Businessday 05 jun 2018 by BusinessDay

AITEO denies sponsoring Niger Delta protest against JTF

iteo has denied allegations by the embattled Commander of Operation Delta Safe, Rear Admiral Apochi Suleiman that it is sponsoring protests by Niger Delta

…alleges oil bunkering and refining reach unprecedented levels youths against oil bunkering in the state, according to a statement released by the company.

news you can trust I * * TUESDAY 05 JUNE 2018 I vol. 15, no 68 I N300

Suleiman had on June 1, 2018, while defending allegations levied against him suggested that Aiteo and its Chief Executive Benedict

Peters are somewhat responsible for the publicly aired complaints about actions and outcomes arising from his work at the JTF. On

ustainability and adverse budget implication is a major cause for worry across board as discussions on the planned minimum wage increase continues.

…Recurrent budget may jump 34% While labour costs in Nigeria are relatively cheap at $50 dollar a month, it is largely unproductive. “What we have now is not a living wage; so already workers are not motivated. The question

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Sustainability of minimum wage hike shows challenge for Buhari OLALEKAN IPELE & BUNMI BAILEY

June 1, 2018, hundreds of youths connected to the Niger Delta region organised a World Press Conference in Abuja to draw attention

of sustainability is a question of priority. The government need to find the money. Funds should be put into the society so that people can afford to meet their basic needs. N18, 000 won’t help

APC Convention Committee lobbies Dogara, others ... nPDP suspends talk with Presidency ...says Buhari not interested in reconciliation KEHINDE AKINTOLA, Abuja

you do that,” said Charles Anudu founding Managing Director and Chairman of The Candel Company Limited, a major player in the Continues on page 2

hairman of the All Progressive Congress (APC) National Convention Committee, Governor Badru of Jigawa State on Monday Continues on page 33

BD ECONOMIC BRIEF

Emiefele’s policy headache isn’t getting any better Emeka Ucheaga

hen the Central Bank of Nigeria (CBN) monetary policy committee (MPC) raised interest rates in 2016, their priority was fighting inflation. Inflation has dropped con-

Continues on page 2

Inside Made-in-Aba campaign attracts N3bn in direct orders - Ikpeazu CRISIS BREWING: A contest has erupted inside the Banana Island estate in Lagos over ownership and use of a plot of land on which these two contending signs now stand. Agents of the Nigerian Army Properties Ltd invaded the estate last week to take down a sign erected by the residents and property owners in the estate before going on to place a signpost belonging to the Army on the same spot. The Army seeks to forcibly take over the land because of a planned 43-hectare Apple island estate some 500 meters offshore Banana Island. However, the land is earmarked for recreation in the original plan of the estate and the adjoining property is a children’s playground. If the Army has its way, the children’s playground will be turned into to a busy highway cutting the estate into two halves to provide access to the Army’s planned Apple Island Estate. Pic by Pius Okeosisi

P. 2

Offa bank robbery: Police makes U-turn, demands written statement from Saraki P. 4

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Nigerian Agricultural industry. “Labour in Nigeria is demoralized labour. Everybody is looking at how he can damage something or steal something simply because he has to survive.” In 2011 when the last national minimum wage increase of 140 percent from N7,500 to N18,000 a month was implemented, the total Federal Government (FG) budget for the period increased by 11.3 percent to N4.9 trillion from N4.4 trillion in 2010. Recurrent expenditure also spiked by 19 percent to N2.5 trillion in 2011 from N2.1 trillion in 2010. The new minimum wage should on the average be in the region of N61, 250 a month equivalent to $170 a month going by demands of the Nigerian Labour Congress (NLC) for between N56,000 and N66,500. An increase of that magnitude (240%) if implemented, could see the FG recurrent budget jump by 34 percent, according to BusinessDay calculations. Even without a minimum wage hike since 2011, the FG recurrent budget has surged by 40 percent between then and now. The FG budgeted N3.49 trillion as recurrent expenditure for 2018 (a N1 trillion increase from 2011 levels), and N2.43 trillion for capital expenditure. Seven years down the line since that last increase many subnational governments struggle to meet their financial obligations to workers, with states like Kogi, Osun and Imo leading the pack with unpaid salary arrears of more than ten months. As is the trend in Nigeria, recurrent expenditure has always exceeded capital expenditure, an increase in minimum wage across board will further stretch state governments’ debt burden already estimated to be over 150 per cent of their revenue on average, and approximately one fifth of the total government debt. Ayodeji Ebo, MD, of Lagosbased financial advisory, Afrinvest said, “We should consider the following before implementing the increase; are we going to borrow to sustain the increase? Or, how are we going to fund the increase? A lot of states despite increase in FAAC allocation are still unable to pay salaries. Continued from page 1

secutively for the last 15 months and based on this trend it is now plausible that Nigeria could see a single digit inflation rate by the 4th Quarter of 2018 based on observed disinflationary trend in the country for the first time since 2015. Despite this monetary policy victory, the CBN has been unable to cut interest rates to spur a credit boom which could quicken the pace of Nigeria’s

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“Again, is this increase going to be on the federal level only or across board to include states and local government?” “The growing need for the government to increase capital spending especially on the energy and transport infrastructure side will drastically suffer because their focus will be now on paying salaries and already in Nigeria the civil service just pays people for doing essentially nothing,” Ebo concluded. According to economics consulting firm Financial Derivatives Company, the country needs to invest about $15 billion annually for the next 15 years to be able to sufficiently bridge the rapidly widening infrastructure gap across the country. Yvonne Mhango, an economist at Renaissance Capital said, “In term of wages generally, if you look over the past five years, real wages have fallen. Part of why we have seen consumer spending come under pressure. So I think talks about wage increase, if implemented is a positive one for real wage and for consumer spending.” A $169 minimum wage will put Nigeria at par with the likes of South Africa, Burkina Faso, Algeria and Egypt. The global chief economist and head of macro strategy Renaissance Capital, Charles Robertson said, “There is a perspective about keeping yourself competitive internationally. Right now according to my data Nigeria has one of the lowest minimum wages in the world. Nigeria at $50 per month, Ghana $49 and Egypt at $67,” “A 100 percent increase is saying the average Nigerian minimum wage needs to be 30 percent above minimum wages like Egypt and if you are trying to compete in the world economy that is always a challenge. People should not look at it purely in Nigerian focus; you have to see that we are a world economy, we are trying to attract investors, how expensive should our wages be to attract investment” “looking at how in the last couple of years, real wages have fallen in Nigeria, and how unimaginable it is to live on $50 a month, at the moment there is room for a rise but the question is how much of a rise?” Robertson concluded.

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Tuesday 05 June 2018

L-R: Tonye Cole, chief executive, Sahara Group; Oyewole Oyewumi, commissioner for Agriculture & Rural Development. Oyo State ; Chris McAllister ,MD, BAT Nigeria, and Kola Jamodu, chairman, BATN Foundation board of directors at the launch of the 2018/2022 country program in Lagos, yesterday. Pic by Pius Okeosisi

Made-in-Aba campaign attracts N3bn in direct orders - Ikpeazu … says state to diversify economy through agriculture GODFREY OFURUM, Aba

he Made-in-Aba campaign has so far attracted over N3billion in direct orders into Aba, while ensuring the employment of about 1-million new employees and apprentices in the over 300,000 markets around the State, says Governor Okezie Ikpeazu. Ikpeazu in his broadcast to mark his 3 years in office, as the Governor of Abia State, observed that the Made-In Aba campaign has opened new doors of opportunities for producers in Aba, the State’s commercial hub. He stated that the ongoing Ariaria Independent Power Project, being financed by the Rural Electrification Agency of the Federal Government, when completed would improve power supply in the Ariaria business corridor, especially at the finished leather cluster. He explained that the power project has for the last 6 months, provided uninterrupted power at the market to 2,000 shops on its pilot phase, which was successful and revealed that the agency is constructing a power station that would provide uninterrupted power to 34,000 shops in the market. In his words, “You are all aware of the steps we took to ensure that

Emiefele’s policy headache isn’t getting... economic growth. Many economists believed that as finally fell below the monetary policy rate (MPR) for the first time in two years, Central Bank will take the window of opportunity to ease the currently tight monetary conditions in the economy. But the Monetary Policy Committee has chosen to hold the MPR, cash reserve ratio (CRR)

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and liquidity ratio at the same rate for the past 23 months. Although the Central Bank would love to cut interest rates to boost credit activities, the threat that the Naira may come under attack thereby causing a currency devaluation is a risk too big for the MPC to assume this year. If Nigeria reduces interest rate, it could trigger a large amount of capital outflows in the country.

capacity is improved in our flagship shoemaking sector, by sending 30 shoemakers from the state to China, to learn the art of automated shoemaking. “We have ordered the equipment that the shoemakers used in China and they are expected in the country soon. We will commence large-scale production at the Abia Shoe Factory, in Aba, before the end of the year.” Ikpeazu sated further that his administration has pursued with uncommon vigour, its determination to diversify the economy of the State, through agriculture, stating that the large scale mushroom production and training programme is already yielding great results and attracting requests for support from other States. According to him, many young Abians have been trained and are currently engaged in large-scale commercial mushroom production. On rice production, the Abia State Governor, stated that his administration is also actively supporting rice farmers in the State to further boost production and put more of the highly nutritious ‘Abia Rice’ in the market. “Our target is to be self-sufficient in rice production, by 2019 and target the export market afterwards.

