuela). Indeed, the difficulties in the economy are logical, giving that a GDP growth of 1.5% against a population growth of 2.5% can

STRATEGY & POLICY

MA JOHNSON Johnson is an eclectic researcher, writer and columnist whose articles cover maritime, defence, technology and public policy issues and other areas of human interests. He is a member of the BusinessDay Editorial Advisory Board)

hen Nigeria’s Civil War officially ended on 15 January 1970, many Nigerians at that time would have thought that it was the end to bloodbath. Men and women including families who lost their sons, daughters, and friends to the War must have thought that Nigeria would never plunge into such darkness again. But here we are fighting the war on terror for almost eleven years. The recent attack on the military formation in Metele, Guzamala Local Government Area of Borno, by insurgents brought dashed hope

only result in decline in GDP per capita, and therefore many Nigerians will naturally continue to feel that the recession was still subsisting. The modest and tentative recovery from recession occurred mostly because of the recovery in the price of crude oil in the international market. In January 2016, a barrel of crude sold for $29. 78 per barrel but by October 2018 the price had recovered to nearly $80 per barrel, with projections it could hit 100 dollars per barrel. The Economic Recovery and Growth Plan (ERGP) of the federal government is expected to be supported by the recovery in oil prices. Certainly the significant rice in our foreign exchange reserves from about $24 billion in Q4 2016 to nearly $44 billion in November 2018 derives essentially from this recovery in global price of crude petroleum. The arrest of the devaluation of the Naira from about 500 Naira to about 360 Naira against the US dollar was made possible by the significant improvement from price of oil. That became a major factor coupled with the CBN tight monetary stance in reigning in the inflation which had reached nearly 20% in Q4 2016, but today is under 12%. Despite these improvements in macroeconomic indicators, the government has had to face up to the unrelenting growth in unemployment and underemployment. The current efforts at social spending, including conditional cash transfers (CCT) to the poor-

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... our economy moves in sync with the movement of oil price. If the price goes up, Nigeria’s economy goes up and if the oil price goes down, Nigeria’s economy takes a dive. That is the way it has been since Oloibiri

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est of the poor, some support to the industry and micro financing need more time and sustained intensity to show significant result. But the hope for sustained recovery is facing three threats. One is the changing focus to politics, and the diminishing focus on good governance. With the ringing of the bell for the resumption of political campaigns, all gloves are off and soon governance may go on auto-pilot while the politicians focus either on remaining in power or returning to power. If you are looking for evidence that this is true, kindly consider the fact that a serving economic minister is made the DG of a Presidential

campaign organization and the leader of the Nigerian Legislature is the chairman of a party campaign council. With the very low level of national productivity, any prolonged distraction from the levers of good governance will further imperil the fragile economy. Most government officials (at the centre and sub-national levels) will only discuss issues with you if only it will help them or their party win the forthcoming elections. If you bring up any other issue, you are asked to wait till after the elections. Secondly as if taking cue from the political officials, many investors (local but especially foreign) have put most investment decisions on hold. They claim it is part of risk management on one hand and a hedge against Nigeria’s notoriety for policy inconsistencies. An agreement with one government can easily be repudiated by another government, even if both belong to the same political party. So new investments may be slow in coming for the next 6 months at the least. This certainly will take a toll on a country that is in dire need of investments. Investments create jobs. Jobs create wealth. And wealth drives away poverty! The third and perhaps more troubling threat is the unpredicted fall in oil prices. It was hoped that Trump’s trouble with Iran was going to push oil prices higher up to $100 per barrel. Prices that picked at $ 80 dollars in Sept/October have inexplicably been going down over the last several weeks,

reaching a low of $50.93 last week, a huge 22% decline in November alone. Nigeria remains, despite all pretensions to the contrary, an oil dependent economy. And so, our economy moves in sync with the movement of oil price. If the price goes up, Nigeria’s economy goes up and if the oil price goes down, Nigeria’s economy takes a dive. That is the way it has been since Oloibiri. But traditionally there has always been some reasonable gap between the swings, allowing sufficient recovery before a new burst. Before the June 2014 burst, GDP was over 6% and had been at such high levels for nearly a decade, which helped us sail through the global Economic crisis of 2008-2010 (of course helped by our excess crude savings). But here we are, just labouring to achieve a GDP of 2% and after about only an 18- month recovery time frame, we are faced with the present danger of another sustained decline in oil prices and a possible relapse into recession. I just pray that the effort of OPEC to cut output will help stabilize prices and perhaps reverse the decline. If we are borrowing our entire 2018 capital budget with the improved level of oil prices and production output in the last two years or so, I am scared about what will happen if the prices go below today’s level. I hope that I am not the only one worried! Send reactions to: comment@businessdayonline.com

We shall conquer as a nation to our soldiers and citizens of this country. It was very shocking to hear such a bad news especially when we thought that terrorists have been “technically defeated”. Plato’s remarks that “Only the dead have seen the end of the War” is highly emotional. Permit me to dilate upon Plato’s quote by stating that, our soldiers who have lost their lives in all wars and military operations are the only ones who do not need to fight a war anymore. Everyone else is destined, either to take part in a war or to be an observer as long as we are alive. Why? We live in an era of globalization. One of the contradictions of globalization is pervasive insecurity where terrorism and internal conflicts have greatly interrupted the process of development in Africa and other parts of the world. We are in an era where terrorist groups network with one another globally. It’s equally an era where children-male and female without formal education are trained on how to strap bombs to their bodies, and also, taught how to operateand advance with weapons. These children are being trained to die fighting while our military is trained to conquer in addition to protecting lives of citizens. We look forward to the day when Nigerians will see the end of the war on terror. One can say with deep sense of responsibilitythat those soldiers who lost their lives are patriots whose

blood is the seed of our freedom. The freedom we have today as Nigerians would not have been possible without the blood, sweat, and courage of these gallant patriots. One of the most famous generals in military history, General George S Patton, spoke of giving thanks and celebrating the lives of dead soldiers rather than just mourning their losses. In Patton’s words, heroes shouldn’t just be remembered; they should be used as an example to inspire us all. Nigeria owes a debt of gratitude to all her fallen heroes that she can never fully repay. May the gentle souls of those brave soldiers who lost their lives for our freedom and democracy Rest in Peace. We equally, commiserate with those families who have lost loved ones. We are a nation at war. War in itself is defined by Clausewitz as “an act of violence intended to compel our opponent to fulfill our will,” directed by political motives and morality. Nigeria has been managing violence for several decades. Managing violence is very expensive. It’s better to manage peace. Today, what we’re witnessing in Nigeria is asymmetric warfare. This is one of the negative effects of globalization. National security has been compromised by terrorist organizations operating within borders of countries in the Lake Chad region. War has both military and political objectives. The military objective in any war is easily realized but the political objective is always a challenge to accomplish. You will recall that the

Iraq War (Operation Iraqi Freedom) was a protracted armed conflict that spanned almost nine years (20 Mar2003-18 Dec 2011). The conflict lingered for a longtime because an insurgency emerged which was opposed to the US-led coalition that overthrew the government of Saddam Hussein. The emergence of insurgency did not allow the coalition forces to restore peace to Iraq within a short period of time. It was when “A Responsible Plan to End the War in Iraq” was crafted with a reduced role for the US troops in the operation that Iraq started having a semblance of peace and security. Boko Haram (BH) is no more occupying any territory in Nigeria. That is an indication that the military objective of the operation in that area is successful. Restoring peace in the North East goes beyond the military in an era of globalization. In fact, the military cannot do it alone. Since 1999, two Chinese Colonels have argued that today’s war is not about using armed forces to compel the enemy to submit to one’s will in the classic Clausewitzian sense. The war on terror in the North East of Nigeria will be won by using the armed forces and other components of national power- diplomacy, economic, information and intelligence gathering amongst others. The security challenge has consumed the country’s lean resources to the extent that analysts see “FG’s declining

military spending limits chances of defeating Boko Haram.” The truth is that wars are won through adequate logistics. The feeding of an army is of vital importance. The troops must be equipped and armed while the sick and wounded are given medical attention they deserve. The battlefield has fundamentally shifted to the society. The country cannot fight asymmetric warfare perpetually as it will have negative impact on development. If some government officials or those close to the corridor of power are benefitting from the war on terror, then there will be no end to the violence. The plan to recover and ensure there is peace in the North East Region of Nigeria must be well executed. Our policy makers must put more efforts to addressing refugee issues and funding of education in the North East to improve the status of children. The growing and boundless threat in the North East requires better deterrent capabilities and far more developed defenses. Above all, good governance to our citizens is vital to lasting peace and security in the entire country. We need to apply care and caution so that the nation is not left with a disaster of monumental dimension capable of rendering the entire West African sub-region unstable.

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Tanzania – Recent banking trends & outlook

Rafiq Raji “Dr Raji is chief economist at Macroafricaintel. He was previously an Africa Economist at Standard Chartered Bank, London, UK. (Twitter: @DrRafiqRaji)”

will not give any money to failing banks.” In typical style, President John Magufuli has adopted a no-nonsense approach to the troubles of the Tanzanian banking sector. In March 2018, he ordered the central bank not to rescue any failing bank. Mr Magufuli’s angst towards bankers is underpinned by his view that previous government bailouts for the sector of about 40 banks currently were squandered or misused. In any case, it has been about a year since the Bank of Tanzania (BoT) announced new capital rules for banks, as non-performing loans rose sharply. How have Tanzanian banks fared since then? NPLs continue to rise, hitting profits. As a proportion of total loans, NPLs rose by almost a percentage point to 11.7 percent in December 2017 from 10.6 percent six months earlier; a deterioration from what was already double the official cap of 5 percent. Most recently, though, in April 2018, NPLs to gross loans stood at 11.3 percent. The central bank has been wielding the big stick to stem the tide. It shut down 5 community banks in early January; namely: Covenant Bank for Women, Efatha Bank, Njombe Community Bank, Kagera Farmers’

Cooperative Bank and Meru Community Bank. The January move brought the number of such banks closed to eight. While this is laudable, it is the domineering few big banks that probably require greater scrutiny and supervision. Tightening of controls on foreign exchange has also been weighing on banks’ bottom lines. Return on assets declined to 1.7 percent in April 2018 from 2.2 percent only a year before. Return on equity dipped as well; to 7.2 percent in April 2018 from 10.1 percent in April 2017. Interest rates falling, PSCE still low Unsurprisingly, bank lending to the private sector has slowed. In mid-December, the IMF highlighted reduced public spending and policy uncertainty as some of the reasons why. The central bank gives the sector a clean bill of health, however; reporting in June 2018 that “the banking sector remained sound, stable and profitable with levels of capital and liquidity generally above regulatory requirements.” As at endApril, the BoT put banks’ core capital to total risk weighted assets and off-balance sheet exposures at 18.7 percent; well above the minimum 10 percent. Also, liquid assets to demand liabilities was 39.1 percent in the same period; well above the minimum 20 percent. The BoT did highlight a palpable deterioration in NPLs. Some of the measures it has put in place to remedy the situation is an insistence that banks compulsorily use credit reference bureau reports for the appraisal of loans; in addition to other strategies it wants banks to develop to “strengthen credit application processing, credit management, monitoring and recovery measures.” To the BoT’s credit, though, a joint World Bank/IMF finan-

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In a mid-March 2018 research note, it avers the Tanzanian “banking system will remain resilient, with improving operating conditions, solid capital and liquidity, despite asset quality and profitability pressure

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cial sector assessment programme (FSAP) vindicated its position on the soundness and stability of the Tanzanian financial services sector. They note the country’s payments, clearing and settlement systems are operating efficiently. In this regard, the central bank has begun engagement with relevant stakeholders to develop a national switch. While still far off, once in place, the national switch would greatly reduce the cost of payment services. Also to this end, the BoT is licensing more payment service providers. There has also been an increase in transactions in the banking system on the back of an increasing adoption of digital channels. And the BoT continues to make efforts to reduce interest rates. In this regard, it cut its discount rate by 300 basis points to 9 percent in the period between July 2017 to April 2018. Yields on government securities have certainly followed suit; easing to about 4 percent in April 2018 from a little above 13 percent a year before. By and large, interest rates on commercial loans eased as well; albeit still high at about 17-18

percent. But it is an improvement from about 22 percent hitherto. Encouraged by easing measures by the BoT, which in addition to slashing its discount rate also reduced the statutory minimum reserve requirement, one bank cut its interest rate by half to 11 percent from 22 percent previously. Consequently, private sector credit extension (PSCE) should improve. Still, PSCE growth of almost 1 percent in April 2018 is an improvement from negative growth rates in late Q3-2017 and early Q4-2017. Total assets have also been growing steadily; up 5.3 percent year-on-year to 29.9 trillion shillings in April 2018. Moody’s, a rating agency, is similarly optimistic. In a mid-March 2018 research note, it avers the Tanzanian “banking system will remain resilient, with improving operating conditions, solid capital and liquidity, despite asset quality and profitability pressure.”Christos Theofilou, vice president and senior analyst at Moody’s explains further: “We expect operating conditions to gradually improve as private sector businesses adapt to higher taxes and liquidity in the system improves with the payment of government arrears and more focus on infrastructure and development plans by the authorities.”Moody’s also assesses the country’s banks’ capital buffers as “among the strongest in sub-Saharan Africa and globally.” However, it acknowledges their declining profitability “due to lower interest income, reduced business activity and rising loan-loss provisions.”It also believes NPLs might rise some more “due to the continued, delayed impact from last year’s public sector job cuts, a corporate liquidity crunch and lower corporate margins following a crackdown on tax collection.”

More consolidation expected On its part, the government has been tidying up its act in the sector, approving the merger of two of the banks it owns in mid-May; Twiga Bancorp and TPB Bank. It is part of a broader planned consolidation of state-owned banks. BoT deputy governor Bernard Kibesse explained the authorities’ thinking to the media thus: “We will see more mergers of government-owned banks until we remain with one or just a few banks owned by the government.” The central bank would like to see more consolidation in the sector: “We would like more mergers and acquisitions to take place between the existing banks in Tanzania, including those that are privately owned, so that we remain with a few efficient banks”, Mr Kibesse added. Key stakeholders in the sector seem receptive to the idea. In about mid-April, Ineke Bussemaker, chief executive of National Microfinance Bank (NMB), the country’s largest bank, told Reuters “if there is a coordinated effort to do a consolidation in the banking sector….NMB will play a role.” And Bussemaker, who took over as CEO in 2015 from a role at Rabobank in The Netherlands, which owns a 34.9 percent stake in NMB, is not just buying into the idea of the government, which has a 31.9 percent stake in NMB, it believes consolidation has become a necessity; with its chief executive telling Reuters further that “there are a number of small banks that are struggling with a relatively small capital base…[and thus]…forsee some consolidation in the sector.” • An edited version was published in the Q3 2018 issue of African Banker magazine

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The chain is only as strong as its weakest link: Nigerian affordable housing roundtable

Chinwe Ajene-Sagna Chinwe Ajene-Sagna is an expert in the real estate industry with over 20 years of experience, including strategic advisory, asset/portfolio management and transactional services. She has a Harvard MBA, Dartmouth BA (H. Honors) and is an MRICS (chartered surveyor)

arly in November, the International Finance Corporation (IFC), together with the World Bank (WB), Family Homes Fund (FHF) and FMDQ, hosted the Nigerian Affordable Housing Roundtable that brought in players from both the demand and supply side of the industry, as well as government representatives, to debate the issues concerning Affordable Housing in Nigeria. The first session began with individual presentations’ by the IFC, WB and the FHF. Olaf Schmidt Regional Industry Manager for The IFC Africa kicked off by listing out the key constraints they face financing affordable housing projects in Nigeria.“It’s im-

portant that we learn from the past,” stated Olaf as he gave case studies from other emerging markets. In Mexico, the IFC was able to achieve 600,000 mortgages a year for homes costing between 20-30,000 USDall thanks to a government subsidy scheme. However, once the subsidies ceased, the industry tanked. Subsidies are not sustainable, explained Olaf and it’s important to identify a sustainable model for Nigeria. He provided key examples including affordable homes in mixed economic classes for cross subsidisation, utilisation of technology to achieve scale, and masterplans for energy efficient processes. “We cannot wait for conditions to be perfect,” declared Olaf.“We need to start now with projects that can create a demonstration effect.” The next presentation was from the World Bank Team lead for the Nigeria Affordable Housing Project Feyi Boroffice, who echoed similar sentiments. Feyi highlighted the advances made thus far in the demand side of the equation, most notably NMRC and FHF who are seeking to address the financing challenges. The focus should now be on the supply side which has significant constraints including the complex land regulatory environment (land acquisition and registration process), high construction costs due to importation demands, a lack of

economies of scale, poor existing infrastructure, lack of skilled labour and limited access to developer financing. The World Bank is seeking to partner with both the public and private sector to address these challenges. Steps include the land reform plan to facilitate the development of affordable homes, skills and capacity development for the developer and construction sectors, and initiatives to maximize financing for development given the government’s funding constraints. Following his colleagues from the IFC and World Bank was Femi Adewole CEO of the Family Homes funds (FHF), who highlighted FHF’s involvement in addressing some of these challenges. The FHF is the housing component of the government’s social intervention program aimed at improving quality of life and targeting the 70% of the population who earn less than $200/month. The FHF has been set up by the Ministry of Finance and Nigeria Sovereign Investment Authority (NSIA) with 500 Billion Naira, but this only represents 30% of the capital needed to address the social housing issue. Their key objective is to work with partners to create 500,000 homes by 2023 and 1,500,000 jobs by 2023. According to Femi, 600 units are already under commitment with another 20,000 homes expected by the end of the year. Closely following these sessions was a lively debate by the demand and

supply side professionals, moderated by Ifeoma Ezeokafor IFC Principal Investments Office Services Sector. Issues such as, what tasks should take priority (demand vs. supply focus) and the short-term vs. long term role of government were debated with some key themes emerging. To begin with, the demand vs. supply focus by the government was challenged with industry players questioning the expectation or notion that resolving the financing issue for off-takers will result in tickle down financing for the developers. Nonetheless all agreed that financing as a whole was an issue for both sides. More focus now should be given to the supply side financing with the FHF leading the way via funding to the developers. Another challenge debated was the role of government in the shortterm vs. long-term. The government representatives argued that it was challenging for governments to provide subsidized choice lands to developers of affordable housing as this meant a loss in revenues and made it difficult to complete infrastructure projects. Private sectors participants disagreed stating that the government should consider subsidies as a short-term solution to jump-start the industry. There are also ancillary benefits for the government in the form of increased development and investment which result in ad-

ditional tax revenues and jobs for its citizenry. There were also alternatives to subsidies such as payment plans or infrastructure bonds that the government could explore. In spite of these varying views, some generally accepted principles were agreed upon. For instance, a general consensus on the need for an enabling environment as a cost effective solution was established. By removing the current bottle-necks, the government can streamline the process and reduce costs for land acquisition, titling, and custom duties. This will result in greater cost efficiency and speed to delivery for developers thus addressing the economies of scale issue facing affordable housing. Developers can also leverage new technologies that can deliver mass housing solutions that are finally economical to the mass market. Breaking the existing deadlock in affordable housing will require a collaborative effort by the various stakeholders. Silos don’t work. Collaboration instead will ensure that weaknesses within the value chain are highlighted and addressed; establishing in the process, a seamless enabling environment needed to deliver economically viable solutions for affordable housing in Nigeria.

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Editorial Publisher/CEO

Frank Aigbogun editor Anthony Osae-Brown DEPUTY EDITORS John Osadolor, Abuja Bill Okonedo NEWS EDITOR Patrick Atuanya EXECUTIVE DIRECTOR, OPERATIONS Fabian Akagha EXECUTIVE DIRECTOR, DIGITAL SERVICES Oghenevwoke Ighure GENERAL MANAGER, ADVERT Adeola Ajewole ADVERT MANAGER Ijeoma Ude FINANCE MANAGER Emeka Ifeanyi MANAGER, CONFERENCES & EVENTS Obiora Onyeaso SUBSCRIPTIONS MANAGER Patrick Ijegbai CIRCULATION MANAGER John Okpaire DIGITAL SALES MANAGER Linda Ochugbua GM, BUSINESS DEVELOPMENT (North)

Bashir Ibrahim Hassan

Tuesday 04 December 2018

Rotimi Amaechi should take the blame for failure of rail concession

t is no longer news that the global infrastructure giant General Electric has pulled out of the concession arrangement to revitalise Nigeria’s western narrow gauge rail network. GE announced that it will be “transitioning leadership of the International Consortium selected to execute the Nigerian narrow-gauge concession, to Transnet,” a South African infrastructure company. This was because GE has decided to exit the transportation business from its portfolio. Of cours e, the minister of transportation, in a desperate bid to absolve himself of blame, cited the official reason given by the company, which is its decision to exit the transportation and has nothing to do with the Nigerian government or even the Nigerian economy. Further justifying his claim, Am ea chi avers that the government has yet to sign any agree-

ment with GE insisting that the government was still involved in negotiations with the consortium. “We have been negotiating; there is no way you will get a concession agreement in one year”. It is disingenuous, in the least, for the Minister of transportation Rotimi Amaechi to try to absolve himself of blame for the failure. He had more than 20 months to complete the concession agreement and get it going b efore GE pulle d out but yet kept pussyfooting around. Contrary to what the minister said, one year is enough to comprehensively negotiate a concession for a government in a hurry to reform public transportation. But Ameachi has more than one year. He has a whole 20 months and did nothing. The mishandling of the rail concession agreement speaks to the character of Nigerian public officials who constantly fail to identify priorities with the most impact and give their best is

delivering on them. Instead of proceeding with haste to tie up the agreement and get the consortium to work, the government and minister of transport particularly, kept pussyfooting, throwing one form of bureaucratic bottleneck after another and prolonging negotiations unnecessarily while the country continues to groan under the yoke of dilapidated and broken down infrastructure. A good example is the takeover of Nigerian roads by tankers and trailers, which now have to transport goods to and from the ports in Lagos since the rails have stopped working a long time ago. Sadly, these trucks have virtually damaged all the road networks in the country as the roads were not built to accommodate the volume of trucks that currently ply those roads. Nigerians cannot be fooled. The simple truth is that Ameachi bungled the concession deal long time ago. The government began

the rail concession negotiations early last year, but when it was going nowhere, it began to talk about an interim rail concession. Sadly, even that has now collapsed and the expected respite for those who struggle daily at the Lagos ports is also now up in the air. The interim rail concession was meant to have delivered better rail access to the Lagos port by October 1, last year and it was after this milestone was missed that Businessday first raised alarm about the slow pace of the negotiations. Now, GE has pulled out of the deal altogether and the government is beginning afresh to negotiate a new deal with Transnet. Going by Ameachi’s logic, that negotiation should take another two years to conclude – and if p erchance another government comes to power, the negotiations will be cancelled and the new government begin another one. How so unserious can public officials be in Nigeria?

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

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BUSINESS

Tuesday 04 December 2018

COMPANIES & MARKETS

DAY

Diamond Bank gets CBN approval to quit international operations

Pg. 14

C o m pa n y n e w s a n a ly s i s a n d i n s i g h t

BANKING

Nigeria’s biggest banks flirt with 52-week low as oil rout hammers stocks LOLADE AKINMURELE

igeria’s largest banks have their stocks trading close to a oneyear low in what opens a window of opportunity for long-term investors to swoop on fundamentally sound companies that are trading below intrinsic value. The renewed dip in global oil prices piles pressure on public companies in a stock market that has slumped to a loss of 19 percent since the start of the year. Led by the most valuable public company, Dangote Cement, which is down 18.74 percent since the start of the year to a 52-week low of N186 per share, company stocks in Nigeria have buckled under pressure from a wider emerging market sell-off sparked by rising interest rates in the United States and political uncertainty ahead of local elections February 2019. Of the top five banks in Africa’s largest oil producing country, United Bank for Africa is down the most since January 2018 with the lender down some 27.18 year to date to N7.50 for each share as at Friday, Nov.30. Access bank follows closely with a 25.8 percent decline to N7.75 per share year to date. First Bank stocks are down 19.32 percent to N7.10 per share while the most capitalised bank and biggest bank by assets, Guaranty Trust bank and Zenith Bank are down 15.71 percent and 9.5 percent respectively. At current prices, the banks are all less than a naira shy of their 52-week low, while Guaranty Trust bank and Zenith are slightly farther with a N1.85 and N3.6 per share spread respectively. First bank has the thinest spread with N0.30 (30 kobo) while UBA is only N0.45 away and Access- N0.75 shy. Not in any of Africa’s largest economies will you find cheaper company stocks (Average Price to earnings ratio of Nigerian firms is 9.4 times) yet investors want nothing to do with Nigeria at the moment and it could get worse as oil prices endure their longest losing streak since 2016. The fortunes of public companies in Nigeria, particularly the banks is directly or indirectly tied to the oil price. Brent crude, the international benchmark, fell to as low as $57 per barrel as at 1pm Friday, and is down 34.5 percent

since a peak of $87 per barrel in September. All eyes have turned to an OPEC meeting Dec.8 where expectations are

for the cartel to announce fresh supply cuts to help prices stabilise. Amid the oil rout, Nigeria is feeling the strain as investor

sentiments turn sour. Investors currently pay as low as 9.4 naira for each naira of profit made by companies

listed on the Nigerian Stock Exchange (NSE), the lowest since 2008. That’s despite the fact that

Edited by LOLADE AKINMURELE (loladeakinmurele@gmail.com) Graphics: CHINEDUM ONYEMA

the companies’ return on equity climbed to 15 percent as the end of September 2018, the Continues on page 14

BUSINESS DAY

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Tuesday 04 December 2018

COMPANIES & MARKETS BANKING

Diamond Bank gets CBN approval to quit international operations Hope Moses-Ashike

iamond Bank Plc has received the approval of the Central Bank of Nigeria (CBN) following its application to operate as a National Bank with immediate effect. This is subject to conclusion of the sale of Diamond Bank UKDB UK Plc. With this approval, the bank will cease to operate as an International Bank. The re-licensing as a national bank supports Diamond’s objective of streamlining its operations to focus resources on the significant opportunities in the Nigerian retail banking market, and economy as a whole. The move follows Diamond’s decision to sell its international operations, which included the disposal of its West African Subsidiary in 2017 and Diamond Bank UK, the sale of which is currently in its final stages. The change to national bank status also enables the bank to maintain a lower minimum capital requirement of 10% as against 15% required for international banks. This creates room for the bank to deploy more capital for stronger growth in the quarters ahead through addi-

tional investment in technology platforms, customer acquisition and expansion of loans to the critical sectors of the economy. Uzoma Dozie, CEO, said: “The move to a national banking license marks a continuation of our strategy to focus on Nigeria’s significant fundamental trends, including a large under-banked population and Africa’s biggest economy. By focusing and optimizing our resources towards Nigeria and the priority area of retail banking, we will be better positioned for longer term growth and greater profitability. “The reduction in minimum capital requirement also increases our capacity to expand the quantum of business and product services we can offer consumers, as well as representing a key step in strengthening our financial position.” This development does not affect the bank’s ability to offer services to its clients in international locations; rather, with focus on its domestic business being priority, the bank also intends to pay down in full, the Eurobond loan of $200m at maturity in May 2019. There will be no refinancing of the loan as the intent to pay down with foreign exchange generated from its internal operations, a reflection of the solidity of its operations and

Maximise outsourcing potentials to create jobs - Experts tell FG ...as AOPN elects Obiora as new president

oncerned about the high rate of youth unemployment, experts have urged the Federal Government to maximise the potentials in outsourcing to create jobs. The experts who spoke at the Association of Outsourcing Professionals of Nigeria (AOPN) interface event held in Lagos recently say that the country need to embrace outsourcing as a strategic tools to drive economic growth and stimulate job creation. “We need to leverage outsourcing opportunities to combat high youth unemployment,” says Chris Isede, executive chairman, Polar Afrique in his keynote address. “India through outsourcing created jobs that pulled millions of it citizens out of poverty. Nigeria can also leverage outsourcing as a solution to the daunting unemployment challenge the country is grappling with,” Isede says. He notes that reduction of unemployment rate in the country will translate to increase in the development of Nigerians and reduction of poverty rate in country. He says that for government to leverage the opportunity outsourcing provides, it must mainstream it into the coherent national planing initiative. Also, he calls for the identification of areas of comparative advantage that can make the country effectively compete in through expertise. Accroding to the National Bureau of Statistics, Nigeria’s

funds flow in the last few years Services to international customers will continue through its digital channels (Diamond Mobile, Internet Banking etc.) and network of correspondence

banks. Meanwhile, the bank also said Friday that it was in talks with a multilateral agency to raise medium-term funding over a 5-year period and will

repay a $200 million Eurobond due in May on maturity from its own cash and other sources. The bank said it has completed due diligence and agreed indicative terms with the agency,

which it declined to name. Diamond Bank shares, which have been in free-fall this month, dropped 3 percent on Friday to a new record low of 0.65 naira each.

BANKING

APPOINTMENTS

Josephine Okojie

L-R: Pobina Yinkare, chief investment officer, Sigma Pensions; Afolabi Folayan, executive director, operations; Dave Uduanu, MD/CEO; chief financial officer, Michael Orekaya and Head Internal Control, Emmanuel Eje during Sigma Pensions Walk to live in Abuja.

unemployment rate stood at 18.8 percent in the third quarter of 2017, with youth unemployment at 52.7 percent. The bureau of statistics has not released new jobs data since the third quarter of last year, prompting accusations by critics that this is due to political reasons. Also,Madu Obiora, newly appointed president of AOPN says that the government needs to provide an enabling environment to drive outsourcing investments into the country. “Outsourcing create jobs at different levels. It is something we can leverage if the government creates the enabling environment to attract foreign investments in outsourcing,” Obiora says. “The relationship between outsourcing and employment is massive. There was a research during the Obasanjo’s administration that found out that outsourcing comes top in providing jobs in the entertainment and construction indurty.” Giving his inguaral speech, Obiora the appreciated the past president, members of the board and members for their efforts in pushing the sector forward. “AOPN started when in spite of the waves being made in outsourcing globally, nobody understood or appreciated it importance in Nigeria. However, being part of this journey, I know it has not been an easy one,” he says. As part of plans to move AOPN forward, he says the Association will foster collaborations both locally and internationally to build capacity and increase professionalism of its members.

Nigeria’s biggest banks flirt with... Continued from page 13

BANKS

PRICE / 52-WEEK LOW

ACCESS N7.75 / N7.00 FBNH N7.10 / N6.80 GTB N34.35 / N32.50 UBA N7.50 / N7.05 ZENITH N23.20 / N19.60 Source: NSE, Business Day highest since 2014, according to Bloomberg data. Investors pay much higher to hold stocks in peer markets. In South Africa, the average price to earnings ratio is 15.2 times, while listed companies in Egypt are valued at an average of 12.5 times of earnings. For publicly listed companies in Ghana, investors pay 22.4 times of earnings, while in Kenya they pay 11.2 times of earnings. Investors had paid up to 12.42 times of earnings to hold Nigerian stocks at the start of 2018, after paying a peak of 14.5 times in 2017 and 17.40 times in 2016- which coincides with the period the economy

was in recession and company profits fell. The decline in appetite for Nigerian stocks, which succumbed to a year to date loss of 19.27 percent Friday, is driven by an exit of foreign portfolio investors who are worried about the exchange rate leading up to the 2019 elections next February. In dollar terms, the market is down about 16 percent. Local investors are also showing less appetite for equities amid an uptick in bond yields that have proved a profitable distraction from stocks. The effective yields on government bonds touched a twoyear high of 17 percent, Friday.

Investment banks have written a raft of reports advising clients to take advantage of low valuations to buy fundamentally strong companies. Some fund managers and institutional investors interviewed by Business Day said they were waiting to see if valuations could go any lower before they swoop. “Trying to pre-empt a floor in this market is like trying to catch a falling knife, but the decline in oil prices means there isn’t a shortage of negative events to push stocks lower,” a fund manager in South Africa told Business Day. The stock market of Africa’s largest oil producer mirrors the

dynamics of oil, which is the lifeblood of the economy; therefore it hasn’t surprised market observers that the renewed dip in oil prices has pushed stocks lower. Even signs last week that the US Fed may begin to slowdown the rate of rate hikes haven’t helped Nigerian equities or even the naira to the extent at which it has benefitted other emerging and frontier markets. The naira slipped to N364 per US dollar at the marketdriven Investors and Exporters window Friday, the weakest rate since inception in April 2017, as lower oil prices threaten to test the resolve of the Central bank to defend the naira.

BUSINESS DAY

Tuesday 04 December 2018

COMPANIES & MARKETS

Business Event

INDUSTRIALS

Lafarge spends N168m on community projects in Ogun RAZAQ AYINLA, Abeokuta

s part of efforts to give to back to the communities where its cement manufacturing plants are located in the Ewekoro local government area of Ogun state, Lafarge Africa has spent a sum of N168 million on various community projects, cutting across e ducation, health care delivery, economic empowerment, agricultural production and elderly care support programme. The multinational cement firm distributed N100,000 bursary award each to 187 undergraduate students of various tertiary institutions; empowered 114 adults with funds and trade equipment; empowered 103 farmers with farm tools and high yielding seeds and seedlings and offered funds, foodstuffs, drugs, sanitary kits, among others, to 155 elders, all drawn from about 15 communities in Ewekoro local government area. Speaking at the 2018 Lafarge Community Day held for its host communities on Friday in Ewekoro, Michel Puchercos, Lafarge Africa’s Country Chief Executive Officer, said the socioeconomic interventions provided for one of its host communities in Ogun state - Ewekoro -were made as part of effort to support the sustained growth and development of its host communities with a view to ensuring mutually benefitted relationship between the firm and the communities it operates.

Puchercos added that Lafarge Africa is not only in Nigeria as foreign investors who have come to the country purposely of business and investment but it also comes to Nigeria to help ensure s o c i o e c o n o m i c g ro w t h and development through human capital development, physical wellbeing, economic empowerment, technical and vocational training, education as well as agricultural production. He said, “For the Ewekoro Community in Ogun State, projects launched at the Community Day include a block of five classrooms to the Local Government Nursery and Primary School, Jagunna, Itori and a renovated block of four classrooms, head teacher and assistant head teacher’s offices with toilets for both teachers and pupils at First Africa Mission School, Lapeleke. “For health and wellbeing, projects launched include Laboratory equipment at the Health Centre built by Lafarge Africa for Egbado Aj e gunle, construction of 14 bedded h e a l t h c e nt re s l o cat e d at three communities in Ewekoro local government area of Ogun state and installation of a substation and electrification of Oke Oko Egbado community. “Also in a bid to improve the quality of produce from our farmlands and create more opportunities for our people to live better, agricultural support was provided to farmers while several members of the Ewekoro community also benefitted from

economic empowerment programmes. “To reiterate Lafarge Africa’s commitment to education, over 200 students of higher institutions from the Ewekoro community are beneficiaries of bursary awards.” While thanking Ogun state government and traditional rulers in the communities for exemplar y leadership they continue to display, Puchercos added, “Lafarge Africa’s commitment to the development of our local communities is unwavering. “As an organization, we recognize our host communities as our partners, building progressively together for the future, while ensur ing that we leave positive footprints that will impact the society. “We thank all our stakeholders for supporting our goal of creating sustainable, peaceful communities. We especially thank the leaders and people in our host communities for creating an enabling environment for us to operate”. In his speech, the Baale of one of the host communities, Joshua Oniyitan (Ilufemiloye I) expressed appreciation to Lafarge Africa, describing the projects as a timely intervention. “We sincerely appreciate the commitment of the management of Lafarge Africa for making sure these projects were completed as they have raised the standard of our children, mothe rs, ou r pre g nant women, the elderly and the community at large to the next level”, he said.

L-R: Nike Akande, former Minister of Industries and member Lagos Chamber of Commerce and Industry Women Group; Yemisi Daramola, deputy treasurer, LCCI; Olajumoke Fashanu, Chairperson, LCCI Women Group and Ngozi Okeke, member at the LCCI Women Group Annual Health Talk/Walk held in Lagos. Pic by Olawale Amoo

L-R: Adetunji Adegboyega, chief executive officer, Give Raffle; Adebanke Ogunode , head, legal, Lagos State Lotteries Board; Femi Davies, chief executive officer, Metro News, and Dotun Solanke, chief executive officer, Mediatek Global Services Limited, during the launch of Give Raffle, in Lagos. Pic by Pius Okeosisi

APPOINTMENTS

AACCI inducts African executives Jumoke Akiyode-Lawanson

he induction of the AsianAfrican Chambers and Commerce and Industry (AACCI) African executives and award for eminent Nigerian dignitaries will be coming up on December 8, at NECA House, Ikeja Central Business District, Lagos. Speaking with newsmen in Abuja on Thursday, the Vice President of AACCI, High Prince Leye Babalola stressed the need for the Abuja Chambers of Commerce and Industry (AACCI), NACCIMA and Small and Medium scale Association of Nigeria (SMEDAN) to have bilateral agreement with AACCI because of the rapid increase in the business between African Pacific and Asian countries had jumped from $2.8billion in 1990 to about $300 billion in 2018 and is expected to surpass $1.5 trillion by 2020.

He disclosed that the Senior Special Assistant (SSA) to the Vice President on Job Creation and Youth Empowerment, Afolabi Imoukwede will deliver a key note address on how bilateral trade relations will help Nigeria’s economy while the Ooni of Ife, Oba Enitan Ogunwusi will be the royal father of the day. Also speaking at the press briefing, Tunde Osho, a representative of the University of Entrepreneurship and Technology (UET), State of Delaware, United States, announced that eminent Nigerians that had distinguished themselves in their various endeavors, who had also contributed immensely to the development in the field of security, business, governance, engineering etc will be honored during the induction of African Executives of AACCI by the UET with honorary doctoral degree

certificates. Dignitaries to be honored include the Executive Governor of Niger State, Alhaji Yahaya Bello Governor of Kogi State, Rabiu Kwankwaso, former governor of Kano State, Mike Okiro, immediate chairman of the Police Service Commission (PSC) and former Inspector-General of Police, Theordore Ahamefula Onyi former governor of Abia State and Prince Adetokunbo Kayode (SAN) chairman, Abuja Chambers and Commerce and Industry, Ibrahim Kanje Baua, former Director, INEC Legal Services. Others are Stephen Mayaki, a former MD of VONO products PLC, Ife Oyedele, Executive Director, Niger Delta Power Holding Ltd, Senator Robert Boroffice, and Rasak Ayinde Sanusi, former Acting Statistian General of the Federation.