“We have in the same vein engaged in massive palm planting campaign, which has so far seen us planting over 4-million tenera specie palm seedlings across the State. “Our target is to plant 7.5-million seedlings by the end of 2019 and we are firmly on course. We have also provided mechanized farming equipment across the State, through leasing at affordable rates.” He revealed that the State’s enhanced poultry and fish production, has yielded great results with 100 poultry pens of 2000 birds each, established across the State. “We constructed a massive 165,000 birds-capacity poultry processing plant at Umuosu Nsulu in Abia Central Senatorial Zone, while additional 2-units for Abia North and South, are currently under construction. He stated that Abia is gradually regaining its pride of place, as an agricultural hub, stressing that his administration is poised to do even more, by ensuring that the Umuahia Agro-Industrial Cluster takes off soon. He explained that the industrial zone will handle cassava, oil palm, cocoa, Rice and cashew processing in the 1st phase with potential of creating over 1-million jobs, along the value chain.

In 2017, foreign portfolio investment was as high as $12b according to the National Bureau of Statistics (NBS). The outflow en masse which typically follows a devaluation could cause an exchange rate crisis as the external reserves will come under tremendous strain. With the Nigeria economy recovery still very fragile considering GDP growth of less than 2 percent in Q1 2018 and trade contracting in the quarter after

expanding for the first time in Q4, 2017, following 6 quarters of negative growth prior, an exchange rate crisis could cause all the output gains to reverse and economic growth to return to zero or even negative. Now in trying in boost economic growth by dropping interest rates, the Central Bank may end up causing an exchange rate crisis less than a year to Nigeria Continues on page33

Tuesday 05 June 2018

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Made-in-Aba campaign attracts N3bn in direct orders - Ikpeazu … says state to diversify economy through agriculture GODFREY OFURUM, Aba

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Tuesday 05 June 2018

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PMB’S uncertain march to 2019

MAZI SAM OHUABUNWA OFR sam@starteamconsult.com

ast week, President Muhammadu Buhari (PMB) began the last lap in the four year term given to him by the people of Nigeria to lead the nation. Though PMB has expressed a wish to have his mandate renewed, no one can be sure if this request will be granted, until after the presidential elections in February or March next year (depending on which schedule will rule - INEC or NASS) and hoping that all things remain equal. You may ask me what I mean by “all things remain equal” I have read resolutions by some ethnic nationality groups insisting that Nigeria must be restructured or there may be no elections. In view of the fact that no one knows if the restructuring will take place on one hand and the fact that nobody knows whether the ethnic nationalities can carry out their threat on the other hand, that’s what I mean by “all things being equal” Nevertheless, the chances of granting PMB’s request will certainly depend on what he does or what he does not do in this last lap. Watching recent heightened level of activities within the polity, I get the sense that PMB and his team have realized that if the elections were held this moment, his chances are not as bright as they were in 2015. Never mind

STRATEGY & POLICY

MA JOHNSON Johnson is a marine project management consultant and Chartered Engineer. He is a Fellow of the Institute of Marine Engineering, Science and Technology, UK.

or a sailor, life at sea most times can be a struggle and on other occasions, it’s beautiful. Life at sea is beautiful when a sailor has the nerve to weather the elements. The sea has its opportunities and risks. The opportunities offered are displayed in the immeasurable quantity of mineral and natural resources. The risks are reflected in tsunamis, hurricane, storm surges, and rogue waves amongst others. Besides, naval personnel are put in harms way through wars and various peacetime maritime security issues namely, fishery and environmental protection; anti-piracy/sea robbery; human, drug and arms trafficking; terrorism; as well as protection of oil and gas assets. No single navy can face all these

the huge political crowds in Kano or Yobe. Every Nigerian knows that political crowd is a commodity in Nigeria, in addition to the fact that it will require votes from North and South, East and West for the mandate to be renewed. And it does not matter if one region gives 97%, we will still need the 5% to make up 100% (ala PMB’s arithmetical formula) In the last few weeks, Lai Mohammed, Babatunde Raji Fashola, Chibuike Rotimi Amaechi and some of the other ministers in PMB’s cabinet have been crisscrossing the nation inspecting road and rail projects and drawing attention to the infrastructural exploits of this administration. Press conferences were being held in Abuja and in Lagos and on the democracy day, 29th May, PMB took time to list the achievements of his administration in the last 3 years and was kind of beating his chest and expecting the applause of Nigerians. Of course, some members of APC who have benefitted from the administration applauded; while some other segments like the nPDP were busy complaining that they have not received any “return” on their “huge investments” in the party and PMB’s victory in 2015. Many other Nigerians comprising the growing army of the unemployed, the bereaved from the unmitigated onslaught from the militant Fulani herdsmen and sundry marauders, the traumatized and dispossessed farmers, internal refugees in the IDP camps and many hungry could not applaud. PMB has asked Nigerians to judge him on three issues: the economy, security and anti-corruption. Certainly on the three key issues, we are not where we should

Whether this strategy will work in improving Nigeria’s ranking on the CPI is yet to be seen and whether it will help to make Nigeria less corrupt may be determined perhaps after PMB’s tenure or when another party comes to power and follows in this footstep of covering own sins and exposing the opposition’s sins

be, based on the promises made to the people of Nigeria. Though the economy is in recovery mode (1.9% GDP growth in QI), it is still performing below the May 29, 2015 levels in all ramifications. What is most frightening is that unemployment has doubled over the period from about 9% to 18% as at end of Q1 2018. And we are not talking of making the Nigerian Naira equal to one US dollar. I have long convinced my wife not to hold this against PMB, which is one of the promises she has eagerly awaited its fulfilment. Nigeria today is the 6th most economically miserable country in the world. On security, the success achieved against Boko

Haram insurgency in the Northeast has been fully eroded by the militant herdsmen onslaught mostly in the Middle Belt. Nigeria is currently rated one of the most unsafe places on the planet earth. On anti-corruption, PMB seems frustrated that despite all the noise, dance and drama, Nigeria’ position on the transparency International Corruption Perception Index (CPI ) has worsened in the latest ranking. What is worse, not many convictions have been obtained on those charged to court regarding PDP’s 2015 campaign funding. It therefore looks to me that PMB has mounted a renewed offensive in this area putting pressure on both EFCC and the judiciary. The decision of Justice Abang to go ahead with the case against Olisa Metuh, whether he is alive or dead sign posts the present desperation to get convictions by all means. In one week alone, several former office holders who belong to the PDP were arraigned in courts in what looked like a major joint campaign by the EFCC and the judiciary. Former Governor of Kano State and former Minister of Education, Ibrahim Shekarau, Ambassador Aminu Wali and the campaign director of former President Goodluck Jonathan, Mansur Ahmad, former deputy governor of Sokoto state and Minister of Water Resources, Mukhtari Shagari, Ibrahim Gidado, a former commissioner, PDP state chairman, Ibrahim Milgoma, PDP treasurer, Nasiru Dalhatu as well as the state PDP governorship candidate in the state in the 2015 election, Abdallah Wali, were all charged to court in an unprecedented blitz of arraignments. Others were former governorship candidate in Edo state, Pastor Osagie Ize- Iyamu, state party chairman, Chief Dan Orbih;

former deputy governor, Lucky Imaseun, a member representing Esan South East and Esan North East in the House of Representatives, Tony Azegbemi, and Mr Efe Anthony. Meanwhile, former Governor of Plateau State and a serving Senator, Jonah Jang was recently arraigned in Jos and former governor of Kaduna State-Mukhtar Ramalan Yero is set to be arraigned soon on corruption charges. One would have applauded this renewed onslaught if not that it is patently one sided and absolutely partisan. No member of APC is on the list including members of the nPDP or politicians who have decamped from PDP to APC. Therefore many people including international observers see this as essentially a political strategy to discomfiture the opposition, to keep them distracted and occupied with defending themselves in court and thereby whittling down their energy and resources to oppose APC in the forthcoming elections. I am personally saddened by this apparent clampdown and harassment of the opposition which actually makes a mockery of the anticorruption fight. Whether this strategy will work in improving Nigeria’s ranking on the CPI is yet to be seen and whether it will help to make Nigeria less corrupt may be determined perhaps after PMB’s tenure or when another party comes to power and follows in this footstep of covering own sins and exposing the opposition’s sins. Whatever may be the case, it is clear that what actions PMB takes in this last lap will either make or mar his chances in 2019. It is essentially up to him.

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Nigerian Navy @ 62: Togetherness rekindled maritime security challenges alone because the sea is interconnected. The good news is that modern technology, inter-agency collaboration, including regional and international maritime cooperation make it possible to predict and interdict various threats from the sea. This writer remembers the hard work, commitment, years of sacrifice and dedication put in by officers and ratings to make sure that the Nigerian Navy (NN) thrives. On 01, June 2018, the NN was sixtytwo years old. And it’s gratifying to state that the Navy has evolved beyond what the colonialists and the founding fathers envisioned. At the moment, the NN is a sub-regional naval force with global influence. This is the NN of today. A navy that Nigerians should be proud of, and one which can defend the nation’s interest from the sea. Certainly, this writer is proud of the NN despite its challenges. And it is with deep sense of responsibility that all officers and ratings of the NN, are heartily congratulated in recognition of their hard work to maintain a quality profile at sea for decades. Although, firepower is very key, the quality of personnel in a naval force is equally important. The quality of a navy is largely determined by the calibre of its human capital. In the face of changing value system in the

society, the NN must still bear in mind that it has a responsibility to defend the nation’s territorial integrity from the sea. The technical nature of the navy poses a tremendous challenge, that to be an officer or a rating, one has to be of good character and also, of more than average intelligence. Therefore, in order to get a steady supply of officers and ratings with vital quality of leadership, it is incumbent on the top brass of the NN to adopt a policy that makes provision for a talent hunt in the society. When the NN was established in 1956, fire control systems, jet engines, high calibre weapons and sophisticated machinery almost exclusively belonged to navies of developed nations. Today, modern warships guarantee the survival of the NN. The NN cannot stop planning for future acquisitions either to replace aging ships in the fleet or filling the gaps in the inventory. Today’s navy cannot settle for mediocrity. It must aspire to excellence because “the nation that will insist on drawing a broad line of demarcation between the fighting man and the thinking man is liable to find its fighting done by fools and its thinking done by cowards,” according to William Francis Butler. So as an active partner in providing sub-regional and regional maritime security, men and women who serve today and who will lead tomorrow must

be prepared to accept responsibility and accountability in protecting and defending Nigeria’s regional commitment and global interests. If efforts are not made to produce strategic thinkers, the future role of the NN may be mortgaged despite the fact that there is a large percentage of Nigerians who do not know much about the institution beyond what is available on its official website. Traditionally, the Navy is a silent force all over the world. Even in civilized countries, it is as obscure as its establishment is misunderstood. In fact, some people, including policy makers, may think that the Navy consists of men and women who just aimlessly wonder upon the high seas, and therefore, fail to realize its role in maritime defence of the nation’s territorial waters. As the NN celebrates its sixty-second anniversary, it must aspire to excellence. The celebration provides a unique opportunity for the leadership to think togetherness. Togetherness-an important component of family lifemust be rekindled. If the NN as a critical component of the nation’s security architecture wants to go far, officers and ratings must go together. This is imperative because of the nature of the naval profession which demands that people of different backgrounds live together in a confined space, dine together, and

fight the enemy together. Onward Together is the motto of the NN. It’s expected that those in service will keep working together in order to achieve greater success in their contributions to national development. So they must remember the words of Henry Ford: “coming together is a beginning; keeping together is a progress; and working together is success.” The NN must not rest on its oars as she steams ahead. It must draw from the past, be responsible for the present and aggressively shape the future irrespective of challenges. There is no doubt that the maritime security challenges of the nation are daunting, it is expected that those serving will go forth in faith and do their best to shape the future of a nation that needs NN’s support in the Twenty-first Century. As the NN rides the waves in peace and war, its personnel should not forget the lines from the hymnist, James Edmeston: “Lead us Heavenly Father lead us. O’er the world’s tempestuous sea, guard us, guide us, keep us, feed us, for we have no help but thee; yet possessing every blessing, if our God our father be.” May the Navy’s anchor hold in the storms of life. Fair wind and following seas. Happy anniversary to y’all!

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Smart Lagos (5): Status, prospects & opportunities

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

ccording to PwC, the Nigerian gaming industry, w h i c h i s l a rg e l y domiciled in Lagos, would earn about $87 million in revenue by 2021 if its 16 percent average annual growth prediction is vindicated. Still, Lagos’ gaming industry pales in comparison to that of Kenya’s Nairobi. Considering Nigeria is four times as populous, the relatively smaller gaming market in the country points to opportunities for interested investors. How difficult would it be to create a model that provides access to the country’s teeming youths to have fun via games and also earn income? A virtuous loop also means more would be interested in creating new games themselves. For

an industry earning revenue of about $116 billion globally, there is huge potential for the Nigeria gaming industry to take a bigger slice of the pie. And the focus does not need to be on foreign markets. There is an ample market opportunity within the country itself and clearly in other African countries as well; especially for mobile phone game apps since more people own a smartphone or have access to one than they do a computer. Considering games via mobilie phone apps are expected to rival those based on consoles or played via a computer, this is probably just as well. Some other players are trying to succeed in more complex areas. Take the punishing traffic of Lagos; artificial intelligence could be used to make it better. That is the ideal case, of course. In reality, traffic lights in the city are not even reliable. That is, if they work. When they work. To power some traffic and street lights, those in critical areas of the city especially, the state government relies on solar power generating systems. Still, even if the current traffic management system in Lagos works fine, it could hardly do the

For an industry earning revenue of about $116 billion globally, there is huge potential for the Nigeria gaming industry to take a bigger slice of the pie. And the focus does not need to be on foreign markets job well without some human intervention. Besides, artificial intelligence would be useful to solve the traffic problem, say, only if there already existed a well-functioning infrastructure. Examples of initiatives in Lagos traffic management using artificial intelligence are mostly focused on providing information and directions to reduce the probability of getting stuck on the road. An example is Lara. ng by RP Technologies, which relies on artificial intelligence to provide directions and fare quotes for public transportation in Lagos. But since artificial intelligence is the “ability of a

digital computer or computercontrolled robot to perform tasks commonly associated with intelligent beings”, the user experience of Lara.ng does not meet the standard; albeit it is not yet fully developed. But it definitely shows how tech stakeholders in Lagos and Nigeria at large are thinking about how to use more complex but useful technologies to solve common problems in the city. In general, though, artificial intelligence is yet to take off. In the words of Emeka Okoye, chief executive of Cymantiks, “we don’t do AI in Nigeria. For now, what we have are copycats of the Artificial Intelligence frameworks adopted by the foreign-based platforms.”A related field is the Internet of Things (IoT) defined as “a network of physical “things” embedded with sensors and connected to the Internet.”“With IoT technology, devices are able to communicate and share data between one another without ma nu a l i nte r ve nt i o n .” Th e relationship between artificial intelligence and the Internet of Things is akin to that between the human brain and the body respectively. Since both are connected, companies involved in the internet of things would

also fall under the umbrella of artificial intelligence. Vacker Nigeria, an engineering solutions provider, avails its clients in the retail and manufacturing sectors with tools to monitor and manage their supply chains using the internet of things, for instance. Cloud services is another potential growth area. Although a lot of Nigeria firms still prefer to have their own network infrastructure, the need for scale as they expand makes cloud services attractive. Cloud service providers like MainOne and the Rack Centre, host the networks of their clients in their own infrastructure, which they share with other subscribers to their service. Trust remains a constraint, however. • The author, Dr Rafiq Raji, is an adjunct researcher of the NTUSBF Centre for African Studies, a trilateral platform for government, business and academia to promote knowledge and expertise on Africa, established by Nanyang Technological University and the Singapore Business Federation. This article was specifically written for the NTU-SBF Centre for African Studies Send reactions to: comment@businessdayonline.com