L-R: Adenike Adebola, marketing director, Guinness Nigeria; Rio Ferdinand, English former professional footballer; Francisca Ibe, a winner in the win a chance to celebrate with Rio Ferdinand promo by Guinness; Oladipo Fatai, another winner, and Baker Magunda, MD/CEO, Guinness Nigeria plc at the prize presentation in Lagos. Pic by Pius Okeosisi

L-R: Kingsley Odiana; Angel Okwosa ; Prince Azubuike; all directors, Idu Owuosa, founder, and Ogana Okwuosa , director all of LasGidis Recyclers at the grand opening ceremony of the company in Lagos. Pic by Pius Okeosisi

BUSINESS

DAY

Tuesday 04 December 2018

COMPANIES & MARKETS PROFESSIONAL SERVICES

Philips consulting engages HR directors on networking opportunities MICHEAL ANI

hillips Consulting, Ni g e r i a’s foremost indigenous management and consulting firm, last week engaged HR executives on networking opportunities that are geared towards enhancing their knowledge and building professional and building professional relationships that are mutually beneficial. Known as one of the most respected group of senior HR leaders in Nigeria, The HR Directors Network is a gathering of HR executives that facilitates innovative and thought leadership knowledge sharing sessions for members. The theme for this 6th edition was ‘Leadership and Innovation’. The Chairman of Phillips Consulting, Fo l u s o P h i l l i p s e xplained how leaders

can drive business performance through Digital Transformation while Managing Director of ABInBev, A n nab e l l e D e g ro o t, delivered the second paper on ‘Workspaces with Purpose’ explaining how potential and productivity can be unlocked by creating purpose driven workplaces. S e n i o r P a r t n e r, Strategy and Operations Transformation, Francis Buamah delivered the welcome address said “transformation and change is constant in leading organisations, but it is typically a bitter pill to swallow especially for a consulting business. But for Phillips Consulting, this is an opportunity to redefine ourselves and services to be relevant in this digital economy. The event was attended by over 60 HR directors in Nigeria. Managing Director of Phillips Consult-

L-R: Lead Auditor, DQS Management Nigeria Limited, Mr. Lawrence Ogudu, presenting the Executive Director, Business Development Directorate, Mrs. Nike Bajomo; and Chief Executive, Mr. Eric Fajemisin, both of Stanbic IBTC Pension Managers Limited with the ISO 9001:2015 Certification at Stanbic IBTC Wealth House in Lagos on Friday, 30 November, 2018.

ing, Robert Taiwo said, “ The core themes of digital transformation and the purpose driven workforce are more pertinent now than ever before. He noted that new

technologies can drive competitive advantage and stimulate job creation for young people. “This is especially impor tant in a countr y where 62 percent of the population is under the

age of twenty-five.” He said. Senior Partner, People Transformation, Paul Ayim who was the chief host for at the event praised the HR Directors Network for setting

the pace in organising such high profile capacity building events for its members. This is one of the few learning events that is well attended by very senior executives, he said.

PROFESSIONAL SERVICES

CoronationMB emerges top brand to watch in 2019

eading African financial institution, Coronation Merchant Bank has emerged as the top brand to watch in 2019 during the Top 50 brands Nigeria awards which held recently in Lagos. Now in its 4th year, Top 50 brands Nigeria is an annual selection of top brands (companies) in Nigeria. The rating agency recognises brands that have shown tremendous leadership in their sectors and across the corporate Nigeria. The award also provides a plat-

form to bring together industry leaders in Nigeria whilst celebrating the achievements of those driving economic growth across Africa. Commenting on the awards ceremony, Chief Executive Officer of top 50 brands Nigeria, Taiwo Oluboyede said, “the essence of the yearly rating is to make brand owners appreciate the importance of brands, which is the most valuable asset of their corporate entity and a major success factor to their businesses. At this very important

time in our country, the brands play important roles in our business space,” Oluboyede said. “They provide the muchneeded jobs, goods and services, create wealth and also are socially responsible, with many interventions endearing them more to the people”. In emerging a top brand to watch a 2019, Coronation MB has shown exciting promises that has attrated a lot of people to them. Receiving the award on behalf of the bank, the Group Managing Director/

CEO of Coronation MB, Abu Jimoh, said, “We are delighted to be recognised as a leading brand in Nigeria. To be rated the top brand to watch in 2019 further shows that we are on the right path towards becoming Africa’s premier investment bank. Since its inception in 2015, the banking group has been at the heart of economic growth, connecting customers to opportunities through its wide range of distribution channels and robust digital services. Coronation

MB Group applies its extensive knowledge of the sub-Saharan region, backed by its in-house research capabilities to provide solutions to the most complex financial problems. The Groups operation style, staff conduct and service delivery models are built on 4 core principles; Focus, Intelligence, Network and Execution. These principles informs its value proposition and social pact with its clients and stakeholders. Driven by its vision

of becoming Africa’s premier investment Bank,the group has been the recipient of numerous International and National awards for product innovation and sound corporate governance practices. Some of the international awards it received in 2018 include Best Investment Bank in Nigeria by World Finance, Fastest Growing Investment Bank by Global Banking & Finance Review, Best Investment Bank by Global Business Outlook and Best Investment Bank in Nigeria by BAFI Awards .

Tuesday 04 December 2018

BUSINESS DAY

Tuesday 04 December 2018

Organisation takes nation’s re-branding responsibility to Nigerians …Rewards individuals, corporates for value addition Stories by Daniel Obi Media Business Editor

oth federal and state governments in Nigeria have over the years not paid serious attention to nation re-branding efforts. Some of the initiatives in this direction were not enduring and did not yield measurable impact as the country continues to stand on poor image rating in the global market with its socio-economic consequences. With government lethargy in this course, the private sector which deeply understands the significance of branding among comity of nations, is taking the responsibility of image building to the citizens. This is because the value of the Nigeria brand directly affects Nigerians personally. A project, IAMBRANDNIGRIA focusing on Nigerians has therefore begun with the aim of devising various means of getting the attention of the critical mass and “getting them to see the need for us to protect, promote and jealously guide our most valuable asset, our national brand”, says Taiwo Oluboyede, CEO of Top 50 Brands Nigeria, the initiator of the project. “It is a private sector driven initiative towards enhancing the value of the Nigeria brand, a clarion call to 190 million stakeholders of the brand for open endorsement and enhanced association as we use the

stories of tenacity, resilience and the entrepreneurial spirit of many individuals and corporate brands that have been able to achieve success against all odds as a positive and better narrative to enhance the brand Nigeria. This is called the Nigeria spirit” Taiwo said Nigerians have compelling stories of achieving success against all odds. “We are a very tenacious people, we are aspirational. These are undeniable qualities that always differentiate a Nigerian and a sellable value too. We are using this positive attribute as a better narrative and how we should be perceived by people”.

According to him, one of the main activities in the project is the annual #IAMBRANIGERIA Award where the project will specially recognise and celebrate certain individual and corporate brands who have become proponents of value addition to the Nigeria brand through their endeavour, putting the brand on the global map for the right reasons. The award is recognising Nigerians and Nigerian brands in Humanitarian, Journalism, Entertainment, Academic, Political Office, Governance, Sport, youth influencing, New Initiative, Innovative Product among others.

When MOLFIX relishes outstanding 3 years milestones

OLFIX, the flagship brand of Hayat Kimya which was launched into the Nigerian market in 2015 has made some eye-popping appearance in the last years with valued driven awards. One of the successes is at the recently held Advertisers Association of Nigeria Marketing Excellence Awards in Lagos, where the brand led the pack with priceless Brand of the Year, and second position with its first ever corporate social responsibility “Happy Mums, Happy Families” CSR campaign. Speaking to some of the milestones recorded in 3 years, Roseline Abaraonye, Marketing Manager, Hayat Kimya Nigeria said “Amidst the highly cluttered and competitive environment, MOLFIX defied all odds and played against the already established brands in the category. The brand kept

growing steadily year on year until it took over the Nigerian diaper market. Within these 3 years, MOLFIX has won multiple awards based on quality, innovation and execution”. According to Abaraonye, who spoke on the brand CSR initiative and the importance of the award, said in a statement “Hayat Kimya as a global organisation is a firm believer in giving back to the society. Hence, in Nigeria, we identified the fact that unemploy-

ment is a key issue.” “In addition to the fact that a lot of women have become the bread winners of their families, the brand thought it wise to empower our mums and enable them earn a living through the brand. As a result, the brand launched the “Happy Mums, Happy Families” CSR campaign. With our first ever award entry on CSR, MOLFIX came 2nd place amidst all the established brands that have been doing this for many years. This has refueled our energy to do more knowing that we have taken the right step in the right direction,” she said. On the ADVAN awards, the Hayat Marketing Manager stated that ADVAN awards is unarguable one of the most credible awards used to celebrate the Marketing professionals for their hard work through the year under review.

‘Enabling Success’ commercial, demonstration of faith in Nigerians

he latest Union Bank TV commercial entitled ‘Enabling Success’ is not only captivating but inspiring. The success of the advert was largely dependent on the employment of the story-telling method, its relevance to average Nigerian and the flowing narrative. The commercial which will pass as short Nollywood movie for many people beams spotlight on the Nigerian society highlighting the role everyone (artisans, professionals, politicians alike) has to play in fighting corruption, and social decay and building the productive Nigeria that is desirable . The commercial which has been watched on Utube by over two million people, opens with a young man jogging past politicians’ campaign posters which reflect the moment when politicians will promise and do not deliver. In the face of this, struggle continues as the short video also captures other social activities such as taking children to school and a commercial driver cleaning his tricycle before a day’s activity. The 152- second video talked about corruption, dishonesty and greed among all classes of people in the society including politicians, artisans, and commercial vehicle operators and even within the educational system. Within this

gamut of challenges, Union Bank understands that people need to continue struggling and pushing ahead as the commercial also shows a young photographer who put on his generator to continue his business because of epileptic public electricity supply, a challenge which has been with Nigeria for years. Through the short film, Union Bank challenges Nigerians not to lose hope or become the ‘ultimate pessimist’ like Uncle Thomas. Instead, it encourages everyone to continue to believe in a better future and work towards it. With the ‘Enabling Success’ commercial, Union Bank has positioned itself as enabler. The bank is sending strong message that it understands challenges, struggles Nigerians go through every day, but they should not despair instead they should have bigger dreams and the bank is there to help. Having been in existence for over a century, Union Bank is saying it knows what it means to go through tough times and emerge better. The Bank is simply demonstrating its faith in the country and her people. Enabling Success which is a product of good creativity using relevant storytelling tool as a vehicle, is not just an advert, but an encouragement to Nigerians to forge ahead no matter the obstacles.

SPAR expands, opens outlet in Opebi, Lagos Mbata Jeremiah

n a bid to boost the economic sector and create a stress-free distribution system between the consumers and the manufacturers, SPAR, one of the foremost chains of hypermarket stores has opened another outlet in Opebi, Lagos state. The new hypermarket store is said to be the largest outlet of SPAR in Nigeria and caters to the various needs and aspirations of Nigerians consumers’ goods and products such as Food and Grocery, Butchery &Bakery, Wine & Spirit, Fresh Farm Foods, Frozen Foods, Laptops, Mobile phones, electronics products and other household

items. According to Haresh Keswani, the Managing Director of SPAR Nigeria, Opebi store is the 15th outlet in Nigeria, out of which 9 are in Lagos with Abuja and Port Harcourt having 2 each and one outlet in Enugu and Calabar respectively. The new outlet was commissioned by Oba of Lagos, His Highness Oba Rilwan Akiolu in the presence of other well-meaning dignitaries. Speaking at the launch of the new outlet, Oba Rilwan Akinolu said with the opening of the new store, SPAR Nigeria has demonstrated that it is committed to the economic growth of Nigeria and making consumers’ goods and services available to the ever increasing residents of Lagos state in particular and in Nigeria in general.

Firm unveils Give Raffle, a society empowerment programme

ive Raffle, described as innovative way to impact people’s lives has been unveiled in Lagos. It is an Online raffle where players play to win Grand Prize of a new brand car monthly. They also stand the chance to win other prizes such as mobile phones, TVs, microwave among others on daily basis. Participation in the raffle requires players to purchase N500 ticket to stand the chance to win in the daily or monthly draw while N200 ticket qualifies participants to stand the chance to win in the daily draws.

Speaking at the unveiling of the Give Raffle, chairman and visioner of the project, Adegboyega Adetunji said the project is simply an innovative way to give back to the society. “This idea and belief to impact people’s informed the small amount of money for the tickets”, he said. According to him, the company’s idea is to build a big brand in Nigeria as he said that he strongly believes in Nigeria. The project is operating in Lagos for now, he said. Players can purchase tickets through the company’s website ,the mobilr agents or kiosks at strategic locations.

BUSINESS DAY

Tuesday 04 December 2018

Like Silicon Valley, Nigeria’s creative IT minds need more interactions - Concept Nova CEO Chukwuma Ochonogor is the CEO of 29-year-old Concept Nova, one of Africa’s foremost Information Technology and software development companies which deploy solutions for various Business to Business companies for the reduction of operational cost and for increased revenue. In this interview, he assessed opportunities and challenges in Nigeria’s IT sector and stated that the Nigerian education system should position to prepare students on how to be creative and how to be problem-solving rather than just the acquisition of certificates. He spoke on more issues around IT solutions for various socio-economic challenges. Excerpts With your operation spanning over two decades, how would you assess Concept Nova’s contribution to Nigeria’s IT ecosystem? he IT industry is the one that sees most change and the most competitive in terms of globalisation as we all are part of the globalised world. There has been a lot of evolution and we have evolved to where we are. We started off with hardware and we have moved to software solutions. Now we are in the data and business solution space centring and using IoT. We centre on the need to have value proposition solutions that demonstratively reduce cost and increase profitability. Our clients can attest to the impact of our solutions on their operations. Can you give me one or two solutions that you have provided for clients? One of our more interesting solutions that have had client acceptance and satisfaction is our fuel control system which we have for both stationary and mobile tanks. There are leakages that happen from both vendor side and from internal employees’ side. This is a solution that gives the vehicle owners remote visibility into what is going on that they will not ordinarily see. In some cases, some of our clients have experienced over 130% return on investment, the same day they installed the application. These solutions bring transparency and reduce cost. Another solution is our asset management solution. This works hand in hand with our telematics system. Prices of most equipment and cars have gone up and therefore it has become imperative for organisations to guard their assets. Our solution greatly assists clients to protect their assets and therefore extend the useful life of equipment to about 60%. They are therefore saving replacement and maintenance cost. With your experience, would you say Nigeria is on the right path to sustainable IT innovations? For example, in Concept Nova, the solutions are indigenous. Though we are dealing in a globalised marketplace, there will always be opportunities to solve problems. We have talented people in Nigeria but whether the talent is optimised through

Chukwuma Ochonogor

the educational system is another issue. Does the education system teach how to be creative and how to be problem-solving rather than just the acquisition of certificates? It is now a case of what can the students do with knowledge acquired in schools. Even though there are some positives, but I always look at the gaps and try to close those gaps such as the education system and brain drain, which is our best

‘

The primary reason for technology is to bring about efficiency and to be able to optimise and bring information for predictive power. This enhances better decisions, and solutions are madeWhen a firm adopts a technology, it becomes a competitive advantage for the firm

talents moving to other climes; in terms of funding of entrepreneurs, there could be more to promote and in terms of standard to ensure we have solutions that will be competitive outside. Though we have started, we still have a long way to go but with proper funding and direction of the educational system, we will be there. Could you, therefore, identify other growth hindrances of the IT sector and how can they be addressed? The most obvious is the human capital. There is the Silicon Valley in the US, the Hubs in France and China where IT is encouraged. This is because it is where creative minds come together; those great creative ideas and solutions are born. There should be more interaction among creative IT minds and the education system needs to step up because it is for people to achieve their dreams but now it seems that the potential achievement is now left to individuals rather than the education and institutions really adding value. We are living in more rapid changes driven by technology; how would you say this dynamism has affected businesses? The primary reason for technology is to bring about efficiency and to be able to optimise and bring information for predictive power. This enhances better decisions, and solutions are made. When a firm adopts a technol-

ogy, it becomes a competitive advantage for the firm. It is either company acquire technology, or they are left behind and lose business. Fundamentally, progress is all about better information and people that are more informed are always ahead. What is, therefore, your message to firms that are yet to adapt and adopt technology for operational solutions? Life and business are about competition. If you are lagging in competition, somebody with more technology and information will offer quality service and better price. Technology is not just nice to have; they are particularly a need to have for business to survive in this fast-paced world. Some SMEs think cost when they want to acquire technology for operations, how can they navigate through the fear of cost? Technology keeps on improving. About 10 years ago, there were client-server enterprise solutions. This means clients must have a server and the solutions will be installed in the server and maintained at the client’s site. This was expensive and cumbersome. We are now in the cloud system. This means that the client can be managed from one site and what is needed is access to the internet. This has greatly reduced software cost. At Concept Nova, all our solutions are cloud-based subscriptions making it very affordable for SME-size organisations. For instance, earlier, our Fleet Management System was for very big organisations with over 500 vehicles and the cost was running into millions of Naira but now with N1,000 per vehicle, a client will be able to get the benefit of the solution that will be able to increase ROI and maintain efficiency.This will enable vehicle owners to monitor the speed of the vehicles, driver behaviour, elongate the life of the assets and reduce cost by making the maintenance crew more accountable for the maintenance work. Let’s talk about the security of some solutions, especially when the solutions deal with accounting and funds, how secure are some of the solutions to abuse and hijack? In Concept Nova, we deal with solutions of the highest standard. We appreciate the importance of data and the privacy of our clients. We take all the necessary steps in

terms of safeguarding our clients’ data. We have IT security team that is always looking at improving the security of our system. Public sector still appears unready about adopting technology for operation. To you, how critical is it for the sector to start leveraging IT solutions in its operations? The public sector is the largest organisation in terms of clients it dispenses services to, which is the citizens and the general public. Given Nigeria’s growing population, it means that there are more people that need to be attended to. IT comes a long way in terms of data capture, record keeping, record retrieval compliance and business rules and transparency in the system. Though the private sector is driven by profit, the public sector really should be number one in terms of the use of IT solution. Therefore it is imperative for the public sector to adopt IT. The cost of public sector lethargy to IT is in many folds which include a delay in service delivery. This manifests itself in many ways such as our low Ease of doing business rating, societal ill as people take extra-judicial means to solve things as they think that the bureaucracy is cumbersome to get things solved. In Lagos, commuters have a headache every day due to gridlock and residents face waste, how can IT be deployed to tackle these challenges? Some of our solutions go some way to solving these challenges. For example, on the traffic management, there is a situation of poorly maintained vehicles. There is an unnecessary breakdown of vehicles due to poor maintenance. There is information available of where there is breakdown so that other vehicles can avoid the route. We are moving to a situation when there will be fewer vehicles on the roads as the car-sharing model comes into play. When vehicles adopt the right solutions to monitor driver behaviour and ensure proper maintenance, this will lead to less traffic on the roads. On waste management, this also depends on the efficiency of the driver doing his round and he is monitored to do that optimally. In terms of crime, it will involve placing remote Closed-circuit television, CCTV at strategic locations.

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BUSINESS DAY

Tuesday 04 December 2018

BDTECH

BUSINESS DAY

Tuesday 04 December 2018

In association with

‘Nigeria’s future will be built on digital enterprise’ Stories by Jumoke Akiyode Lawanson

eland Rice, chief executive officer of Dedalus Global, an investment advisory, focused on emerging technology in emerging markets, says that Nigeria’s future would be built on digital enterprises and not on oil. Rice, who is also the founder of Africa’s premier fintech event, the Africa Fintech Summit, said this in an opening remark at the Africa Fintech Summit held for the first time in Lagos, Nigeria. The Summit — which came up at the heels of its earlier edition in Washington, D.C. last April — featured keynotes and panel discussions on the emerging technologies, payment innovation and regulation, blockchain, investment, lending, and financial inclusion in Africa. “The overall level of investor capital, political will, and collaboration around technology in general reflect a growing awareness that Nigeria’s future will be built not on oil and industry but on digital enterprise,” Rice said. According to him, Nigeria, with all its challenges, offers some of the greatest opportunities and its youth, endowed with entrepreneurism and accustomed to finding ways around barriers, possess a bias towards innovation. That com-

bination, in concert with demographic-driven demand, according to him, positions Nigeria as an important spot to watch on the global fintech map. “If you’re into demographics you know that Nigeria is Africa’s largest market and that a whopping one-third of its 186 million people (15 and 35 years olds) are tech savvy. And if you’ve ever lived or worked there (especially in Lagos), you know it’s a place that’s powered by pure hustle and entrepreneurial energy. Let’s be clear-eyed for a minute though. There’s no doubt

that Nigeria’s infrastructure and policy gaps hinder fintech growth. But in many ways, they also fuel the innovation fire’, Rice said. More than 50 speakers and 500 finance professionals, tech enthusiasts, investors, and regulators gathered at the Summit—organised by Dedalus Global—to discuss technologies transforming finance on the continent, debate regulatory policies, compare best practices, and forge new ventures. The Summit also featured a roundtable for the Global Startup Virtual Conference 2019, which will

air in February 2019 on globalstartup.tv; an open banking roundtable on the development of API standards; and a regulation roundtable on the industry responses to the draft guidelines for licensing and regulating payment service banks. Outcomes from these roundtables will be published in the coming weeks. Keynote speakers included Yewande Sadiku; executive secretary of the Nigerian Investment Promotion Commission (NIPC), Lanre Osibona, special advisor on ICT to the President of Nigeria, Tayo Ovi-

L R; Oluwatosin Bamidele; Chief Technical and Information Officer, NTEL, Maryam Bayi; Director Human Capital and Administration Nigerian Communications Commission NCC, Umar Garba Danbatta; Executive Vice Chairman/CEO NCC, Gbenga Adebayo; Chairman Association of Licensed Telecoms Operator of Nigeria (ALTON), Akinwale Goodluck; Head Sub Saharan Africa Global System of Mobile Association (GSMA) during the Future of Industry workshop, Driving Innovation and Growth, organised by the GSMA at the NCC head office in Abuja on Thursday, 29 November 2108.

osu; founder & CEO of Paga, and Ayotunde Coker, managing director, Rack Centre. Other speakers at the Summit included Andrew S. Neving; chief economist of PwC Nigeria, Temitope Akin-Fadeyi; head of Financial Inclusion Secretariat of the Central Bank of Nigeria, Iyin Aboyeji; cofounder of Flutterwave, Victor Asemota; co-founder of SwiftaCorp; Ercin Eksin; co-founder of Lidya, Ekechi Nwokah; CEO of Mines. IO (whose company recently concluded a $13 million Series A fundraising round) and Emmanuel Quartey; head of growth at Paystack (whose company recently raised $8 million in Series A funding). In a bid to recognise excellence in innovation and entrepreneurship, the summit also hosted an awards ceremony. The categories and winners were: Innovation of the Year: Binkabi; Excellence in Blockchain: Seso Global; Excellence in Payments: Flutterwave; Excellence in Lending and Financing: Renmoney and Excellence in AI: Branch International. Other winners included: Excellence in Governance and Policy: Central Bank of Nigeria; Most Innovative Bank: Access Bank; Best Customer Engagement Tool: United Bank for Africa (UBA); AFTS Tech for Good Award: Piggybank. ng; Best Infrastructure Innovation: Rack Centre; Accelerator of the Year: Venture Platform and Investor of the Year: EchoVC Partners.

Experts prompt acceptance of shared agent network expansion for financial inclusion

xperts and Stakeholders at that fourth quarter 2018 edition of the point of sales (PoS) innovation summit are gearing up to discuss, explore and examine the dynamics of the Shared Agent Network Expansion Facility (SANEF) initiative, powered by the Central Bank of Nigeria and Deposit Money Banks, which aims to accelerate the financial inclusion goals in Nigeria. The SANEF initiative is designed to spur quick growth in the level of financial inclusion through availability of financial access points, and drive the Federal Government’s Social lnvestment Program (SlP)which relies on im-

proved banking agent network coverage points. With the theme; ‘Pricing and Shared Agent Viability’, the organisers of the summit, Global Accelerex Limited, a leading payment terminal service provider and payment solution service providers, say that the keynote speaker; Sam Okojere, director of payment system management, Central Bank of Nigeria which is a new department carved out by the CBN to have oversight function on the payment system industry in Nigeria, will charge, will charge stakeholders to take advantage of the capabilities of the Shared Agent Network Expansion Program to achieve financial inclu-

sion goals of the PSV 20:2020. Other keynote speaker, Edwin Otieno, head, agent banking, Kenya Commercial Bank, Kenya, will also deliver insightful and engaging presentations. According to Global Accelerex, the panel discussion segment will feature industry experts including, Niyi Ajao, Ag managing director, Nigeria inter-bank settlement system (NIBSS), Bunmi Lawson, director, EFInA and former MD Accion micro finance bank, Emmanuel Agha, MD, Innovectives and Jay Alabraba, COO, Pagatech. “To achieve the lofty ideals and objectives of SANEF, there must be concerted effort towards pro-

moting agent banking through the shared agent network approach. This requires the attention of relevant industry stakeholders who will convene, deliberate and educate participants at the Summit,” says Kayode Ariyo, executive director, business development and COO of Global Accelerex. The SANEF project seeks to deepen financial inclusion through an integrated ecosystem with strong regulatory oversight, consumer protection and interoperable payment system with limited concentration risk. The initiative involves onboarding 40 million low income and unserved Nigerians into the

financial system, increasing financial access points from the current 50,000 to 500,000 by 2020 and deepening access to mobile and digital financial products and services such as savings accounts, micro loans, insurance and pensions. Over 200 delegates are expected to attend the summit in Lagos on 12, December 2018, and will have the opportunity to contribute to the general forum and deliberations that will shape the future of payments in Africa. The PoS Innovation Summit is a quarterly platform which seeks to ensure innovative and sustainable growth of the e-payment industry in Nigeria.

BUSINESS DAY

Tuesday 04 December 2018

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ESET highlights cyber security trends in Nigerian organisations Stories by JUMOKE AKIYODE-LAWANSON

SET, IT security software and services provider recently held another edition of its Security Day event where it provided a common platform for business owners, decision makers and end-users to interact with security experts and senior management teams from ESET to discuss the security landscape in Nigerian organisations and the country as a whole. ESET focused on the cyber security trends in Nigeria enterprise businesses as the security market is undergoing rapid developments with the threat landscape evolving with more and more targeted and persistent attacks, which conventional countermeasures are failing to prevent. ‘The question is not if your defenses were penetrated, but how they were penetrated. They are failing due to the lack of security awareness among employees, missing proper security policies and lack of “basic hygiene”,’ says Olufemi Ake, country manager, ESET. The ESET security day

R-L: Ayotunde Coker, managing director of Rack Centre in Lagos receiving the Best Infrastructure award on behalf of Rack Centre rom Leland Rice, CEO, Dedalus Global, an Investment Consultancy firm, at the 2018 Africa Fintech Summit held in Lagos recently.

event took place in Lagos Nigeria on November 23, 2018 and attendees had the opportunity to see and learn from Remi Afon; president, Cyber Security Experts Association of Nigeria (CSEAN) who was well represented by Tunji Igbalajobi; director and membership coordinator of CSEAN. He cautioned organisation against showing lackadaisical attitude towards IT security, adding that many are suffer-

ing from reputational, financial and other damages orchestrated by cyber criminals. According to him, both private and public sector organisations must pay attention to cyber education and awareness. The cyber security expert said that in the era of disruptive technology, it is possible for hackers to hijack IT security in the artificial intelligence environment if not handled with care.

Igbalajobi who said that IT security has become integral part of governance recommended periodic risk assessments; reduction to the level of administrative access; multi-factor authentication and adequate password management, as part of the panacea to stay safe. He further extolled ESET for outstanding performances and products that meet the need of the markets which led to over 600million users that

trust the solutions currently. ESET Security Day is wellknown globally as a gathering of independent and ESET security experts with IT professionals, business people and the general public. More than eight thousand people around world have attended previous ones with positive feedback on how beneficial it has been to them and their organisations. The IT Security conference is not limited to ESET research − independent and non-ESET affiliated IT security experts provided presentations and leading discussions on cyberthreats and data protection issues which affect the current business environment. Attendees gained access to valuable know-how and technology support by headline speakers. “At ESET Security Days participants can enjoy the latest news from our own ESET kitchen. You will not only hear about what we offer to safeguard your business but you will receive valuable technology and security awareness insights along the way,” said Richard Marko, CEO ESET The ESET Security Day 2018 (Nigerian Edition) had 58 delegates and forty-one companies in attendance.

Facebook holds election integrity exhibition in Lagos

s part of its continued commitment to tackling false news, fake accounts and hate speech, as well as improving the transparency of advertising on its platform, Facebook on Friday November 30, 2018, held an Election Integrity Exhibition for the Nigerian media, civil society partners and other stakeholders. Outlining work, Facebook has been doing in Nigeria, the exhibition also focused on how the social media platform is dealing with bad actors; tackling fake accounts; improving the transparency of advertising and pages; and reducing the distribution of false news in the run-up to the 2019 Nigerian general elections. The social media giant has set up teams to ensure that people are equipped

with accurate knowledge about electoral policies, and making sure that people are motivated to actively participate and vote in upcoming elections. Taking the media through the tour, Tom Miller, Facebook’s politics & government outreach manager for Europe, Middle East & Africa said that the company takes the integrity of elections seriously, and will continue to explore multiple measures and partnerships to ensure that the integrity of the Nigerian elections is protected. Miller emphasized that teams across the company are committed to ensuring Facebook remains a safe platform for all. “Our goal is to continue launching measures to ensure the integrity and safety of the Nigerian Elections, so that we can continue to

drive positive social and economic impact across Sub-Saharan Africa, drive innovation by supporting Africa’s tech entrepreneurship ecosystem and also train communities and the next generation of leaders to better understand and utilise the power of digital tools for civic engagement,” Miller said. With problems such as misinformation, the Facebook team is putting up tools that would help detect these behaviors and crack down on accounts that pose such threats. Having launched strong policies on voter suppression, the Facebook team is looking to make sure the people are not disenfranchised or demotivated from fully participating in the elections. Highlighting Facebook’s commitment to fighting the spread of false news and hate speech on the

platform, Akua Gyekye, public policy lead for Anglophone West Africa, said that Facebook cares about Nigeria and is invested in the country. “Facebook’s mission is clear: to give people the power to build communities and bring the world closer together. Our mission in Nigeria is no different - we understand the importance of being local in a global world - and want to have a positive long-term impact.” she said. “In addition, we want to support people who want to be more civically engaged and connect with issues they care about— not just on Election Day, but every day. We do this through a variety of activities, such as partnering with civil society organisations focused on increasing voter education, building tailored Civic Engagement

tools which are relevant for Nigeria, and by raising digital literacy by sharing tips on how to spot false news with our community.” Gyekye restated She also stressed the need for people to be vigilant, especially during the election period, and to report any content that they feel might be in contravention of Facebook’s Community Standards. “We encourage our community to flag content to us that they don’t think should be on the platform - whether it’s a picture, a written post, a video – reporting is completely anonymous and confidential and can be done in three simple steps. This allows our Community Operations team to review the content and remove anything that’s violating our community standards,” Gyekye said.

Signal Alliance, Microsoft, Cisco collaborate to deliver Azure Stack to the enterprise

s businesses in Nigeria continue to find more effective ways to drive down their running costs, whilst improving profitability, Signal Alliance, Microsoft and Cisco have joined forces to deliver the Azure Stack solution, an innovative hybrid cloud computing solution designed to help organisations deliver their various services efficiently from their own data centers. Speaking at the workshop, Uche Nwaukwa, Signal Alliance Azure Practice Lead said, “Azure Stack is an extension of Microsoft Azure, which brings the agility and fast-paced innovation of cloud computing to on-premises environments.” The workshop had the Cisco Country General Manager, Kunle Oloruntimehin; Microsoft Business Lead, Cloud, Wale Olokodana; Signal Alliance Technology Director, Yinka Ntia; Microsoft Cross Industry Senior Territory Executive, Sophia Sankey in attendance. Also present at the event were top business executives from selected organizations in the banking, insurance, telecoms, and oils & gas sectors. Workshop participants were shown how Azure Stack can enable businesses and Government agencies leverage cloud capabilities and still maintain regulatory requirements around data residency, including Payment Card Industry Data Security Standard (PCI-DSS) compliance. Furthermore, there was a demonstration of how the solution serves as a hybrid cloud computing platform for edge and disconnected scenarios which address latency and connectivity issues, including simple and easy-to-use analytics. While speaking on development, Sikiru Abass, Head of Platforms & Applications, Signal Alliance said it enables organizations to build modern applications across hybrid cloud environments, balancing the right amount of flexibility and control. Moreover, with Azure Stack, developers can speed up new cloud application development by building on application components from the Azure Marketplace, including open source tools and technologies. With this consistent cloud platform, organisations can confidently make technology decisions based on business requirements, rather than business decisions based on technology complications.

BUSINESS DAY

Tuesday 04 December 2018

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E-mail: jumoke.akiyode@businessday.com

How the growth of eCommerce is reshaping the logistics landscape Ogunfowoke Adeniyi

t present, online consumers are far more demanding than those in previous eras. This is simply because they want their orders to be delivered as fast as possible. It, therefore, follows that online marketplaces are left with no choice than to ramp up their delivery capacity. The supply chain or logistics of any online marketplace can make or mar such a platform especially if they are always experiencing logistics nightmare which might lead to late order delivery. Definitely, the customer will be unhappy. Thus, as eCommerce is growing and disrupting the economic landscape across Africa and the world, so is logistics changing to meet the delivery demands of the 21st-century consumer. To ensure a seamless delivery, Jumia Services, which is the arm that handles logis-

tics in the Jumia ecosystem came on board. Today, Jumia Services with operations in 12 African countries, and over 50 logistics partners delivered over 10 million packages in 2017, over 250 pickup locations and 10 large warehouses. This is all in a bid to ensure that orders are delivered at the customers across the continent. When you compare this to what happened in the past, you will observe that the idea of logistics has drastically changed. Then, the goods you bought can sit in the warehouse for days before it is even shipped and it will never be delivered at the agreed duration. You have to accommodate delays. But as eCommerce became the trend, logistics had no choice than to change. Indeed, Jumia has innovated and with Jumia services, logistics are better managed and handled. eCommerce and Logistics Logistics and distribution networks have considerably evolved over the last couple of years. From the mo-

done with the aid of technology. Regardless, eCommerce platforms like Jumia and others have been delivering orders 8 hours a day and 5 days a week. (b) Infrastructure: roads have improved over the years. However, more needs to be done to improve roads in certain parts of the country.

ment electronic commerce was introduced, everything changed, including logistics. To be more precise, traditional logistics chains are basically outdated. Retail models do not imply any more freight moving from one distribution centre to the other. This takes a considerable amount of time and does not provide insight into product inventory. The growth of eCommerce

management has led to the redefinition of logistics functions to include: e-fulfillment centres, parcel sortation centres, parcel packaging, order tracking and much more. Major eCommerce logistic challenges In Nigeria, there are quite a number of challenges facing logistics in the country despite the countless opportunities provided by eCom-

merce. Some of the challenges include (a) Ineffective home numbering: the fact is, if a location is ineffectively numbered, there will be delays in order delivery. Although, the Lagos State Government has made efforts in numbering houses as it did in 2012 when it numbered no less than 1.2 million houses in the state, there is still the need for another round of numbering which should be

The Future of logistics Undeniably, as electronic commerce continues to grow, logistics will also grow in tandem. Today, some eCommerce companies are experimenting and contemplating employing drones for last mile deliveries. Furthermore, as the autonomous or self-driving vehicle technology becomes more sophisticated and satisfy the five stages of autonomous driving levels, eCommerce companies can use them to deliver orders. These smart cars will further reducedelivery times and data can easily be gathered. Ogunfowoke, Adeniyi Ayuba is a PR Associate at Jumia NIGERIA

Genesys Ignite 2018: The digital revolution has started Jumoke AkiyodeLawanson

echnology has the capacity to help leapfrog our National development but it takes a number of initiatives to make this a reality, especially for a country like Nigeria with so much human potentials. One of such initiative is Genesys Tech Hub by Tenece Professional Services, set up with the aim of developing software talents, as well as incubating and funding start-ups. It is in furtherance of this objective that Genesys Tech Hub kicked off an annual conference tagged Genesys Ignite which aims to bring together start-ups, academia, software developers, students, policy makers, tech enthusiasts etc. to the beautiful city of Enugu. This year’s event had over 1,000 people in attendance from across Nigeria and abroad. Speakers at the event included a two-time federal minister and former Direc-

tor General of the Nigeria Economic Summit Group, Frank Nweke Jnr. who doubled as the chair the event. The keynote address was delivered by former Corps Marshal and Minister of Aviation, Osita Chidoka while the CEO of Nextzon, Mac Atasie presented a paper titled how to ‘Create a Knowledge-driven Economy’. Rapper M.I. (Jude Abaga) used his song, “One Naira”, as context for his presentation titled, ‘Collaboration: A Tool for National Development’. The panel session on ‘human capital development and innovation was moderated by the Co-Founder of GoDo.ng, Chukwuemeka Fred Agbata Jnr. In the words of the Founder, Genesys Tech Hub, Kingsley Eze, ‘when we first conceived the idea of Genesys Ignite, we wanted to have an annual gathering that truly serves as a convergence of the ecosystem and we are happy that two years on, the impact keeps growing. Our commitment is to contribute

to deepening the start-up ecosystem and we are confident of achieving this with the right support and partnerships.’ He added. There were three categories of awards presented, beginning with two out of the 12 start-ups that made it to the final stage and pitched there ideas before a panel of judges. Two start-ups, GreenAge Tech-

nologies and LawyerApp received $15,000 each as seed investment and both of them will be incubated at Genesys Tech Hub Enugu. Similarly, university undergraduate students participated in “Hacktober”, a software development hackathon that sought to build their skills in software engineering, and create a community of young devel-

opers in the region. The top three winning universities were Federal University of Technology, Owerri (First prize - N200,000), University of Nigeria, Nsukka (Second prize - N100,000), and Michael Okpara University of Agriculture, Umudike (Third prize - N100,000). Lastly, the winners of the Young Innovators Challenge were University

L-R: Developer, LawyerApp, Daniel Ihesiulor; Former Corps Marshal and Minister of Aviation, Osita Chidoka;Co-founders, Greenage Technologies, Uche Ogechukwu and Esumeh Aaron; two-time federal minister and former Director General of the Nigeria Economic Summit Group, Frank Nweke Jnr. and Kingsley Eze, Founder, Genesys Tech Hub at the 2018 edition of Genesys Ignite which held recently in Enugu.

Secondary School, Enugu Campus (first prize), Shalom Science and Technical Academy, Enugu (second prize), and Command Secondary School, Enugu (third prize). The winners received prizes ranging from laptops, desktop computers and free coding training for their schools. The managing director of Genesys Tech hub, Nnamdi Anika is of the opinion that Nigeria and Africa at large stands to gain a lot from an event like GenesysIgnite. According to him, ‘this is not designed to be just another technology event, no, far from it. Our ultimate goal is to create a platform that will lead to new ideas and solutions, which will solve problems and ultimately contribute to National development. This is our hope and we are focused on making this a reality, hence, the investment in the 2018 edition’. He concluded. One thing is clear; Genesys Ignite has truly joined the league of world-class annual technology events that have come to stay.

BUSINESS DAY

Tuesday 04 December 2018

BUSINESS DAY

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Tuesday 04 December 2018

EDUCATION

Weekly insight on current and future trends in education

Primary/Secondary

Higher

Human Capital

‘Struggle for resources, shortfall in capacity account for privatisation of higher education’ KELECHI EWUZIE

he struggle for resources by staff and students coupled with the decrease in productive and capable graduates have being identified as the reasons for the privatisation of higher education in Nigeria. The low evaluation of the role of public education currently in achieving economic development in Nigeria is responsible for attracting private funds to the education sector. Professionals from education sector have said. They observe that the critical challenge plaguing institutions of higher learning is funding. This has generated a cluster of other issues regarding attendance and effectiveness of many institutions. Toyin Falola, professor at the University of Texas, USA said that as units of learning,

faith-based universities are not immune to challenges of other institutions of higher learning in Nigeria. Falola while speaking at the 3rd convocation lecture of McPherson University on the topic: The Inte-

gration of Knowledge and Faith stated that while it’s obvious that governments alone cannot effectively fund education, tertiary education has been heavily relying on tuition fees, donations and faith-based

institutions. “The influence of religion on socio-political and economic life is not the only factor that motivated the development of faithbased universities pointing out that many difficulties

including dwindling enrolment rates, funding restrictions as well as influence of political protest groups were major challenges”, he said. He further observed that most tertiary institutions rely on a combination of fees, donations and faithbased institutions for funds. He however cautioned that the problem of funding is not peculiar to Nigeria since in other African nations there are restrictions in budgetary allocation to education. According to him, “The capacity of some faith-based universities is at variance with poor enrolment. This data not only highlights the need for funding of faithbased universities but also the profit motive of some of them” “The direction of private universities is linked to funding as well as how the country is managed and leadership. Also, government policies will influence the agenda of faith-based

institutions and impact the diversification of programs of study in each. This concern of leadership must also be addressed in addition to the challenges regarding the funding of various programs and institutions. Adeniyi Agunbiade, vicechancellor of the university in his welcome address at the event where Seventy (70) graduates where found worthy in character and learning said the University after the visit of The National Universities Commission (NUC) have received a full operational license A breakdown of the graduating grades according to the vice chancellor include: 11 First Class Honours; 35 Second Class Upper Division; 15 Second Class Lower Division. Bello Kehinde Oluwatoyin of the Department of Accounting and Finance, was emerged the overall best graduating student, with a Cumulative Grade Point Average (CGPA) of 4.81.

Over 100 candidates write first Educationist advocates for improved skill set among students British Council CFA Exams in Abuja to drive competitiveness HARRISON EDEH, ABUJA

KELECHI EWUZIE

he need for students to be exposed to skills required to be effective in the 21st century job market have again being reiterated. Magdalene Okrikri, Principal Greenspring Schools, Anthony campus stated this while speaking at the 2018 career fair organised for students in Lagos. Okrikri observed that the world is dynamic and things keep changing, adding that educators there need to position themselves to help students develop skills they need to cope in the 21 century. According to her, “As a school, we are always proactive to seek ways to help our students better. This

motivated the formation of the thinking school, the first in Nigeria and Africa where we teach thinking to our students”. “For us, it’s not just about getting the content, but teaching our students to be critical and creative thinkers, because these are the skills they need to survive in future” Okrikri said. She further stated that Gre enspr ing Group of Schools has become the first in Nigeria and indeed Africa to be recognised as a thinking school. While commenting on the reason students are not interested in the teaching profession, the principal opines that teaching requires creativity and that’s why the school have looked into the direction of ensuring that students are taught how to think.

“We also have to re-educate ourselves as teachers and the school has to train every teacher to ensure that we also change our strategy to enable our children know how to teach. So, we are in that process,” she added. On her part, Chinelo Nkennor, Head of Counselling, Greenspring Group of Schools pointed out that it is worrisome that a lot of students have a wrong perception of what teaching is all about, adding that it is important educationist begin to stress the need to see teaching as a noble profession. Nkennor further observed that in choosing a career, there are certain things students need to consider. “These are your personality, aptitude, value system and your interest”.

ver 100 candidates on Saturday sat for the Chartered Financial Institute examination, which was organised in association with British Council in Nigeria for the first ever Certified Financial Analyst (CFA) examination in Abuja. The CFA examination which was first held in Nigeria on 23 June 2018 in Lagos state with over 800 candidates, also took place in Lagos for the second time with over 400 candidates sitting for the exam. Lucy Pearson, Country Director, British Council Nigeria and West Africa Cluster Lead explained that the examination in Abuja presents a huge relief to candidates in Nigeria by saving cost and reducing travel time. “Before the commencement of the exams in Nigeria, Ghana was the closest country where Nigerians travelled to for the examination, while those who could afford it

went to Europe or Dubai with the attendant foreign exchange expense on flight, hotel and logistics. Pearson informed that Nigeria alone, has are over 2,000 Certified Financial Analysts. On why the British Council has decided to work with the Chartered Financial Institute to make the CFA exam more accessible to Nigerians, Pearson, explained that securing internationally recognised qualifications promotes personal growth, career opportunities and provides a chance for enhanced livelihoods. “At the British Council, through our work in Nigeria, we are focused on giving access to these opportunities.” Speaking at the Launch of the CFA exams in Abuja, Banji Fehintola, President of CFA Society Nigeria expressed delight at the opening of CFA Institute and new test centre in Abuja. With the CFA exams now available at two test centres in Nigeria, Fehintola said that the development will

no doubt make it easier and less expensive for Nigerian candidates to write the CFA exams. He added that it will also save the country a lot of foreign exchange, supports the economy and demonstrates CFA Institutes strong commitment to Nigeria. “Looking into the future, we expect the candidate numbers in Nigeria to grow rapidly and this will further boost the membership of CFA Society Nigeria, which is currently the fastest growing CFA Institute member society in the world.” He said. Also speaking on the launch, Marniee Nottingham, Country Examinations Manager, British Council Nigeria, highlighted that the British Councils partnership with the CFA will give Nigerian professionals access to the exams in their own country, and will open the doors to further career development and bring opportunities to develop critical skills needed to compete in todays global economy.

BUSINESS DAY

Tuesday 04 December 2018

EDUCATION Corona school students urged to imbibe the right attitude to achieve excellence …Holds speech and prize giving day KELECHI EWUZIE

tudents of Corona Secondary school, Agbara, Ogun State have been encouraged to imbibe the right attitude to learning and life in order to achieve excellence. Adam Nuru, managing director, First City Monument Bank (FCMB) and guest speaker at the 2018 speech and prize giving ceremony of the school observed that students don’t achieve excellence by just being themselves; it’s by beating the person inside of them and even doing better at that. Nuhu while speaking on the theme, “Exploring Creative Excellence” tasked the students to realise that they

all have their various callings and peculiar areas of interest where they use their strengths. “So just tell yourself that I want to be the best in what I do. It’s about achieving a goal; it’s all about winning, and about taking part and commitment in becoming better at something”, he said. Nuhu urged the students never to forget their goals, and keep trying until they get it right adding that if they don’t fail, they may never learn the best way to achieve their goals. He further pointed out that it is the attitude that each student put into what he or she does, that would determine if they will excel in it or not and therefore call on them to imbibe the right attitude. Chinedum Oluwadamilo-

la, principal, Corona Secondary School, (CSS), Agbara, in her address at the event said the programme is all about celebrating the commitment to values and purpose of the school. According to her, “We celebrate example, we celebrate efforts of those students who have made huge and commendable progress in their fields of learning. We celebrate each Childs determined effort not only in academic pursuit, but in all spheres such as sports, arts, behaviour and the likes”. Oluwadamilola said that in 2017/2018 academic session, students from the school performed fantastically well in their public examinations, and many of them exceeded their own expectations. “They made excellent

grades in the last May/June West African’s Senior Secondary school Certificate Examinations (WASSCE), with about 96 percent pass at distinction level; in English, Math’s, and other subjects” she said. She further noted that among that set, Ibukun Oduntan achieved an impressive score of 344 out of 400 in JAMB UTME, making her the candidate with the second highest score nationwide. “Ikenna Uruakpa and Anna Adobamen emerged as seconds best in the prestigious Standardized Aptitude Test (SAT) Examinations SAT award, it continues with two other of her students emerging amongst the top five in the Nigerian Stock Exchange Essay Competition, amongst others”, she said.

L-R: Adeyoyin Adesina CEO, Corona Schools’ Trust Council; Chinedum Oluwadamilola, Principal, Corona Secondary Schools, Agbara; Ikenna Uruakpa, 2nd best students in 2018 SAT I result in the Universe, and Anna Adobamen and Niyi Yusuf, Chairman, Corona Secondary School Board at Corona Secondary School Annual Speech and Prize-Giving Day for 2017/2018 academic year held in Agbara.

Congress of University Academics set for maiden summit at OAU TELIAT SULE

he Congress of University Academics (CONUA) will hold its first summit on Thursday, December 6, 2018 with discussants expected to deliberate on the theme: “ Emplacing Nigerian Universities in the 21st Century Mold: Rethinking Unionism and the Role of Academics”. According to a statement signed by Ayo Ayannuga, secretary, summit planning committee, the one-day event will see eminent scholars that include the keynote speaker, Babafunso Sonaiya, a professor from the Faculty of Agriculture, as well as other prominent discussants such as Kayode Ijadunola, Oladega Soriyan, Charles Ukeji, Kehinde Taiwo, and Tunji Ogunyemi. Earlier in February 2018, lecturers at the Obafemi Awolowo University, Ile Ife decided to chart a new course in the annals of the history of university education in Nigeria with the formation of the Congress of University Academics (CONUA). The new body aims to protect its members through measures that are consistent with intellectual sophistication, constructive engagement of all the stakeholders and the blossoming of the intellect in a sound body. “The Congress of University Academics (CONUA) was borne out of a growing need for a responsive and responsible unionism among university academics in Nigeria. CONUA was birthed in Obafemi Awolo-

wo University, Ile-Ife and is in the advanced stages of obtaining full and formal registration. Membership is absolutely voluntary and till date. Membership dues are willingly paid-in out of pocket because of the confidence and faith most lecturers have in her ideals. Currently, most lecturers in OAU are members of CONUA. Several sister universities have contacted us on the need to nationalise our ideals. Hence, this first ever summit by our Congress .It is expected to bring together academics from ours and various sister institutions”, CONUA said. Kayode Ijadunola is a professor and the provost of the College of Health Sciences; Oladega Soriyan, is a professor from the Department of Chemistry; Charles Ukeji is another professor from the Department of International Relations; while Kehinde Taiwo, the only woman among the discussants, is a professor from the Department of Food Science and Technology. Furthermore, Tunji Ogunyemi is a don from the Department of History, all from the prestigious Obafemi Awolowo Univesity, Ile Ife. “There will be a lecture presentation followed by a discussion segment by a five-man panel of very eminent academics and thereafter a free flow question and answer session. The entire occasion is a public event expected to be attended by students, lecturers and colleagues from sister universities”, the summit planning committee said.

Experts advocate inclusion of road safety rules in primary school curriculum

he Federal Road Safety Corps (FRSC) and the managers of the Indomie Fan Club (IFC) have emphasised the need for Nigeria to deepen road safety rules in the primary school curriculum. Hyginus Omeje, sector Commander of FRSC made this call in Lagos during the IFC Road Safety Quiz Competition saying that such action will ensure that school children learn road safety rules early in life for survival adding that

primary school operators in Lagos need to establish Federal Road Safety Clubs in their schools. Omeje, who was represented by FRSC Deputy Corps Commander, Olalekan Morakinyo, said when the children are taught road safety rules at a tender age, such knowledge will remain with them till adulthood, a situation, which he said, will help to curb road accidents in the future. According to him, “One of the major reasons for our

partnership and support of the Indomie Fan Club Safety Quiz Competition is to help towards deepening general safety knowledge among the pupils and to also use them as agents of change in our society, especially as the festive season approaches.” For the past s e veral months, a team from FRSC and IFC having been going from school to school teaching school children about road safety issues. The Indomie Fan C lub Road Safety Quiz Compe-

tition is expected to assess the level of understanding of road safety protocols by the pupils of the various IFC-supp or te d s cho ols after months of enlightenment on road safety rules by officials of the corps. Twenty-seven IFC-supported schools drawn from all the local government councils in Lagos participated in the elimination stage of the competition held at the FRSC Sector Command, Ojodu Berger, Lagos. Out of the four schools that

made it to the finals, Kings Crown School, Surulere, came in first, just as Doncas Private School, Ikotun, came second, while First Baptist School, Kosofe, came third with Paragon Nursery and Primary School, Shomolu, coming in fourth. In her opening speech, the Coordinator of the IFC, Faith Joshua, stated that IFC believes in educational development, safety and harnessing of the special talents of children who will someday become resource

persons in the society. According to her, the IFC road safety quiz competition was aimed at evaluating the pupils’ understanding on the dos and don’ts of road safety. Speaking after the competition, winners and representatives of Kings Crown School Surulere, Ifeonye Emmanuel and Adebambo Deborah thanked Indomie Fan Club for its continuous support to pupils and promised to be good ambassadors to IFC and FRSC.

BUSINESS DAY

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Tuesday 04 December 2018

EDUCATION Educating the Nation’s growing population

OYIN EGBEYEMI

igeria’s growing population may be an indication of the availability of a market for the education sector. According to the results of the 2006 census and projections from the National Population Commission, the young and active make

up majority of the country’s population. Some people may view this large active population as an indication of strength under the guise of availability of labour. However, with an overall annual growth rate of about 3.5 percent (National Population Commission), policy makers may want to consider the impact this has on the resources available to cater to this large and growing population. It is also important to consider what access this active population has to education and other means through which they can develop their skills, and whether or not they are encouraged or even willing to develop themselves…if indeed the availability or an active population equates to

the availability of labour. Given that life expectancy in the country is 53 years (World Bank), and the negative net migration rate of -0.35 (2015, Kneoma), population growth is assumed to be driven largely by net childbirth. This means that the number of children who need to be educated is going to continue to rise. Policy makers in the education sector should be very weary of this as many scenarios in Lagos State alone are beginning show symptoms of State that is struggling to cope with its growing population: for instance, the number of children begging on the streets during school hours, insufficient number of public schools, inadequately skilled

teachers. Another symptom of this dire issue is the rise of “quack” poorly equipped and low standard private schools. The availability of a market for private education becomes apparent because of the failure of public sector schools to keep up pace with the monumental development in the education sector locally and globally. Parents are therefore left with few options for quality education and if they can afford to, the more attractive option would be private schools. What is highly concerning about this is the fact that despite the rise in the number of private schools in the State, not many of them meet up

to local or international standards. Those which do may charge school fees that are not affordable or sustainable for the average Nigerian man. Quality education now appears to have become a luxurious commodity only accessible to the rich, and might not even be viewed as an essential item when analysing disposable income in the light of the current economic climate in the country. Recent trends in consumer spending and disposable income show a sharp reduction in 2016 and slow growth in 2017 (Business Monitor International). So household spending may be predicted to grow steadily over the next 3 years on the back of an im-

proving economic outlook: inflation expected to decrease, thereby reducing the pressure on household budgets; and oil prices expected to continue to increase. Given this, there might be some hope that education may become more affordable. However, the concept of access to quality education being perceived now more as a luxury than a necessity needs to be taken into serious consideration in order to ensure that the growing population in Lagos State and the country could indeed be its strength. Oyin Egbeyemi is an executive administrator at The Foreshore School, Ikoyi, Lagos.

Endowment funds to boost academic Enugu State lauds Promasidor career pursuit for indigent students guidance initiative for students Akinremi Feyisipo, Ibadan.

he prospects for indigent students pursuing their academic dreams have being given a boost as Tunde Afolabi, Chancellor, First Technical University; Ibadan has endowed a scholarship scheme to help them through university tertiary education. The scholarship awarded through the Josephus Foundation is strictly merit-based and it covers tuition, accommodation and other fees of beneficiaries who are newly admitted undergraduate and direct entry students of First Technical University commencing from the 2018/2019 academic session till the end of their study. Ayobami Salami, vice chancellor, First Technical University, speaking during

the presentation of letter of awards to beneficiaries, appreciated the Chancellor for his thoughtfulness and generosity. Salami assured that the University is committed to its vision of world-class institution fully grounded in entrepreneurial practices, unique innovation, sustainability science and international best practices for radical societal transformation. According to him, “The essence of Tech-U is to raise the bar in tertiary education. This University was established to address the skills gap in the country and not to massproduce unskilled certificate wielding graduates, as it is in the country today. Here, our students are carefully baked to be outstanding entrepreneurs and innovators”. In addition to the Josephus Scholarship and the LGAsbacked scholarships available

for top-flights students at the STEM-BASED institution, Salami noted that the Tech-U management is commitment to providing more support schemes to enable students have a best-in-class, globally competitive education. A distinguished professor of Space Application, Salami encouraged the students to justify their selection by demonstrating excellent moral and academic performance during their course of study. Pioneer recipients of the scholarship were selected from diverse applicants through a keenly competitive aptitude test. The Scholarship will be offered on an annual basis to newly admitted (UTME, JUPEB and direct entry) students and could be held, subject to satisfactory performance, for the duration of a beneficiary’s programme of study.

Education stakeholders during an intteractive sessions at the 2018 ‘Get to know us’ programme organised by Greenspring school, Lekki campus Lagos

nugu State government has commended the management of Promasidor Nigeria Limited for extending its corporate social responsibility initiative, “Harness Your Dream” to students of the state. Uche Eze, Enugu State Commissioner for Education in his goodwill message at the fourth edition of the career guidance programme held at Queen’s School, expressed deep appreciation to company for adding value to the students, drawn for JS 3 classes of the host and neighbouring schools. Eze who was represented by Chidiogo Ugodu said that the impact of the project would be felt in the years ahead of the beneficiaries, who would now be able to make the right career choices. Eze urged Promasidor to consider extending “Harness Your Dream” to other schools in the state, particularly those in the rural communities. According to him, “I have harnessed my dream today. With this programme, the students now know about other career choices. Promasidor, we thank you for coming to Enugu. We thank you for adding value to us. We will like you to extend this programme to other parts of the state,” The Deputy Director, Guidance and counselling at the Ministry of Education, Lazarus Ude and the Principal of Queen’s School, Enugu, Ada Nweke also thanked Promasidor for extending the programme to the state. “You did not make any mistake by choosing our state as one of your catchment zones. Our amiable governor is education friendly. He always want to see children

achieve their aims in life,” Nweke said. Earlier, Anders Einarsson, managing director, Promasidor Nigeria Limited, said that the company is deeply committed to supporting Nigerian youths in fulfilling their potentials, adding that the motivation for the initiative to guide students to choose careers that match their talents, skills and aspirations. “We specifically target your class because by next session, you will be selecting relevant subjects that will determine your future careers,” explained Einarsson, who was represented by the company’s Head of Legal and Corporate Communications, Andrew Enahoro. He encouraged the students to take advantage of other projects by Promasidor, including Cowbellpedia Secondary School Mathematics Television Quiz Show, which is sponsored by the company’s flagship brand, Cowbell. Einarsson recalled the feat of Munachi Ernest-Eze, who in November last year added the senior category of the Cowbellpedia Mathematics competition to the junior category he had won two years previously. “Munachi’s exceptional performance is a story of dedication, discipline and devotion. And this is the path you should follow,” the Managing Director admonished. He also stated that the Loy a Swim Meet, which has just concluded its third edition, helped to support the sports development aspirations of hundreds of youths. “These initiatives are not inspired by excess funds as we have limited resources like every other company. The difference we have make lies in our genuine passion in assisting you to achieve your dreams,”

he explained. Enahoro said that Promasidor Harness Your Dream is encouraging the spirit of hard work among young Nigerians. He said the choice of courses taught at the programme was skewed towards helping the benefitting students ultimately becoming gainfully employed and useful to themselves and the society. “Next year, we are going to change the syllabus because this one has run for a whole year. We will like to incorporate other professions and careers into the programme,” he hinted. Promasidor staff, who served as resource persons, shared their educational and career experiences with the students and explained how to become professionals in several disciplines. These are: Personnel Management and Emerging Entrepreneurial Opportunities, and Information and Communication Technology. Others are: Accounting and Business Management, and Digital Marketing. The celebrity appearance by the Aneke Twins heightened the interest of the students in the programme. Chidinma and Chidiebere Aneke, Nollywood actresses and humanists who founded the Aneke Twins Foundation, inspired the students with the moving story of how they lost virtually everything when their father died while they were in their teens, and how they battled against rejection by family and friends. A CSR initiative of Promasidor Nigeria Limited, Harness Your Dream has been held in Lagos and Ogun States, as well as the Federal Capital Territory, Abuja since it was launched in November last year. It is a pan-Nigeria project, which is held every school term.

Tuesday 04 December 2018

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How Echo Stone technology will revolutionise housing, create jobs in Lagos Stories by CHUKA UROKO

Infrastructure Maintenance With TUNDE OBILEYE

L-R: Gbolahan Lawal, commissioner for housing, Lagos State; Anthony Recchia, Echo Stone Global CEO, and Anders Lindquist, Echo Stone co founder, at the ground-breaking for 250 housing units development in Badagry, Lagos recently

explosion in Lagos which requires radical construction technology to bridge the state’s huge housing deficit estimated at three million units. The state needs to build 20,000 housing units in the next 10 years to close this gap. “What we really need is industrialisation of labour, along with technology to create the asset which then produces mortgages,’’ Recchia said, noting that construction had not evolved in the last 50 years and that industrialisation would bridge huge demand gap while mortgage institutions could effectively drive supply by enabling demand. With four houses the technology is going to deliver every 14 days, it is also expected that the entire project in Badagry which sits on 10 hectares of land would be completed within three months and this will be happening alongside training of local artisans to ensure skill transfer to residents of Lagos. Besides the skills transfer, many jobs are being created and, according to Recchia, “mostly what I see on the job side is that it is gender neutral; men and women are working

together with women running the machines and helping with the form-works’’. Part of the highpoints of the new technology is the use of form-works which, Ander Lindquist, Echo Stone Founder and President, Business Development, said eliminated time wastage and allowed opportunity for construction of a minimum of eight homes daily from ground to carcass. Furthermore, the technology provides 7.5 percent lower temperature in the homes, thereby reducing the need for air conditioners. “Electrical and plumbing fittings alongside other accessories are done simultaneously with construction and this ensures durability of the facilities for over 50 years without maintenance”, Lindquist assured. The Badagry project known as Peridot Parkland promises such facilities as green areas, power supply, street lights, sewage reticulation, car parks, among others. Gbolahan Lawal, Lagos commissioner for housing, explained that the project was part of the “global mission“ of Governor Akinwunmi Am-

bode’s administration to construct 20,000 houses in various parts of the state in four years. The commissioner explained further that the state government was beginning with the 2,000 to be constructed by Echo Stone while other developers would build the balance in the next four years as part of efforts at bridging the deficit in the state. “This is like an economic revolution because whoever has a home has almost everything because, with that home as collateral, he can obtain a bank credit,’’ he said, pointing out that fast and affordable housing delivery was a priority for the state government, hence the adoption of this speedy construction technology. Echo Stone was assured of a ready market for their products, not only because of Lagos large population and housing deficit, but also the availability of mortgage facility for buyers. Homebase Mortgage Bank, one of the mortgage banks providing support for purchase of the houses, assured that they had in place all financial capabilities to help residents finance their homeownership dreams.

New leadership in NMRC holds out promise for improved mortgage market

he beleaguered mortgage market in Nigeria may be in for good time as a new leadership has stepped into the management of the Nigerian Mortgage Refinance Company (NMRC), holding out promise of a new order and new approach to doing mortgage business. NMRC is a secondary mortgage refinancing institution in Nigeria set up with the core mandate of increasing liquidity in the credit-famished mortgage system in the country by raising funds from the capital market and using same to refinance mortgages originated by the primary mortgage banks (PMBs) and other mortgage lending institutions. It is a private sector-led mortgage institution with the public purpose of catalyzing processes that will enable

The value of effective prioritizing in FM

or a sprawling city with over 20 million residents for whom housing accommodation is already dire, what Lagos State needs now is a technology that can revolationise housing delivery and that exactly is what Echo Stone has brought into the state along with job creation for the citizens. Echo Stone, a property development firm, is in Lagos on a joint venture initiative with the state government, through the state ministry of housing, to build 2,000 housing units as part of the state’s planned 20,000 housing units to be delivered in four years under the Lagos Affordable Public Housing (LAPH) initiative. The company has already deployed its technology for the development of the 2000 housing units across three sites in Badagry, Immota and Ayobo. Expectation is that given its speed of delivering of four units of 2-bedroom bungalows in 14 days, the whole 2,000 units may be ready within 12 months. At a ground-breaking event recently to mark the commencement of construction work on the first 250 housing units in Badgagry, Anthony Recchia, EchoStone’s Global Chief Executive Officer and Co-founder, highlighted the advantages of the Echo Stone technology including industrialisation of housing/labour. EchoStone housing system is a high quality, rapidly scalable and sustainable construction that approaches housing master plans comprehensively and sustainably, taking into consideration social, environmental and financial factors. Echo Stone technology is the best response to the rapid urbanisation and population

BUSINESS DAY

development and delivery of affordable housing for low income earning Nigerians. NNMRC is conceived and fashioned after Freddie Mac and Fannie Mae in the US which account for the country’s over 70 percent homeownership level as against Nigeria’s 10 percent. Last weekend marked a turning point in the company with the exit and appointment of key officers. Charles Adeyemi Candide-Johnson and Kehinde Ogundimu were appointed chairman and managing director of the company respectively with effect from December 1, 2018. Candide-Johnson takes over from Charles Okeahalam, who retired with effect from November 30. On the flipside, Chika Akporji, the company’s executive director in charge of policy, strategy and partnerships, re-

tired effective November 30, 2018 while Anino Emuwa, nonexecutive director, stepped down from the company’s board. Until his appointment, Candide-Johnson was a nonexecutive director at NMRC and a senior partner at Strachan Partners, a leading commercial law firm based in Lagos and Abuja, Nigeria with substantial practice across the nation. He was called to the Nigerian Bar in July 1984 and conferred with Senior Advocate of Nigeria (SAN) in September 2003. He received an LL.M Degree from the University of London in 1985 and between 1984 and 1990 was Counsel in the leading chambers of Jon B Majiyagbe in Kano, Nigeria. He moved to Lagos in 1990 to establish the Lagos practice of that firm and in 1994 led the founding of Strachan Partners.

Appointed as notary public for Nigeria in 1988 and in 1996 a Fellow of the Chartered Institute of Arbitrators of England, Candide-Johnson is an approved tutor-examiner for the Institute. He is an honorary fellow at the Centre for International Legal Studies in Salzburg, Austria and a supporting member of the London Maritime Arbitration Association. Ogundimu was NMRC’s chief finance officer (CFO) and Acting Managing Director prior to his new appointment. He holds a Bachelor of Science degree in Electrical Engineering from the University of Ibadan and obtained an MBA from the University of Lagos, Nigeria. He is a seasoned professional with over 20 years work experience in financial services including secondary mortgage and diversified banking, energy and public accounting.

acilities management (FM) has the potential to improve processes by which private and public sectors built environment can be managed thereby encouraging end users to contribute significantly to the economic growth and success in a work place scenario or in the case of a residential community, the occupiers enjoying the ambience with little or no complaints. When all of the buildings’ needs are treated exactly the same, effectively prioritizing the work required can fast become overwhelming to the facilities manager and the maintenance team. However, the truth is that some tasks are more critical than others when the problems are evaluated. Some planned or routine maintenance work will do more to keep the built environment in good shape and make everyone happier than others, but determining which tasks come first requires a framework. To this end, it pays to think of each facility as an asset within a building portfolio. A building portfolio can be used to establish a framework that helps pinpoint the best use of resources. A portfolio may be made up of buildings that bear certain similarities. Through this framework, facilities managers can better understand how each segment of the portfolio fits into the overall FM strategy. With this understanding, it becomes easier to determine which FM approach will best serve certain problems. In understanding the impact each problem may have on the facility and end users, facilities managers can better determine in which order to make improvements, and perform more strategic short and long-term planning. To implement a system of building portfolios, consider the following three steps: Do Your Research Creating the best possible strategy depends on insight about both the built environment and needs of the endusers. It is knowledge that facilities managers cannot acquire on their own. The first step is to bring together individuals who have expert knowledge of the various installations in the built environment and other stakeholders to gather information and develop a plan. By also involving the decisionmakers of the organization, facilities managers will gain

insight into considerations that won’t normally be available on a traditional facilities assessment. It is through these discussions with a broad group of interested parties that facilities managers can begin to effectively organize the facilities into useful categories. Examine the facts Once the fact gathering is completed, it is time to evaluate the information and determine how each asset is performing. This disciplined examination of the information is necessary to best decide how to use available resources to get the maximum impact out of the improvements. This step requires a datadriven examination of elements to understand if each asset is performing as expected. If the finding is that an asset is not meeting users’ needs, this is the time to dig deeper to understand the reason. After all, there may be numerous reasons an asset is performing more differently than expected. Interacting with stakeholders is useful but data will give deep insight into a problem and help uncover some possible solutions. Data also helps persuade stakeholders to make strategic decisions on available resources. Put the plan together When a strategic framework is created, facilities managers can begin to examine how the various tasks play into the bigger picture. The framework will provide a strong overview of how the problems compare, which should get priority over the other and which can wait a bit longer for solution. Through this framework, it is possible to take a more critical look at the assets, their strengths and weaknesses, and how they compare to other assets. With these pieces in place, the facilities manager can have an informed conversation with decision-makers about how best to utilize the limited resources. By viewing a building portfolio in its entirety, facilities managers can make more methodical long-term decisions and, in time, create a built environment that better meets the needs of all end-users. Obileye is a UK-trained lawyer and CEO, Great Heights Property and Facilities Management Limited Email: Tundeobileye@greatheightslimited.com

BUSINESS DAY

Tuesday 04 December 2018

‘Our objective as an organization is to make our products affordable to buyers’ As affordability continues to be a big issue in the Nigerian housing market, developers are, increasingly, coming up with creative and innovative ways of making their products affordable to home buyers. In this interview with CHUKA UROKO, the MD/CEO of Dradrock Real Estate, OLADIPO IDOWU AGIDA, offers insights on how his company has used creative ways to make their products affordable to over 500 Nigerians who have bought property from their housing schemes. He also speaks on other salient real estate issues. Excerpts:

ince you opened for business a decade ago, you must have impacted on the lives of many families and also contributed to the growth of the national economy. Tell us how Over this period, it has been a fulfilling experience because we have been able to help people achieve one of their major dreams of owning homes. One of our major roles as a company is advisory. We advise clients on how best to buy their homes or holding property for investment purposes. We segment the market, look at buyers based on their type of job and income level. We structure payments for people according to their cash flow and they are always excited to see that we are able to do. In terms of numbers, we have been able to help about 500 people to own property. These are mainly those in high income class, the mid-income earners and not many low income earners. But we have started offering something for the low income. In terms of percentage, what we have is 10 percent for low income, 40 for the high income and 50 for mid-income earners. We have also contributed to the growth of the economy by providing jobs for people. We have all classes of workers on our employ—skilled and unskilled labour, professionals, artisans and others. You have a number of on-going and completed projects; what kind of products do you have on offer, especially from the Annapolis schemes?

a prospective buyer get from your partnering mortgage banks? We are looking at a rate that is much better than what is on offer in the market at the moment. But we have a problem in this country which is cultural. People borrow from micro-finance banks and don’t pay. This also happens in mortgage banks and that is why operators complain of huge non-performing loans in their books. This is why we need a good credit system in this country. If we have a good credit system that capture people’s credit history, that will help a lot. We are hoping that with the work that is being done at both government and individual level like the Nigerian mortgage refinance company (NMRC), housing finance issue will be resolved. It may take time but there is hope.

Oladipo Idowu Agida

Annapolis is a brand of our products. We have Annapolis Garden at Lakowe where we have serviced plots and 30 units of 2-bedroom apartments. We have another Annapolis Residence at Sangotedo where also we have serviced plots, 2-bedroom, 3-bedroom and terraces of 4-bedroom.We also have Annapolis Court at Ibeju Lekki where we have about 1000 service plots and developments for low income earners. The objective of the Annapolis brand is to create a place for people where they can live and have the kind of lifestyle they desire. It is for all classes of people—the upper class, middle class and the lower class. For the Snagotedo scheme, our serviced plots are going for N10million -N20 million per plot. This caters for the upper middle class.

sue for both buyers and suppliers of housing products. What do you do to help buyers to enable them to afford your products? The problem of finance is on both parties. It is unfortunate that government is not doing enough in terms of infrastructure provision. In all our projects, we are the ones providing the infrastructure and that affects the cost of construction and the capacity of those who want to buy. We are in partnership with mortgage banks. We also offer structured payments to our buyers and support that with mortgage. We believe that anybody who earns $200 can own a home in Lagos in a place where there are basic amenities like water, power, good roads and security.

Finance is a critical is-

What interest rate can

The real estate sector has been recording negative growth in the last 10 quarters. How is this affecting you as an organization? Negative growth in the real estate sector is usually not steady. Back in the first quarter of 2014, there was a decline in the growth of the sector but after sometime, it started rising again up to 2016 when it declined again with the onset of recession. We saw another major decline in the first quarter of 2018, but improved a little in the second quarter of 2018. What explains this improvement is the inflow of foreign investment into Nigerian market. This may not be structured or captured but a whole lot of foreign capital is coming into the market mostly from Nigerians outside. The market has been slowing but, for us as an organization, we are doing a lot, planning ahead of time.

We know that some people buy property to build their homes as first time buyers, others buy in order to hedge their funds against inflation while yet others buy for investment. Because of that, no matter the level of economic decline, people still put money in real estate because it is safer there. So, essentially, we are just being strategic. Some people say the economic recession in Nigeria had its positive side because it brought creativity and innovation into the property market. What were your survival strategies? One of the things that keeps us going here is the strength of our team and our ability to project into the future. As we speak, we are already looking into next year, thinking of what is going to happen during and after election; how the result of that election will impact on business and what will happen to the naira. We factor all these into our product costing and delivery time. These also help us to take position and absorb any shocks coming from the swings in the economy.

they will go for it. Our objective as an organization is to make our products affordable to buyers. When we speak to the middle or premium class of people, the question is, how can we make it affordable for them? In the Sangotedo scheme too, our one-bedroom apartment with toilet and bathroom is not more than N8 million. We are considering developing mass housing where a two-bedroom apartment will not be more than N5 million. So, it is all about being creative on how you can make it accessible to the low income earners. They need structured payment and that is why we are trying to work on a mortgage system that will help accessibility.

Most companies are now reviewing their project size to respond to market realities, leading to small size products coming to the market. What is Dradrock doing in this direction? We are also responding to market realities our own way. In our scheme at Sangotedo, we are building one-bedroom apartments because there are young people who need this size of apartments. These are not expensive. If you are able to do what is affordable to people,

What are the challenges you face operating in an unfriendly business environment like Nigeria? One of the major challenges is funding. But funding as a challenge also makes developers to be creative. The other challenge is infrastructure deficit. There are no infrastructure like roads, bridges and rail tracks which would have encouraged many people to live outside the city centre. All these are limitations that make it difficult for us to develop our own cities. What we do as developers in the face of all these is to be creative and manage our cost. To take us out of this, government should come up with policies like tax incentives for estate developers. It can also provide a kind of material prices that will make houses more affordable. Developers on their part should take steps towards solving these problems on their own. There should be collaboration between the government and developers to bring about solution.

instance, is an aspirational nation, so no matter how much you try to segment your ads, there is someone outside your target group, watching and wishing. No harm in that. The question becomes, how do you reach them as their interest starts to grow, exponentially? The Nigerian real estate market is exactly at this point. Year on year, the market has grown, with new players coming in, offering something different, and pricking the interest of Nigerians, increasing the belief that they could own one of those hotspot apartments in Ikoyi or Victoria Island. That belief lingers until the interested party looks down at the bottom right of the flyer she has just been

handed to find the pricing. Sigh, they still have a same target audience. A couple of years back, they seemed to have cracked it with the installment payment - a huge down payment for a start and subsequent smaller payments over time. To an extent, that could be considered the Nigerian version of a mortgage, but no you don’t get to live in that house you have made a down payment for, nor do you already ‘own’ it, you are still paying rent elsewhere, and just added another billing to your already existing billings. It is a hectic process, one which a lot of people, especially younger millennials, who are already surprised about the level of bills pressing against their small pay, can barely stand.