Governor Bindow Jibrilla’s roads to freedom and matters ahead

MOHAMMED DAHIRU AMINU Mohammed Dahiru Aminu, writes from Cranfield, United Kingdom mohd.aminu@gmail.com

n his 1918 book, “Roads to Freedom”, Bertrand Russell, the British philosopher, historian, logician, mathematician, writer, political activist, social critic and Nobel laureate, offered an assessment of several competing streams in the thought of the political left which included Marxian socialism, anarchism and syndicalism. Ever since then, the work has been selected by scholars as being of cultural importance and as forming the knowledge base of civilization as we know it. While Russell’s book was themed around discussions on social equality and egalitarianism which are often in opposition to social hierarchy, nonetheless, in more generic terms, there seem to be a link between roads as passages from one place to another and freedom as entitlements

through which we thrash our ways to privilege and expression. It is in this context that Adamawa state governor, Bindow Jibrilla’s remarkable achievements in road constructions in the state, comes to mind. Although I am from Adamawa state, however, as a doctoral student living in the UK (for a period of three years starting from early 2015), my academic sojourning outside Nigeria could not grant me the opportunity to be in constant touch with the visible achievements of the Bindow administration, particularly in the areas of township road networks. The rehabilitation of roads within the state capital has effectively transformed the state and its economy for good. It can be recalled that prior to the present administration, it can be said that within the northeast geopolitical zone, Yola, the Adamawa state capital had suffered tremendously due to decaying road infrastructure, and this was like no other state capital in the north east. It is therefore impressive that credible transformational change on major infrastructure was achieved within the first two years of the Bindow administration. But it is also important for the Adamawa state government to proceed even further and develop on more economic empowerment strategies by ad-

dressing challenges in other key areas of the state’s economy. Areas of worthy note could be education, agriculture and solid minerals development. The education sector in northern Nigeria has been in the forefront of developmental discussions for many years now. The history of education in the north is not particularly impressive when evaluated vis-à-vis the key performance indices from the southern part of the country. But even more disadvantageous for the region is the fact that government policies in recent times have not been especially favorable to the northern Nigerian population. Thus, Adamawa state cannot be an exception in the plight of the educational challenge plaguing northern Nigeria. It is in this purview that education should be given a special priority to promote the stakes even higher and to offer a competitive advantage on the part of the state’s younger citizenry. Since agriculture is a sector that requires a lot of improvement in Nigeria generally, it is important to highlight that one of the major areas for the diversification of the economy lies in this sector. The Adamawa state government could innovate new ideas to optimize agricultural production. As a first step, incentives should be put in place for citizens to see the need to patronize and consume lo-

cally produced food from rural farmers who engage in small and medium agriculture. In addition, increased interest should be placed on mechanized farming to help agricultural produce consumption. If these can be achieved, the state government can begin to put mechanisms in place to pave way for the local and international export of agricultural produce that could not be consumed within the state. In the Benue Valley for instance, modern irrigation control methods, if explored, can greatly improve farm productivity. But it is also important to note that for effective agricultural production to be achieved, the government must not only declare agriculture as one of its highly prioritized areas, but it also must ensure efficient provision and delivery of fertilizers and seeds, and other tools that aid farmers participation in agribusiness. Beyond these, there could also be a need for the state government to encourage agricultural entrepreneurship and businesses by giving out loans of various kinds to local farmers. The solid mineral sector in Adamawa state is yet to be explored for commercial advantage. From a more holistic perspective, it is not in doubt that the solid mineral potential of Nigeria can greatly complement earnings from the energy sector. The solid mineral deposits in Adamawa

state include iron ore, lead-zinc, cassiterite, manganese, columbite, tantalite, limestone, gypsum, kaolin, etc. Since the federal government has recently earmarked billions of naira for the solid minerals sector in a bid to develop it to a reasonable degree that could attract foreign investors on the one hand, and a reduction in the overdependence on oil on the other hand, it wouldn’t be out of place for the Adamawa state government to create its own priorities and align the deliverability of such priorities with that which is already put in place by the federal government. The federal government had already indicated that since Nigeria is starting from a low base, it is important to have a portfolio of exploration activities in place that could stimulate the attention of investors, and so should this be for the case of Adamawa state. The development of these mineral deposits will create a great economic opportunity for our state. It is also worthy to emphasize that there will be enormous domestic and foreign demands for minerals and metals from Adamawa state. All these, if achieved, will go a long way to attract and sustain investments, improve the economy, and carve out a place for our state within the global economy. Send reactions to: comment@businessdayonline.com

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Editorial PUBLISHER/CEO

Frank Aigbogun EDITOR-IN-CHIEF Prof. Onwuchekwa Jemie EDITOR Anthony Osae-Brown DEPUTY EDITORS John Osadolor, Abuja Bill Okonedo NEWS EDITOR Patrick Atuanya EXECUTIVE DIRECTOR, SALES AND MARKETING Kola Garuba EXECUTIVE DIRECTOR, OPERATIONS Fabian Akagha EXECUTIVE DIRECTOR, DIGITAL SERVICES Oghenevwoke Ighure ADVERT MANAGER Adeola Ajewole MANAGER, SYSTEMS & CONTROL Emeka Ifeanyi MANAGER, CONFERENCES & EVENTS Obiora Onyeaso SUBSCRIPTIONS MANAGER Patrick Ijegbai CIRCULATION MANAGER John Okpaire GM, BUSINESS DEVELOPMENT (North)

Bashir Ibrahim Hassan

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

Tuesday 05 June 2018

New minimum wage conundrum

t the recent May Day celebration, the issue of minimum wage came up again. The Nigerian Labour Congress (NLC) wants the a new minimum wage of N56,500. 00 The other faction of NLC, not to be outdone, is pitching for N90, 000. 00. Feeling its demand of N56, 500. 00 was too low, the Ayuba Wabba led NLC recently raised its demand to N66, 500.00. The NLC president said the union considered the prevailing realities including certain variables and current inflation to make an upward review of its demand. The demand by the labour unions for a raise in the minimum wage, which is currently a paltry N18, 000.00, didn’t start this year. It started as far back as 2015. We recall that in 2016, the NLC threatened to embark on a nation-wide strike in May 2017 if the federal government did not begin the implementation of the N56, 500 new national minimum wage it proposed. Apparently, the threat did not work but the unions are not relenting in mounting pressure on the government to approve the new minimum wage. Well, considering that the

elections are close at hand, the federal government quickly accepted to begin paying a new minimum wage with Minister of Labour and Employment, Chris Ngige, announcing that the payment would take effect from September 2018. Haven raised the hope of workers, the minister again dashed their hopes announcing that the new minimum wage cannot be ready for implementation in September. He said the September date was just the timeline to conclude negotiations after which a report will be presented to government for deliberation and approval before an executive bill is sent to the National Assembly on the issue. True, we agree with Wabba that the review of the minimum wage is long overdue. The current minimum wage, set in 2011, was at a time the Naira exchanged with the dollar at N150.00. Presently, the exchange rate hovers around N360 to a dollar. It even went as high as N500 at a time in 2016. Clearly then, inflation has eroded the value of the naira and the minimum wage as it stands is a huge joke. In saner climes, minimum wages are reviewed at periodic intervals to keep pace with inflation and the needs of

the time. But that has clearly not been the case in Nigeria. The uniqueness of the Nigerian situation however is the capacity to pay. Before the recent upsurge in the price of crude oil, about 30 states of the federation were unable to pay salaries (the meagre N18, 000 minimum wage) and have to depend almost exclusively on bailouts to pay the little they were paying pay, like half salaries in some states or reduction in working days by some state governments. Meanwhile, the same NLC agitating for an upward review of the minimum wage has not been able to do anything to compel delinquent states to pay their workers the old minimum wage. Also, over 70% of the federal government budget is spent on recurrent expenditure with salaries and emoluments contributing the lion share. Any steep rise in the minimum wage will worsen the ratio. This is coming at a time where there is unanimity in the call for the government to reduce its recurrent expenditure in favour of capital expenditure. The Minister also hinted at the capacity to pay and the need to get inputs of all those concerned including state governments and the organised private sector.

Reality is: as desirable as the new minimum wage is, the Nigerian federation (especially states and local governments) do not have the capacity to pay the amount. Like the minister revealed recently, may state governments are adamant that they will not be able to pay the new minimum unless the current revenue allocation formula is reviewed in favour of the states and local government. What is more, the economic impact of tripling or quadrupling the minimum wage on the economy may be severe and undesirable. We feel the NLC must face the reality of the moment. The current federal arrangement is unworkable and unsustainable and cannot pay the wage demands of the labour unions the moment the price of oil dips. It is our considered view that the NLC and other labour and trade unions should join hands with those calling for the restructuring of the Nigerian federation along fiscally viable lines such that states will be financially and economically viable enough to maintain and pay its workforce without recourse to the federal allocation. Only a viable federation can ensure fiscally strong and stable states.

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Tuesday 05 June 2018

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Value of top 100 global brands’ increase, hit $4.4 tr …growth ignited by creative marketing approaches Stories by Daniel Obi Media Business Editor

PP’s marketing and brand consultancy firm, Kantar Millward Brown has valued top 100 global brands at $4.4 trillion, an increase of $750 million which is 21 per cent increase. The brands are dominated by European and Western countries. The first 10 brands list this year in Brandz ranking has 8 American brands. Increasing use of data-driven, intelligence-led technologies – such as artificial intelligence (AI) and augmented reality (AR) – alongside creative marketing approaches has allowed many brands to build a more in-depth understanding of their customers and deliver convenience, personalised content and exceptional brand experiences. Eight out of the top 10 are technology or tech-related brands. This category continues to dominate the rankings with Google and Apple retaining the number 1 and 2 spots, growing +23% to $302.1 billion and +28% to $300.6 billion respectively. Amazon moved into the third position ahead of Microsoft, growing +49% to $207.6 billion, while Tencent rose to 5 ahead of Facebook (no.6) growing +65% in brand value to $179 billion, up three places from last year’s ranking. David Roth, WPP, says in a statement: “We’ve seen the biggest ever

rise in brand value this year, driven by growth across all categories. Both new and established players have seen the payoff in being bold and adopting a long-term outlook towards brand-building. “WPP’s own focus is on providing innovative approaches for our clients that combine data and technology with world-class creativity. Those companies that invest in intelligence-led marketing and back their brands with the power of creativity and ideas will be the winners in today’s world of innovation, disruption and change.” “Despite economic and political uncertainty in many regions of the world, this year’s ranking shows its largest-ever annual increase in value – almost $750 billion (+21%). This gave the BrandZ Global Top 100

an overall total brand value of $4.4 trillion; up 204% over 12 years since it was first published in 2006. This is also the first year that all categories in the BrandZ Top 100 reported growth”. The report said this was the first year non-US brands grew faster than US brands. Fourteen Chinese brands appear in the Top 100 ranking compared to just one (China Mobile) in 2006. The total value of China’s Top 10 grew year-on-year by +47%, more than double that of the US brands (+23%). Other parts of the world, such as India and Indonesia, are also showing strong regional growth. The BrandZ Top 100 included seven Asian brands (excluding China), which grew +14% giving them a total brand value of $146 billion.

BUSINESS DAY

Chief marketing and communications officers set to chart new way for industry

he Advertisers Association of Nigeria (ADVAN) has announced that it will be hosting its unique leadership forum for Heads of Marketing and Communications in Nigeria. The forum which has a theme ‘’The Chief Marketing and Communications Officer as the CEO’’ comes up on the 7th of June at the , Eko Hotel & Suites, Victoria Island, Lagos. The forum will afford the opportunity for Heads of Marketing and Communications of various organisations to listen, discuss and chat a new way for the marketing and communications business and its players in Nigeria under a relaxed atmosphere. Victor Adenrele, the Chief Executive Officer of Omari Consulting Services Limited and former Director General Institute of Directors Nigeria has been slated as guest speaker. Folake Ani-Mumuney, President

of ADVAN stated that the ADVAN Chief Marketing and Communications Officers’ Forum is an exclusive event meant only for Heads of Marketing and Communications of each organization. These include Marketing Communications Directors, Marketing Directors, General Managers - Marketing and Communications, General Managers - Marketing as it relates to each organization. In her words, ‘’the forum was birthed out of a need to provide the nation’s marketing and communications leaders with a platform to better navigate the fast-changing marketing communications landscape as well as provide insights on the changes local and multinational marketing and communications leaders need to make in order to effectively deliver profitable brand growth as they equally grow in their chosen career’’.

Noah’s Ark CEO emerges Cannes Lions Juror

n what could be described as yet another historic feat, the Managing Director & Chief Creative Officer of Noah’s Ark Communications Limited, Lanre Adisa, has made the list of Juries for the world’s biggest Adverting Festival-the Cannes Lions Festival. Adisa who was recently announced as a member of the Brand Experience and Activation shortlist jury for the 2018 edition of the prestigious Cannes Lions Festival would be working with 413 other jury members from around the world to prepare the shortlist for the main festival scheduled to hold in Cannes, France between 18th and 22nd of

June 2018. According to Lisa Berlin, the Jury Director, International Festival of Creativity, mostly known as Cannes Lions, Lanre Adisa would be joining other jurors selected across the world to conduct the first round of the judging process in advance of the festival which would create the shortlist for the final judging process. “We are delighted to confirm your appointment as a member of the Brand Experience & Activation jury at Cannes Lions 2018. It goes without saying that all jurors will be of an equal, world-class standard regardless of their contribution to the judging process,” said Berlin.

Survey: 72% Nigerians say Trust for organisations holds key for success …Fake news reduces trust on media

rust and credibility survey among the Nigerians in the mainstream institutions of government, business, media and non-governmental organisations has revealed that 72 per cent of Nigerians rank trust in an organisation as number one consideration above other factors when buying a product or relating with an organisation. In the first ever 2018 Edelman Trust Barometer Report unveiled in Lagos, recently, Nigerians sampled in the survey said although a good reputation may get them to try a product; but unless they trust the company behind the product, they will soon stop buying it regardless of its reputation. “Eighty-seven per cent of the respondents say companies that only think about themselves and their profits are bound to fail”, the report indicated, noting that respondents’

expectation is that businesses should be the driver of economic prosperity rather than mining profits to themselves only. “Fifty-seven per cent agree that driving the economic prosperity of our country is one of the most important things businesses should do”, it affirmed. The presentation of the 2018 Edelman Trust Barometer in Nigeria by Edelman was organised by Chain Reactions Nigeria, Edelman’s Exclusive Nigerian Affiliate and the Preferred West African Partner with the theme, ‘The Battle for Truth’. Speaking at the presentation of the global data from the report, Managing Director, Edelman South Africa, Jordan Rittenberry, expressed concern that the overall global assessment of the four mainstream institutions showed declines in trust about business and non-governmental organisations in 14 of the 28 countries sampled, and therefore called on

key decision makers in the respective organisations to be deliberate in building their trust asset through increased investment. “Over time trends have shown there is low trust in business and non-governmental organisations, so it is important that people in these institutions pay more attention to how the citizens trust them”, he stated. Rittenberry added that globally “media is now least trusted institution” as a result of the menace of fake news which he noted has moved from

being just a phenomenon to a key factor in shaping perception. “People define media as both content and platforms, so nearly seven in 10 worry about false information or fake news being used as a weapon”, he declared. Managing Director/Chief Strategist, Chain Reactions Nigeria, Israel Jaiye Opayemi enthused that the inclusion of Nigeria in the annual survey for the first in the 18-year-old history of Edelman Trust Barometer was in fulfilment of the company’s promise last year to ensure Nigeria was in focus among the comity of nations of reckon annually sampled by Edelman. “Trust sits at the heart of social capital. For those who were here last year, we made a promise that Nigeria would be included in the 2018 deck of the Edelman Trust Barometer. I am happy to announce that we are here today to fulfil that promise”, he said. Speaking on the Nigerian data

from the survey which showed that government was the least trusted of the four institutions of the Nigerian society, Opayemi counselled against a quick condemnation of government by stakeholders. He cautioned that, rather than condemnation, government requires help from communications professionals to help redesign the architecture of government communications in Nigeria. He likened the current situation in most government communications departments to a hospital that is manned by a pharmacist where people with cardiac conditions go to for help simply because the pharmacist is a product of a medical school. He therefore advocated engagement of communications professionals by key occupiers of government positions like the president and governors in order to overcome the challenges around trust and credibility assets of government.

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Tuesday 05 June 2018

Marketing&Pr Computer Village Relocation: Concessionaire states plans for Katangowa ICT Business Park DANIEL OBI

he concessionaire for the construction of the proposed world class Kantagowa ICT Business Park, Bridgeways Global Projects Limited has said the plan to build the ICT park is beyond providing another real estate for the relocation of Ikeja Computer Village. In a statement, the company said the Lagos Katangowa ICT Business Park plans to provide a world class technology incubation platform to give entrepreneurs and businesses the opportunity to create value in development of technology software and hardware development. Recall that the Lagos State government concessioned the Katangowa ICT Business Park, located along the Lagos-Abeokuta Expressway to Bridgeways Global Projects Ltd, for development of the ICT Business Park, as part of its plan to relocate the Computer Village Ikeja to a more befitting and purpose-built location. Speaking on the grand plan for the ICT Park, Chief Executive Officer of Bridge-

ways Global Projects Limited, Jimmy Onyemenam said in the statement: “What we are developing in Katangowa will elevate the status of Lagos as a global technology location. It is far beyond providing real estate for the development of another Computer Village.” He added: “The Katangowa ICT Business Park will also provide the infrastructure to incubate and accelerate the development of technology solutions that can improve development outcomes on the African continent. “Within the technology developer community, we have found an abundance of curiosity, innate talent and passion in Nigeria. These developers can do with more infrastructure support to develop more solutions that are development-relevant especially in the areas of Education, Health and Agriculture.” Onyemena also noted that the Katangowa ICT Business Park will also provide infrastructure for the manufacturing of technology hardware. According to him, “Thanks to the visionary outlook of the current Lagos State government, under the leadership of Akinwumi Amode, the Katangowa ICT Business Park will also have the capacity to

Dano commemorates World Milk Day, breaks Guinness World Record

n solidarity with nutrition stakeholders across globe, dairy brand, Dano milk has deepened conversations on the imperatives of milk consumption and healthy living to commemorate 2018 World Milk Day in Nigeria. Undergraduates of tertiary institutions across Lagos, school children, mothers, representatives and officials of the Lagos State Ministries of Health and Education converged on Muri Okunola Park, Victoria Island to key into the celebration as Dano milk broke the Guinness World Record for the longest drinks

pouring relay using milk. The event showcased regular milk intake by the young and old. Conversations around the event were hinged on#RaiseAGlass and #NourishNaija. Speaking at the historic event, Deputy Governor, Lagos State, Idiat Adebule lauded Dano for its sustained advocacy on healthy living. “I am delighted by the continued advocacy of TG Arla Dairy Nigeria, celebration and successful hosting of the past two editions of the World Milk Day in Lagos. June 1st has become a symbolic day for many countries to celebrate and come together to focus attention on milk and celebrate the importance of the dairy sector to sustainability, economic development, livelihoods and nutrition. The Deputy Governor urged Dano to sustain the advocacy drive just as she enjoined people across the country to tap into the goodness of milk.