Why OneSqm may be the future of real estate in Nigeria MICHEAL ANI

very other day, when a random young person on Twitter, usually from a country in Europe or the Americas, makes a post about buying their first house, and sometimes topping it off with a car, there is a sudden wave of comments from Nigerian Twitter, many of which are nice comments congratulating the chap on the achievement and the rest, meaning that they want same for themselves usually with the inscription “Lord, I see what you are doing for others”. Sadly, their realities are different. Most millennials struggle with bad decisions and the pressure to get their act together. There are age limits to a whole bunch of

things - a job, a car, marriage, your house, and the list goes on. It isn’t like Nigerian millennials don’t try hard enough to get these things. They do, but it just often seems like the system is rigged against them, in a way that success or their timeline towards it, is now measured by the quality of bad decisions they are making, and if they are making too many of them. For instance, a friend could be led to believe that the reason you don’t have a car yet is because you do too many Uber rides to work when you should be using danfos and saving to buy a car; thus a bad decision. Here we save for almost everything, but there are just some things you can’t just save enough for, espe-

cially when there are always bills to pay, and not enough of the income left for the things that push you ahead. In the US, most homeowners rely on mortgage loans to purchase houses, a system that many consider a lifeline and a suitable model to keep them in check and make the investment easier on them while they figure out other aspects of life. In some years like 2017, aspiring real estate owners are lucky to enjoy low mortgage rates and that can be a super head start. The problem in Nigeria is, people don’t trust the banks well enough to take those loans, and a large number of those who might even be willing to go for it, aren’t deemed creditworthy. So people save and save, paying rent

and hoping that someday their savings can catch up with the rising real estate prices; an uphill task for so many given the meager income across the board. A long time ago, the Fast Moving Consumer Goods (FMCG) industry, seemed to have made a marketing breakthrough when they got products that people love but couldn’t afford into pack sizes that they could afford. The idea, often referred to as sachet marketing, is a thing of meeting people where they are, this time, having nothing to do with positioning but everything to do with packaging, proposition, pricing and a couple other Ps. It is brilliant thinking when you look from different angles. Nigeria, for

Tuesday 04 December 2018

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BUSINESS DAY

Formal retail still tenants market as landlords struggle to drive up occupancy …no prospects for rental growth in the near to medium term STORIES BY CHUKA UROKO

constrained purchasing power and oversupply of mall space reinforce this outlook. With these market realities there is no capacity and prospect for rental growth in the near to medium term”, Alintah posited. Very few malls(+-10,000 square metres) are currently in the pipeline in the core and secondary markets, with the focus being on smaller design concepts that are specifically tailored to the demographics within the mall’s catchment area. In the core markets, especially in Abuja and Lagos, activities and trends remained unchanged. These markets remain the first point of entry for new brands coming into the Nigerian formal retail space. Lagos, for instance, accounts for over 70 percent of investment in formal retail so far. Abuja is yet to see the volume of investment in retail that Lagos has received. A major formal retail in the federal capital city is the Jabi Lake Mall Abuja, a joint venture project by Actis, a leading private equity investor in growth markets, and Duval Limited. It opened for business in November 2015 and has created hundreds of employment and skills acquisition opportunities

for Nigerians. In addition to household names such as Shoprite, Game and Silverbird Cinemas, the mall also harbours renowned retailers including sports giant - Nike, Levis, Vlisco, Woodin and T.M Lewin, making it a top retail and leisure destination for residents of Abuja. “The mall was developed to tap into the buying power of Abuja’s estimated 68,000 households with annual expenditure of over $150,000 per household. With a rapidly growing population of 2.2 million, Abuja is a very strong market comprising A and B level consumers which underpins the residents’ potential buying power”, Michael Ch’udi Ejekam, a former director, real estate at Actis, told BusinessDay. But whether it is in Abuja or Lagos, landlords are really at ease. In a bid to remain competitive, they are incorporating family-friendly offerings, cinemas and arcades to capture the changing consumer preferences. Additionally, some landlords are bringing in a number of international brands on their own balance sheets. Average asking rents for spaces as small as 50 square metres – 200

square metres and they range between $30 per square per month – $70 per square per month. Transactions ultimately are conducted on a case-by-case basis and achievable rents could fall well below this average. “Demand enquiries have remained constant in Q3:2018, with space requirements focused on 100 square metres or lower. As in the first half of 2018, demand was predominantly driven by local retailers in the fashion and food and beverage categories”, Alintah pointed out. She noted that retailers were reexamining their strategy in the market such that relocations from formal malls to surrounding high-street locations have become evident with some retailers opting to locate in close proximity to malls in order to benefit from passer-by traffic whilst incurring reduced occupancy costs. Furthermore, she added, retailers that had initially adopted a strategy to locate exclusively in stand-alone locations are now branching out into malls. This could be attributed to internal strategies to curb competition and to benefit from parking as well as other amenities provided within malls.

Projects’ upside potential, value proposition top investors considerations …as analysts bet on Eko Atlantic, Landmark Village

hese days with the continued lull in the property market, especially at the high end residential or commercial, investors have become not only savvy, but also choosy on where to push funds in search of yield. A good number of potential investors are holding back investment, but analysts have continued to encourage them to take position in projects which have what they call upside potential and also offer compelling value propositions. Two projects stand out, in their estimation, in Lagos and these are the Eko Atlantic City and the Landmark Village being developed by South Energyx Nigeria Limited and Landmark Group respectively. The two projects, according to the analysts, are destinations for good re-

Rydal Mews’ new initiative lightens homeownership journey for first time buyers

ost recession formal retail in Nigeria is still tenants market as consumer purchasing power remains crimped. Declining footfalls at malls has put many retailers in dire straits, forcing many of them to close short. Landlords, especially those in secondary market locations, are under intense pressure to drive up occupancies at malls many of which are largely unoccupied. The situation is so frustrating that, in addition to the existing concessions to drive take-up occupancies, landlords are considering even more flexible lease terms such as annual and hybrid Naira/ Dollar leases But this, according to a Broll Property Services Retail Market Viewpoint for Q3 2018, is yet to become an established practice in the market as it is more on a caseby-case basis. Asking rents within the quarter have dropped in dollar terms. “Average asking rents for malls in secondary locations are lower in the quarter under review in dollar terms”, notes Nnenna Alintah, a researcher and Head, Occupancy Services at Broll. She pointed out that average asking rents ranged fromUS$15 per square metre per month – US$25 per square metre per month for spaces between 50 square metre – 200 square metre down from US$20 per square metre per month – US$30 per square metre per month in the previous quarter. Outlook for this segment of the market is not entirely bright. With the existing macroeconomic conditions and the upcoming elections in Nigeria, current market dynamics are expected to persist. This means that headline inflation is not likely to drop, nor will exchange improve in favour of the local currency which is a major challenge for the retail market where many of the wares are imported. “The large gap between occupational costs and effective demand,

turn on investment not only because of the integrity and antecedents of their promoters, but also for the value proposition which each presents to the commercial and residential real estate investment markets. A brand new city that is being developed on reclaimed land adjacent to Victoria Island, Lagos, Eko Atlantic remains prime real estate investors’ toast despite the considerable drop in demand and values in near-by highbrow locations, especially Victoria Island. Land in the city still attracts premium price and depending on the part of the city on offer. The water front and the business district of the city attract higher prices. The developers have created 10 million square metres of prime realestate on which some office and

residential buildings have been developed with tenants and residents respectively. The Business District alone will have approximately 650,000 square metres of gross lettable area (GLA) to offer the market. Ronald Chagoury Jnr, the vice chairman of South Energyx Nigeria, says that, upon completion, the city will be home to about 500,000 residents with an expected commuter volume of approximately 300,000 people. What this means to a savvy investor is that there are limitless opportunities to tap from as diverse businesses will be berthing in the city and will be creating jobs and attracting ancillary industries that will also create more jobs and offer more services. Landmark Village is a mixed-use development sitting on 38,000 square metres of land in Victoria Island, offer-

ing prospective buyers, investors and tenants opportunities to live, work, and play. This concept is central to Landmark Africa’s developments and will be the first of its kind in Nigeria. Landmark Village is aimed to mirror nodes like Melrose Arch, Rosebank and Illovo in Johannesburg and developments like Canary Wharf in London. The development will have two office towers offering grade A accommodation, residential apartments, retail outlets, a 250-room 4-Star hotel and a convention centre. The development offers other amenities like leisure and recreational facilities. All these hold promise for different levels of opportunities ranging from residential to hospitality, facilities management, project management and sundry services, leading to additional job creation.

etermined to lighten the burden of owning a home in highly cosmopolitan and relatively expensive city like Lagos, a new homeownership initiative has been introduced into the property market by Rydal Mews Limited to aid first time home buyers to own homes. Rydal Mews is a fast-growing company that is in Nigeria to offer top notch real estate solutions and services including management, advisory, marketing and consultancy. It was founded in 2011 to provide customer centric services and value addition to the property sector which, in-turn, has created a niche in the real-estate ecosystem. Its new initiative, ‘Promise-ToOwn’ is structured to provide opportunity for its customers to own quality and affordable houses in the burgeoning Lekki corridor in Lagos with flexible payment plans spread over five years. This aligns with the company’s vision to shape the future by redefining the real estate industry globally. This means the customers don’t have to struggle with the heavy burden of providing all the cash needed to buy a home in this fast growing area of Lagos where property values are sky-rocketing in response to rising demand from young business executives who find that corridor a compelling destination. ‘Promise-To-Own’ as launched as part of activities marking the company’s 7th Anniversary. It was engineered to make homeownership affordable to Nigerians while preserving the ultra-modern standard of living. “Our Promise-To-Own initiative will mitigate the challenges of owning a house in highbrow locations in Lagos and spread real estate opportunities to property investors conveniently”, explained Modupe Anjous, the company’s CEO in an interview in Lagos. wWe are focused on providing top marketing and sales, facility management, advisory services and property management while developing more properties that fit into future smart-cities. Rydal Mews will help transform the landscapes of urban communities and place Nigeria at the forefront of development in Africa, Anjous assured. The Promise-To-Own initiative starts with the PrimeWater View Gardens 2 right in the heart of Lekki Phase 1, which has a fully serviced environment with proximity to commercial offices and other communal social amenities. It offers the customer double benefits of moving into a 3-bedroom apartment on first payment and also subsequent installments spread over two to five years based on structured agreements. Mustapha Akinkunmi, former commissioner for finance in Lagos State, described this initiative as a disruptive innovation in the property space and likened to what UBER is doing in the transport industry.

BUSINESS DAY

Tuesday 04 December 2018

Harvard Business Review

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Protecting Workers 98%: The U.S. Bureau of Labor Statistics found that 98% of companies have sexual harassment policies in place. + Professional Ties 2 times: Research shows that candidates are twice as likely to be hired for a job through a connection from their professional network than their personal network. + Manager’s Remorse 19%: According to a study from Leadership IQ, companies consider only 19% of new employees to be successful hires. + Health Benefits $1.1 trillion: American companies pay an estimated $1.1 trillion on health insurance costs. + An Action Plan for Climate Change 500: Almost 500 companies around the world have set sciencebased targets to reduce emissions, according to the Science Based Targets initiative.

We all overcommit ourselves from time to time. And then, because we feel overwhelmed, we cancel or back out at the last minute. It feels like no big deal — everybody does it, right? But not following through on your commitments, whether by constantly rescheduling meetings or by failing to get back to people when you say you will, erodes your trustworthiness. Honoring your commitments begins with saying yes only to things you know you can do. If you’re unsure about a request, ask for time to think

Make your out-of-office message a little more personal

things over. And practice saying no so that you’ll be ready to turn someone down when needed. (Think about how you can tactfully but frankly refuse, and then say the words out loud until they feel comfortable.) By thoughtfully — and honestly — assessing the requests that come your way, you can protect both your schedule and your reputation.

(Adapted from “You Have to Stop Canceling and Rescheduling Things. Really,” by Whitney Johnson)

will speak to your audience, like an article or a new piece of research. It could be related to taking a vacation (there are lots of great stats on why time off is so important!) or something that potential clients might be interested in. A personal — but still professional — message allows you to connect in a new way with colleagues, clients and vendors.

(Adapted from “Why You Should Put a Little More Thought Into Your Out-ofOffice Message,” by Michelle Gielan.)

Getting Better at Handling Disappointments

isappointments are inevitable and unpleasant — a missed promotion, a failed project, a poor investment — but you can always learn something from them. To constructively deal with your next setback, think through what happened. Distinguish situations that were predictable and preventable from those that were unavoidable and beyond your control. Ruminating over something that didn’t go your way — and that you couldn’t control — will only frustrate you further. For situations that you could have handled differently, consider them in positive terms: What can you do differently next time? What lessons can you learn from the mistakes you made? And remind yourself of what’s going well in your life, so you don’t let the disappointment take an outsize role in your brain. It might sound like a cliché, but keep the setback in perspective — and try to let it go. You may be tempted to play the situation over and over in your head, but staying preoccupied with it will only create unnecessary stress.

(Adapted from “Dealing With Disappointment,” by Manfred F. R. Kets de Vries.)

Improve your emotional intelligence with Are you yeally busy? Look for simple solutions to recurring problems a specific, feedback-based plan When you’re

Tips & Talking Points If you commit to something, don’t cancel at the last minute

TALKING POINTS

ost of us write our out-of-office messages as we’re running out the door for vacation or a business trip. But putting more thought into what the message says can help you build relationships with the people who try to reach you while you’re away. Instead of just including the dates when you’re out and who to email in your absence, consider sharing why you’re gone. Where are you going on vacation, and why did you pick that location? What are you learning at the conference? You can also share a resource that

BUSINESS DAY

t’s not always obvious how to improve your emotional intelligence skills, especially because we often don’t know how others perceive us. To figure out where you can improve, start with a reality check: What are the major differences between how you see yourself and how others see you? You can get this kind of feedback from a 360-degree assessment, a coach or a skilled manager. Next, consider your goals. Do you want to eventually take on a leadership position? Be a better team member? Consider how your ambitions match up with the skills that others think you need to improve. Then

identify specific actions that you’ll take to improve those skills. Working on becoming a better listener? You might decide that when you’re talking with someone, you won’t reply until you’ve taken the time to pause and check that you understand what they said. Whatever skill you decide to improve, use every opportunity to practice it, no matter how small. (Adapted from “Boost Your Emotional Intelligence With These 3 Questions,” by Daniel Goleman and Michele Nevarez.)

chronically busy and stressed, it’s easy to react in ways that make the situation worse rather than better. For example, if you have a million tasks on your to-do list, you may not think you have time to stop and prioritize. But simply barreling through everything that feels urgent isn’t an efficient strategy. Step back and rank your tasks based on urgency and importance. Whatever meets both criteria should be done first; everything else can wait. You should also look for simple solutions to problems that eat away at your time. Constantly forget to charge your phone? Keep a power cord at the office. Catch the same

c 2017 Harvard Business School Publishing Corp. Distributed by The New York Times Syndicate

mistakes again and again? Ask your team to make a checklist for spotting their common errors. Travel for work a lot? Create a universal packing list so that planning takes less mental effort. Strategies like these will give you more energy, confidence and time.

(Adapted from “4 Ways Busy People Sabotage Themselves,” by Alice Boyes)

BUSINESS DAY

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Tuesday 04 December 2018

Energy Report Oil & Gas

Power

Renewables

Environment

Norwegian companies to expand into power sector, others …as Marine Platforms boss becomes Norwegian Consul General OLUSOLA BELLO

h e No r w e g i a n government says Norwegian companies are trying to expand their business frontiers in Nigeria into the power sector and other sectors of the economy. Jens-Petter Kjemprud, the Norwegian Ambassador to Nigeria, disclosed this during the investiture of Taofik Adegbite, managing director and chief operating officer of Marine Platforms Limited, one of the country’s foremost subsea service companies as Norwegian consular general in the country. The ambassador stated that the power sector he believes needs a lot of engagements nationally and hopeful by international actors to improve the efficiency of the power sector in the country. Approximately 17 Norwagian companies are active in Nigeria with the bulk of them based in Lagos and predominately in the oil and gas sector and in the fishing industry and fish export to Nigeria. This is an important part of the Nigerian Norwagian Bilateral trade and relations. He said, he was using the opportunity of the investiture to talk about the power

sector because if Nigeria is going to move on from the dependency of oil and gas into manufacturing she needs very functioning power sector. “This is what I preach everywhere I go.” He said approximately 17 Norwegian companies are active in Nigeria with the bulk of them based in Lagos and predominately in the oil and gas sector and in the fishing industry and fish export to Nigeria. This is an important part of the Nigerian - Norwegian bilateral trade and relations. Other areas they the Norwegian business concerns

would like to explore will be in aquaculture and a number of other areas. “The event of today is very important to us as our goal was to have a consul general in Lagos because embassy may always be able to oversee activities both in Abuja and Lagos where most business take place. “We are happy to have this event here because we believe I said, Lagos is the heart beat of Nigeria. As we are the embassy is based in Abuja it is not possible to be in Lagos all the time and we need to have someone here that can take care of responsibilities and

Nigerian firm introduces innovation to reduce cost of oil production OLUSOLA BELLO

igeria may soon record a substantial reduction in the cost of oil production if the new invention made by an indigenous company and its partner gains with adoption among the operators in the oil and gas industry The cost of producing a barrel of crude oil in Nigeria is said to be one of the highest in the world with a unit cost going to as much between $22 to $30 a barrel. The increase in the cost of introduction however is as a result of so many factors but chief among them is militancy in the Niger Delta which has heightened insecurity. However Royal Niger Emerging Technologies Ltd and their technology partners – Viper Innovations Ltd seem to be finding a way out of

this problem as they recently presented their breakthrough collaboration for the Nigerian market which has the serious potential to reduce maintenance costs for subsea electrical equipment maintenance and electrical integrity in the Upstream industry. Neil Douglas, managing director of Viper Innovations said: “We see Nigeria as one of the growing areas and there are many business opportunities if you can provide leading-edge technology coupled with local content. As part of our collaboration objectives, we will be training Royal Niger Personnel to provide the in-country support for our services and installation of our hardware. This will help Royal Niger build on their current capabilities and capacity. We are all looking forward to the future with not only Viper and Royal Niger benefiting from the col-

allowed the Dutch disease to take over their country. The industries continued and of course they insulated the oil and gas space. On account of fiscal prudence, the country has to its credit today, the sovereign wealth fund of Norway which has over a trillion dollar in savings compared to Nigeria’s $1.5 billion. This is because all the found realised from oil and gas space is being saved. He said what is instructive is the fact that from the yields, the country is only allowed to take 4 percent of the interest. So taking this back home, he said Nigeria had independence 50 years after Norway had hers, and yet the country is so prosperous. Nigeria he said therefore has a lot to learn, to work with the Norwegians. The technology the Norwegian have is innovative. Narrating how Marine Platforms Limited started, he said: Initially at “ Marine platform we were very unconventional, we don’t abide with protocols, so we are doing business haphazardly and going into Norway aggressively indeed looking for opportunities, we were able to get companies and make business deals and we were being prosperous in isolation”.

Aspen Energy Nigeria to Hold 2nd “Aspen Energy Roundtable” FRANK UZUEGBUNAM

laboration but also our clients will benefit from award-winning technologies to extend field life and reduce operational costs” Viper Innovations expressed their excitement at the opportunities presented by their distributor agreement with Royal Niger Emerging Technologies Ltd. Major stakeholders in the oil and gas industry such as Nigerian National Petroleum Corporation (NNPC), international oil companies and their deepwater operations teams were present at the presentation. Many of the participants sought clarification in many areas and also offered a robust exchange of ideas, and at the end, many of the participants claimed they were convinced that the technologies presented would be great tools for achieving long-term integrity management of subsea electrical systems and controls.

Olusola Bello, Team lead, Analysts: Isaac Anyaogu, Stephen Onyekwelu, Graphics: Joel Samson.

possibilities for Norwegian interest in Lagos.” He stated that they could not have had anyone better than Taofik Adegbite. “He knows so many more Norwegian companies in Nigeria so whenever I have questions about the big business in Norway I always ask him to introduce me to them.” He said by appointing Taofik Adegbite as a consul general, he will complement Norwegian presence in Nigeria as we have what we call team Norway which is made up of Norwegian companies and institutions in the country, such as Norwegian Ex-

port Credit and the embassy. In addition to these, we have the Nigerian dimension which is the Nigeria – Norway Chambers of Commerce which is very active in Lagos. The Marine Platforms boss while responding to this gesture, thanked the ambassador and the Norwegian government for the confidence they have in him and promised not to disappoint nor to betray them. He said he was particularly humbled because he never thought it would happen and now that it has happened it would not have been a reality but for the entire project Marine platforms. He said his company came to being as a consequence of the local content idea, adding that Norway is a country that is highly prosperous yet frugal, very rich but conservative. According to him Marine platforms built its first ship in a community of 5000 people in Norway where in the technology is amazing. He said what interests him is the fact that Nigeria has a lot of things in common with Norway, a country where private sector helps in building infrastructure. Norway he said had at a time decided to go into what it needed such as fishing, and building fishing boats and when oil came they never

spen Energy, an integrated energy consultancy company will host the second Aspen Energy Roundtable in January 2019 in Lagos. The event, a platform for thought leadership in Nigeria’s energy sector, attracts leading operators in the energy sector in the country as well as top policy makers. The theme of the proposed Roundtable is “Gas Business in Nigeria: Challenges and Opportunities”. It will feature deliberations on the full spectrum in Nigeria ranging from the Nigerian gas master planthe journey so far, to financing natural gas projects in Nigeria among other topics. The first Aspen Energy Roundtable event held in July 2017 attracted key players in the industry, which included Austin Avuru (MD/CEO of

Seplat Petroleum), Lai Fatona (MD ND Western), Osten Olorunsola (Former DPR Director), Seye Fadahunsi (MD Pillar Oil), Pat Maseli (Head Upstream Monitoring & Regulation representing the MD Department of Petroleum Resources), Olusegun Olujobi (MD Vertex Energy), Bunmi Toyobo (Executive Director- Oil Producers Trade Section) and Mason Oghenejobo amongst several others. In his opening speech at the inaugural Aspen Energy Roundtable themed “Growing Nigerian Independents to World Class E&P Companies”, Opadere stated that with over sixty years of petroleum operations in Nigeria and the advent of Indigenous oil and gas companies, the Nigeria’s Petroleum Industry has both the capacity and the opportunity to be a catalyst for investments and economic growth in Nigeria, creating employment for several thousands of Nigerians.

The Managing Director of Aspen Energy, Benjamin Ofodile, reiterated that the Roundtable aims to articulate the organising logic for building a vibrant and sustainable energy sector in Nigeria. He said that the intellectual content is usually very rich adding that the output is distilled and communicated to various stakeholders, including government. “We look forward to the second edition of the Aspen Energy Round table as it promises to be bigger and better”, he said. Aspen Energy Limited is an integrated energy company established in 2010 to provide an assortment of expert services across the upstream, midstream and downstream sectors of the energy value chain in Nigeria and the West African sub region. The company aims to create long-term value in the Sub-Saharan African oil and gas Industry.

Email: energyreport@businessdayonline.com, Tel: +234-8023020011; +234-7037817378

Tuesday 04 December 2018

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BUSINESS DAY

Energy Report

Oil price fall not based on economics but Trump’s policy mistakes STEPHEN ONYEKWELU

Three months Brent crude price

il prices entered a bear market one month after hitting a fouryear high of over $75 per barrel and some experts say this is not based on economics but President Donald Trump’s policy missteps. When President Trump showed no inclination toward US-Sino reconciliation, hopes associated with world trade, investment and finance dissipated. And as the prospects of global recovery turned illusive, crude prices began a steady fall. Oil futures climbed to their highest settlement in nearly four years in early October, only to drop to a more than one-year low in late November. For global benchmark Brent crude LCOG9, -1.40% that was a drop from a peak settlement of $86.29 on Oct. 3 to $58.76 on Nov. 28. “Ironically, there was nothing inevitable about the dramatic reversal of oil prices in October. It was not based on economics. Rather, it was the effect of overcapcity and the Trump trade wars fuelled by hollow dreams of an ‘America First’ 21st century” Dan Steinbock, founder of Difference Group Lt. said. Achieving a balance in

Source: Nasdaq the oil markets is proving to be a challenge for the Organisation of the Petroleum Exporting Countries and its allies, and they face their stiffest test yet when they meet in Vienna Thursday. OPEC’s official meeting will be held on Dec. 6, and members of the group, along with some non-members, may agree on a production cut as the market reels from a more than 30 percent drop in prices over less than two months. “Markets will be watching how OPEC will grapple with multiple threats to their efforts to keep prices buoyant,” says Peter Kier-

nan, lead energy analyst at forecasting and advisory services provider Economist Intelligence Unit. Those include “expectations of slower oil demand growth next year, robust U.S. supply and vocal pressure from [U.S. President] Donald Trump to keep prices lower.” One of the big factors in the oil price slump was Trump’s pushing Saudi Arabia to increase production and then surprising the Saudis by issuing exemptions to several nations allowing them to continue doing business with Iran. “This is a business cycle Nigeria will have to manage

carefully. The first hit will be the exchange rate because of our reliance on the import of refined petroleum products. So, the naira will take a beating because we do not have enough foreign reserve to defend it. This is one of the low hanging fruits the Petroleum Industry Governance Bill would have addressed” Wumi Iledare, professor of petroleum economics said on phone. OPEC is expected to cut production in an effort to stave off a global glut in supplies. The risk of an oversupply emerged after the group and its allies, including Russia, agreed in June to raise production, in part due to an expected loss of oil from U.S. sanctions on Iran’s energy sector. Before that June increase, oil producers had been cutting back production for more than a year to get rid of an oversupply. “If oil price continues to fall such as we have seen in the last few weeks, then there is need for concern. Already when oil price was at $72 per barrel we used about $3 billion of the foreign reserve to defend the naira” Johnson Chukwu, managing director/chief executive officer Cowry Asset Management Limited said. “At below $60 per barrel, this will put pressure on the naira, increase inflationary pressure, and reduce the standard of living and purchasing power.”

Local entities default on tax payment over US$8 billion oil and gas assets Olusola Bello

ver US$8 billion oil and gas assets were sold to Nigerian entities – especially onshore fields –between 2005 and 2015 and these companies have failed to pay tax The failure of these companies to pay Capital Gains Tax (CGT) on the sale of the assets is allegedly seen as one of the major factors fueling poverty, underdevelopment and inequality in Nigeria. This revelation was contained in a report titled “Impact of non-payment of Capital Gains Tax (CGT) and other Levies in the Oil and Gas sector on the Socio-Economic Development of the country” and which was recently unveiled by the Socio-Economic Rights and Accountability Project (SERAP) in Lagos In recent years, economic inequality has soared to unprecedented levels in Nigeria, hampering poverty reduction efforts, fueling political instability and presenting new threats to the full spectrum of human rights

The report also revealed that the divestment of assets by international oil companies has not translated into commensurate increase in revenue arriving in the Nigerian Government’s coffers from taxes. According to SERAP information obtained from the Federal Inland Revenue Service (FIRS) for the report, the governments of Umaru Musa Yar’Adua and Goodluck Jonathan failed to collect CGT on the sale of Addax Petroleum to Sinopec in 2009 from divestment of assets worth $2.5 billion. The report also stated that Goodluck Jonathan government also failed to collect tax on the transfer of Conoco Phillip Oil Company Nigeria Limited to Oando Hydrocarbon (Now Oando Oil Limited) through the acquisition of the shares of Conoco Phillips in Canada for US$1.79 billion. The shares were acquired by Oando Energy Resources Canada. Consequent upon this, it called on the authorities to urgently recover any possible past-unpaid dues, and for improvement in the collection

and estimation of capital gains tax in the Nigerian oil sector. It stated that the political will to improve framework and policies for the determination and payment of capital gains tax in the oil sector could generate the much needed revenue for execution of government projects and provision of infrastructure and socio-economic development. “An improved framework it stated that has the potential to galvanise action to reduce poverty, underdevelopment, unemployment, and inequality”. Presenting the report to the media, Azeez Alatoye and Bimpe Balogun urged the Federal Government to move swiftly to improve the administration of capital gains tax in the oil and gas sector and to identify the loss over a period of time. In his contribution at the presentation, Femi Falana SAN, commended SERAP for the public presentation of this timely report. “From the report not less than $270 million has not been recovered by the federal government, the amount recoverable has not been cap-

tured due to the refusal of Department of Petroleum Resource ( DPR) and Nigeria Extractive Industries Transparency Initiative (NEITI) to provided requested information on the oil companies that have divested interests in the oil and gas sector. SERAP should proceed to compel the two agencies to supply the information so as to update the report.” Falana also said the NEITI disclosed that the NNPC and others have withheld the sum of $22.06bn and N481bn from the federation account. Femi Falana also said SERAP should collaborate with NEITI to collect the huge fund of $22.06bn and N481bn allegedly being withheld from the federation account by NNPC without any further delay. “SERAP and the progressive extraction of the civil society must take special interest in the judgment of the Supreme Court which has ordered the federal government to recover 18-year lost revenue from oil giants under the Deepshore Offshore Inland Production Contract Act.”

NNPC, NIPCO outline strategies to increase cooking gas consumption Olusola Bello

ommitted to enhancing the penetration of Liquefied Petroleum Gas (LPG), popularly known as cooking gas among Nigerians stakeholders have promised to aggressively grow local consumption. The stakeholders who renewed their commitment at the 8th international conference and exhibition renewed their commitment to see that deforestation is highly reduced and firewood is replaced with cooking gas. The Nigerian National Petroleum Corporation (NNPC) is targeting 10 percent market share of the global Liquefied Natural Gas (LNG) market and because of this, it is determined to invest in making LPG available to Nigerians to discourage the current trend of using firewood and other unsafe means for cooking, stressing that it was time to bring LPG closer to the people and at affordable price. In a presentation entitled: “Strategic Direction – Driving Nigeria’s LPG Future”, Maikanti Baru , group managing director of NNPC said significant investment has been made by the Corporation to address the challenges of products deficit. He listed some of the projects aimed at deepening LPG consumption in the country to include: expansion of NNPC LPG storage facility at Apapa from 4,000mt to 8,000mt in the first phase; construction of pipelines to deliver LPG to plants in the hinterland; and development of coastal supply facilities. “We have also purchased two LPG vessels for export operations through the West African Gas Ltd (WAGL), a joint venture firm, and we have developed a growth strategy plan and gradually providing LPG skids across NNPC Retail outlets”, he stressed. On the global scene, Baru declared that NNPC was doing everything to leverage on the nation’s enormous gas reserve to secure about 10 percent of the global market share of traded LNG. In its own strategy, NIPCO Plc said it has heightened plots to weaken deforestation rocking parts of Nigeria with multimillion dollars investments. Sanjay Teotia, who is the managing director of the company, maintained that this is being done through NIPCO’s huge investments in cooking gas sub-sector. The feat, he said, “has not only created lots of awareness on the benefits of gas as domestic cooking fuel but has also served as drawback to deforestation in the country.” Throwing his company’s weight behind the Federal Government agenda to grow

the LPG sub-sector, the NIPCO’s boss promised continuous and deliberate efforts in “supporting government’s genuine desire to make LPG domestic cooking fuel of choice among the populace.” He continued; “We diversified in the gas realm in 2009 with the inauguration of a state of the earth LPG plant in Lagos with a total storage capacity of 4,800MT spread across three spheres and a three point loading gantry. “As at the time of its inauguration, it was the biggest LPG storage in the country thus creating veritable avenue to store gas and distribute effectively with the scores of LPG trucks commissioned by the company.” In 2017, the company improved on the storage capacity and other LPG infrastructures in a bid to meet growing LPG stakeholders’ interest. “We commissioned the biggest LPG single sphere in Africa with a capacity of 5,600MT and increased the loading arms in the gantry to five in a bid to ease loading of trucks for onward distribution of the product to all the nooks and crannies of the country.” “Today, NIPCO controls a major share of the LPG market with its massive storage facilities and other infrastructures put in place to aid access to the product by the populace. “The peerless service being provided by the company has made it depot of choice by many bottling plants and others in the business of LPG. “The improved storage facility and product reception at the terminal has been a major boost in the effective turnaround of LPG vessels berthing at the Apapa jetty”, he pointed out “In buttressing the assertion, Tony Attah, the Managing Director, Nigeria LNG, on a visit to the company’s LPG plant said; “I never in my wildest imagination believed that this kind of facility exist in Apapa here. I can see also very huge investment that NIPCO has put into upscale the amount of LPG that they can receive into the country. For me that is the real game changer and we are committed to continue to support NIPCO and indeed Nigeria to bring about the positive change in terms of energy availability for Nigeria”, he added “We have also gone ahead to empower potential LPG users through donation of gas accessories like cylinders, hose, burners among others, to some communities in Auchi, Edo state; Apapa, Lagos state; and some public schools in Lagos.” The feat has, according to him, “not only created lots of awareness on the benefits of gas - as domestic cooking fuel - but has also served as drawback to deforestation in the country.

BUSINESS DAY

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Tuesday 04 December 2018

Energy Report

Three modular refineries may be ready for operations in 2019 Olusola Bello

s part of the Federal government efforts to reduce Nigeria’s dependent on imported fuel three modular refineries may come on stream in 2019 a source close to the ministry of Petroleum Resources has said. The minister of state for Petroleum, Emmanuel Ibe Kachikwu also corroborated this when he said that out of the 40 companies given license for modular refineries only three of them are currently active to the point that one could say they would come on stream next year. Another seven companies have however shown some signs of progress the minister also said A $35 million debt facilities agreement was executed between Walter Smith Refinery and Petrochemical company and Africa Finance Corporation ( AFC) for the construction of a 5,000 barrels per day modular refinery which is expected to be built and

completed within the next 18 months. The total cost of the refinery is about $48 million. While AFC is providing $35 million of the money the promoters of the project which is being sited Ibigwe field in Imo State are to make available the balance. According to Abdulrasaq Isa, chairman of the WalterSmith Petroman Oil Limited the facility would be scaled up to 30,000 barrels

per day after the first phase of the project must have been completed. Automotive Gas Oil (AGO), House Hold kerosene, Naphata would be the major products that would produced from the 5,000 barrels per day refinery. The Walter Smith boss said that petrol, Aviation fuel and Liquefied Petroleum Gas (LPG) would be produced after the plant would have been scaled up

to 30,000 bpd. In May this year, the company executed the Engineering, procurement and construction Agreement with VELEM, a consortium of two companies, VFUELS based in the United States and Lambert Electromec based in Nigeria. Also another Nigerian firm,Integrated Oil & Gas Limited has said that its 20,000 bpd modular refinery is on course. The

modular refinery which is located at Tomaro Island off the coast of Apapa port zone is expected to come on stream next year. An officer of the company said after an environmental screening meeting with the Department of Petroleum Resources (DPR), the technical partners/engineering consultants and the environmental impact assessment consultants, every necessary step was being taken to ensure that the refinery was delivered on schedule. The meeting with the DPR was part of the imperatives for the acquisition of the Environmental Impact Assessment Report (ESR) and other approvals. According to him, the meeting looked at the Front End Engineering designs of the refinery where the Crude Distillation Unit (CDU) was explained and analyzed and all concerns with how the various units would interface with the environment was explained, adding that after all the loose ends and every environmental concerns have been addressed, the company would get the EIA report.

Emerging gas diplomacy realigns interests, buyers, suppliers STEPHEN ONYEKWELU

as is fast becoming a critical piece on the chessboard of energy security as both global buyers and sellers seek strategic realignments to access and sustain supply of the cleaner fossil fuel, this could mean new markets for Nigeria, too. Market dynamics are changing fast and gas has occupied a prominent place in geopolitics across the world. Gas does not meet the entire energy requirement of many countries, but these nations and others still rely on each other for gas supply and are compelled to cooperate. So, gas provides an energy alternative for the countries that are dependent on oil only. Global gas demand will grow at an average rate of 1.6 per cent a year, reaching just over 4,100 billion cubic meters (bcm) in 2023, up from 3,740 bcm in 2017, according to the Paris-based International Energy Agency (IEA) annual gas market report titled: Gas 2018. In recent times some instances where gas demand and supply has reared up its

head in determining geopolitical and diplomatic decisions are Pakistan-Saudi Arabia-Iran-United States of America axis and GermanyRussia-U. S. A. In the case of the first axis, Pakistan is one such country which once heavily banked on oil to satisfy its energy appetite, but started gas imports during the tenure of previous Pakistan Muslim LeagueNawaz (PML-N) government. For decades, Saudi Arabia is considered to have influenced Pakistan’s foreign policy in return for providing Islamabad with vital oil supplies. After the current Pakistan Tehreek-e-Insaf (PTI) government took the reins of power, Imran Khan, prime minister of Pakistan also visited Riyadh, which tried to use oil diplomacy to keep Pakistan away from Iran. Soon after the premier’s visit, Saudi authorities rushed to Pakistan where they offered investment in an oil refinery and oil supply on an extended credit facility. Energy experts say in order to avert external influence, Pakistan should go for other fuel sources and learn from the experiences of European countries which have switched to alternative energy

resources. Russia, an oil and gas-rich country, has been supplying gas to Europe since long despite fierce opposition from the United States. Now, it is working on a new gas pipeline through the Baltic Sea and has got the backing of European economic power Germany. European countries have dismissed the U.S. opposition, arguing that they need gas to feed their economies and Russia is a big supplier. Donald Trump, the US President has made a verbal assault on Germany for supporting the Baltic Sea pipeline deal with Russia, believing Berlin would become a “captive of Russia”. Trump was of the view that Germany would be paying billions of dollars to Russia for the gas purchase. Again, Nigeria may miss the opportunity to grab major diplomatic alignment despite its large gas reserves. Africa’s largest crude oil producer has been unable to add new trains to its liquefied natural gas (LNG) plant. The units that freeze natural gas into liquid form for export on ships are known as trains in the natural gas industry. Big ticket projects like Olokola LNG, Brass LNG

and the NLNG’s Train 7 have been unable to reach final investment decision by the stakeholders. The OK LNG project was stalled because all the international oil companies (BG, Shell and Chevron) withdrew from the project, with only the Nigerian National Petroleum Corporation left. The Brass LNG project, which was designed to produce 10 million metric tonnes per annum, was to be built by the NNPC, Total, ConocoPhillips and Eni Group. But ConocoPhillips withdrew from the project in 2013. “It’s time to prepare for the likely demand outlook that’s positive, and has outperformed projections in the last three years. Let’s get back to exploration and production activities,” Tony Attah, managing director and CEO NLNG Limited said at Nigeria International Petroleum Summit in Abuja in February. Nigeria could struggle to regain prized markets for its long-term contracts due to its unstable regulatory environment, including the moronic decision to amend the NLNG Act by the House of Representatives. The fact that competitors

are offering more flexible terms calls for rethinking the NLNG strategy. LNG buyers receive fixed monthly volumes. Even if a buyer cancels a cargo due to a period of unusually low demand, payment is still due under “take-or-pay” obligations. Most Asian long-term supply contracts contain “destination clauses” which prevent buyers from on-selling LNG to third parties. To protect buyers and sellers from sharp price swings, the LNG under most long-term contracts is indexed to oil which is prone to volatility. However the United States has developed destinationfree and gas-indexed US LNG exports and this provides additional flexibility to the expanding global LNG market and makes its cargoes more attractive to Asian markets where Nigeria is targeting. What is more, industry leaders say shorter-term contracts and spot markets will increasingly gain prominence. Charif Souki, chairman at US LNG developer Tellurian Inc., at the Flame conference in Amsterdam on June 26, said long-term contracts in the LNG sector would soon be a thing of the past.

Relief for air travelers as 11plc re-launches its Aviation Fuel Business OLUSOLA BELLO

big relief has come the way of air travellers as additional source of getting aviation fuel which will make it easier for airlines to refill with ease has come on stream. 11plc (formerly Mobil Oil Nigeria plc) has recommenced the sale and marketing of aviation jet fuel (ATK) at the Murtala Mohamed International Airport and General Aviation Terminal (GAT – Domestic), in collaboration with Air BP. The company’s aviation business which has been inactive for the past five years is being revitalised in the wake of the construction of a new 20million litre aviation jet fuel (ATK) tank, laying of new ATK pipelines linking the company’s facility at Apapa with the Apapa Jetty. Adetunji Oyebanji, managing director and chief executive officer of the company who was apparently elated with this development, said: “We are delighted with the relaunch and our collaboration with Air BP. Air BP is one of the world’s largest suppliers of aviation fuel products and services. We are leveraging their innovative technical support and risk management expertise to provide

Tunji Oyebanji

best-in-class aviation fuel services to airline customers”. The Company, under its new management, continues to take huge strides in the Nigerian oil and gas downstream sector in keeping with its strategic investment drive geared toward repositioning for maximum output and improving the Company’s growth and earning potentials.

Tuesday 04 December 2018

BUSINESS DAY

38 BUSINESS DAY NEWS

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Investors eye Santa rally as UBA, Access, FBNH... Continued from page 1

panies that are trading below intrinsic value.

The renewed dip in global oil prices has piled pressure on public companies in a stock market that has slumped to a loss of 19 percent since the start of the year as foreign outflows exit ahead of elections February 2019 and rising interest rates in the United States. All of the top five banks in Africa’s largest oil producing country are flirting with a 52-week low and investors have been urged by a raft of investment bank reports to pay attention. “While we expect investors to remain cautious ahead of the coming elections, we see bargain hunting opportunities in fundamentally strong names,” said Tajudeen Ibrahim, head of research at investment bank, Chapel Hill Denham. “We have BUY ratings on Access Bank, Zenith Bank, Guaranty Trust Bank, Stanbic, FBNH, and United Bank for Africa in the banking sector,” Ibrahim said in a note to clients on Monday, December 3. Of the top five banks in Africa’s largest oil producer, United Bank for Africa is down the most since January 2018, with the lender down some 27.18 year to date to N7.50 for each share.

Access bank follows closely with a 25.8 percent decline to N7.75 per share year to date. First Bank is down 19.32 percent to N7.10 per share while the most capitalised bank and biggest bank by assets, Guaranty Trust bank and Zenith Bank are down 15.71 percent and 9.5 percent respectively, according to NSE data. At current prices, the banks are all less than a naira shy of their 52week low, while Guaranty Trust bank and Zenith are slightly farther with a N1.85 and N3.6 per share spread respectively. First bank is closer to its 52 week low than any other bank with a spread of N0.30 (30 kobo) while UBA is only N0.45 away and AccessN0.75 shy. Brent crude, the international benchmark, which has recovered some ground after falling to as low as $57 per barrel Friday, jumped to $61 Monday as Saudi Arabia and Russia extended their pact to manage the market and Canada’s largest producing province ordered unprecedented output curbs. The recent rally in bond yields also plays a notable role in depressed stock prices, according to Ayodeji Ebo, the managing director at Lagosbased investment advisory firm,

Afrinvest Securities Ltd. Yields on 10 and 15 year government bonds have crossed 15 percent to a one year high with effective yields gradually pushing towards 17 percent, as demand to hold safe fixed income assets swell in an economy marred by rising political risks. “Investors are rotating from risky equities to safe bonds, as they try to balance rising political risks in Nigeria with a sheer hunger for yield,” Ebo said. “However, the fundamentals of blue chip companies remain strong and investors are taking positions ahead as volumes are gradually going up, even though it is not at a level to see a rally in prices,” Ebo added. Nigerian stocks currently trade at their cheapest since 2008 and are considerably cheaper than peer markets. Investors currently pay as low as 9.4 naira for each naira of profit made by companies listed on the NSE. That’s despite the fact that the companies’ return on equity climbed to 15 percent as the end of September 2018, the highest since 2014, according to Bloomberg data. Investors pay much higher to hold stocks in peer markets. In South Africa, investors pay the equivalent of 15x earnings, while listed companies in Egypt are valued at an average of 12.5 times earnings.

Tuesday 04 December 2018

Passengers knock NCAA over old aircraft... Continued from page 2

insists that no matter how hot an aircraft is, there is a level it gets to that the air condition must work because it is pressurised. “On ground, it is possible that Air Power Unit (APU) which is also the air conditions may not work but this is not possible on air,” Ola said. He however assured that the airline will investigate the issue and address whatever the case may be. In the same vein, BusinessDay’s checks also show that some of the airlines are currently struggling financially as there has been drastic reduction in their fleet size over maintenance and insurance costs. As a result, airlines are currently putting more pressure on the fewer aircraft available by serving same routes they had serviced with more aircraft. For instance Aero Contractors, which had 10 aircraft in its fleet has seen it reduced to two aircraft. Arik Air, which had over 28 aircraft on its fleet, currently has about eight aircraft. Medview airlines which had about four aircraft, currently has about two. Dana Air which had five aircraft currently has three aircraft. Also AirPeace, the largest domestic airline in Nigeria recently reviewed its flight schedule downward on account of five of its aircraft it pulled out of service and sent abroad for C-checks. Recently passengers are bearing

the brunt because airlines have had to delay flights and in some cases, cancel flights. Another passenger who craved anonymity told BusinessDay that one of the domestic carriers now photocopies its safety manuals, which are supposed to be printed and visible enough for passengers to see. Passengers have also complained that while foreign airlines deploy newer aircraft on the Nigerian routes, domestic carriers still parade one of the oldest airplanes despite the ban NCAA placed on aircraft older than 22 years being brought into the country. SamAdurogboye,generalmanager, corporate communications at NCAA said“PeoplealwaysthinkNCAAshould know everything happening to an airline. However, I want people to know that the 100percent safety of an aircraft lies with the operators. “Until we accept the responsibility that it is our own, things will never be right in this country. People should stop looking for whom to blame for other people’s failures. If an airline has an issue, they are supposed to report and NCAA will take it up from there. If the passengers complain, then we will take it up from there and it will be corrected.” Adurogboye assured that some of the complaints will be channelled to the appropriate directorate so the issues will be addressed.

UNILAG medical, pharmacy students in... Continued from page 2

L-R: Oscar Onyema, CEO, Nigerian Stock Exchange; Herbert Wigwe, GMD/CEO, Access Bank plc; Joseph Sanusi, former governor, Central Bank of Nigeria (CBN); Godwin Emefiele, governor, CBN; Uche Olowu, president/chairman of council, The Chartered Institute of Bankers of Nigeria, his wife, Beatrice, and Kennedy Uzoka, GMD/CEO, UBA plc/chairman, 2018 annual dinner committee, at the 53rd annual bankers dinner in Lagos. Pic by Pius Okeosisi

2019: Jonathan, Saraki, Tambuwal, Lamido... Continued from page 1

platform, Facebook. A number of former and current governors of northern states addressed the crowd, asking them

to vote out the current administration, led by President Muhammadu Buhari. The governors include; Sule Lamido, former governor of Jigawa; Babangida Aliyu, former governor of Niger state; Rabiu Kwankwanso, former governor of Kano state; Aminu Tambuwal, governor of Sokoto state; Darius Ishaku, governor of Taraba state; Ahmed Makarfi, former governor of Kaduna state. Also present at the rally was former President Goodluck Jonathan; former Vice-president Namadi Sambo; and Uche Secondus, the PDP national chairman; Senate President Bukola Saraki; Yakubu Dogara, speaker of the house of representatives. While giving his address, Dogara

said Nigeria is not safer today than it was in 2015, and that the economy has since deteriorated, asking the people to kick out the Buhari administration. Most of the governors who spoke at the rally addressed the people in Hausa and partly in English, reiterating the same message, asking the people to vote Atiku Abubakar, the presidential candidate of the PDP. At the rally, Jonathan said only the PDP and Atiku can make Nigerians eat well three times daily, asking the people to vote for the party. The Independent National Electoral Commission (INEC) had listed 79 candidates for the race to contest for the nation’s top job. IncumbentMuhammaduBuhariof therulingAPCalsorecentlylaunchedhis policy statement which he called ‘next level’promisingtotransformthecountry if given another four years to rule and consolidate on his achievement.

Invisible sector gulped 64.7% of forex... Continued from page 2

The CBN said it continued to intervene at the interbank and BDC segments of the foreign exchange market to further sustain the improved liquidity and relative stability in the market. The bank sold $4.26 billion to

authorised dealers in October, compared with $4.05 billion supplied in September. This indicated a 5.2 per cent and 153.6 per cent increase, compared with the respective levels in the preceding month and the corresponding period of 2017, CBN explained. Higher sales at the inter-

Atiku was a former Vice President of Nigeria from 1999-2007 under the OlusegunObasanjoledadministration. He was credited to have spearheaded the administration’s privatisation of key public enterprises which was seen to be largely a success. Speaking on Atiku campaigning in Sokoto, national president of an Atiku campaigngroup,Atikumandate,Lawal Soitan, said that the former Vice president remained the best man to lead the country out of it current woes among all theotherpresidentialcandidatesinnext year’selection,promisingthatthegroup will campaign for his victory. “We are in Sokoto with him and you need to see the reception around him everybody wants to see Atiku and you can see in the eye of the people that they want a change, because APC have failed them”. “Our group is with him and we are going to campaign vigorously with him across the country for his emergence because we know he has the solutions to Nigeria’s problem,” Lawal said. bank and BDC segments, increased swap transactions and forwards disbursed at maturity accounted for the development, relative to the preceding month, the bank added. Sales at the Investors and Exporters (I&E) window, however, declined by 30.0 per cent to US$1.46 billion and accounted for 34.2 per cent of aggregate sales, according to the banking regulator.

Deputy Vice Chancellor and Provost. A source privy to this development said, “We just had a meeting with the Deputy Vice Chancellor and Provost. They said that to pacify us, they would bring the light back for this week while they deliberate, but we would have to pay the increase in funds for the light. If not, we would return back to just 4 hours of light per day.” “They are saying that the students will be metered now; so there is the tendency that students will pay for the energy they expend. As at now there is still no light, but promises have been made for light to be brought back before deliberations are made on Thursday,” according to our source. How it all started A students who spoke to BusinessDay said, “Our hostel fee has been N33,000 for some time but there was an instalment of power plant in school with a promise by the school authority to give us uninter-

rupted power supply; our hostel fees was then increased to N44,000. “Thereafter the students complained to SERVICOM in Unilag and SERVICOM got back to the Provost of the College that it is impossible for students in “College” to pay double of the hostel fees of “Akoka” students. The Provost is taking it out on the students that they will just have 4 hours of power supply in a day. That is outrageous for a medical school and is the worst that has been heard among federal schools in a long time,” the student noted. It was learnt that the students signed an Indemnity Form earlier on, “which has taken the right of students to protest,” according to our source. Other students of the university “Akoka” campus could not resume for the 2018/2019 first semester on November 18 as scheduled because of a strike action by the Academic Staff Union of Universities (ASUU).

OPEC’s future on shaky ground as Qatar... Continued from page 2

political stances have drawn the ire of its neighbours, particularly Saudi Arabia, OPEC’s largest exporter. OPEC members Saudi Arabia and the United Arab Emirates, and fellow Arab states Bahrain and Egypt, have imposed a political and economic boycott on Qatar since June 2017, accusing it of supporting terrorism. Although Doha denied the charges and says the boycott aims to intrude its sovereignty. Delegates at OPEC, which has 15 members including Qatar, sought to play down the impact. But losing a long-standing member undermines a bid to show a united front before a meeting that is expected to back a supply cut to shore up crude prices that have lost almost 30 percent since an October peak. “It could signal a historic turning point of the organization towards Russia, Saudi Arabia and the United States,” said Algeria’s former energy minister and OPEC chairman, Chakib Khelil, commenting on

Qatar’s move. He said Doha’s exit would have a “psychological impact” because of the row with Riyadh and could prove “an example to be followed by other members in the wake of unilateral decisions of Saudi Arabia in the recent past”. It highlights the growing dominance over policy making in the oil market of Saudi Arabia, Russia and the United States, the top world’s three oil producers, which together account for almost a third of global output. Riyadh and Moscow have been increasingly deciding output policies together, under pressure from US President Donald Trump on OPEC to bring down prices. Activities in OPEC meetings are always center for discussions in Nigeria, despite being Africa’s largest producing oil country, it still faces a third straight year of lower than planned revenues, as the Federal government now has barely four months to raise N5 trillion if it must meet its 2018 revenue target, according to Business Day analysis.

Tuesday 04 December 2018

BUSINESS DAY

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LegalPerspectives

With

Tuesday 04 December 2018

Odunayo Oyasiji

The landlord and tenant relationship in Lagos State (part 2) ADETOLA ADELEKE,

Lead Partner, Crowncourt Attorneys

T 1.1.

Who Pays for What? he landlord and tenant relationship is largely commercial and majority of disputes arising from this relationship is monetary. While it is common knowledge and an implied term of the tenancy that the tenant pays rent to the landlord for occupying the property, there are other financial obligations which may arise during the tenancy which are often pushed from one party to the other, especially when there are no express provisions in the tenancy agreement in respect of those obligations. Now, we will consider some oft-disputed items as follows: i. Agency and Legal Fees: It is the duty of the party who engages the services of a professional in respect of the tenancy agreement to pay the fees for such professional services. ii. Repairs: The landlord is liable for the structural and external repairs of the property, while the tenant is responsible for the internal repairs and minor wears and tears repairs. iii. Utilities: Except where service charge has been paid, the tenant is responsible for utilities consumed on the property. iv. Land Use Charge and I n s u r a n c e : The landlord is obliged to pay land use charge and insurance premium. 2. Categories of Tenancies Recognized Under the Law

i. Tenancy at sufferance is created when either the contractual tenancy or license given by the owner or person entitled to the right of occupancy of premises expires, and the tenant or licensee

holds over possession. For example, a tenant for a fixed term who refuses to vacate possession at the expiration of his tenancy and wrongfully (i.e. without the consent of the landlord) continues

tiff. The defendant requested that the plaintiff should reply by post. The letter of offer to the plaintiff was wrongly addressed and as such the letter didn’t get to the plaintiff until September 5. Due to the delay the letter of acceptance did not get to the defendant until September 9. The defendant already sold the wool to another person on September 8. The question the court was

ii. Tenancy at will is created by a mutual understanding that both the tenant and the landlord can terminate the tenancy

DO YOU KNOW?

LOCUS CLASSICUS Adams v Lindsell (1818) 1 B & Ald 681

rinciple :The principle established by this case is with regards to acceptance by post. It states that acceptance of an offer occurs the moment the acceptance letter is posted – even if the letter does not get to its destination eventually. Fact: The defendant wrote a letter to the plaintiff of September 2 making an offer to sell some wool to the plain-

in possession.

whenever either party elects or at any time convenient to any of them. However, for all practical purposes, in a tenancy at will, the tenant is the tenant at will because he occupies premises at the pleasure or happiness of the Landlord. The landlord can send the tenant packing at anytime, but subject to proper notice issued to the tenant by the landlord. Thus, for example, a contractual tenant, say a yearly tenant whose rent become due but remain unpaid and who holds over the property, with the consent of the owner, transforms into a tenant at will and he is, in that status, entitled to only one week (or 7 days) Notice to Quit to determine the tenancy instead of six months to which a yearly tenant is entitled. iii. Customary Tenant is always a tenant. No matter how long he is on the land, a customary cannot acquire ownership by divesting the radical owners of their title merely by virtue of long tenancy in possession during which time he is entitled to occupy and use the land. In other words, the occupation and use of the land by the customary tenant is always subject to the landlord’s right of reversion under appropriate circumstances. iv. Tenancy by Estoppel: In a tenancy by estoppel, a person acts as landlord but he lacks title to the property. In spite of this shortcoming, the tenant cannot deny the tenancy; he cannot challenge the title of the so-called landlord. The tenant can only challenge the landlord’s title if the landlord acquired the premises subsequent to the letting.

A tenant who pays service charge, facility and security deposit in addition to the rent is entitled to a separate receipt for the payments and also written account of how the money was disbursed at least every six months. Section 10 of Tenancy Law of Lagos State 2011 states that “10. In any case where the landlord or his agent in addition to rent requires the tenant or licensee to pay – (a) A security deposit to cover damage and repairs to the premises;

asked to answer is whether there is already a contract of sale between the plaintiff and the defendant at the time the defendant was selling the wool to another person on September 8. The court held that the offer had been accepted immediately the letter was posted. Therefore, a contract was already in place. The defendant was held liable for breach of contract.

(b) For services and facilities for the premises; or (c) Service charges in flats or units that retain common parts on the premises, The landlord or his agent shall issue a separate receipt to the tenant for payments received and such tenant shall be entitled to a written account at least every six (6) months from the Landlord of how monies paid were disbursed.”

Tuesday 04 December 2018

LegalPerspectives

C002D5556

With

BUSINESS DAY

Odunayo Oyasiji

CASE UPDATE

Ikeja Electric Plc dragged to court over estimated and excessive billing

he plaintiff, M r O l ay i wola Sadibo instituted su i t nu m ber ID/2606GCM/18 against Ikeja Electric Plc over the issue of estimated and excessive billing on his apartment. The matter was instituted at the High Court of Lagos State, Ikeja judicial division. The matter was assigned to Honourable Justice Adebiyi. From the processes sighted by Businessday, the plaintiff stated that he took several steps via telephone calls, emails and visits to the office of the defendant to get the matter resolved without success. Copies of emails and responses from the defendant were attached to the processes filed as evidence. The matter was instituted by way of originating summons i.e. with more focus on the interpretation of various sections of the law governing the consumer- distributor relationship between the parties to the matter. The issues submitted to the court for determination are1. Whether by virtue of Regulation 1(1) of the Nigerian Electricity Regulatory Commission’s Meter Reading, Billing, Cash Collections and Credit Management for Electricity Supplies Regulations of 2007 and Regulation 4(1) of the Nigerian Electricity Regulatory Commission (Methodology for Estimated Billing) Regulations of 2012 which were made pursuant to the Electric Power Sector Reform Act of 2005, the Defendant is required to obtain the actual reading of the meter serving the Claimant’s Apartment before the imposition, issuance and/or service of electricity bill

on the Claimant. 2. Whether by virtue of Regulation 4(1) and (2) of the Nigerian Electricity Regulatory Commission (Methodology for Estimated Billing) Regulations of

2012 made pursuant to the Electric Power Sector Reform Act of 2005, the Defendant is required to bill the Defendant based on the last actual reading of the meter serving

the Claimant’s Apartment which shall be obtained every month but not later than once in every 3 (three) months. 3. Whether the Defendant can law-

fully elect to impose, issue and/or serve estimated bills on the Claimant’s metered Apartment rather than bills which are issued based on the actual reading of the meter serving the Claimant’s Apartment in the manner required by Regulation 1(1) of the Nigerian Electricity Regulatory Commission’s Meter Reading, Billing, Cash Collections and Credit Management for Electricity Supplies Regulations of 2007 and Regulation 4(1) of the Nigerian Electricity Regulatory Commission (Methodology for Estimated Billing) Regulations of 2012. 4. Whether the Claimant, by virtue of Regulation 5(1)(f ) of the Nigerian Electricity Regulatory Commission’s Connection and Disconnection Procedures for Electricity Services of 2007 made pursuant to the Electric Power Sector Reform Act of 2005, is entitled to a prior written warning before the Defendant can lawfully disconnect electricity supply to

his apartment. Furthermore, in a motion on notice for interlocutory injunction that was filed by the plaintiff, the plaintiff pointed out the fact that his apartment was disconnected on May 24, 2018. Despite the disconnection, Ikeja Electric Plc still kept on bringing outrageous estimated bills for subsequent months. The matter came up for the second time on November 27, 2018. It was slated for hearing of pending applications- motion to amend and motion for interlocutory injunction. The counsel to the plaintiff moved the motion for amended. However, when the motion for injunction was to be moved, the court instructed that the amendment should be done first as there will be no originating process for the court to look at in determining the motion for injunction as the court is required to look at all the processes.The court adjourned the matter to January 17, 2019.

BUSINESS DAY

C002D5556

Tuesday 04 December 2018

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

Are Nigerian companies spending on Capex after recession period? Stories by BALA AUGIE

igerian companies to have got their mojo back as they are gradually embarking on the acquisition of property plant and equipment to fund expansion plans. Hitherto, Corporate Nigeria had slow down capital expenditure spending due to an economic lethargy brought on by a precipitous drop in crude oil price that tipped the country in its first recession in 25 years. However, a rebound in crude oil price and production combined with a favorable foreign exchange market help the country exist a recession in the third and fourth quarter of 2017. As a result of the aforementioned economic recovery, firms’ cash flow position got a boost as they were able to source dollars to import raw material and equipment to propel production and meet consumer demands. For the upstream oil and gas players, the combination of an uptick in crude oil price combined the relative peace in the Niger Delta region gave them the leeway to resume exploration. The capital expenditure spending of 40 non-

financial companies that have released third quarter results increased by 20.86 percent to N226.16 billion from N187.12 billion as at September 2017, this compares with a reduction of 38.17 percent to N187.12 billion from N304.52 billion in 2016 and a decline of 41.27 percent to N304.52 billion from N522.68 billion as at September 2015. “They have been trying to expand by increasing their capacity to meet new demands following the economic slowdown of 2017 and 2016,” said Ayodeji Ebo, manading director/CEO of Afrinvest Securities Ltd.

“However, we may not see most of these firms start new projects because slowdown in foreign direct investment,” said Ebo. The energy stock, consumer goods, and energy firms drove much of the capital expenditure spending. Oando Nigeria Plc, an oil and gas major, saw investment in property plant and equipment surge by 212.94 percent to N21.38 billion as at September 2018, while it revenue grew by 31.13 percent to N505.13 billion in the period under review. For the consumer goods firms, Guinness was more aggressive in using cash

stock piles to fund infrastructure as investment in property plant and equipment surged by 876.10 percent to N4.07 billion as at September 2017. However Nigerian Breweries hasn’t been investing in capital expenditure as investment in property plant and equipment has been falling in the last five years, which is why it capitulated to stiff competition. Julius Berger Nigeria Plc, the largest construction company by market capitalization saw investment in property plant and equipment surge by 814.80 percent to N1.56 billion as

at September 2018; the last time the company acquired assets was in 2015. Industrial goods stocks could get a boost from the country’s housing deficit and government’s proposed infrastructures spend. The capital expenditure spending will continue to increase after the election when people feel more comfortable. There are issues that make people nervous about investing, according to Bismarck Rewane, managing director/CEO of Financial Derivatives Company Limited, a Lagos based investment house. “For the oil and gas firms

we have to take the exchange rate into considerations since what they owe has increased,” said Rewane. Any improvement from capex tailwind could help cushion some investors’ concerns about equity valuation, which is at their lowest since 2013. The Nigerian Stock Exchange 30- list of the most liquid firms- 12 months price to earnings ratio is now 7.44 percent, compared with 14.97 percent as at June 6 2017, according to data from the Bloomberg terminal. The Manufacturing Purchasing Managers Index in the month of September stood at 56.2 index points, indicating expansion in the country’s manufacturing sector for the 18th consecutive month, according to the Central Bank of Nigeria (CBN) Purchasing Managers Index Survey report. The report stated that a composite PMI above 50 points indicated that the manufacturing/non-manufacturing economy was generally expanding; 50 points indicating no change; and below 50 points, generally contracting. “It should be expected because Seplat has been spending on gas assets for some time, said Jubril Kareem Energy Research Analyst at EcoBank.

Insurers remain efficient as combined ratio is below threshold

igerian listed in sure rs have remaine d efficient amid rising claims and underwriting expenses as their combined ratio is below the 100 percent threshold. The cumulative average combined ratio f0r 19 firms that have released third quarter results fell to 78.73 percent, this compares with 84.12 percent in 2017 and 0.99 percent in September 2016, as appropriate pricing underpinned underwriting profit. Markets and Intelligence derived combined ratio using the National Insuranc e Commission formula of total operating

or management expenses divided by net premium income. A ratio below 100 percent means an insurer earns more in premiums than it pays out in claims. Experts are of the view that firms have been curtailing expenses in order to bolster efficiency as management expense ratio is a yard stick shareholders use to gauge the performances of managers. Firms must return surplus capital back to shareholders in from of dividend payment. A breakdown of the figures shows AXA Mansard Insurance Plc’s combined ratio fell to 98.25 percent in

September 2018 as against 1.085 perecent the previous year. Mansard’s underwriting profit surged by 102.93 percent to N4.44 billion in September 2018 from N2.18 billion the previous year, the first uptick in four years. Lasaco Insurance’s combined ratios fell to 70.42 percent in the period under review as against 114.92 percent as at September 2017. The company’s underwriting profit surged by 146.47 percent to N1.52 billion in the period under review from N618.59 million the previous year, first uptick in four years.

Cornerstone Insurance’s combined ratio reduced to 94.39 percent in the period under review from 157.75 percent them previous year. The company recorded an underwriting profit of N1.67 billion in September 2018 from a loss figure of 622 million the previous year. Regency Assuranc e Plc’s combined ratio fell to 84.25 percent in the period under review as against 91.49 percent the previous year. Underwriting profit was up 10 percent to N1.59 billion in the period under review from N1.45 billion the previous year. The underwriting profit is net premium income less

BD MARKETS + FINANCE Analysts: BALA AUGIE

claims and underwriting expenses, which is synonymous with gross profit for manufacturing, oil and gas and service firms. “There is sanity in the industry; people are trying to price appropriately. The suspended TBMSR AND the process of implementation of solvency 11 have led to increase in capital base,” actuarial analyst at Wapic Insurance Plc. “Shareholders want to see return on the business. The sanity will see improved results in the financial statement,” said Monsuru. Experts say the introduction of the TBMSR- albeit it has been suspended

by regulator- will ensure that insurers do not have to be compelled to increase capital to underwrite risks that stress their capital without commensurate return on investment. Insurers are spending less on operating expenses to generate each unit of premium income as cumulative average operating or management expenses fell to 38.38 percent in September 2018 from 40.67 percent the previous year. “It is a key performance indicator for them. Some of these firms have reduced management expenses,” said the actuarial analyst who doesn’t want his named mentioned.

Tuesday 04 December 2018

BUSINESS DAY

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Tuesday 04 December 2018

Security, agric, welfare, better economy top priority as Ortom, Ishaku, Bindow, Abdulrazaq, Aisha, kick off guber campaign James Kwen, Abuja, Sikirat Shehu, Illorin and Nathaniel Gbaoron, Jalingo

s the campaign for the 2019 governorship election kicked off Saturday, November 1, some first term governors seeking second term and new candidates vying for the first time have promised to tackle insecurity in their states, improve welfare of their citizens and reposition the economic status of their states and to run an all-inclusive government. In line with the time table and schedule of activities for the 2019 general election released by the Independent National Electoral Commission, INEC Governorship and State Houses of Assembly campaigns commenced Saturday, December 1. Prior to the take off date, some serving governors and those seeking fresh mandates had at different fora indicated what would form the basis of their campaign and why they deserve the peoples’ support. For instance, Governor Samuel Ortom of Benue State has being assuring people of the state that if re-elected he would among other things, prioritise the security of lives and property by protecting them against external attacks. Ortom particularly promised to ensure full enforcement of the open grazing prohibition law which seeks to protect farmers in the state against the heinous attacks by suspected Fulani herdsmen who have already killed scores on Benue. The Benue State Governor at different fora reiterated that the people of the state were resolute in the implementation of the Open Grazing Prohibition and Ranches Establishment Law 2017, stressing that, “Benue people are not against any group or persons but are against the destruction of their crops by herders, hence their resort to ranching”. But his main contender, Emmanuel Jime of the All Progressives Congress (APC) has centered his campaign on welfare of civil servants, an area Ortom seems to have erred due to backlog of salary and pension arrears. Apart from, workers’ welfare, Jime has promised to bring on board programmes that will boost the economy of the state to bring succour to the citizens and consequently return Benue to its lost glory.

Ortom

The governorship candidate had at a religious function in Gboko, the traditional Headquarters of Tiv, the dominant ethnicity in Benue, promised to partner the Federal Government to develop a Free Trade Zone in Benue, build key roads and invest substantially in healthcare and education. Governor Dairus Ishaku, PDP candidate for Taraba State seeking re-election, has continuously at different gatherings, promised to consolidate on the achievements of the first four years of his administration in the areas of security, agriculture, among others. In the area of Agriculture he promised to upgrade high land tea to be the best in the world if re-elected, stressing that, “On the state tea policy, I can tell you that, the tea policy is already a done deal; I would have said this tea would within a shortest time be exported, but we are still considering how we would meet up the demands of Nigeria for the tea before we start the exportation; if re-elected it will be a thing of the past. “I want to make Taraba great, we have revived the moribund companies and are now working; we no longer import either animal feed, oil or politeness. Seven moribund companies have been revived and we are going to do more to see Taraba amongst the greatest states in the country. In the next four years all this will be improved upon,” he assured. Also, the governorship flag bearer of the United Democratic Party (UDP), a former Minister of Women Affairs, Aisha Alhassan, popularly called, Mama Taraba, has been

Ishaku

promising justice, fairness and an all-inclusive government devoid of religious and tribal background while Danladi Sani of APC has promised to take security and welfare of Tarabans to be his topmost priority if elected. On his part, the Adamawa State Governor who is pursuing his second term ambition on the platform of APC simply promised that if given another tenure, he will run an allinclusive government where citizens’ interests will be vigorously pursued. In an elaborate campaign blueprint, Abdulrahman Abdulrazaq, APC governorship candidate in Kwara State, contesting for the first time said: “My priority in Kwara will be the provision of security and creating of jobs for the youths. We will establish industrial training incubators where youths will be given opportunities right after graduating from Secondary School to be trained in technical, electronics, IT and related skills. “We shall also provide agricultural extension services and take full advantage of the Nigerian Agricultural Mechanised Agency located in Ilorin. This will create opportunities for youths to go into farming on a large scale. We have very fertile soil in Kwara particularly along the banks of the River Niger, where rice will be massively cultivated. We have a huge potential for growing various crops and vegetables all over Kwara. Due to climate change we shall establish green houses with the private sector to harvest vegetables all year round and possibly develop an export market through our international airport in Ilorin.

Bindow

“These shall be our focus. However, we shall also address the provision of good primary healthcare services, good roads, adequate and constant water supply and provision of power through renewable energy. I recognise the excellent initiative of University of Ilorin in her plan to establish a huge solar farm and power plant on its campus. l pledge to fully support this initiative and bring it to fruition. “I also recognise the need for an efficient, well trained and well paid civil service particularly teachers at all levels. Kwara State is a state of reputable public and private universities. We shall explore the benefits that these institutions can bring to the state and their adjoining communities. “Also, we shall address the tourism potentialities of the state, renovate the dilapidated tourist sites, develop new untapped sites and revive traditional festivals with the active involvement of our royal fathers, whose role also in the peace and security of the state cannot be over emphasised. “We have a duty to improve our agricultural standards through socially sound and scientifically acceptable methods, extension services and subsidy programmes. This will enable us create more sustainable jobs for the people and at the same time contribute to the economic growth of the state. “For our citizens who work with the state government (at all levels) to be happy and committed to work, the government of change is prepared to work solidly on civil service reforms that hone the capacity of work-

ers, promote their welfare through bonuses, incentives and peopleoriented assessments. “We would deploy all resources needed to put in place health care policies that align with Universal Health Care standards. Our education sector will be receiving a total reform it urgently deserves. Likewise, we shall take a new approach towards youth empowerment by focusing on wealth creation, not slavery-oriented empowerments”. Similarly, the Labour Party Candidate in Kwara, Issa Aremu vowed to implement a 5-point development agenda focusing on people, prosperity, popular participation and partnership for development. Aremu said his administration would gear toward ending poverty by ensuring prompt payment of living wages, pensions and investment in education. Still in Kwara, Adetunji Oyabami of UDP promised that, “My goal is to bring back all our industries to Kwara State. Twenty-five years ago, we had industries like Tate and Lyle, Kwara textile and Okin Biscuits, among others. “But everything has folded up today. By the grace of God if we are elected, we can bring them back. My administration will focus on energy and water provision, improved agriculture, quality education and health care facilities, among others. “I will pay the new minimum wage for the state workers if elected. The issue of pension arrears for the state retirees will be addressed because they deserved their entitlement having worked for the state,” he said.

State, is Director General of the Atiku Cares Foundation. ACF, a philanthropic platform of the former Vice President for humanitarian interventions to vulnerable persons and communities has under the leadership of Abbas, made great impact in bringing succor to the most vulnerable around the country especially in the Northeast zone. Shuaibu, 43, a publicist

and public communications consultant hails from Kogi State. Lamuye, a lawyer and philanthropist is the founder of Prince Alade Lamuye Foundation (PALF), a vehicle she has used to impact on the lives of the widows in her state of Osun. She was until recently a member of the National Assembly Service Commission.