Over 300 winners emerge in Mamador National Consumer Promo draw

P L-R: Seyi Oreagba; senior legal officer, Lagos State Lottery Board; Susie Onwuka, regulatory head, Consumer Protection Council(CPC), Lagos State; Abiola Laseinde, company secretary, PZ Cussons; Joy Okuna, regulatory head, National Lottery Board; Mohit Kumar, head of sales, PZ Wilmar; Chioma Mbanugo, category marketing manager, PZ Wilmar, at the first draw of the Mamador Kitchen Makeover promo.

support the manufacturing of technology hardware like Computers, mobile phones, solar panels, health technology equipment, to mention a few. “The ICT Business Park will also put Nigeria on the global call-centre value industry, which is expected to reach $9.7b in 2019, as we will be making provision for in-

frastructure that can support the delivery of globally competitive call-centre services.” The Katangowa ICT Business Park is proposed to be developed on a 15.7 hectares parcel of land. When completed, the ICT Business Park will comprise of over 3000 retail outlets of assorted sizes, a 4000-capacity k-klamps mall, 5,000 sitter exhibition hall

and ICT incubator complex, assemblage/warehouses, and office accommodation. The park will also include facilities like; a budget hotel, banking facilities, restaurants, helipad, OPD clinic, Police Station, Security and fire Service, electric power, portable water and sustainable waste management plants, among other facilities.

Small Doctor appointed Western Lotto brand ambassador

aming and entertainment platform, Western Lotto&Bet has signed on as brand ambassador the wavemaking Nigerian fuji hip-hop artiste Temitope Adekunle popularly known as Small Doctor. The ‘Penalty’ crooner, who featured in DJ Lambo’s latest music Kunta Kunte, officially became the face of the gaming brand effective June 1, 2018. He is joining other A-list Nollywood and music stars that had since been signed on by the Western Lotto & Bet as brand ambassadors. Already, Small Doctor has

featured in an action-packed Television Commercial (TVC) recently shot by Western Lotto & Bet that is due to be aired soon. Managing director Yomi Ogunfowora said Western Lotto & Bet engaged Small

Temitope Adekunle

Doctor because of his strong appeal to the youths, especially the mass market. “Signing on Small Doctor at this time is a mere formality because he has always been a friend of the house. The young man has taken music to the nooks and crannies of Nigeria; the street identifies with him and we believe he is the right person to help take the gaming brand to the next level. “We seek to be the hub of gaming and entertainment in Africa. There is a game for everyone on our platform. If you love sports betting, lotteries, instant and virtual games, we have them all for you.

MTN leverages employee volunteer programme to empower youth

housands of MTN employees in 21 markets across Africa and the Middle East have launched the company’s annual employee volunteerism programme, 21 Days of Y’ello Care. The programme, which runs from 1 to 21 June, will see employees lend a hand to

contribute to this year’s focus area, youth empowerment. The programme will run under the umbrella theme, ‘Creating a Brighter Future’, and for the next three weeks employees will participate in projects including, but not limited to, skills development, access to information and

content, and entrepreneurship support. This is all in aid of uplifting the youth in the countries the company operates in. To amplify this year’s programme, MTN will also hold a career day across all its operations on the same day – a feat it has never attempted before.

Z Wilmar’s cooking oil brand, Mamador recently held the first draw for its ongoing national consumer promotion, tagged ‘Mamador Kitchen Makeover’. The draws took place in Ilupeju, Lagos. The draws, according to a statement recorded over 300 winners with one lucky consumer, Monsurat Hammed becoming the first winner of the ultimate prize of a full kitchen Makeover. Monsurat emerged winner after her number popped up on the electronic raffle draw screen. The draw event was hosted by Nollywood actress, Ufuoma McDermott and was witnessed by representatives of the National Consumer Council (CPC), The Lagos State Lotteries Board (LSLB), The National Lottery Regulatory Commission (NLRC), press and staff of PZ Wilmar. The draw show was quite exciting , as senior members of PZ Wilmar staff joined in the automated process, hitting the shuffle buttons at different intervals to reveal the winners of the various prizes up for grabs. One after the other the winners began to emerge in their numbers and at the end of the draws, not less than 372 winners were recorded.

71-year-old emerges first millionaire in StarTimes World Cup promo

71-year old civil engineer from Akure has emerged the first millionaire in the on-going StarTimes World Cup millionaire promo, after a raffle draw held in Lagos, which produced the first winner in the 3-month promotion, under the supervision of the National Lottery Board Commission. The official broadcaster of the FIFA 2018 World Cup had earlier promised a special experience for Nigerians who watch the games on of its platform, promising a never like before experience. “We are happy to announce our first winner in the ongoing promotion, Tony Fakuade, a civil engineer who resides in Akure. He subscribed for 1 month on StarTimes Classic bouquet.

Tuesday 05 June 2018

BUSINESS

COMPANIES & MARKETS

DAY

Kaiser eyes jobs in new marriage with University of Lagos

Pg. 16

Co 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

Conoil to pay N1.40bn divided to shareholders

onoil Nigeria Plc intends to reward shareholders with a dividend of N1.40 billion for the financial year ended 31st December 2017, amid daunting economic challenges. This translates to N2.00 on every 50 kobo ordinary share. A payout ratio of 88.15 percent and yield of 9.50 percent means the company has an aggressive policy that continues to allure institutional investors. Between 2012 and 2016, it has paid a total of N8.4 billion as dividend. The proposed dividend is expected to be ratified by its shareholders at the Company’s next annual general meeting in Uyo, Akwa Ibom State. Conoil’s cash reward to its owners for the financial year beats analysts’ expectation as they had envisioned that

federal government protracted delay in the payment of subsidy monies could undermine petroleum oil

marketers’ financial potency. Shareholders and investors of Conoil need not fret as the firm is on the path of

growth as it trimmed debt with a view to bolstering cash flow. There has been an im-

Wakanow offers 50 percent discount on summer travel deals Obinna Emelike

akanow has again partnered with key airlines to offer highly discounted travel packages for summer. Of such partnerships is a deal with Emirates Airlines, which offers 50 discount on select hotels to customers who are visiting or stopping over at Dubai for a minimum of three days this summer. The customers also stand to enjoy substantial discounts on all Emirates flights bookings and

Dubai Visa fees along with extra baggage allowance. Furthermore, the online travel booking giant is offering up to 15 percent discount on flight bookings to customers who book their hotel stay to any destination on the company’s booking portal. According Obinna Ekezie, managing director, Wakanow, as the pioneer online travel agent in Nigeria, Wakanow has come up with unbeatable deals for the season that would greatly thrill its customers. “We understand that this is the period when the holiday travelers

are hunting for the best deals to ensure that they can enjoy a luxury holiday with their loved ones without breaking the bank. With these deals, we have reaffirmedour brand promise to be our customers’ absolute best, trusted and indispensable travel companion; with a strong determination to continue to excite them with the best travel deals and services that are unobtainable elsewhere”, he said. The special summer offers do not come short of the company’s best price guarantee on flightsand hotels. Invari-

ably, Wakanow would beat or match competitive fares on the grounds that the itinerary and terms of the booking(s) are same. Wakanow is Africa’s largest Online Travel Agency with commercial operations in Nigeria, Ghana, Kenya, UAE, the UK. The company is rapidly changing the face of travel in Africa with its wide range of best-priced products that include Flight booking, Hotel Booking, Travel packages, Visa assistance, International Travel SIM, International Prepaid card and a loyalty solution.