Atiku appoints 3 youths, a woman as aides

s campaigns of the People’s Democratic Party candidate, Atiku Abubakar kicks off in Sokoto State today, 3 December, 2018, the former Vice President of Nigeria has appointed, three youths and a woman as aides. The new appointments are contained a press statement issued by his Media Adviser, Mazi Paul Ibe in

Abuja on Sunday. The new appointees include Dr. Ahmed Adamu, Special Assistant (Youth and Strategy); Aliyu Bin Abbas; Special Assistant (Youth Support Groups); Phrank Shuaibu, Special Assistant (Public Communications) and Barr. (Mrs) Funmi Lamuye, Special Assistant (South-West). Adamu, 33, academician, petroleum econo-

mist and leadership and development expert, who hails from Katsina State is the pioneer Global President of Commonwealth Youth Council. He was an international expert at the United Nation’s Global Forum on Youth. He was also ranked among the top 100 most influential young Nigerians by Advance Media Africa. Abbas, 34, an indigene of Borno

Tuesday 04 December 2018

C002D5556

BUSINESS DAY

Analysing Jimi Agbaje’s tripartite vision for Lagos ODINAKA ANUDU

lujimi Kolawole Agbaje, popularly known as Jimi Agbaje, flagged off his campaign at Lekki, Lagos, last Saturday. His mantra is to free Lagos and create a state of equal opportunities for all. Agbaje contested in 2015 against the incumbent Governor Akinwumi Ambode, whose second term fate was sealed by Jide Sanwo-Olu, governorship candidate of the All Progressives Congress (APC). Agbaje emerged the governorship candidate of People’s Democratic Party(PDP) in Lagos in early October, after defeating his rival, Adedeji Doherty. In line with the provisions of the Electoral Act of 2010, as amended in 2014, presidential campaigns started on November 18 while gubernatorial campaigns commenced on December 1. The pharmacist unveiled his agenda before a group of supporters, party faithful and journalists. He anchored his vision on three main areas: Livability, Economy and Future. On livability, the PDP governorship candidate explained that he would make life better for all Lagosians in order to ensure they stay in the state and tap its economic potential. “Lateef Jakande (former Lagos governor) was a model we can look at. In four years, the traffic in Lagos will not be what it is today if I am elected governor. “How can we have a state like Lagos without a light rail? Lagos is the fifth largest economy, but they have been doing the light rail for 12 years without success. They now say it will be ready in 2022. Addis Ababa (Ethiopia) had its light rail in four years. We are telling the people of Lagos that within four years, light rail will be working,” he assured. Also on livability, Agbaje said Lagos state healthcare system would

Olujimi Agbaje

be revamped. He said the plank of his healthcare programme would be built around the health insurance scheme. “For health, we will be running a model based on health insurance so that you won’t worry when you get to the hospital,” he explained. Lagos State output in 2017 was $136bn, which is more than a third of Nigeria’s gross domestic product, according to official estimates. Data from the Manufacturers Association of Nigeria (MAN) show that out of N329.94 billion invested by manufacturers in the first half of 2017, 32.9 percent (N108.87 billion) went to Apapa zone while N67.27 billion (20.4 percent of total investment) worth of investments was channelled to Ikeja. Similarly, in the second half, manufacturers made investments estimated at N176.69 billion. Twenty-four percent or N42.46 billion was channelled to Ikeja, while 20 percent or N35.33 billion went to Apapa zone. In the first and second half, Apapa got N144.2 billion (28.46

percent), while Ikeja got N109.73 billion (21.65 percent). Agbaje explained that his economic blueprint is anchored on cutting unnecessary taxes and levies imposed on investors in the state, vowing that if elected, he will make doing business easier in the state. He explained that Lagos makes more money than 30 states put together but these states have friendlier business environment, pledging that he would stop multiple taxation to enable investors, micro, small and medium enterprises (MSMEs) to heave some sigh of relief, make more money and create more jobs for the people. Like in many states, the power sector is a challenge as businesses grapple with high operating costs fuelled mainly by expenditure on alternative energy sources. Nigeria generates 4,000 to 5,000 megawatts of electricity and distributes less. Agbaje believes his will power businesses and MSMEs when elected. He targets 1,000 megawatts of power in four years to boost the

economic fortunes of Lagosians. “There is an arrangement we will put in place in four years. I am giving you a guarantee as a governor that we will have a minimum 1,000MW of power. Lagos needs 3,000MW to have some sense of stability, but I can promise 1,000MW.” He said the state used to be the industrial hub of the country but has lost it to a neighbouring state due to several unfriendly business policies, but assured Lagosians that he would restore the state to its glorious status as an industrial and business epicentre. He explained that he would unveil a programme for MSMEs, which are the bedrock of any economy, adding that it would not be mere hand-outs but support with concrete infrastructure and funding. Moreover, Agbaje pledged to reduce unemployment to the barest minimum by providing jobs for the teeming young population. “As far as our children do not have education, they cannot have jobs. The economy is driven by MSMEs, which is why we have to look at how to support entrepreneurs. We must address ease of doing business.” On the Future, the PDP candidate said after spending N6 trillion in 20 years, government after government in the state has not been able to rejig the state’s economy, its infrastructure, health and education systems. He promised to restore the high standards of education in the state by providing more accessible, quality education, as opposed to what he called ‘the current ineffective system’. Lagos’ total debt profile has risen to N1.04 trillion, according to the National Bureau of Statistics. Another report by the Debt Management Office (DMO) puts Lagos’ foreign debt at $1.45 billion, which is highest among the 36 states. He pointed out that things are not working in the state owing to

vested interests. “Things are not working because there are one or two people with vested interests. It is the vested interests that will decide what will be given to Lagosians. They are the ones that have decided that local government system will be ineffective.” “I am running a believable administration and I am in the race for service not for self. They are in politics for selves. They have said that I am their ‘customer’. But I want to tell them that the customer is the king and he is always right. By March 2019, the rest will be history because this election will be decided by the people of Lagos who yearn for freedom, and not by political parties,” he told the enthusiastic supporters. He also used the opportunity to introduce his deputy, Haleemat Oluyemisi Busari, promising that they would ‘carry the load together’ instead of the culture of making the deputy a ‘spare tyre’. Agbaje is a pharmacist and founder of JAYKAY Pharmaceutical and Chemical Company Limited, serving as its managing director until 2005 when he ventured into politics He was a member of the Pharmacists Council of Nigeria (1999– 2006); national secretary of the Nigerian Association of General Practice Pharmacists (NAGPP) from 1987 to 1990; national chairman NAGPP (1990–1993) and chairman, Pharmaceutical Society of Nigeria, Lagos State (1994–1997). He was also a member, Lagos State Task force on Fake and Adulterated Drugs (1989–1993); National Drug Formulary and Essential Drugs List (1986–1993), and Lagos Hospitals Management Board (1994–1997). He sits on the board of several organisations, including Oakwood Park Ltd, Atlantic Hall Secondary School Epe, Jimi Agbaje Outreach (a project dedicated to helping the less fortunate) and has served as business mentor at Fate Foundation.

to create wealth for their citizens. According to him, the continued dependence of the federating states on the monthly federal allocations makes nonsense of the idea of a federal structure that Nigeria had set out to operate. “Nigeria must restructure to allow states take responsibility for certain aspects of this economy. Even if you have zero-level corruption, best economic policies, if you don’t restructure to allow state create wealth for the people, those policies won’t work.” Oshinowo said that a situation where only Lagos and Abuja are the centres of attraction is not good for

the country. “Today, it is only Lagos and Abuja that things seem to be happening. There are no economic opportunities for the citizens in other states. So, what you find is a situation where Nigerians are moving out of those states to Lagos to find means of livelihood. This is not good for the economy. The federating states must be able to create opportunities to engage their citizens and fight poverty.” Citing the gridlock around the ports and Apapa, Oshinowo said there was the strong need for government to take the issue of infrastructure more seriously.

Nigeria’s economy is over-regulated, says NECA …New president must focus on infrastructure to attract new investments JOSHUA BASSEY

l u s e g u n O s h i n ow o, director-general of the Nigeria Employers’ Consultative Association (NECA), says the Nigerian economy is bleeding from over-regulation, as multiple regulatory agencies created by the government— most of which have duplicated functions— see themselves as existing only for revenue drive. Oshinowo said rather than support and aide enterprise, the agencies have become a cog in the wheel of economic growth, as businesses in many respects are hounded,

thereby discouraging investments. The consequence of this, according to Oshinowo, is that business expansion is hampered by negative impact on employment generation. The DG spoke on Monday during a valedictory press conference, saying in other climes regulatory agencies play critical roles in the encouragement of growth and sustenance of enterprise. Oshinowo is retiring from NECA this December after 19 years of service in the association. “Unlike in other environment where regulation is used to encourage and aide the growth of enterprise, regulatory agencies in

Nigeria have actually become killers of businesses” said Oshinowo. Recall that NECA has had to fight battles with many of the Federal Government regulatory agencies, and only recently issued a statement to strongly condemn Nigerian Lottery Regulatory Commission (NLRC) for shutting down offices and business premises of Nigerian Breweries Plc nationwide over a disagreement arising from a sales promo, which the NLRC claimed was a lottery. The DG also made a case for the restructuring of Nigeria to allow states take full responsibility for their resources and manage same

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Challenge of high interest rate and how to fix it

period September 24 -October 4, 2018, from a sample size of 1,770 households randomly selected from 207 enumeration areas (EAs) across the country, with a response rate of 96.9 percent. The percentage of respondent households who felt that interest rates had risen in the last 12 months declined by 3.1 points to 29.3 points in the current quarter when compared to 32.4 points attained in Q2, 2018. On the other hand, 7.0 per cent of respondents believed that interest rates had fallen, 18.1 per cent of the respondents were of the opinion that the rates stayed about the same in the last 12 months, while 45.4 per cent of the households had no idea. The result revealed that more households had no idea on the direction of interest rate in the past 12 months. On the other hand, the respondents were asked whether it would be in the interest of Nigerian economy for interest rates to rise or fall. The results showed that 34.4 per cent indicated that it would be best for the Nigerian economy if interest rates fell, while 15.6 per cent opted for higher interest rates. The results further revealed that 11.1 per cent

thought that it would make no difference, while 38.3 had no idea. These responses revealed that while most of the respondents favored lower interest rates for the Nigerian economy, while the majority had no idea whether it should rise or fall. Results of survey conducted by the Manufacturers Association of Nigeria (MAN) shows that the average interest rate charged manufacturers (including SMEs) by banks in the second half (H2) of 2017 was 23.05 percent as against 22.65 percent in first half (H1) of 2017 and 21.4 percent in H1 of 2016. Many banks are unwilling to offer loans to MSMEs and those that do often provide same at above 20 percent. Though experts say funding is not the biggest challenge facing small businesses, they unanimously agree that it is among the top four. Nigeria has 37 million MSMEs that are expecting the government to recapitalise development finance institutions in the country. The Bank of Industry (BoI), for instance, lends credit to entrepreneurs at about nine percent. The focus of the BoI is the industrial and value-adding sectors such as manufacturing, agro processing, entertainment and export, among others. The Bank of Agriculture (BoA) also lends to farmers and those in the agric value chain. Ideally, BoA is supposed to lend to farmers at a single-digit rate, but the bank has been cash-strapped for a long time now. The bank officials are unhappy that they are not in charge of the Anchor Borrowers Scheme, which ordinarily could have increased the relevance of the bank, BusinessDay understands. Similarly, the current government set up the Development Bank of Nigeria (DBN) in 2016 with a view to increasing lending to small businesses and development-oriented sectors. Entrepreneurs tell us that this bank lends to them at a doubledigit rate of 13 to 16 percent. Small businesses are expecting a single-digit interest rate to able to borrow from banks and unleash potential. Presidential candidates are challenged to present a blueprint on this.

cessful brands to cheat Nigerian users. “SON will not sit back and watch some unscrupulous people threaten the survival of the industry. We will not sit down and watch these people pull down the investments of genuine manufacturers or importers. As long as you are law abiding, we will be there to protect you,” he said. He enjoined stakeholders in the lubricant sector to support the organisation in its quest to rid Nigeria

of substandard products in general, urging them to always consult SON for the minimum quality requirements for all products as outlined in the Nigeria Industrial Standards (NIS). He said the new SON office was to bring standards close to the people, while also achieving efficient and effect service delivery of standards. He noted that the office would also go a long way to checkmating the influx of substandard goods in the state.

HOPE MOSES-ASHIKE

here is no doubt that over the years, high interest rate, which is the cost of borrowing money from a lender or the reward for saving, has been a major challenge in the country. Nigeria’s benchmark interest rate has remained at 14 percent since July 2016 when it was increased from 12 percent. In view of this, the focus of whoever will emerge the winner of the upcoming general election should be on how to address this problem that has resulted in high cost of credit to the real economy. However, analysts from the financial services sector have come up with some suggestions on how the government can tackle the issue of high interest rate. Ayodele Akinwunmi, head of research, FSDH Merchant Bank Limited, said provision of adequate infrastructure in the country, mainly power, electricity and transport network will help to reduce the cost of doing business in Nigeria, attract investments and develop the nonoil sector in such a way that there will be increased supply of foreign exchange, reduced demand for foreign exchange and increased revenue for the country. “All these factors will help to reduce the risks inherent in the economy, ensure stable exchange rate and reduce inflation rate. Then interest rate can drop. Without these measures, interest rate will continue to rise. High interest rate is one of the prices a country pays for the risks inherent in its economy,” Akinwunmi said in an emailed response to BusinessDay. The country witnessed a sharp drop in crude oil prices around July 2014, which fell to as low as $30 per/barrel in late 2015/ early 2016. Apart from that, there were other major shocks that adversely affected the economy. These included geopolitical tensions, global growth slowdown, and U.S monetary policy normalisation. The Central Bank of Nigeria (CBN) at the time embarked on a cycle of tightening to rein in inflation. Inflation rate is currently at

11.28 percent from as high as 18 percent in January 2017. Ayodeji Ebo, managing director, Afrinvest Securities Limited, sees high interest rate as a complex problem interlinked with several economic variables. Ebo said the best way is to create an enabling environment that would de-risk the business operating environment. This can be achieved by improving infrastructure as well as easing the process of doing business. “This will lower the credit risk premium over risk free instruments, hence reducing the maximum lending rate. As long as the operating risks remain elevated, the lending rate will remain high”, Ebo said in an emailed response. One of the advantages of high interest rate environment is that the cost of borrowing by corporates and individuals as well as inter-bank lending rates is high. What the banks usually do is to transfer the cost of borrowing from the Central Bank of Nigeria unto their customers, making loans expensive and less accessible. Credit to the private sector de-

clined by 0.1 per cent to N22.275 trillion at the end of June 2018, in contrast to an increase of 0.02 per cent at the end of the corresponding period of 2017, according to the CBN’s half year 2018 economic report. The development owed, wholly, to the decline of 1.1 per cent in claims on the core private sector. In a recent report by the CBN, 23.5 percent of Nigerian households expected interest rate to rise on bank loans and savings over the next 12 months, while 14.6 per cent believed that the rates will fall. However, more respondents (61.8 per cent) of the respondents either expected no change or had no idea. Since June 2009, the National Bureau Statistics (NBS) conducts the inflation attitudes survey on quarterly basis, to sample the views of households on how they view the price changes of goods and services in the last twelve months, and their expectations of price changes over the next twelve months. Respondents’ opinions were used to explore the general public’s understanding of monetary policy framework. The Q3 2018 Inflation Attitudes Survey was conducted during the

SON and task of ridding Nigeria of adulterated lubricants ODINAKA ANUDU

or Nigeria to work, the Standards Organisation of Nigeria (SON), a body charged with the responsibility for standards, has a responsibility to rid Nigeria of substandard and adulterated lubricants. The SON has taken up this responsibility, stating that it would blacklist and publish the names of erring importers and manufacturers of fake and sub-standard

lubricants in the country. Osita Aboloma, director-general, SON, disclosed that the action would also send a strong warning to unscrupulous individuals to desist from the nefarious trade in fake and substandard lubricants. Aboloma stated this at the opening of SON’s office in Nassarawa State. ‘‘The name and shame’’ exercise would also help Nigerians to identify genuine lubricants in the market while also deriving value

for hard- earned money spent on such products,” he said. In his words, “SON classifies lubricants as life threatening and life endangering. The effect is far reaching and the nation cannot industrialise without quality lubricants.” He noted that courtesy of SON Act 2015, the agency has been empowered to prosecute purveyors of fake and substandard goods who indulge in the act of faking and adulterating established and suc-

Tuesday 04 December 2018

AVIATION

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GUIDE

BUSINESS DAY

in association with

Safety, infrastructure, key to delivering aviation’s benefits in Africa - IATA IFEOMA OKEKE

he International Air Transport Association (IATA) has explained that safety and infrastructure are indispensible to Africa’s aviation sector. The association therefore urged governments in Africa to maximize the positive social and economic power of aviation by working together to promote safe, sustainable and efficient air connectivity. “African aviation supports 55.8 billion dollars of economic activity and 6.2 million jobs. To enable aviation to be an even bigger driver of prosperity across the continent, we must work closely with governments,” Alexandre de Juniac, IATA’s Director General and CEO said at the 50th Annual General Assembly (AGA) meeting of the African Airline Association (AFRAA) in

Morocco. Safety was highlighted as a positive example of progress through collaboration. “Africa has had no jet hull losses for two years running and is two years free of any fatalities on any aircraft type, it’s clear that progress is being made. But more needs to be done. We urge governments to recognize the IATA Operational Safety Audit (IOSA) in their safety oversight programs. “With IOSA carriers performing three times better than airlines not on the IOSA registry, we have a convincing argument. Similarly states must push forward greater adoption of ICAO Standards and Recommended Practices (SARPS),” de Juniac added. Only 24 African states comply with at least 60 percent of ICAO SARPS. “That is not good enough,” de Juniac said as he encouraged states to make global safety standards a top priority. Airlines in Africa, on average, lose 1.55 dollars for every passenger car-

ried. Establishing competitive cost structures that enable growth and reducing blocked funds are essential to improving the competitiveness of African aviation. “Africa is an expensive place for airlines to do business. There is no shortage of examples illustrating the heavy burden that governments extract from aviation. Jet fuel costs are 35percent higher than the rest of

the world. “User charges, as a percentage of airlines’ operating costs, are double the industry average. And taxes and charges are among the highest in the world. On top of that, 670 million dollars of airline funds are blocked. Too many African governments view aviation as a luxury rather than a necessity. We must change that perception. “In Africa we have infrastructure

problems in two extremes. In some cases it is overbuilt and expensive. In other cases, it is deficient and cannot meet demand. Dialogue between industry and government is critical to ensure that there is sufficient capacity to meet demand, that airline technical and commercial quality standards are met and that the infrastructure is affordable. Achieving that will create the platform on which aviation’s economic and social benefits can be maximized,” de Juniac explained. IATA expressed strong support for the Single African Air Transport Market (SAATM) initiative. “The low density of the African intra-continental network makes it impossible to realize the potential benefits of a connected African economy. SAATM—if implemented—gives Africa the potential for economic transformation. History has shown that opening markets leads to rapid advances in connectivity,” de Juniac said.

Dana Air bags two crew proficiency awards Aero deepens competition in Industry with new training school

ana Air has shown clear leadership in crew professionalism among domestic airlines in Nigeria as it crew clinched the Excellent Crew Professionalism Award, and Cabin Crew Excellent Award at the Nigerian Aviation Business Exhibition 2018 and Cabin Crew fair 2018 held in Lagos recently. The Aviation Business and Exhibition 2018 and the Cabin Crew Fair 2018 organised by Mamanaviworld and Mama J Aviation Consult respectively, are platforms designed for stakeholders to deliberate on industry best practices, human capacity development and way forward for Nigeria’s aviation industry. Commenting on the double crew excellence awards, Obi Mbanuzuo, the chief operating officer of Dana Air said, “Dana Air is proud of the level of professionalism that our crew have exhibited in the last 10 years of our operation. They have been highly trained and these awards are testament to the level of courtesy and professionalism they bring to bear in not just ensuring the comfort of our guests but as safety officers.’’ Speaking further, Obi said, “re-

cently, we reaffirmed our commitment to professionalism in the industry with our sponsorship of the first-ever cabin crew reality TV show in partnership with the Crew Training Institute, and this is part of our commitment to train and impact prerequisite knowledge and soft skills needed for aspiring cabin crew.’’ He noted that the Dana Air crew also made the airline proud at the last two editions of the Nigerian Aviation Awards where one of its cabin crew members, Joy Louis, bagged the Air Crew of the year award for her human relations and efficiency, while two other members of the airline’s crew (Collins Ginika and Chiogo Okani ) beat other domestic airlines crew to the King and Queen of the Air contest crown. Obi maintained that Dana Air will continue to be a leading light and will to do its best to encourage best practices and professionalism in the industry. Dana Air recently celebrated 10 years of service to Nigeria with a record breaking load factor, an unrivalled on-time performance, worldclass in-flight service and customercentric products and services.

igeria’s oldest airline, Aero Contractors has launched training school to end dearth of skilled manpower in the aviation industry. The training school slated to start in January was launched by the company after obtaining Approved Training Organisation (ATO) licence from the Nigerian Civil Aviation Authority (NCAA). Aero said the school would kickoff with the training of cabin crew and dispatchers and later other courses would be added to the curriculum, noting that it aims to be aviation training facility for the West and Central Africa. It also aims to partner with the Nigerian College of Aviation Technology (NCAT), Zaria and similar international institutions to give Nigeria the best skilled manpower for the industry. Ado Sanusi, CEO of Aero Contractors said, “We have just got Aviation Training Organisation license. We have been on this for a long time because we wanted to get it right; we wanted to make sure we have a training organisation that is based on a solid foundation, which can be grown into a centre of excellence.

“Now, we are starting with two approvals on our ATO, which are flight dispatcher and cabin crew. We intend to grow that into a bigger school and eventually into a research centre. “We want to build Aero Contractors to be a one-stop shop in aviation. After the training organisation

approved by NCAA, we have maintenance organisation that is also approved by NCAA; we have maintenance facility, charter business and scheduled flight service. These are four strategic business units that we would like to grow separately so that they can feed the market.

L-R: Taofeek Sanni, chief finance officer (CFO), Aero Contractors; Rex Okunor, head of Aviation Training Organisation (ATO); Ado Sanusi chief operating officer (CEO), Aero Contractors, and Joy Ogbebor, editor, Mama J Blog, at the launching of Aero Training School in Lagos.

BUSINESS DAY

Tuesday 04 December 2018

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BUSINESS DAY

FINANCIAL TIMES

Hong Kong: is ‘one country, two systems’ under threat?

Stocks fly on US-China trade detente

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World Business Newspaper

Market rally set to reach Wall Street after US-China trade war truce Car and tech stocks rebound but concerns remain over long-term resolution DON WEINLAND , EDWARD WHITE AND MICHAEL HUNTER

global stock rally was expected to reach Wall Street on Monday, as investors breathed a sigh of relief that Washington and Beijing had refrained from escalating their trade war at the G20 talks. The market rise was particularly pronounced in technology and automotive stocks, which had been beaten down for months amid fears that US-China brinkmanship over tariffs would smother already faltering global growth. Futures trading pointed to gains of around 2 per cent for the S&P 500 and the Nasdaq Composite, after similar gains across European bourses. Carmakers also stood out after President Donald Trump suggested on Twitter on Monday morning that China had agreed to lower tariffs on auto imports, although Beijing has not confirmed the measure. Shares in major US auto companies rose in pre-market trade, with Ford’s stock up 3 per cent and GM up just over 4 per cent. German carmakers made with gains of between 5 per cent and 6 per cent across the sector. There were strong gains across Asian equities indices, particularly

in China, where stocks have been the hardest hit by trade jitters. The CSI 300 index of major stocks in Shenzhen and Shanghai closed up 2.8 per cent. In Hong Kong, the Hang Seng index added 2.6 per cent higher. Tokyo’s Topix added 1.5 per cent. Although investors were heartened by Mr Trump’s agreement with Xi Jinping, his Chinese counterpart, not to impose higher tariffs on Chinese imports for 90 days, there was also concern that the truce only delayed the day of reckoning. In addition, although both sides held off on raising tariffs, other details of the Buenos Aires G20 agreement remained unclear. It was enough, however, to bring technology stocks into the rally. Apple was up by more than 3 per cent in pre-market trade, with Amazon up almost 5 per cent. European technology stocks were led by big chipmakers Siltronic, Infineon and STMicro, which were up by 7 per cent apiece. “While longer term implications remain uncertain — for example the threat of further US tariffs on China remain if the 90 day negotiation period is unsuccessful — the market had been pricing in excessive pessimism in recent periods,” said Karan Talwar, a senior investment specialist for emerging markets debt at BNP Paribas Asset Management. Pressure had been building on Mr Xi and his economic team to

Mnuchin warns China against going soft on trade commitments Treasury secretary demands ‘specific dates, specific action’ in talks following truce JAMES POLITI AND TOM HANCOCK

teven Mnuchin, the US Treasury secretary, has warned China to avoid “soft commitments” in a new round of trade talks expected to follow a ceasefire deal reached at the weekend between presidents Donald Trump and Xi Jinping. In a telephone interview with the Financial Times after the truce was sealed at a dinner following the G20 summit, Mr Mnuchin urged Beijing to flesh out pledges made in Buenos Aires in negotiations over the next three months. “There’s a 100 per cent unanimous view on our economic team that this needs to be a real agreement,” Mr Mnuchin said. “These can’t be soft commitments from China. There need to be specific dates, specific action items,” he added. According to the agreement reached on Saturday that hit the pause button on a months-long trade war between Washington and Beijing, Mr Trump agreed to not ratchet up tariffs on $200bn of Chinese imports from 10 per cent to 25 per cent on January 1, as planned. In exchange, China agreed to buy US goods to narrow the trade gap between the countries and move ahead with structural changes to its economy to address practices such

as intellectual property theft and the forced transfer of technology that the US regards as unfair. Mr Trump also wrote on Twitter on Monday morning that Beijing had agreed to cut tariffs on auto imports, though the Chinese government did not immediately confirm any change in duties. Mr Mnuchin’s comments suggest there is doubt among US officials about whether China will live up to the terms of the truce. The US said that if a deal was not reached on these sensitive issues within three months, the tariffs would rise as originally expected. The deal on Saturday night capped a period of seesawing signals about whether China and the US might reach an agreement. After the two delegations arrived in Argentina, there was a meeting between Mr Mnuchin, Robert Lighthizer, the US trade representative, and Liu He, the Chinese vice-premier, on Friday, according to a senior administration official. That night there was also a brief exchange between Mr Xi and Mr Trump at the main social event of the G20 summit, a gala dinner at the Colon theatre and opera house in the heart of the Argentine capital. But the deal only came together once the presidents met face to face over a sirloin steak dinner at the Continues on page 50

strike even a short-term deal with the Trump administration, with Beijing perceiving the pause as giving it breathing space. China reported its slowest quarterly growth figure in almost a decade in October and economists expect that trend to continue in the coming years. Tariffs have hurt Chinese manufacturing exports, which still drive economic momentum. Signs of even brief relief for China helped tighten emerging markets debt spreads, while the US

dollar softened against the renminbi and other currencies. The onshore Chinese renminbi exchange rate, which moves within a trading band of 2 per cent either side of a daily midpoint set by the People’s Bank of China, was up 0.6 per cent at Rmb6.9148 per dollar. The offshore rate was 0.6 per cent higher at Rmb6.9066. The dollar eased back, with the index tracking it down 0.5 per cent to 96.805, trimming its gain for 2018 to just over 5 per cent.

But some analysts said the deepseated political mistrust between the two countries and conflicts over global strategic ambitions would hinder a longer term trade deal. “Narrow agreements and modest concessions in their ongoing trade dispute will not bridge the wide gulf between their respective economic, political and strategic interests,” Atsi Sheth, a managing director for credit strategy at Moody’s, wrote in a note to investors on Monday.

Qatar pulls out of Opec as relations with neighbours sour World’s largest exporter of liquefied natural gas to quit oil cartel in the new year ANJLI RAVAL AND SIMEON KERR Qatar plans to quit Opec from next year as relations with its Arab neighbours sour, ending a near sixdecade-long membership of the oil price cartel. The emirate’s oil minister told reporters on Monday the decision to leave the group of big oil exporting countries had come after Qatar reviewed the ways it could enhance its role abroad while shifting the focus of the country towards gas. The move comes amid a deteriorating political situation between Qatar and its neighbours. Four Arab states — Saudi Arabia, the United Arab Emirates, Bahrain and Egypt — have imposed a trade and travel embargo on the country since June last year over allegations that Qatar supports terrorism. However, Saad al-Kaabi, Qatar’s oil minister, insisted the decision to quit Opec, which the country joined in 1961, was not linked to the political and economic boycott. Qatar, the world’s largest exporter of liquefied natural gas, is among the smallest oil producers in the group, pumping 609,000 barrels a day, according to the Opec research arm’s October oil market report. Mr al-Kaabi said the country was seeking to increase

LNG production from 77m to 110m tonnes each year. The oil price surged on Monday after the US and China agreed a 90-day truce in their trade war, agreeing at a weekend meeting in Argentina of the G20 not to impose additional trade tariffs. Brent crude was 3.88 per cent higher at $61.77 by midday in London while West Texas Intermediate, the main US contract, was 4 per cent up at $52.97. Qatar’s decision comes as nonOpec countries, such as Russia, have become more influential in setting oil policy alongside Saudi Arabia, the largest producer within the cartel and its de facto leader. Mr al-Kaabi said Qatar’s impact on Opec production policy was small, which had influenced its decision to leave, but the country would still comply with co-ordinated oil deals among global producers. Still, it was his predecessor who played a crucial role in securing an agreement in 2016 among producers inside and outside the cartel for co-ordinated production cuts that helped end a multiyear downturn. Mr al-Kaabi said Qatar would still attend an Opec meeting of ministers later this week in Vienna as they dictate oil policy for 2019, amid a slide in crude prices that has taken prices to below $60 a

barrel last week, from above $86 last month. “Qatar has worked diligently during the past few years to develop a future strategy based on growth and expansion, both in its activities at home and abroad,” said Mr al-Kaabi. “Achieving our ambitious growth strategy will undoubtedly require focused efforts, commitment and dedication to maintain and strengthen Qatar’s position as the leading natural gas producer.” Qatar’s decision to walk away from the oil cartel was not “super” consequential for Opec, given Doha’s limited oil output, said Robin Mills, chief executive of Qamar Energy, a consultancy. Saudi Arabia and its key ally the UAE, two leading Opec members, have led the embargo against Qatar, but others, including their arch-foe Iran, continue to sit around the same table. “It’s surprising that Qatar is walking away from its seat at the table. It would be better to be there than not,” said Mr Mills. “Presumably it is linked to the political dispute, but lots of Opec members are not party to the dispute.” Nor was Opec membership preventing Qatar from focusing on ramping up LNG production, Mr Mills added.

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NATIONAL NEWS

FT Mnuchin warns China against going soft...

Abraaj fall from grace prompts investors to sharpen due diligence

Continued from page 49

Park Hyatt hotel the following night. “Xi laid out in great detail what they were willing to do,” Mr Mnuchin said. “This was the first time that the Chinese came back with a long, specific response to both the structural issues and the non-structural issues. The president made a decision on how to proceed,” he added. Apart from its main demands, the US has also pressed China to refrain from competitive devaluation of its currency to offset the impact of the tariffs. While Chinese officials had previously committed not to use such a tool in the trade war, it was reiterated again. “On currency we received commitments that they understand that issue and will act appropriately,” he said. The deal reached by Mr Trump has been met with relief among US business groups, but has faced a backlash from some in the president’s base of supporters who are disappointed that he did not maintain a hard line with China.

Betway dole out N1m to 5-a-side league winner

fter 12 weeks of exciting football action in the Betway 5aside League, Ikeja All-Stars defeated G12 on penalties to emerge winners of the N1 million cash money. 24 teams participated in the games which were held across 4 locations across Lagos, while the final match took place at the Landmark beach front, Victoria Island, Lagos. Lere Awokoya, the Betway country manager said, “The competition was fierce but healthy, the passion for the game was very much present throughout and we hope to spread the love deeper and wider. This has been nothing short of an awesome season and we are excited about doing more towards building sports in Nigeria.” According to Awokoya, Betway, which is the official kit sponsor of English Premier League side, West Ham, has been involved in many sports activities since its entry into the Nigerian betting market. At the end of the final match, awards were presented to players who distinguished themselves during the season. The golden ball went to Chidi Nwankwo of Ikeja All-Stars as the best player of the league, Emeka Asogwa of Vic FC was presented with the golden shoe as the highest goal scorer of the league, while Adelana Ademola of Ikeja All-Stars was presented with the golden gloves. The Nigerian Amputee football team, the Special Eagles, fresh from the Amputee World Cup in Mexico, thrilled spectators to some beautiful football, while excited fans participated in ball juggling competitions and showed their knowledge of football by taking part in quizzes. Also, a football freestyle competition was staged between 2 top free-stylists. Present at the final were Seun Anibaba, the chief executive officer of the Lagos State Lottery Board; Adeyinka Suleman, the head of finance and accounts of the Lagos State Lottery Board; and Chris Ubosi, the country director of Betway.

Tuesday 04 December 2018

The scandal gives pause to those seeking emerging market exposure via private equity JAVIER ESPINOZA

Nigeria president Buhari denies rumours he was cloned Leader says he has not died or been replaced by a lookalike NEIL MUNSHI

igerian president Muhammadu Buhari would like voters to know that he is not dead — and has not even been cloned. At a roundtable with Nigerian expats in Poland, the Nigerian leader jokingly responded to a conspiracy theory that has circulated online for months that he had passed away and been replaced by a body-double. The rumours emerged after Mr Buhari, who has long been dogged by questions about his health, spent months in the UK last year seeking medical treatment for an undisclosed ailment. In a clip on Mr Buhari’s official Twitter account on Sunday, he addressed what he jokingly referred to as an “important question” about whether he was cloned. “A lot of people had hoped that l was dead,” he said. “It’s [the] real me, I assure you. I will soon cel-

ebrate my 76th birthday and I am still [going] strong.” Mr Buhari was in Poland for the UN’s COP24 climate change conference. His comments come as campaigning heats up ahead of elections in February in Africa’s most populous nation. Mr Buhari faces a tougherthan-expected race against former vice-president Atiku Abubakar, who reportedly recently joked about conspiracy theory at a party conference. The president said he felt sorry for his vice-president Yemi Osinbajo, who had been courted for jobs by people presuming he had ascended to the presidency after Mr Buhari’s death. “That embarrassed him a lot; we discussed it when he visited me while I was convalescing.” The government’s reluctance to say anything about Mr Buhari’s medical status has helped fuel rumours about the president’s condition. Diplomats and executives

in Lagos and Abuja say that he is clearly in much better shape than he was before he started medical treatment in London in 2016, when he appeared gaunt and frail. Conspiracy theorists have argued that Mr Buhari was cloned before he died in London or replaced by a lookalike known online as “Jubril from Sudan”. Former government minister Femi Fani Kayode, a strong critic of the president, has postulated that a satanic ritual was involved. In April, he wrote on Twitter: “Buhari is dead and he never came back from London. Only his body did. They invoked the spirit of Jubril and placed it in Buharis body. It is a common ritual among satanists.” An AFP fact check of the rumour published last week traced it to a Twitter post from September 2017 of a video of Biafran separatist leader Nnamdi Kanu telling supporters Mr Buhari had died and been replaced by Jubril.

EU embarks on sensitive reforms to financial crisis tools Ministers meet to discuss four ways to prevent future meltdowns JIM BRUNSDEN AND MEHREEN KHAN

U finance ministers will on Monday discuss proposals to give the eurozone more powerful tools to prevent financial crises. While politicians including France’s President Emmanuel Macron have floated grand ideas such as the appointment of a euro area finance minister, or the creation of a fully fledged European Monetary Fund, months of technical negotiations leading up to Monday’s so-called eurogroup meeting have focused on more low-key, politically feasible improvements to the currency union’s plumbing. But the talks have still strayed into highly sensitive territory for some capitals. Proposals to reinforce the currency bloc’s banking union have inflamed German sensitivities about cleaning up financial problems in other countries. Meanwhile, Italy and others are wary of reforms that could make it more expensive for them to sell their sovereign debt. Negotiations between finance ministers on Monday are expected to stretch into the night. The EU is close to having a blueprint for priority reforms, but where will it leave the bloc’s project to build a stronger single currency?

Reinforcing the Banking Union The euro area’s common system for overseeing its banks was one of the main policy achievements to come out of the sovereign debt crisis. But working out how to finish it has vexed national finance ministries. Plans pushed by Brussels, the European Central Bank and southern Europe for a common scheme to guarantee bank deposits still face fierce resistance in Germany. Diplomats say Monday’s deal is likely to kick the can down the road by handing the project, known as EDIS, to a group senior national finance officials that would report back in June. “There is no appetite to put political capital in EDIS,” says Isabel Schnabel, a member of the German Council of Economic Experts. “The big pushes on the big things only come with serious problems.” Efforts have instead focused on beefing up the bloc’s Single Resolution Fund, a pot of money that can be tapped to help wind down failed banks. Months of negotiations have yielded detailed “terms of reference” on how to give the SRF access to emergency loans from the European Stability Mechanism, the euro area institution that handles sovereign bailouts. The emergency public loans are

a priority for the ECB and others who see it as a key step to strengthen the banking union’s credibility. But conditions attached to the deal — including German insistence on a reduction in banks’ portfolios of non-performing loans — mean that it may still not become operational for several years. Making bondholders share the pain Getting investors to take a hit on their holdings of government bonds if a country needs a taxpayer bailout has been a consistent demand from Germany and its northern European allies, but has been resisted by high-debt countries led by Italy. EU officials say a likely compromise on Monday will involve governments endorsing a system of debt restructuring that would allow the ESM to mediate between creditors and governments. They cautioned though that Rome remains wary of any steps that could lead investors to demand a higher risk premium when buying Italian debt. Ministers are also set to agree on plans put forward by France and Germany earlier this year for government bonds to be issued with tough “collective action clauses” to prevent situations where “holdout” investors can prevent debt writedowns.

nvesting in emerging market private equity is about to become that bit tougher. Abraaj, once the largest private equity firm specialising in regions such as Africa and the Middle East, has been accused by investors including the Bill & Melinda Gates Foundation and the World Bank of mishandling millions of dollars of their investments. Since concerns were first raised in autumn 2017, investor trust has further eroded and the firm’s indebtedness has been exposed. The Dubai-based fund is under investigation by regulators in the city state. Abraaj’s founder, Arif Naqvi, has reportedly been speaking with creditors in an effort to avert the company being liquidated. Its demise has sent shockwaves through the fund management industry. Institutional investors in emerging markets — from pension funds to endowments and sovereign wealth funds — are now tightening their due diligence. The fall of the private equity firm, which had $14bn of assets under management and was behind some of the biggest takeovers in the Middle East, has added a layer of complexity to dealmaking in what were already difficult jurisdictions in which to do business, say industry insiders. Investors entering the sector will have to carry out more stringent checks and balances, says a former adviser to Abraaj in Dubai, speaking on condition of anonymity. “Abraaj funds had some of the most conservative investors in them. They have layer upon layer of due diligence. And even then they failed to spot any issues,” says the adviser. “They are going to be even more conservative now.” Investors cannot be passive in private equity funds, says Ludovic Phalippou, a finance professor at the University of Oxford’s Saïd Business School, adding that Abraaj’s unravelling came about in part thanks to investors being better informed. “The next step will be to have mechanisms in place so that these sorts of things do not happen in the first place,” Mr Phalippou says. A public relations expert working for a large money manager in emerging markets, believes investors have come to an “informal consensus that they don’t want their names to be associated with Abraaj because it was so toxic for emerging markets” — a view reflected in people’s reluctance to be named in this article. One observer compares the softening of investors’ due diligence to that seen in the case of Bernard Madoff, the US financier behind a $65bn Ponzi scheme that came to light in 2008. “Like Abraaj, Madoff was about: ‘Well, everybody is in it and I [don’t want to miss out], so let me just write a cheque and not ask too many questions’,” says the private equity investor in emerging markets, who asked to remain anonymous.

Tuesday 04 December 2018

C002D5556

BUSINESS DAY

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

Stocks fly on US-China trade detente European rally follows strong gains in Asia; oil jumps on Russia-Saudi Arabia co-operation MICHAEL HUNTER AND EDWARD WHITE

lobal stocks rallied hard, bond prices fell, the Chinese renminbi rose and the dollar eased as markets reacted to the temporary truce in the US-China trade dispute struck by Donald Trump and Xi Jinping in Buenos Aires on Saturday. The moves came after the US agreed not to increase tariffs on more than $200bn of Chinese goods from 10 per cent to 25 per cent in January, as had been planned. The Europe-wide Stoxx 600 rose 1.8 per cent, with resource stocks to the fore. London’s FTSE 100 added 1.1 per cent, with Frankfurt’s Xetra Dax 30 up 2.5 per cent. One of the best single gains made in the region was by Antofagasta, the copper miner, up almost 9 per cent. The Stoxx index tracking miners added 5 per cent. The momentum was expected to last into the US open, with futures trade pointing to gains of 1.4 per cent for the S&P 500 and 2.2 per cent for the tech-heavy Nasdaq Composite. Mainland China’s C SI 300 climbed 2.8 per cent, trimming its decline for 2018 to just over 19 per cent. Hong Kong’s Hang Seng rose 2.6 per cent, leaving its year-to-date decline at just over 9 per cent. Energy stocks received an added boost from a surge in oil prices after Russia signalled it would continue to co-operate with Saudi Arabia on managing production. The Stoxx index tracking European oil majors rose more than 3 per cent. The onshore Chinese renminbi exchange rate, which moves within a trading band of 2 per cent either side of a daily midpoint set by the People’s Bank of China, was up 0.6 per cent at Rmb6.9148 per dollar. The offshore rate was 0.6 per cent

higher at Rmb6.9066. Australia’s dollar — which can act as a proxy for the outlook for China’s growth since the bulk of the country’s metals are exported there — rose by as much as 1.1 per cent to a day-high of $0.7393 The dollar index was down 0.3 per cent. Goldman Sachs analysts said the ceasefire “improved the tone” of relations between Beijing and Washington but also prolonged the period of uncertainty around the eventual structure of trade ties between the world’s two biggest economies. “There appears to have been no concrete progress on the other important issues of market access, [intellectual property rights] protection, cyber attacks, and forced technology transfer (the latter two US concerns have always been denied by Chinese policymakers), which are left for working level officials to work out in the next 90 days,” Goldman analysts added. Commodities Brent crude oil was up 4.1 per cent at $61.92, while West Texas Intermediate, the US marker, rose 4.7 per cent to $53.33. The gains came after Russian president Vladimir Putin said at the G20 that his country’s co-operation with Saudi Arabia on oil supply would continue, increasing the likelihood of a deal at this week’s Opec meeting in Vienna. Metals prices were also higher in the wake of the US-China trade truce. Copper for delivery in three months on the London Metal Exchange was up 2.3 per cent at $6,338.5 per tonne. Fixed income The US 10-year Treasury yield, which rises as prices fall, was steady at 3.033 per cent. The yield on the equivalent German Bund was up 1.4bp at 0.324 per cent.

Glencore’s copper kingpin Telis Mistakidis to step down

Billionaire executive to retire at end of year amid leadership shuffle HENRY SANDERSON AND DAVID SHEPPARD

lencore’s billionaire copper kingpinTelis Mistakidis will step down by the end of this year amid a leadership shake-up, as the miner faces growing regulatory scrutiny over assets he once ran in the Democratic Republic of Congo. The move comes as part of a broader leadership shuffle at the Switzerland-based mining and trading giant led by Ivan Glasenberg as it deals with the fallout of a US Department of Justice probe of its activities in the DRC, Venezuela and Nigeria. Mr Mistakidis is one of the biggest figures in the global copper market, and was previously on the board of the company’s subsidiary Katanga Mining, before stepping down last year. The LSE-educated Mr Mistakidis, who is half-Greek, helped expand Glencore’s business in the DRC, with the help of its former business partner Dan Gertler, an Israeli who was sanctioned by the US govern-

ment last year. In addition to the DOJ investigation, Canada’s Ontario Securities Commission is looking into Katanga Mining and its accounting practices. Glencore said company veteran and coal chief Peter Freyberg will be appointed head of industrial mining assets, a newly created position suggesting the company is moving to centralise the oversight of mining activities. It said Nico Paraskevas will replace Mr Mistakidis as head of copper marketing. Mr Paraskevas is a former chief financial officer of Katanga Mining. Glencore also said that Gary Nagle, global head of Ferroalloys, will become head of coal assets replacing Mr Freyberg. Separately, Glencore reduced the earnings guidance from its marketing division, saying it now expected $2.7bn this year, from an earlier guidance of up to $3.2bn. Mr Mistakidis did not immediately respond to an email seeking comment.

A move by the Fed away from explicit guidance and towards a more ‘data dependent’ approach has long been in the works © Reuters

Zion Oil prays for more JAMIE POWELL

ion Oil, whose 18-year struggle to extract the black stuff out of Israel’s holy land suffered another setback recently, is planning to, yet again, raise money off investors. On Friday a lengthy press release arrived in our inboxes, detailing what Zion had learned from its latest dry well -- the fifth in a row -- as well as its plans going forward. As a result of these unanswered questions and with the information gained drilling the MJ#1 well, Zion now believes it is prudent and consistent with good industry practice to try and answer some of these questions with a focused 3D seismic imaging shoot of approximately 50 square kilometers surrounding the MJ#1 well. If undertaken, this will not be a short-term exploratory project with immediate results, and it is one for which Zion will need to raise additional funding, the success of which is not assured. A realistic timeframe in which Zion can reasonably expect to complete this project would be six to twelve months (following a successful raise) to plan the survey design or layout, identify and obtain the necessary equipment

which will likely have to be imported, receive the necessary permits, negotiate potential surface damages, and acquire the data. An interpretation effort would follow the seismic acquisition. We intend to proceed soon with a new unit program to try and raise the needed funds for this and will provide details concerning unit program limits, parameters, use of proceeds, and other pertinent information. This time around however, it might be trickier for the faithbased driller to raise sufficent cash, particularly from investors who were willing to put their money in the business earlier in the year. Its share price is languishing at $0.45, half of the circa-$1 share price it raised money at in September, and 90 per cent down from its $5 offering in April. Still, founder John Brown, who took home $632,419 in compensation last financial year, including $41,981 of “perquisites and other personal benefits”, remains optimistic. Another email arrived early Monday from the former marketing executive, titled “A time of testing”. Here’s a highlight: I want to personally thank you for all your prayers and support of Zion as we press on despite

the current trials of our faith with which we have been challenged. I encourage you all to remain strong in the faith and to remember to pray for Israel and Zion, we serve a mighty God who is “Big” Enough. (Psalm 3). At present, we are still waiting for the SEC review to be completed and law suits to be adjudicated. Personally, I believe that God has allowed this test of our faith so that after it is all over He only will get all the glory from what we have been called to do in Israel. The promise of the oil in Israel and my calling are based only on The Bible and scripture (Acts 22:14,15). I believe that if we will hold steady, we will eventually see God do it (Ro. 4: 20,21). I have obeyed God (1 Sam. 15:22) in pursuit of the Vision that He gave me, (Hab. 2:2,3) and I will do nothing without confirmation from Him in the scriptures. (Psalm 14:2 and Psalm 16:7) So, don’t be discouraged because: “The Lord bringeth the counsel of the heathen to nought: he maketh the devices of the people of none effect.” Psalm 33:10 So on the downside, there’s an SEC review (read: investigation) and shareholder lawsuits to contend with. On the upside, Brown is on a mission from God.

GSK to boost cancer drugs pipeline with $5.1bn Tesaro purchase Deal for US group will be first major acquisition under Emma Walmsley SARAH NEVILLE

laxoSmithKline is to buy Tesaro, an oncologyfocused company based in Waltham, Massachusetts, for about $5.1bn, in the first major acquisition by Emma Walmsley since she took the helm at the company in April 2017. Since taking office Ms Walmsley has focused on attempting to boost GSK’s drugs pipeline, and the company said the deal would “significantly strengthen GSK’s pharmaceutical business, accelerating the build of GSK’s pipeline and commercial capability in oncology”. GSK said the acquisition, and associated R&D and commer-

cial investments, “will impact adjusted earnings per share for the first two years by mid to high single-digit percentages”. The acquisition was expected to start to be accretive to adjusted EPS by 2022. Its guidance for full-year 2018 adjusted EPS growth remains unchanged at 8 to 10 per cent in constant currencies but it now expects adjusted EPS growth for the period 2016-2020 “to be at the bottom end of the mid to high single-digit percentage CAGR range”. Tesaro’s product Zejula is currently approved for use in ovarian cancer. It belongs to a class of drugs called PARP inhibitors. Clinical trials to assess whether

there is a bigger market for Zejula — on its own or in combinations — as a “first line” maintenance treatment for ovarian cancer are also under way. GSK said it believed PARP inhibitors “offered significant opportunities for use in the treatment of multiple cancer types”. Ms Walmsley said: “The acquisition of Tesaro will strengthen our pharmaceuticals business by accelerating the build of our oncology pipeline and commercial footprint, along with providing access to new scientific capabilities. “This combination will support our aim to deliver long-term sustainable growth and is consistent with our capital allocation priorities.”

BUSINESS DAY

C002D5556

Tuesday 04 December 2018

ANALYSIS Shell yields to investors by setting target on carbon footprint Cutting emissions to be linked to executive pay in industry first

oyal Dutch Shell will set carbon emissions targets next year and link these to executive pay, reversing its chief executive’s opposition and following intense pressure from shareholders who want fossil fuel companies to take greater responsibility for their contribution to global warming. Investors such as the Church of England and Robeco have pushed Shell to make firm commitments to cut its carbon footprint, saying last year’s announcement of a long-term “ambition” to halve carbon emissions by 2050 did not go far enough. By setting targets “we will be systematically driving down our carbon footprint over time”, chief executive Ben van Beurden told the Financial Times on Sunday. “We all know the benefits of energy but there are associated effects that we have to manage.” Shell also said it will link ener-

“dialogue” with investors that had led to the “evolution” in Shell’s position, with the short-term targets creating a more effective and flexible way to manage the company through an uncertain, multi-decade energy transition. Shell is ahead of its peers such as UK energy major BP and ExxonMobil in the US in its public commitments to reduce carbon emissions. Shell’s long-term goal announced in 2017 also includes the emissions of third parties, such as cars that burn Shell’s petrol and diesel. Shell now aims to curb its net carbon footprint, including emissions of its consumers, by around 20 per cent by 2035, and will start setting specific targets each year from 2020 for the next three- to five-year period. The company plans to increase the share of gas in its production mix from 50 to 75 per cent, is investing more in low carbon energies and has sought to reduce the leakage of methane from wells, pipes and pumps. The latest move has been

gy transition targets to the longterm incentive plans of senior executives, subject to a shareholder vote in 2020. Shell said it was still in talks with investors about the percentage to be targeted but the remuneration of 1,200 top employees could be affected. “It is a massive step change,” said Adam Matthews, director of ethics and engagement for the Church of England Pensions Board. “This presents a model for how [companies] can proceed.” The announcement comes as the annual UN climate talks start in Katowice, Poland, when signatories of the Paris climate agreement will try to agree on the rules for how the deal will be implemented from 2020. The world has already warmed by about 1°C since pre-industrial times, largely due to emissions from the burning of fossil fuels, and the Paris climate agreement aims to limit temperature rises to well below 2°C. The pledge — the first of its kind in the sector — is a significant shift for Mr van Beurden, who said in July that setting hard targets was a “superfluous” exercise that would expose the energy major to litigation should it fail to meet them. Mr van Beurden said it was

backed by Climate Action 100+, a group of international investors with more than $32tn in assets under management, which has pushed for the biggest corporate polluters to cut emissions and improve disclosures and governance on climate issues. The group includes Calpers, Legal & General Investment Management and UBS Asset Management. Investor concerns have mounted about the risks associated with holdings in fossil fuel companies — not only tied to their role in global warming but also because oil and gas projects could become uneconomic should the world move more towards using cleaner fuels. The company has also pledged to review its membership of industry lobbying groups which may take a stance on climate-related topics that undermines the goals of the Paris deal — a significant concern of investors. Shell, like other energy companies, is grappling with how lowcarbon investments can generate similar revenues and dividends as its legacy projects. Even as a big spender in this space compared to peers, it is still only committing 8 per cent of its annual capital expenditure of $25bn to clean energy projects.

ANJLI RAVAL, LESLIE HOOK AND ATTRACTA MOONEY

R Hong Kong: is ‘one country, two systems’ under threat? The business community warns that Beijing’s steps to silence critics threaten the rule of law BEN BLAND

hen Chinese agents abducted a bookseller critical of Beijing and a politically connected tycoon from semi-autonomous Hong Kong, many foreign investors said privately that they were thorns in Beijing’s side. As the Hong Kong government ratcheted up the pressure on the city’s democracy movement, prosecuting activists, blocking opposition politicians from running in elections and banning a political party, investors said local politics did not impact business. Corporate executives have looked the other way as Beijing has emphasised its “comprehensive jurisdiction” over Hong Kong, reversing the self-restraint that marked the early years of the “one country, two systems” arrangement, under which China granted the city a “high degree of autonomy” and civic freedoms for 50 years after the British handed it back in 1997. But the Hong Kong government’s decision to in effect expel Victor Mallet, the Asia news editor for the Financial Times, has finally pushed some representatives of the international business community to confront the growing threats to Hong Kong’s rule of law, the cornerstone of the city’s success as a global financial centre. “As the issues mount up, it’s getting more difficult to sweep them under the carpet,” says Tara Joseph, president of the American Chamber of Commerce in Hong Kong. “The free flow of data and information is absolutely crucial to the reputation of this financial market.” The government declined to renew Mr Mallet’s work visa — and then refused to let him enter the city in November — after he hosted a talk at the city’s Foreign Correspondents’ Club by Andy Chan, an advocate of the city’s independence whose Hong Kong National party was subsequently banned. Charles Mok, a former IT executive who represents the sector in Hong Kong’s partially democratic Legislative Council, says investors have been shaken by the decision. “Previously when I went abroad to promote investment, people asked me whether they could make money, but now they are asking about freedom of expression and rule of law-related problems,” he says. Hong Kong is much less im-

portant to Beijing in terms of economic output than it was in 1997, with its gross domestic product equivalent to just 3 per cent of China’s, compared to nearly 20 per cent at the handover. But it remains a key financial centre, for foreign money coming in to China and, increasingly, for Chinese capital going out. With the Hong Kong government under pressure from President Xi Jinping to curb opposition to Beijing’s rule, legal experts say that investors — and the government — should be much more concerned about the erosion of the city’s freedoms and autonomy. If Beijing’s influence continues to grow in the medium term, Hong Kong risks losing its preferential access to global markets, which is premised on the maintenance of the promised “high degree of autonomy”. “The situation is very serious,” says Ho-fung Hung, a professor of Chinese political economy at Johns Hopkins University, warning that Hong Kong risks being hurt by the deteriorating USChina relations. “Western governments can no longer pretend that Hong Kong has genuine autonomy from Beijing.” Hong Kong’s one country, two systems arrangement, as it was christened by former Chinese leader Deng Xiaoping, is a unique political experiment, to see if a city with many political freedoms can survive and prosper inside the world’s most powerful authoritarian state. A political compromise between the UK and China, it is ridden with conflicts and contradictions. Hong Kong’s Basic Law, the city’s mini-constitution, guarantees civic rights and judicial independence and ostensibly limits Beijing’s role to defence and foreign affairs. But it also requires the Hong Kong government to implement “directives” issued by Beijing, to enact laws to prohibit “treason, secession, sedition and subversion” [which it has yet to do] and gives Beijing the power to overrule Hong Kong’s judges by issuing “interpretations”. Jasper Tsang, a former Legislative Council president, says the arrangement relies on “mutual understanding” between the Chinese government and Hong Kongers. But Mr Tsang, who is one of Beijing’s most prominent supporters in Hong Kong, argues that pragmatic consensus has fallen

apart over the past few years as Beijing and Hong Kong have become locked in a “vicious circle”. “On the one hand, Hong Kong people seem to feel that the central government is now tightening up its control, taking away the room for manoeuvre which was given to Hong Kong people during the early years after the handover,” he says. “On the other hand, Beijing seems to become more and more worried about Hong Kong independence and about the alienated, hostile attitude of young people in Hong Kong towards the central government.” Joshua Wong, a 22-year-old student activist who was jailed for his part in the pro-democracy Occupy protests of 2014, argues that “as long as President Xi leads China, there is no chance for democracy in Hong Kong”. That sentiment has driven a growing number of young people to turn their backs on China. In citywide elections in 2016, about one in five Hong Kongers voted for candidates who supported self-determination or independence. Opinion polls have shown that backing for independence tends to be stronger among young people. This trend has alarmed China’s Communist party leadership, which sees separatism — whether in Tibet, Xinjiang or Hong Kong — as a fundamental threat to the party’s legitimacy. On a rare visit last year to celebrate 20 years since the handover, Mr Xi warned Hong Kongers not to cross a “red line” by “endangering China’s sovereignty and security” or “challenging the power of the central government”. “We’re under a lot of pressure from Beijing,” says one Hong Kong government official. “Unless we can show that we’re tackling the independence issue, the pressure on Hong Kong will continue to increase.” Philip Dykes, chairman of the Hong Kong Bar Association, the city’s regulatory body for barristers, fears that the rule of law is starting to fall victim to this political crackdown. He argues Mr Xi’s “red line” is a vague, catch-all term that can be used arbitrarily against dissenters. “You will know when you’ve crossed it, even if you can’t see it,” he says. The media and business communities were caught off guard by the unprecedented decision involving Mr Mallet, the first time a foreign journalist has been denied a visa since the handover.

BUSINESS DAY

Tuesday 04 December 2018

Live @ The Exchanges Top Gainers/Losers as at Monday 03 December 2018 GAINERS Company

Market Statistics as at Monday 03 December 2018

LOSERS Opening

Closing

Change

Opening

Closing

Change

SEPLAT

N589.5

N614

24.5

MRS

N28.55

N25.7

-2.85

WAPCO

N13

N13.4

0.4

N82.6

N80.4

-2.2

ZENITHBANK

N23.2

N23.6

0.4

STANBIC

N48

N46.05

-1.95

GUARANTY

N34.35

N34.65

0.3

DANGCEM

N186.9

N185

-1.9

VALUE (N billion)

N7.1

N7.4

0.3

N11.4

N10.3

-1.1

MARKET CAP (N Trn

FBNH

Company

ASI (Points) DEALS (Numbers)

he Securities and Exchange Commission of Nigeria (SEC) has officially launched the Green Bonds Issuance Rules. The launch at a ceremony yesterday follows series of engagements with stakeholders and Capital Market Operators. The SEC rolled out its rules on Green Bonds on October 12, 2018. The SEC has collaborated on several occasions with the Green Bonds Market Development Programme, a programme supported by the Climate Bonds Initiative(CBI), the FMDQ OTC Securities Exchange (FMDQ) and the Financial Sector Deepening Africa (FSD Africa) to support the development of a Non-Sovereign Green Bond market in Nigeria. The programme provides training for regulators, investors and intermediaries on Green Bonds as part of its efforts to create an enabling environment for issuers and other stakeholders, to take advantage of the tremen-

dous opportunities that Green Bonds offer. Speaking at the launch of the rules, Mary Uduk, Acting DirectorGeneral, SEC stated that “As Nigeria strives to harness the resources of non-oil sectors to anchor the transition to a more resilient economy, there is the urgent need to close the country’s infrastructure gap with investments in sustainable finance initiatives. The SEC’s release of the green bond rules is a significant step in furthering the complementary efforts of the government, regulators and

the financial services industry to direct financial capital to more sustainable economic activity”. Also commenting on the rules, Evans Osano, Director of Financial Markets at FSD Africa commented that “We laud SEC Nigeria for the professional and quick turnaround in the preparation of the guidelines. The new guidelines are prepared in line with leading international guidelines and standards providing confidence to domestic and international investors. It also provides certainty to issuers of

green bonds in Nigeria. FSD Africa is pleased to have supported this process which is a milestone for the Nigeria green bonds market” Olumide Lala, Africa Markets Programme Manager, Climate Bonds Initiative who was also present at the launch ceremony stated that “The launch of the rules brings much needed clarity and guidance on the issuance of green bonds. Adopting the tenets of the Green Bond Principles and Climate Bonds Standard makes it easier to attract foreign investment where needed.”

mitment, Ebehijie Momoh, Head of Retail Banking, Standard Chartered Bank Nigeria Limited noted that the Bank seeks to provide convenient and accessible banking for its clients everywhere and at anytime without time restrictions, physical limitations and dependence on branches. She added that this plan also aligns with the financial inclusion and cashless policy strategy of the Central Bank of Nigeria (CBN). She said, “We have observed a significant increase in the use of our digital platforms by our clients

compared to the use of our physical branches. This is in sync with observable behaviours in the digital age with customers embracing technology and digital channels to conduct transactions. Therefore to ensure we are optimizing all existing service platforms for the benefit of our clients, we continue to invest in upgrading our digital banking solutions and branch network. Our clients want flexibility, accessibility and efficiency in the solutions and services we provide and with our ongoing optimisation drive, they will be able en-

249,736,735.00 2.720 11.243

FBNQuest Trustees to become direct subsidiary of FBN Holdings

BN Holdings Plc has notified the Nigerian Stock Exchange (NSE) and its stakeholders that FBNQuest Capital (a subsidiary of FBN Holdings PIc) has passed a resolution for a business restructuring which will involve the transfer of all of its shareholding interest in FBNQuest Trustees Limited (FBNQT) to FBN Holdings Pic (FBNH). FBNQuest Trustees is currently a direct subsidiary of FBNQuest Capital Limited (FBNQC) which is a direct and fully owned subsidiary of FBNH, thus making FBNQT an indirect subsidiary of FBNH. FBNQT provides solutions in Corporate Trust, Public Trust, Private Trust, Estate Administration, Executorship, and Agency services to both institutional and private investors. With the business restructuring FBNQuest Trustees will become a direct subsidiary of FBNH subject to the approval of Central Bank of Nigeria (CBN) and the Securities and Exchange Commission (SEC). “We confirm that the proposed transfer of FBNQT to FBNH as a direct subsidiary of the Holding

company does not have any impact on the Capital of the holding company or any of its subsidiaries and has no impact on the relative holdings of the shareholders of FBN Holdings Plc”, FBN Holdings said in a notice to the Nigerian Stock Exchange signed by Seye Kosoko, company secretary. FBNH is the ultimate parent/holding Company of all the operating companies in the Group which was incorporated in Nigeria on October 14, 2010 and licensed by the CBN as a Financial Holding Company. FBNH is the parent company of First Bank of Nigeria Limited and its subsidiaries; FBNQuest Merchant Bank Limited & its subsidiaries; FBNQuest Capital Limited & its subsidiaries; FBN Insurance Limited and its subsidiary and FBN Insurance Brokers Limited. The transfer is intended to achieve among others the following strategic objectives: Better visibility within the FBN Holdings PIc Group: As a specialist business within the Group, the direct ownership of the business by FBN Holdings Plc provides more visibility to clients and marketplace.

FCMB receives ISO 22301 certification for Business Continuity Management

Standard Chartered deepens investments in digital banking solutions for clients tandard Chartered recently reiterated its commitment to improving the overall banking experience of its clients’ through digitisation and technology. With a renewed focus on strengthening its digital banking platforms to provide clients with multiple and convenient alternate banking channels, the Bank will be optimising its digital banking solutions and its branch network to cater to the evolving needs of its client. Speaking on this com-

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VOLUME (Numbers)

SEC berths with Green Bond rules Stories by Iheanyi Nwachukwu

30,798.76

joy these benefits from the comfort of their homes, offices or on the go.’’ Earlier this year, the Bank launched its first and fully digital retail bank in West Africa as an important milestone in the Bank’s path towards innovation in its customer service value proposition. Building on the successes in Cote D’ivoire and Ghana, the Bank plans to roll this out in Nigeria shortly. In addition, as part of efforts to remain a client centered business, the Bank will also strategically merge some of its branches across the country.

irst City Monument Bank (FCMB), has bagged the TCIC International Organisation for Standardisation (ISO) 22301:2012 certification. This is in recognition of the Bank’s attainment and compliance with the requirements of Business Continuity Management System. The certification followed a comprehensive audit and evaluation exercise conducted by TCIC Global Certification Limited, a Canada-based independent Management System Audit/Assessment and training providers, founded in 2003. The FCMB Business Continuity Management System is in support of critical services, products and processes. Commenting on the

certification, Adam Nuru, Managing Director of FCMB, described the feat as another milestone in the commitment of the Bank to attain excellence in all aspects of its operation and service delivery. The Chief Executive said, ‘’we are excited to attain the TCIC ISO 22301 certification. It is proof that the successful overhaul and streamlining of our services, products and processes to meet global standards are yielding the desired results and recognition’’. He added that, ‘’we will continue to improve in all aspects of our business in order to match the needs of our esteemed customers, as a response to market demands and also in recognition of rapidly changing global standards’’.

BUSINESS DAY

Tuesday 04 December 2018

BUSINESS DAY

Tuesday 04 December 2018

Live @ the Stock exchange

Prices for Securities Traded as of Monday 03 December 2018 Company

Market cap(nm)

Price (N)

Change

Trades

Volume

Company

Market cap(nm)

Price (N)

Change

Trades

Volume

PRICES FOR MAIN BOARD SECURITIES (Equities) BANKING ACCESS BANK PLC. 216,959.79 7.50 -3.23 70 4,883,698 UNITED BANK FOR AFRICA PLC 256,495.66 7.50 1.33 162 20,265,401 740,957.25 23.60 1.72 327 19,235,671 ZENITH BANK PLC 559 44,384,770 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 265,625.17 7.40 4.23 271 22,120,331 271 22,120,331 830 66,505,101 BUILDING MATERIALS DANGOTE CEMENT PLC 3,152,493.87 185.00 -1.02 158 3,643,867 LAFARGE AFRICA PLC. 116,223.94 13.40 3.08 113 2,051,751 271 5,695,618 271 5,695,618 EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 361,304.96 614.00 4.16 22 55,455 22 55,455 22 55,455 1,123 72,256,174 CROP PRODUCTION FTN COCOA PROCESSORS PLC 440.00 0.20 - 0 0 72,020.21 75.50 - 11 59,359 OKOMU OIL PALM PLC. PRESCO PLC 62,150.00 62.15 - 17 62,011 28 121,370 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 511.20 4.26 - 0 0 0 0 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 1,560.00 0.52 - 8 132,432 8 132,432 36 253,802 DIVERSIFIED INDUSTRIES A.G. LEVENTIS NIGERIA PLC. 767.71 0.29 - 4 10,683 155.66 0.40 - 3 860 JOHN HOLT PLC. S C O A NIG. PLC. 2,111.93 3.25 - 4 21,506 47,151.67 1.16 2.65 62 4,816,617 TRANSNATIONAL CORPORATION OF NIGERIA PLC U A C N PLC. 28,812.97 10.00 - 29 269,715 102 5,119,381 102 5,119,381 BUILDING CONSTRUCTION ARBICO PLC. 711.32 4.79 - 0 0 0 0 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 27,720.00 21.00 - 17 121,230 165.00 6.60 - 0 0 ROADS NIG PLC. 17 121,230 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 4,079.48 1.57 - 2 2,100 2 2,100 REAL ESTATE INVESTMENT TRUSTS (REITS) SKYE SHELTER FUND PLC 1,900.00 95.00 - 0 0 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) 11,300.89 45.20 - 0 0 21,612.98 8.10 - 1 11,500 UPDC REAL ESTATE INVESTMENT TRUST 1 11,500 20 134,830 AUTOMOBILES/AUTO PARTS DN TYRE & RUBBER PLC 954.53 0.20 - 0 0 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 11,352.77 1.45 - 0 0 GOLDEN GUINEA BREW. PLC. 242.22 0.89 - 0 0 GUINNESS NIG PLC 162,088.33 74.00 - 25 77,608 INTERNATIONAL BREWERIES PLC. 264,322.75 30.75 - 8 158,400 NIGERIAN BREW. PLC. 642,950.92 80.40 -2.66 53 316,489 86 552,497 FOOD PRODUCTS DANGOTE FLOUR MILLS PLC 30,750.00 6.15 0.82 36 1,187,494 DANGOTE SUGAR REFINERY PLC 156,600.00 13.05 0.77 27 706,079 FLOUR MILLS NIG. PLC. 82,212.61 20.05 0.25 41 472,183 HONEYWELL FLOUR MILL PLC 8,564.61 1.08 -1.82 38 2,195,387 MULTI-TREX INTEGRATED FOODS PLC 1,340.10 0.36 - 0 0 N NIG. FLOUR MILLS PLC. 944.46 5.30 - 0 0 NASCON ALLIED INDUSTRIES PLC 47,689.89 18.00 - 8 15,401 UNION DICON SALT PLC. 3,676.41 13.45 - 1 900 151 4,577,444 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 17,373.37 9.25 -2.63 22 147,074 NESTLE NIGERIA PLC. 1,177,173.80 1,485.10 0.01 45 131,679 67 278,753 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 22.10 - 0 0 VITAFOAM NIG PLC. 3,544.06 3.40 - 3 10,100 3 10,100 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 40,895.91 10.30 -9.65 14 209,303 UNILEVER NIGERIA PLC. 229,225.72 39.90 - 25 119,579 39 328,882 346 5,747,676 BANKING DIAMOND BANK PLC 16,443.88 0.71 9.23 39 19,741,535 ECOBANK TRANSNATIONAL INCORPORATED 292,675.34 15.95 - 24 144,562 FIDELITY BANK PLC 56,500.85 1.95 -1.52 61 3,492,158 GUARANTY TRUST BANK PLC. 1,019,790.36 34.65 0.87 227 17,593,335 JAIZ BANK PLC 12,964.27 0.44 10.00 11 688,850 SKYE BANK PLC 10,687.83 0.77 - 0 0 STERLING BANK PLC. 50,383.23 1.75 5.42 177 3,028,179 UNION BANK NIG.PLC. 149,971.88 5.15 - 11 83,233 UNITY BANK PLC 8,065.64 0.69 - 6 92,522 WEMA BANK PLC. 19,672.98 0.51 - 26 553,800 582 45,418,174 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 0.20 - 0 0 AIICO INSURANCE PLC. 4,504.63 0.65 3.17 26 1,673,808 AXAMANSARD INSURANCE PLC 19,110.00 1.82 -9.90 14 717,622 CONSOLIDATED HALLMARK INSURANCE PLC 2,660.00 0.38 - 1 200 CONTINENTAL REINSURANCE PLC 18,670.94 1.80 -10.00 4 151,256 CORNERSTONE INSURANCE PLC 3,240.49 0.22 - 1 2,000 GOLDLINK INSURANCE PLC 2,411.47 0.53 - 0 0 GREAT NIGERIAN INSURANCE PLC 1,913.74 0.50 - 0 0 GUINEA INSURANCE PLC. 1,535.00 0.25 - 0 0 INTERNATIONAL ENERGY INSURANCE PLC 487.95 0.38 - 0 0 LASACO ASSURANCE PLC. 2,050.56 0.28 -6.67 14 879,872 LAW UNION AND ROCK INS. PLC. 2,019.28 0.47 - 0 0 LINKAGE ASSURANCE PLC 4,960.00 0.62 - 4 109,500 MUTUAL BENEFITS ASSURANCE PLC. 2,000.00 0.25 - 5 117,000 NEM INSURANCE PLC 12,409.18 2.35 - 6 190,108 NIGER INSURANCE PLC 1,702.69 0.22 - 6 93,335 PRESTIGE ASSURANCE PLC 2,960.40 0.55 - 1 5,000 REGENCY ASSURANCE PLC 1,400.44 0.21 5.00 17 4,135,500 SOVEREIGN TRUST INSURANCE PLC 1,668.16 0.20 - 1 35,000 STACO INSURANCE PLC 4,483.72 0.48 - 0 0 STANDARD ALLIANCE INSURANCE PLC. 2,582.21 0.20 - 1 10,000 SUNU ASSURANCES NIGERIA PLC. 2,800.00 0.20 - 1 4,000 UNIC DIVERSIFIED HOLDINGS PLC. 516.46 0.20 - 0 0 UNIVERSAL INSURANCE PLC 3,200.00 0.20 - 0 0 VERITAS KAPITAL ASSURANCE PLC 3,050.67 0.22 - 3 511,000 WAPIC INSURANCE PLC 5,085.44 0.38 - 16 296,578 121 8,931,779 MICRO-FINANCE BANKS FORTIS MICROFINANCE BANK PLC 11,799.67 2.58 - 0 0 NPF MICROFINANCE BANK PLC 3,429.96 1.50 - 0 0

0 0 MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 4,452.00 1.06 - 5 38,000 7,370.87 0.50 - 0 0 ASO SAVINGS AND LOANS PLC INFINITY TRUST MORTGAGE BANK PLC 5,922.05 1.42 - 0 0 RESORT SAVINGS & LOANS PLC 5,664.87 0.50 - 0 0 2,949.22 3.02 - 0 0 UNION HOMES SAVINGS AND LOANS PLC. 5 38,000 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 7,360.00 3.68 - 22 166,403 CUSTODIAN INVESTMENT PLC 28,821.13 4.90 - 6 54,076 660.00 0.44 - 0 0 DEAP CAPITAL MANAGEMENT & TRUST PLC FCMB GROUP PLC. 30,892.23 1.56 7.59 277 103,476,095 411.91 552.20 - 0 0 NIGERIA ENERYGY SECTOR FUND 1,029.07 0.20 - 0 0 ROYAL EXCHANGE PLC. STANBIC IBTC HOLDINGS PLC 465,734.71 46.05 -4.06 26 192,350 16,920.00 2.82 0.71 23 828,703 UNITED CAPITAL PLC VALUEALLIANCE VALUE FUND 3,312.39 103.20 - 0 0 354 104,717,627 1,062 159,105,580 HEALTHCARE PROVIDERS EKOCORP PLC. 1,680.29 3.37 - 3 10,254 852.75 0.24 - 5 168,001 UNION DIAGNOSTIC & CLINICAL SERVICES PLC 8 178,255 MEDICAL SUPPLIES MORISON INDUSTRIES PLC. 544.04 0.55 - 0 0 0 0 PHARMACEUTICALS EVANS MEDICAL PLC. 366.17 0.50 - 0 0 FIDSON HEALTHCARE PLC 7,350.00 4.90 - 4 48,850 17,340.21 14.50 - 13 26,190 GLAXO SMITHKLINE CONSUMER NIG. PLC. MAY & BAKER NIGERIA PLC. 2,450.00 2.50 - 4 96,471 984.11 0.57 - 11 143,941 NEIMETH INTERNATIONAL PHARMACEUTICALS PLC NIGERIA-GERMAN CHEMICALS PLC. 556.71 3.62 - 0 0 PHARMA-DEKO PLC. 329.57 1.52 - 0 0 32 315,452 40 493,707 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 710.40 0.20 - 2 180,000 2 180,000 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 1,470.89 0.50 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 2.54 - 0 0 NCR (NIGERIA) PLC. 680.40 6.30 - 0 0 381.11 0.77 - 1 25,449 TRIPPLE GEE AND COMPANY PLC. 1 25,449 PROCESSING SYSTEMS CHAMS PLC 1,127.05 0.24 - 0 0 E-TRANZACT INTERNATIONAL PLC 16,590.00 3.95 - 0 0 0 0 3 205,449 BUILDING MATERIALS BERGER PAINTS PLC 1,883.85 6.50 - 3 17,736 22,050.00 31.50 - 11 51,647 CAP PLC CEMENT CO. OF NORTH.NIG. PLC 22,620.20 18.00 - 22 88,717 FIRST ALUMINIUM NIGERIA PLC 696.42 0.33 - 0 0 313.43 0.59 - 2 6,346 MEYER PLC. PORTLAND PAINTS & PRODUCTS NIGERIA PLC 1,999.41 2.52 - 0 0 PREMIER PAINTS PLC. 1,279.20 10.40 - 0 0 38 164,446 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,256.91 2.09 - 0 0 CUTIX PLC. 3,205.61 1.82 - 11 161,949 11 161,949 PACKAGING/CONTAINERS BETA GLASS PLC. 34,148.09 68.30 - 6 4,242 GREIF NIGERIA PLC 388.02 9.10 - 0 0 6 4,242 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 62.50 - 0 0 0 0 55 330,637 CHEMICALS B.O.C. GASES PLC. 1,752.39 4.21 - 0 0 0 0 METALS ALUMINIUM EXTRUSION IND. PLC. 1,803.64 8.20 - 0 0 0 0 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 0.20 - 2 5,850 2 5,850 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 50.60 0.23 - 0 0 0 0 2 5,850 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,252.54 0.20 - 16 1,357,000 16 1,357,000 INTEGRATED OIL AND GAS SERVICES OANDO PLC 58,427.64 4.70 2.13 71 1,591,494 71 1,591,494 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 63,032.05 174.80 -0.11 38 267,030 CONOIL PLC 15,613.92 22.50 - 24 104,209 ETERNA PLC. 5,477.41 4.20 - 19 67,356 FORTE OIL PLC. 23,444.66 18.00 - 42 172,716 MRS OIL NIGERIA PLC. 7,833.01 25.70 -9.98 30 311,451 TOTAL NIGERIA PLC. 67,225.32 198.00 - 9 9,150 162 931,912 249 3,880,406 ADVERTISING AFROMEDIA PLC 2,219.52 0.50 - 0 0 0 0 AIRLINES MEDVIEW AIRLINE PLC 18,818.75 1.93 - 0 0 0 0 AUTOMOBILE/AUTO PART RETAILERS R T BRISCOE PLC. 447.02 0.38 - 0 0 0 0 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 2,593.79 4.40 - 10 85,878 TRANS-NATIONWIDE EXPRESS PLC. 304.75 0.65 - 0 0 10 85,878 HOSPITALITY TANTALIZERS PLC 674.44 0.21 - 1 4,000 1 4,000 HOTELS/LODGING CAPITAL HOTEL PLC 4,801.22 3.10 - 0 0 IKEJA HOTEL PLC 3,492.38 1.68 - 2 16,340 TOURIST COMPANY OF NIGERIA PLC. 7,862.53 3.50 - 0 0 TRANSCORP HOTELS PLC 46,362.46 6.10 - 1 1,400 3 17,740 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 5,280.00 0.44 - 1 1,000 1 1,000 PRINTING/PUBLISHING ACADEMY PRESS PLC. 302.40 0.50 - 0 0 LEARN AFRICA PLC 972.03 1.26 8.62 10 600,335