ARM Pensions posts N3bn profit for 2017

espite the recession and challenges facing economy last year, ARM Pensions Managers Limited has showcased consistent growth in performance and reported an increase in earnings per share from 231 kobo to 257 kobo for the 2017 financial year. ARM Pensions also recorded revenues of N8.12billion during the financial year ended 31 December 2017, against N6.54 billion the previous year. Profit before tax and profit after tax for the year stood at N4.37billon and N3.05 billion

respectively. To consolidate on the company’s achievements for the year, Chairman of the company, Emmanuel Ikazoboh, and two other directors, Lai Afolabi and Aliu Yaradu’a were also returned unopposed to serve for another term at 13th Annual General Meeting (AGM) held recently in Lagos. Assessing performance of the industry in the year under review, Managing Director, ARM Pensions, Wale Odutola noted that like all sectors in the country, the industry was equally affected by recession. According to him, it is dif-

ficult to remove an industry from the economy stressing that what affect the economy would ultimately impact the industry. He said: “Like the economy, we had our up and down, but I think the trajectory is still on the way up”. Optimistic about the growth of the industry, Odutola said the company strong performance is a pointer that the future of the industry is bright. Noting that over the last thirteen year, the company has grown in leap and bound, the Managing Director however

said coverage far from how it should be among Nigerians. Speaking on the Voluntary Pension Scheme, he said it has been effective especially considering the payout that the industry has made since inception. He also cited the certainty that RSF holders have been receiving their pensions unlike what was obtainable in the past. He said beyond that, the industry is always looking for ways to integrate better with the larger economy, to invest, to ensure that fund is sustainable going forward.

provement in three key leverage ratios- debt to equity, debt to assets, and interest coverage ratios. Conoil’s debt to equity ratio fell to 28.90 percent in December 2017 from 48.70 percent as at December 2016. Debt to assets ratio declined to 8.33 percent in the period under review from 12.83 percent the previous year. Total debt in the balance sheet fell by 42.55 percent to N5.17 billion in December 2017 from N9 billion the previous year. Conoil’s time coverage ratio is 2.07 times earnings, which exceeds the 1.5 times bench mark. In other words, the company’s operating profit can cover interest expense. Modest leverage is also a lynchpin of corporate quality, along with high profitability and stable earnings -- and investors rightly look to corporate quality for protection

during downturns. By these quality measures, investors appear to have little reason to fret. Conoil’s revenue increased by 35.64 percent to N115.51 billion in December 2017 from N85.02 billion the previous year. It said all sales are from petroleum product. In a statement, the Company attributed the performance to its sustained culture of financial discipline, prudent and efficient execution of projects and plans, aggressive product development and marketing, supported by cutting-edge customer service delivery. While assuring that its promise to her shareholders remains maximum value, it reiterated delivery of excellent service and products to its customers. The company share piece closed at 31.80 percent as of 2:00 Friday on the floor of the exchange, valued at N22.06 billion.

POWERGAS, ETEFA partner to drive CNG penetration in Nigeria KELECHI EWUZIE

owergas Nigeria, a domestic CNG distribution company, along with its strategic partners European Technologies for Africa (ETEFA), says they are committed to investing in the development of CNG as an alternate fuel for Mass-transit (Buses) and Haulage Sector (trucks) in the country. The investment according to the companies will expand the use of the compressed natural gas (CNG) for vehicles across the country thereby reducing Green House Gas emissions, which is a major environmental pollution. To commence on the Pilot Project of employing one City Bus and One Truck, the partners met with key stakeholders to introduce Clean and Environmentally Sustainable Transportation (CEST) programme. This innovation is to provide Gas Engines for vehicles with CNG Solutions which will significantly reduce CO2 emissions on Nigerian roads, along with saving millions of Naira for the end-users. Deepak Khilnani, chairman of Powergas Africa speaking at the reception of the CEST Programme hosted at the Austrian Commercial Counsel’s residence, said “The CEST project is a highly innovative project that

will change the face of transportation in Nigeria. The gas is from a local source, much cleaner and much safer when compared to diesel or petrol. We are also calling on all stakeholders to join us as we make this technology transfer in utilization of Nigerian Natural Gas for transportation to happen in the next one year” He said the CEST is achievable with having CNG filling stations in strategic places all over the country. These gas stations will allow buses and trucks access to CNG to re-fuel their vehicles with clean energy that is much cheaper when compared to diesel or petrol. Johann Rieger, chief executive officer, ETEFA, an Austrian green tech company that focuses on efficient low cost gas engines said that “Although we have a long way to go because this is new, we are ready to go all the way in proffering frugal energy and transport solutions for Nigeria. Flared gas is a resource that is being wasted today. Tomorrow, this could be a huge potential which can be channelled into fuelling different types of vehicles like cars and public transport.” Nella Hengstler, commercial counsellor, Austrian Embassy, said that with CEST Nigerians are going to save cost on fuel and transportation, and at the same time be sure that children will live in a cleaner and safer atmosphere.

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COMPANIES & MARKETS Kaiser eyes jobs in new marriage with University of Lagos LOLADE AKINMURELE

n a first-of-its-kind type partnership, the Kaiser Foundation for Social Development (KFSD) has inked a deal with the University of Lagos to provide wellrounded education for students studying construction-related degree courses at tertiary level, with a view to boosting their employability skills and creating jobs for them. The collaboration between KFSD- the non-governmental organisation arm of privateowned indigenous construction company- Construction Kaiser- and the University of Lagos, will foster growth and competitiveness in the Nigerian construction industry value chain and contribute to reversing the tide of youth unemployment rate in Africa’s most populous nation which as at end-2017 was a mammoth 33.1 percent. That rate is lower than the Africa average of around 40 percent but is bettered by the EuroZone’s 17.7 percent; United Kingdom’s 12 percent; Canada’s 11.1 percent; India and South Korea’s 12.9 percent and 9.6 percent respectively; and the United States’ 9 percent. “If we don’t do this, our children will not have jobs,” Igbuan Okaisabor, Vice Chairman and Chief Executive officer of Kaiser Group, said during an exclusive interview with Business Day. “We see this partnership with Unilag as a way of making the youths ready for the work place and we also seek

to fund the research that can solve our local problems in the construction industry like how to deliver cost effective housing units to ensure more Nigerians have access to affordable housing,” Okaisabor said. Nigeria’s housing deficit was put at 17 million units as far back as 2014, and for a population expanding at an average of 3 percent annually, that deficit could be as high as 18 million today, assuming supply has been somewhat stagnant. The aim of KFSD and Unilag’s partnership is to promote an overall economic and developmental growth of Nigeria through four initiatives, the first of which is providing scholarships to deserving alumni of their Teenage STEM Summer Construction program; who have been admitted to the University of Lagos but are unable to afford tuition. The scholarship will cover tuition, books and living expenses for the period of their construction-related course of study. Second is through internships, whereby KFSD enlists the Alumni and other qualifying students of the University of Lagos who are engaged in construction-related courses into its sister companies for their mandatory industrial attachment. This shall be based on agreed criteria, Okaisabor says, and the students would acquire hands-on training on their project sites, with emphasis on safety and quality. Third is the undergraduate training. KFSD shall facilitate train-

ings for interested UNILAG students studying Constructionrelated courses on soft skills such as: project management skills, leadership skills, interpersonal skills, team building skills, communication skills, presentation skills, writing (technical and non-technical) skills, etc. This would help them get ready for the workplace on graduation, and make them more employable, according to Okaisabor. Finally, there is the Research Collaboration Scheme, wherein KFSD provides funding to the UNILAG’s Construction Industry Development Research Group (“CIDG”), for research aimed at tackling competiveness, sustainability, growth, performance and inclusion among construction industry stakeholders who operate in the formal and informal economy. Finding a fix for Nigeria’s youth unemployment crisis is never going to happen overnight, but analysts anticipate Kaiser’s partnership with Unilag to clear the path for more private sector contribution towards nipping the growing menace in the bud, without losing sight of the need to address technical onthe-job-training to boost the employability skills of unemployed youths in the construction sector. Being highly labour-intensive, the construction sector is traditionally the highest employer of labour in some of the most populated countries of the world, from the Asian continent to Europe.

Business Event

L-R: Grace Matu of financial administration, Helen Keller International (HKI) ; Bala Yesufu, director, corporate and government affairs, Cadbury Nigeria Plc; Philomena Orji, country director, (HKI); Kemi Adeyoju, state team lead , HKI and Otunuyi Adeniyi, deputy director, Lagos State ministry of economic planning during the groundbreaking ceremony of the Cadbury Nigeria healthy lifestyle programme in Lagos. Pic by Pius Okeosisi.

L-R: Julius Faure, manager, financial services institution , Deloitte and Touche, South Africa; Oduware Uwadiae, business process solutions leader, Deloitte and Touche; Supo Sogelola , executive director, Law Union and Rock Insurance during a seminar for the insurance companies in Lagos. Pic by Pius Okeosisi.