BUSINESS DAY

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This is M NEY A daily guide to your Personal Finance

Tuesday 04 December 2018

• Savings • Travel • Debt & Borrowing • Utilities • Managing your Tax

Make a difference this Christmas who would be glad for a decent meal and some of the clothes you no longer need. Visit the elderly Have you ever visited an old peoples’ home in Nigeria? Get a few friends, put some money together and take some gifts and treats to the elderly who have found themselves in one of a handful of old peoples’ homes in the country, as our extended family social system evolves to a more nuclear model. Cheer them up; the gift of happiness and good stimulating company for an old person who might be lonely during the holiday season, would make such a difference. How is your Alma Mater doing? Do you often reminisce about how things used to be at your old school and how far standards have fallen? Why don’t you do something about it? With an endowed gift, you can provide permanent support for the educational institution. Your contributions will be invested and each year a distribution made to fund the program or area that matches your interest in a particular field of study. Once it is officially established, you or anyone else may continue to add to the fund at any time. You may also

‘ It is not enough to just tell children to be charitable and kind. Our own actions in supporting others or changing lives will speak louder than any thing we can say

‘

rom Christmas lights to trees, gift-wrapping, ornaments, sumptuous meals and carols what started as a most significant Christian celebration has taken on a major commercial significance. In a sense, Christmas has become all about spending. Amidst it all, it is so easy to lose sight of the true meaning of Christmas. What can you do this year that epitomises the true spirit of Christmas? Here are a few ideas that are worth considering: The definition of a philanthropist is “someone who donates his or her time, money, and/or reputation to charitable causes.” By giving back to your community, religious organisations, for education, for sports or for the arts, you afford yourself the opportunity and indeed the privilege of making a positive impact on other people’s lives. Material possessions will eventually lose their shine, but through philanthropy, one can make an impact, and can shape or even save lives. What causes do you identify with? Decide what initiatives you may want to support and then review your finances to decide how much you can afford to give. Will it be a one-off donation this Christmas or is it something you can continue to commit to year on year. Narrow your choices down to a few charities or initiatives that you can identify with and do some research on them to ensure that their ethos and mission is in consonance with your core values; then choose say one or two to support. Follow up to see the impact your action is having. We all love to see the excitement on children’s

faces on Christmas Eve or Christmas morning ripping the wrapping paper off their presents. The experience of receiving piles of gifts makes them believe that they must have lots of new things for Christmas to be perfect. Try to emphasise the non-material aspects of the season, such as family, fellowship and thoughtfulness. “It’s what you do and not what you say” It is not enough to just tell children to be charitable and kind. Our own actions in supporting others or changing lives will speak louder than anything we can say. We must guide them through a program of action so that it becomes ingrained into their psyche. It teaches them a powerful lesson about kindness and generosity and that their personal money or talent can have a positive effect on the wellbeing of others. It will also show them graphically how fortunate they are; as they take so much for granted. There are so many people in need of the most basic necessities that only a privileged few can take for granted. Think about all the food that goes to waste on Christmas day and what a difference it would make to the numerous homeless people

decide to, through the title, forever link your name or that of a family member to excellence at the college. Your contribution will go a long way in improving the standards of education so badly needed in our country. Be grateful for what you have Even if you have had a really hard year yourself, and it sounds absurd to even conisder giving what you don’t have, focus instead of being grateful for what you do have. If you look around, you will find that there is always someone worse off than you are; unemployment and deep-

ening poverty have become normal for millions of Nigerians Give of your time and talent Giving does not mean that you must give only financially; there are several ways to give meaningfully. Can you commit to teaching someone how to read, how to play a musical instrument, how to code, how to sew or bake? What can you teach? The possibilities of giving of your time, experience, talent and intellect are endless and by sharing your knowledge with others you can add sustained value to your community

in this way. Give Christmas investments Amidst the toys and gadgets, include financial gifts for your children. Cash will always be a favourite, but there are ways of giving money that keeps giving. The gift of a mutual fund invested in a portfolio of money market securities or equities, will get them started in a life of saving and investing. The gift of health insurance for a family that cannot afford decent health care would have a huge impact on their lives. Don’t just give it; teach them what it means, so that after the period of your gift, they will be encouraged to stay insured. As we get caught up in the whirlwind of festivity, socialising and present buying, it is little wonder that we often forget the true meaning of Christmas. How can you make a difference? If you haven’t been doing much for others before now, this is a good time to start. As you prepare for Christmas, let us not forget what we have been given; God’s gift of His Son Jesus Christ. This Christmas, be a blessing to others. Merry Christmas Instagram and Twitter: @ mmwithnimi, Facebook and Google+: ‘Money Matters with Nimi’. www. moneymatterswithnimi. com, or send us an email info@ moneymatterswithnimi. com Nimi Akinkugbe has extensive experience in private wealth management. She seeks to empower people regarding their finances and offers frank, practical insights to create a greater awareness and understanding of personal finance. For more personal finance tips, contact Nimi: Email: info@ moneymatterswithnimi Website: www. moneymatterswithnimi. com Twitter: @MMWITHNIMI Instagram: @ MMWITHNIMI Facebook: MoneyMatterswithNimi

Tuesday 04 December 2018

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NEWS 26 aggrieved APC candidates defect to APM RAZAQ AYINLA, Abeokuta

… as Amosun says I’m still in APC

w e n t y -s i x a g grieved candidates of the All Progressives Congress (APC) loyal to Governor Ibikunle Amosun of Ogun State yesterday announced their defection to the Allied People’s Movement (APM), in Abeokuta, the state capital. This comes as Governor Amosun says he will remain in the APC to contest the senatorial election in 2019, while ensuring the re-election of President Muhammadu Buhari. He, however, said aggrieved party members who defected to the APM had his blessings. Amosun spoke on Monday in Abeokuta at a stakeholders meeting of the APC, which was attended by his

preferred governorship candidate and the flag bearer of APM, Adekunle Akinlade. Amosun said he had tried his best to stop the defection of Akinlade and other aggrieved candidates, but vowed to use everything within his capacity to ensure the success of Akinlade and other aggrieved members in their new party. Amosun also said he would not support the governorship candidate of the APC, Dapo Abiodun. “When these people came, they told me they are leaving the APC, I said ‘no’ but I couldn’t stop them. In fact, Akinlade has my full support. “I am not going to stop him, everything I have, I will use to support him, let them try whatever they want to try,

we also have our strategies and I am not going to hide behind one finger. “I remain in APC because that’s what those people want, they want us to leave APC but they are joking. I will stay in APC to ensure that Buhari wins in Ogun State and to let them know that they can’t subvert the will of the state. “Every day, I will campaign for President Muhammdu Buhari, we will do everything possible to ensure Buhari wins massively in Ogun, but they should not miss it. “I, Sen. Ibikunle Amosun, will not support anyone they are bringing,” he said. Amosun, who vowed to resist rigging in the state, also pledged to check violence in the electoral process.

AEC urges OPEC, others to cut oil production STEPHEN ONYEKWELU

he African Energy Chamber (AEC) urges the Organisation of the Petroleum Exporting Countries (OPEC) and other key global oil producers, including Russia, to continue with the historic production cuts at the December 6 OPEC meeting to stabilise oil price. Oil prices dropped by about 20 percent in November, and the month is likely to record the biggest onemonth decline in oil prices since the crash of 2014. This is not good for producers in Africa and African economies. The Chamber urges African producing nations, both those that are OPEC members and non-OPEC members to speak up with one voice in support of OPEC’s policy on stabilising the market. “This new drop in oil prices clearly shows the world that the global supply cut has not been eliminated. The future of the petroleum sector — and indeed the future

of global energy security — depends on a continuation of the OPEC-led production cuts,” NJ Ayuk, chairman, AEC, said. Oil producing nations, many of which are within Africa, are at particular risk of economic hardship if the supply glut continues and prices spiral. Such countries include Nigeria and Angola, two of sub-Saharan Africa’s largest economies, as well as Equatorial Guinea, Cameroon, Congo, Gabon, South Sudan, Algeria, Libya and Ghana. Other key countries that are investing in upcoming mega projects, like Mozambique, Uganda and Senegal, could face project delays in the face of low oil prices. The historic Declaration of Cooperation, moderated by OPEC’s Secretary General, Mohammed Sanusi Barkindo, which was signed in 2016 by OPEC countries and 10 non-OPEC countries and saw several extensions, is set to expire at the end of 2018.

“The historic Declaration of Cooperation is largely credited with rescuing the oil industry from collapse, and returning economic security to oil-dependent nations, many of which are in Africa. Abandoning this extraordinary deal now would only see production increase and the supply glut worsen — effectively making any progress achieved in the last two years null and void,” Ayuk said. “When the oil market is in crisis, the path to dignity and prosperity is closed off to many African families. It leaves many Africans, particularly those without advanced degrees on their own to chart their own course where clear and attainable paths to a meaningful and prosperous life once existed,” Ayuk said. The opinion of many Africans on OPEC and the energy sector has taken a measurable, positive jump as people acknowledge the strong connection between the oil and gas sector, the African economies and the African entrepreneurial dream.

2019 polls: Obaseki charges Edo NUJ on balanced political reporting ... says press critical to success of 2019 elections

overnor Godwin Obaseki of Edo State has called on journalists to strive for balanced political reporting in the 2019 general elections, which is germane to consolidating on Nigeria’s democracy and safeguarding the people’s right to choose their leaders. He made the call while receiving members of the Nigerian Union of Journalists (NUJ), Edo State chapter, who were on a peace walk to the Government House, Benin City, as part of activities to mark the 2018 Press Week, themed: Making the Votes Count: the Media as Catalyst. Obaseki, who was repre-

sented by his Chief of Staff, Taiwo Akerele, said the role of the media cannot be overemphasised as Nigeria approached the 2019 general elections. “The importance of the media cannot be overemphasized. The media have a vital role to play in ensuring balance in reporting political activities. We use this opportunity to call on the Independent National Electoral Commission (INEC) to be above board and fair to all parties. I can assure you that the government is behind you as this administration will do all to ensure the Press Week succeeds,” he said. Obaseki commended the Roland Osakwe-led NUJ in

the state, stressing that the state had experienced peace and development for a long time. He said, “You have been a good partner in progress. This administration will continue to support you to ensure success. The press is important to this administration. We commend you for your professionalism and fair reporting since we came into office two years ago.” The Edo NUJ is a body that supports peaceful elections, chairman, NUJ, Roland Osakwe, said, noting, “We, as a body, stand for peaceful, free and fair elections. We will continue to support credible elections come 2019.”

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Volatile oil price presents risk for Nigeria’s forex market, new minimum wage STEPHEN ONYEKWELU

il prices have been on free fall in the last three weeks, posing significant challenge to Nigeria’s ability to earn foreign exchange and fund its new minimum wage of N30,000 from N18,000. In this light, the Lagos Chamber of Commerce and Industry (LCCI) has warned that the declining global oil prices present a risk to stability in the foreign exchange market and may threaten the ongoing negotiation on the new minimum wage. Data from the Organisation of Petroleum Exporting Countries (OPEC) as of November 29, show that oil prices are trending down at $59.96 per barrel from $88 per barrel in October, Muda Yusuf, director-general of LCCI, said on Monday. In the build-up to the elections in 2011 personnel spending by the Federal Government increased by 24

… as LCCI advises fiscal prudence percent from N1.4 trillion in 2010 to N1.7 trillion the following year, and so reflecting the then new minimum wage of N18,000 per month. The Federal Government’s annual bill remained within a range of N1.6 trillion to N1.7 trillion through to 2015, and the approved 2018 budget projects spending of N2.1 trillion on the personnel of ministries, departments and agencies (MDAs, perhaps a broader measure than in the earlier CBN series). In the face of failing oil prices, the government should be able to pay the new minimum wage because it can borrow, but Nigeria’s debt profile is ballooning. The states, in contrast, have been bailed out by five separate debt relief packages by the Federal Government. In return, their freedom to borrow has been severely curtailed with a few exceptions such as Lagos State. Falling

oil prices mean states will be hard pressed to meet their fiscal obligations. Nigeria’s gross foreign reserves have been falling, from $47.25 billion in July to $45.90 in August, down to $44.45 billion in September and $42.13 billion in October and $41.52 billion as of November 22. The figure is below the Medium-Term Expenditure Framework (MTEF) 2019 to 2021 benchmark of $60 per barrel. The current dip is the longest falling streak since futures trading began in 1983. But OPEC has remained optimistic about its forecast for the oil market. In its World Oil Outlook (WOO) 2018 released November 14, OPEC said the world’s primary energy demand would surge by 33 percent from 2015 levels to 365 million barrels of oil a day (boed) in 2040, with developing economies accounting

for nearly 95 percent of this growth. It also said India and China were forecast to be the most important contributors to energy demand. “If oil price continues to fall such as we have seen in the last few days, then there is need for concern. Already, when oil price was at $72 per barrel we used about $3 billion of the foreign reserve to defend the naira,” Johnson Chukwu, managing director/ CEO, Cowry Asset Management Limited, said. “At $60 per barrel and falling, this will put pressure on the naira, increase inflationary pressure, and reduce the standard of living and purchasing power,” he said. Yusuf noted that the declining global oil prices posed a major risk to the Federal Government’s economic projections for 2019 fiscal year, as well as impact adversely on its MTEF, if the trend continues.

R-L: Valentine Ozigbo, incoming president/CEO, Transcorp plc; Sara Maja, managing director, EFG Hermes; AigbojeAig Imoukhuede, chairman, Coronation Capital; Zeona Jacobs, director of corporate affairs, Johannesburg Stock Exchange (JSE), and Lorna Johnson, president/ED, The Lorna M. Johnson Global Institute, during the panel discussion at the 2018 ASEA Conference held in Lagos, recently

KEHINDE AKINTOLA, ABUJA

lerk of the National Assembly (CNA), Sani Omolori, on Monday urged the leadership of the Parliamentary Staff Association of Nigeria (PASAN) to immediately call-off the proposed picketing and strike action over delays in the payment of 28 percent salary increase. Omolori gave the charge via a letter addressed to the chairman, Parliamentary Staff Association of Nigeria (PASAN) titled: Re: Notice of picketing/strike rising from the resolutions of congress meetings of the PASAN, National Assembly Service Commission and National Assembly Chapters’ with Ref. No:NASS/CNA/149/ Vol.6/75 dated 3rd Decem-

Ogunshola to get CIIN 2018 honorary fellowship

ormer chairman of Punch Nigeria Limited, Ajibola Ogunshola, is to be conferred with the 2018 honorary Fellowship of the Chartered Insurance Institute of Nigeria on December 6. A maths graduate from the University of Ibadan, he entered the insurance industry in October 1967 as an actuarial trainee in the actuarial department of the Eaglestar Insurance Company in London, and qualified as a Fellow of the Institute of Actuaries in 1973. For over 20 years, he was the consulting actuary to many insurance companies and occupational pension funds in Nigeria and West Africa and, after retirement, was appointed chairman of Alexander Forbes Consulting Actuaries until 2015. He has also held several insurance positions including the first life manager of old NICON, first managing

ber, 2018 seen by BusinessDay. The National Assembly accounting officer who blamed the non-implementation of the 28 percent increment on paucity of funds, urged the workers to continue to engage the management of the National Assembly on all issues raised in the letter sent to the Senate president, Bukola Saraki, and Yakubu Dogara, speaker of the House of Representatives. He observed that the letter written by PASAN dated 29th November, 2018 as it relates to the ‘payment of 28% increase in CONLESS’ falls under the purview of management, rather than the presiding officers of the National Assembly. “Following Staff agita-

tions on the above subject, I empaneled a committee made up of representatives of Management and PASAN to study, review and advise on the way forward. The Report of the Committee was submitted to me in June, 2018 and the recommendations were thoroughly discussed jointly by the PASAN and Management. Eventually, the Management and Leadership of the National Assembly acceded to the bargain of PASAN that 28% additional CONLESS should be implemented with effect from January 2018. “In furtherance of the above, the Presiding Officers, in an unprecedented manner, made provision for the implementation of the 28% CONLESS increase in the 2018 Budget, and this

was to be paid from the additional funds earmarked for the National Assembly in 2018. Unfortunately, the level of implementation of the 2018 budget, in terms of release of funds, have made it impossible to pay this additional 28%. This situation has been well discussed, and I am aware that PASAN Officials have investigated and verified this fact from the Federal Ministry of Finance. “Accordingly, any insistence on immediate implementation of this increase, without funding from the Federation Account, is highly unrealistic and non-feasible. Of course, management will not hesitate to pay as soon as funds are available. Once again, we appeal to

director of Niger Insurance plc, member of the governing council of the Nigerian Insurance Association, and non-executive chairman of Continental Reinsurance plc. He was, from 1973 to 1983, a part–time lecturer in actuarial science at the University of Lagos and subsequently external examiner in insurance and actuarial science at the Ahmadu Bello University. An honorary Fellow of the Nigerian Mathematical Society, he holds a D.Sc degree in management (honoris causa) from Olabisi Onabanjo University, Ogun State.

IFRS 17 to boost Nigeria’s insurance sector global competitiveness FRANK ELEANYA

NASS workers’ strike threat: CNA explains delay in implementation of 28% salary increment

Tuesday 04 December 2018

he Nigerian insurance sector has the opportunity to compete with the peers around the globe once the much-anticipated IFRS 17 is integrated, effective January 1, 2022. Experts and industry regulators at the Deloitte IFRS 17 Breakfast Meeting, held in Lagos, said this. The IFRS 17 is an International Financial Reporting Standard that was issued by the International Accounting Standards Board in May 2017. It replaces the IFRS 4 Insurance Contracts and related interpretations and is effective for periods beginning on or after 1 January 2022 (It was previously set for January 1, 2021), with either adoption permitted if both IFRS 15 Revenue from Contracts with Customers and IFRS 9 Financial instruments have also been applied. “It is going to have huge impact in the sense that currently when liabilities are being measured, they are measured based on events that occurred, but the new standard is forward looking,” Oduware Uwadiae, partnerin-charge of IFRS implementation unit of Deloitte told BusinessDay after the event. “It is looking at the risk on the entire contract and also the contract to the last mile. The current standards will only look at the risk as at today, what risk are we having today? But the new standard is looking at the entire risk from now till the end of the contract. So, if I sign a contract today and it is going to expire in the next six years, I

have to measure my risk from today till the end of the six years. So, as I am measuring it, if the risk is increasing each year, I can recoup additional loss on the instrument,” Uwadiae said. A major objective of the IFRS 17 is to standardise insurance accounting globally to help users of accounts make sensible comparisons between companies, their performance, their current financial position and risk exposure. IFRS 17 also unifies the accounting model for all types of insurance contracts that will be transparent and aligned to general IFRS accounting of other countries. It may pose quite a task for insurance companies to fully implement, hence has extended the launch date by one year from 2021 to 2022. “Implementing IFRS 17 won’t be a flick, it is a journey and you are going to be working with your IT unit to make it work,” Giles Waugh, Actuarial Consultant at Deloitte Actuarial and Insurance Solutions. “The training has to run through the organisation.” Implementation of IFRS 17 will also require specialised talents in the actuarial field. Uwadiae said Deloitte was already thinking along those lines, hence the investment in actuarial training. He told BusinessDay that the consulting firm also envisioned some insurance companies poaching its talents as the date of implementation approaches. Hence, it is collaborating with players in the sector to develop in-house talents.

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Transport minister calls for law to criminalise traffic offences … as Guinness, UNITAR, FG unite to combat road traffic tragedies ONYINYE NWACHUKWU, Abuja

igeria’s transport minister, Rotimi Chibuike Amechi, has urged the Federal Road Safety Corps (FRSC) to immediately push for a law that criminalises traffic offenses to check high level of road accidents. About 1.3 million people reportedly die globally on account of road accidents and 5,600 of them are in Nigeria. Amechi said the number was huge and that the level of accidents was not particularly about the number of cars plying the Nigerian roads but principally due to bad roads and bad driving, among other factors. The minister was speaking in Abuja at an event organised by the United Nations Institute for Training and Research (UNITAR) in collaboration with the Ministry

of Transport of Nigeria and Diageo, a global leader in the beverage alcohol industry to improve road safety and combat issues like drink driving. “Let’s leave here with a commitment that we will discipline ourselves,” advised Amechi, who said he was attending the event not as a transport minister but as a board member of UNITAR. The event had UNITAR, Ministry of Transport of Nigeria and Diageo renew a three-year partnership agreement that would see a series of major road safety events to reduce traffic death and injuries, and improve road safety globally. Baker Magunda, managing director, Diageo Guinness Nigeria, said, “Diageo is a global company operating in 180 countries, and Nigeria is an important market for the company because the first Guinness brewery outside of the British isles and the third

globally was built in the country.” Guinness Nigeria is also the only total beverage alcohol company in Nigeria producing spirits, beer and nonalcoholic malt drinks. The company also has a long history of working to reduce the harmful consumption of alcohol and its consequences, supporting numerous drink drive prevention programmes around the world, Magunda said. This range from high visibility enforcement through random breath tests in countries such as Ghana, China and South Africa, to funding safe rides home and free public transportation. He said, “We also look to encourage laws which establish maximum blood alcohol concentration levels in countries where none exist. “We have set high expectations of our products and business. We know that enjoying alcohol is part of life

in many societies around the world and also in Nigeria who are some of the happiest people in the world. “We want people to drink better, not more. For most people, drinking responsibly is common sense. They know that the balance is important, and that drinking too much of any of alcohol can lead to serious problems.” Magunda said all road crashes attributable to alcohol were preventable and that Diageo was committed to tackling alcohol misuse through a mixture of policies, programmes and partnerships. “As a company, we reinforce a common sense understanding of moderation in everything we do and say. We work with governments and other partners to target specific issues, such as drink driving or excessive drinking, with programmes that try to change behaviour and reduce harm,” he said.

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MDAs must invest in ICT skills to boost GDP, create jobs – DBI chief

igeria’s Digital Bridge Institute (DBI) last week in Abuja urged Ministries, Departments and Agencies (MDAs) to invest in Information Communication Technology (ICT) skills to stimulate growth and boost GDP in the country. Such investment will also help Nigeria catch up with the rest of the world in the area of digitisation, job creation, technology adaptation and deployment in the workplace. Chairman, Governing Board of DBI, Titi Omo-Ettu, made the call at the institution’s one-day interactive forum with Directors of Human Resources and Information Technology (IT) of various government agencies. The interaction focused on the role of ICT in human resources with reference to capacity building development. “It is my hope that as leaders in your various organisations, you will make the right

decisions by recognising the need to give ICT training its deserved priority. “We must invest consciously in digital skills acquisition through training and retraining not only to remain relevant but to prepare the workforce for the unfolding digital revolution,” he said. Omo-Ettu emphasised that embracing emerging technologies was crucial in positioning government agency to remain relevant and more efficient. According to Omo-Ettu, the digital age is altering how we do things socially, economically and politically, so the fast pace of changes in technology, tools and platforms in the ICT sector have necessitated need for continuous investments in training. He bemoaned how increased pace of globalisation and technological advancement was expanding the divide between Africa and other regions.

150 newly certified members of CIN to be awarded DCP KEMI AJUMOBI

L-R: Mazen Mroue, chief operating officer, MTN Nigeria; Pascal Dozie, chairman, MTN Nigeria; Kunle Adebiyi, sales and distribution executive, and Rahul De, chief marketing officer, MTN Nigeria, at the launch of the 4th edition of MTN Season of Surprises at Ikoyi, Lagos to mark the kick-off of the Christmas season.

ctivities are lined up for the second induction and AGM of the Compliance Institute of Nigeria (CIN). The event is another stride towards actualising Nigeria’s effort to stem the scourge of corruption, defeat terrorism and instil discipline and a culture of compliance in Nigeria. About 150 newly certified members who successfully sat for and passed the Institute’s compliance professional examinations will be awarded Designate Compliance Professional (DCP). Another 10 members will be decorated with Associate Compliance Institute, Nigeria (ACIN) after applying for and obtaining exemptions as compliance practitioners with the requi-

site qualifications. CIN has reviewed its DCP curriculum to include more contemporary compliance topics such as anti-bribery and corruption, ethics, governance and treating customers fairly. According to Pattison Boleigha, president/chairman of Board of CIN, “The examinations for award of ACIN certification will commence in 2019, and is also expected to cover telecommunications, manufacturing, pharmaceutical, foods and beverages, oil and gas and also mining areas.” The Institute is currently pursuing its chattered status at the National Assembly. With the coming of the Institute to Africa, it is poised to set the right tone for compliance in the continent.

MTN Nigeria launches 4th edition of ‘Season of Surprises’ Modern slavery: Obaseki harps on deepening JOHN SALAU

umerous residents in Ikoyi were treated to gifts, surprises and a great time on Sunday, December 2, 2018, as MTN Nigeria flagged off the fourth edition of its Season of Surprises. The event, which was held at the Giwa Barracks in Ikoyi, Lagos, had top officials of the information and communications Technology Company, as well as distinguished servicemen in attendance. The chairman of the Board of MTN Nigeria, Pascal Dozie, as well as the company’s CEO, Ferdi Moolman, did the unveiling.

In his remarks, Dozie explained that the Season of Surprises transcended the company and was an avenue to remind Nigerians that the celebratory atmosphere of Christmas should be harnessed to extend the spirit of giving and joy to fellow Nigerians. He said this was the company’s way of appreciating the millions of Nigerians who continue to use the company’s services and restated MTN Nigeria’s commitment to delivering the best services in order to ensure that everyone can stay connected to their loved ones and kick-start the act of extending a helping hand to the next person.

The launch was packed as food items and provisions were shared to the residents and a grand raffle draw was held that saw residents go home with generators, mobile devices and other grand prizes. The Season of Surprises, which saw 250,000 Nigerians receive gifts, surprise payments for services and other incentives in 2017 alone, continues across the country. Hundreds of MTN staff have volunteered for this endeavour with the sole aim of transforming the lives of Nigerians with well-orchestrated activities. The initiative is expected to last for two weeks.

global efforts to curb human trafficking

do State governor, Godwin Obaseki, says the fight against human trafficking, which is a manifestation of modern-day slavery, will gain considerable mileage when all stakeholders affected by the menace work together to provide pragmatic, inclusive and sustainable solutions that place a premium on socioeconomic impact in affected developing countries. The governor, who said this in commemoration of the International Day for the Abolition of Slavery, marked on December 2 every year, noted that the new coalition to end human trafficking added a new dimension to the campaign.

He said the state government had made considerable progress in the campaign against human trafficking, which has led to the setting up of the Managing Migration for Development Programme (MMDP), in collaboration with the World Bank and the European Union. On the international coalition, he said, “We would hold the second roundtable dialogue on tackling migration in Edo State from December 4 to 5. This is a new chapter for us with the involvement of the multilateral development agencies on this campaign. We had reached out to them for support and we appreciate the fact that they have engaged constructively with

us, providing the necessary support. “So, we will be reviewing the much we have done and now entering another phase, that will ensure that government’s presence is felt in affected communities, just as the economic space will be opened for them to lead rewarding, fulfilling lives.” Noting that the state government has recorded considerable progress in the effort to break the bond between trafficked girls and their ‘sponsors,’ he said, “With the backing of the Oba of Benin, Ewuare II, we have been able to assure the girls that whatever bond they may have entered into with their madams have no effect.

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news you can trust I TUESDAY 04 DECEMBER 2018

INSIGHT/INNOVATION

I blame GEJ for Buhari’s failure

Ogho Okiti Dr. Okiti is the president, Time Economics Ltd @ Dr_Okiti 081.7153.0058

efore I complete my analysis, I can already imagine the fury from both the People’s Democratic Party (PDP)’s and the All Progressive Congress (APC)’s camps. I imagine both camps berating me for committing a mortal sin by daring to title my article as such. The PDP camp will readily agree that Mr. President, Muhammadu Buhari has failed, but will frown at laying the blame of such failure at the feet of the former President, Goodluck Jonathan. On the APC side, President Buhari cannot be described as a failure, but rather has succeeded beyond reasonable standards and expectations. But as I live through the three years plus of President Buhari’s presidency, the changes that have happened, and the implications for Nigeria’s future, I have had to go back to 2010 on why and how we found ourselves here. In that year, PresidentJonathan had just become president, and one of the first major things he did was the re – launch of the power sector reform in Lagos, which had stalled under

PROPHYLAXIS

Ayuli Jemide Ayuli Jemide is Founder and Lead Partner of Detail Commercial Solicitors. An entrepreneur, public speaker and writer. Email: AJ@ayulijemide.org Twitter: @JemideAyuli

s we approach the Nigerian 2019 elections, I have made it a new pastime to feel the pulse of the nation by speaking to different people at all levels of society. You will be amazed at the different voices out there. I have categorized these voices into seven different groups which I introduce below, in my order of preference. Group one is the nationalist. The nationalist belong to no party, do not support any party but support candidates (either incumbents or opposition) based on ‘’national interest’’. Their mantra is ‘’as long as it is good for Nigeria’’ we will support it. I like the nationalists; their only thought is to see that Nigeria becomes a better place for all its citizens. So, their choices are usually pragmatic. Group two is the loyalists. These people are committed to their party or candidates. They are usually members of a political party or have a leaning towards a political party or just

his predecessor. At the time, and this is still my interpretation, I felt it was symbolic. The President understood the critical and strategic role power plays in the economic performance of a nation, and that the power, through national grid (scale), is still the most sustainable method for achieving it. Soon after, the preparations for the 2011 elections gathered momentum, and at the time, his presidency had naturally become a procession. However, I believe the problems with his presidency started with the manner in which the 2011 elections were conducted and won. President Jonathan, largely new to the high stakes of Nigeria’s politics was deceived into opening the taps through the Nigerian National Petroleum Corporation (NNPC) under the guise of subsidy. Then and now, I still believe that no president has fully understood, or is willing to wage a bet on the economics and politics of petroleum subsidy. They all repeat the same mistakes, as President Buhari is doing now. Now, President Jonathan, after the elections understood what has happened, but did not fully understand the extent and the ramifications of the subsidy arrangement, but was under enormous pressure to prosecute. But I believe that they must have quietly reminded him that he was the biggest beneficiary. Following this, and acknowledging a massive mistake, he opted for the removal of subsidies, following enormous pressure from the governors. The economics was right, but the politics was wrong. Nigerians were livid that those that perpetuated the subsidy bazar will go free but their fuel prices at the pumps will go up. The opposition pounced and the President did not recover from that. But that was not the only problem. There were distinct, historical and circumstantial elements that made it possible for the opposition to pounce in the first place. First, he was a minority. Bayelsa is a small state, and a minority state even within the Niger Delta. The State and its politics before the President

‘

The economics was right, but the politics was wrong. Nigerians were livid that those that perpetuated the subsidy bazar will go free but their fuel prices at the pumps will go up. The opposition pounced and the President did not recover from that

did not enjoy the gravitas of Rivers and Delta States. Second, his background shows he was someone with very limited knowledge of the three major groups until after he entered national politics. His early life and education were confined to Bayelsa and Rivers States. Third, and perhaps most important, the subsidy arrangement fiasco reminded Nigerians of all that is wrong with its elite politics, symbolised by the Peoples Democratic Party (PDP). From that moment in early 2012, all that happened after continued to project the narrative that had been established after the election and the failure to remove fuel subsidies. The opposition seized and projected this, and the president did not recover. By the middle of 2014, the politics started to

crystalise into major and significant decamps from the PDP, and the numbers started to look even grimmer. But these were not some inevitable trends. While President Jonathan did not receive the vote of the North in 2011, he swept the entire south, for which the Yorubas are a key voting bloc, but he was slow and failed to integrate this important bloc, and was slow and indecisive about the information on his administration excesses that were becoming public knowledge. By the late 2013 the opposition started to smell blood, and into what turned out to be an unstoppable opposition train. But the most critical point that cannot be ignored is that 2011 was meant to be a watershed and a big break from Nigeria’s old guard of politics and politicians and its hegemonic elements. Yes, some may even argue that 2007 was meant to be that after the emergence of Umaru Yar’Adua as president. So, 2011 was either meant to be a consolidation or watershed and a tactical rejection of the old guard by the large majority of Nigerians. Back to now, and in the last three years plus, not even the most generous supporter of the president thought he could transform Nigeria, but at the same time, non of his staunchest critic thought he would proceed to preside over the collapse of the economy, expand the state and stifle the civil space, allow parochial corruption to foster, and demonstrated cluelessness about Nigeria’s complex security challenges, and the dangers from poverty and religious extremism. In conclusion, therefore, history will be kind to President Jonathan for the circumstantial and historical manner in which he “surrendered” his presidency, but history will not be kind to him for the consequences because it took us many years back to where we left, especially when it was not supposed to happen. I thank you.

The seven voices of the 2019 elections an interest in candidates that they are loyal to for a good reason or cause. These people will cling loyally to even a fringe candidate who stands no chance of winning an election. I like these people because they know where they stand and have their reasons. Democracy thrives on the back of loyalists. These people are like Americans who are either Democrats or Republicans and they are loyal to the cause. Group three is the reformers. The reformers like the nationalists belong to no party and do not support any party. The reformers simply want to see every incumbent out of power and a new candidate from a new party in their place. They think if a party has held sway for more than two terms they should be jettisoned, and the opposition candidate should take over. I like the reformers. They believe no party or candidate should get too comfortable in office. Reformers are like the French. France to date has had only two Presidents who have served

‘

Statistic has shown that most Nigerians are either pessimist or passivists. In 2015 presidential elections the total number of registered voters was 67,422,005, but only 31,746,490 (less than 50% of registered voters) came out to be accredited on election day

a full two terms (François Mitterrand and Jacques Chirac). In fact, France in year 2000 voted and passed a referendum that reduced the length of the President’s term from seven years to five years. Group four are the hesitant bunch. When you speak to them, they are never sure where they stand with any party or any candidate. These people sound like they can get to the polling booth and toss a coin or roll a dice to decide. You will hear them say – ‘’I think I like so and so candidate and I may vote for them’’. Even the candidate they think they like is still just a thought and if they will vote for that candidate is still just a ‘’may’’. I cringe when I have discussions with these kinds of people because they are the most gullible bunch and may vote based on the last person who spoke to them at the polling booth or probably decide not to vote at all. Group five are the pessimists. This bunch of people believe that all the candidates are horrible, and politicians never mean well for the country so there is no use supporting any candidate. Pessimists typically have not even bothered to get their voters cards and the rich pessimists have booked their tickets to fly out of the country just before elections to avoid any chance of being victims of election violence or skirmishes. Group six are the passivists. The passivists are very pathetic and lethargic Nigerians. They don’t know what is going on, they don’t care to know who the candidates are. They don’t know when elections are and may not even know that there are elections in 2019. If they obtained their voters card it would be because an activist friend of theirs dragged them to INEC office to register. These are the people that INEC’s Director in-charge of Voter Education, Mr Oluwole Osaze Uzi, referred to in an interview with Saturday Vanguard, April 14, 2018 when he said: ‘’the commission in some

cases had tried to reach out to some Nigerians to come and claim their cards, many of them said they were not interested’’. The worse group is group seven – the opportunists. These ones should be given a badge of shame – the Grand National Shame Badge (GNSB). These people simply view elections as an opportunity to make money. They find candidates who they can fleece during elections and support them simply for that purpose. They sell their votes for a piece of bread. They take money to be influencers and canvassers for candidates they know are just the dregs of society. It is all about the money and shortterm gains. Statistic has shown that most Nigerians are either pessimist or passivists. In 2015 presidential elections the total number of registered voters was 67,422,005, but only 31,746,490 (less than 50% of registered voters) came out to be accredited on election day. The INEC chairman, Prof. Mahmood Yakubu, on Thursday, September 6, 2018 said 84,271,832 Nigerians are registered to cast their votes in the upcoming 2019 general elections. So, Nigeria has 14,551,482 new registered voters. If I was to place these 14.5million new voters in any of the seven groupings I will stake my bet that they are either nationalists, loyalists or reformers. Why do I say so? If you heard the stories of how difficult it was to get registered for the 2019 elections’, only people with a cause or some angst would adopt a come rain come shine attitude to collecting their voters’ card. I also think a few repentant passivists or pessimists are part of the 14.5 million new voters because many have woken up from the slumber party. As you can see from my order of preference, I have a leaning for the Nationalists. I therefore urge Nigerians to prepare to vote in 2019 and in choosing candidates to vote for I urge you to do one thing: Think Nigeria!

Published by BusinessDAY Media Ltd., The Brook, 6 Point Road, GRA, Apapa, Lagos. Ghana office: Business Day Ghana Ltd; ABC Junction, near Guinness Ghana Limited, Achimota – Accra, Ghana. Tel: +233243226596: email: mail@businessdayonline.com Advert Hotline: 08034743892. Subscriptions 01-2950687, 07045792677. Newsroom: 08169609331 Editor: Anthony Osae-Brown. All correspondence to BusinessDAY Media Ltd., Box 1002, Festac Lagos. ISSN 1595 - 8590.