Skystone Capital debuts in Lagos ... creates financial services, access for SMEs in Nigeria

kystone Capital and Investment Limited, officially launched in the country following approval from the Central Bank of Nigeria. Speaking at the launch event, Olasukanmi Olabinjo, the CEO of Skystone Capital and Investment Limited, said, “Skystone Capital will provide increased access to financial services for Nigerians, especially microenterprises and small businesses that need access to socially responsible financial services.” The CEO of Page Financial, Segun Akintemi, was also present at the event that took place at their head office, Saro Close, off Karim Kotun, Victoria Island, Lagos. “Skystone will create opportunity for millions of low-income entrepreneurs through innovative lending

practices and client suppor,” Olabinjo said, saying, “Client support is a very crucial part of lending to microenterprises and small businesses in order to have access to socially responsible financial services like what Skystone has to offer, so that they can take part in the economy and generate income.” The head of operations, Yusuf Shoetan, gave an insight of the uniqueness of what Skystone will offer in terms of quality and efficiency of service delivery to clients, “Think Consumer and MSME financing, think Skystone, we are positioned to meet Consumer and MSME’s financial challenges in less than an hour with less stringent documentations”. The HR, Elegbe also assured that Skystone Capital will be a shining example in the area of

Customer experience and also producing world class staff Skystone Capital and Investment Limited, formerly Nexus Credits, began operations in 2009 providing credit services to salary earners and small and micro-entrepreneurs. Since inception, the business has developed innovative and highquality operation methods that actively respond to the financial needs of its customers. At Skystone Capital, we aim to transform the livelihood of Nigerians through handholding our SME clients through stimulating entrepreneurship development while creating a rewarding and exciting work environment for its employees. The company has disbursed over N100,000,000.00 through provision of a wide range of innovative and reliable financial solutions to the Nigerian population.

L-R: William Oyetakin, managing director / chief executive officer, Wilmont Nigeria Ltd; Ola Olabinjo, managinf director / chief executive officer, Sky Stone Capital; Bola Olabinjo, director, Nexus Credits Ltd;Wale Onaolapo, chairman, Davisther Brokers Ltd; Doyin Elegbe, director, HR and strategy, Sky Stone Capital, and Segun Akintemi, chief executive officer, Page International Finance Services Ltd, during the official launch of Sky Stone Capital in Lagos.

L-R: Chioma Agwuegbo, founder, Tech Her; Hamzat Lawal, chief executive, Code Connected Development Organization; Mmanti Umoh, social activist, Ife Adebayo, special assistant to the vice president on innovation and entrepreneur, and Bukonla Adebakin, chief operating officer, The Future Project, At the Nigeria Symposium for Young & Emerging Leaders By The Future Project in Lagos.

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Energy Report Oil & Gas

Power

Renewables

Environment

MG Vowgas gets ISO 9001:2015 certification

.....management system conforms to international acceptable standards

OLUSOLA BELLO

G Vowgas, an indigenous oil and gas fabrication company has joined more than one million organizations from over 160 countries which now ISO 9001:2015 standard certified. ISO 9001:2015 sets out the criteria for a quality management system and it has been the only certifiable standard in the group of ISO9000. According to Godwin Izomor, group managing director of MG Vowgas group , he said: “ As part of our commitment to Total Quality Management System, the group is pleased to announce our recent Certification of ISO 9001 :2015 by Bureau Veritas Certifi-

L-R: G. E. Abbe, wing commander; Brig. Gen M.K Mohammed, RADM of Ministry of Defense; A.O. Odem, AVM & DG DRDB of Ministry of Defence; O. J. Osahor; Godwin Izomor GMD (MG VOWGAS Group); Frankie Ovie Izomor, MD (SUNNUP Logistics) and Douglas Steiner, technical director (MG VOWGAS Group) during the signing an agreement for the fabrication of air boats for the Ministry of Defence.

cation Holdings SAS-UK with the following scope: Engineering, Procurement, Construction (Fabrication) and Installation”.

He stated that the achievement is a demonstration of the company’s management system conformity to international

National Assembly Tasked on Passage of other Petroleum Industry Bills OLUSOLA BELLO

he National Assembly has been tasked by stakeholders in the oil industry to pass other components of the Petroleum Industry Bill just as it has done with the Petroleum Industry Governance Bill (PIGB). The call was made at a roundtable dialogue organized by Centre for Financial Journalism (CFJ) and Facility for Oil Sector Transformation (FOSTER) in Lagos which attracted stakeholders from the oil and gas industry, the media and non-governmental organizations. The other components of the Petroleum Industry Bill are Petroleum Industry Fiscal Bill; Petroleum Host Community Bill; and Petroleum

Industry Administration Bill. The Petroleum Fiscal Bill will ensure progressive framework that encourage sustained investments, growth and revenue to government; serve the socioeconomic needs of all stakeholders; and clarify legislative aspects of the fiscal regime from the negotiable aspects of contractual obligations. On the other hand, Petroleum Host Community Bill will ensure shared prosperity and sustainable development of petroleum host communities; provide direct economic benefits to host communities; and assure inclusiveness, enhance peaceful co-existence and harmonious relationship, while Petroleum Industry Administration Bill will enhance efficient, effective and sustainable development of the sector; encourage and

doing business, It will also enhance the company’s work performance in a more efficient way as all it processes are aligned and understood by everyone in the organization, which increases productivity and efficiency, bringing internal costs down,” Izomor added. The standard is based on several quality management principles with a strong customer focus, motivation and implication of top management decisions and policies, and continual improvement. The benefits include the ability to consistently provide product and services that meets clients’ applicable statutory and regulatory requirements ; facilitate opportunities to enhance customer satisfaction; and enable the management to address risks and opportunities associated with our business plan context and objectives.

11 PLC unveils LP Cooking Gas in Nigeria

facilitate local and foreign investment; promote transparency and accountability; promote liberalization of the downstream sector; and ensure best practices in petroleum operations. The stakeholders noted with dissatisfaction the long delay that has characterized the passage of these crucial bills, noting further that their non-passage so far has deprived the country enormous potential for the growth of the sector. Since the Petroleum Industry Bill was initiated and introduced in 2000, it has been gridlocked in the politics between the contending forces within the Nigerian oil and gas industry such that so far, three successive governments have not been able to pass any component of the PIB into law. Stakeholders also noted that the passage of these bills is urgently needed in view of current dynamics in the global oil market. The Federal Government, including the National Assembly, should expedite action on concluding the necessary reviews of these bills so that they can be passed into law as soon as possible, the stakeholders insisted.

Olusola Bello, Team lead, Analysts: Kelechi Ewuzie, Isaac Anyaogu, Graphics: Joel Samson.

acceptable standard requirement. Having acquired the certification, the fast-growing Nigerian EPIC currently

operating out of its Ultramodern Fabrication yard, Jetty and Office complex located in Port Harcourt, will now be part of the organisations that pride itself in the area of quality management systems. The certification would help MG Vowgas have access to broader markets, as it implies that the standard of work carried out by the company meets global international standard. “It was a strategic decision for us as an organisation and this would help us improve our overall performance and provide a sound basis for our sustainable development initiatives with the following potential benefits,” said Godwin Izomor, “The certification will further encourage us to expand and delve into new markets, as some sectors and clients require ISO 9001 certification before

STEPHEN ONYEKWELU & DIPO OLADEHINDE

n a bid of taking advantage of the numerous opportunities for growth and expansion in Nigeria gas sector, and also satisfy liquefied gas consumers, 11 Plc (former Mobil Nigeria) has launched its Liquefied Petroleum Gas (LPG) in Nigeria. Speaking at the event, the managing director of 11 Plc, Tunji Oyebanji said the company’s entry into LPG business in Nigeria was in consonant with the directory of government towards moving the country into the usage of liquefied gas which the company wishes to align with. Oyebanji said the company feels it is important to align with the government in terms of making clean energy available to Nigerian customers. “A lot of people have the misconception that gas is very expensive and complicated to use and such misleading information needs total awareness”, Oyebanji said at the event. 11plc further noted thatthis initiatives will drastically reduce deforestation and loss of natural habitat for some animal species an also by implication reduce adverse

effect of these on climate change while on the health front, it will guarantee cleaner oxygen being inhaled by our teeming populace and prevent airborne diseases caused by carbon monoxide. The representative of the Nigeria National Petroleum Corporation (NNPC) at the event, Henry Obih applauded the idea of 11 plc decision to bring LPG to the country, noting that the consumption usage of LPG in the country is almost 600,000 metric tonnes, compare to what it was in 2007 and 2019 which were 50,000 and 70,000 metric tonnes respectively. “We also have deployed weighing scale at the sites to enable customer confirm their purchases should they want to verify their quantity purchased. All of these are to ensure our customers feel a sense of fulfilment and they are delighted with good buying experience with us so you will want to call back, 11 plc said. The company formally known as Mobil Plc said the company is quite confident and have positioned itself for further growth and expansion ahead of us as we continue to steward and deliver on quality product using the flawless operations we have been known for over the years.

11 PLC also noted that NIPCO has technical supply agreement with Nigeria Liquefied Natural Gas (NLNG), the largest producers of LPG in the country, which will further reinforces its pipeline and guarantees steady supply. “With NIPCO Investment Company taking over controlling stake in Mobil Oil Nigeria plc now 11PLC in 2016, one of the several positive synergies thrown up from the acquisition is that both companies can very readiness leverage off each other strength and areas of best endeavor,” 11 PLC said. Last year, NIPCO Plc, an indigenous Nigerian downstream oil and gas company, formally rebranded Mobil Oil Nigeria Plc to 11 Plc as part of its strategy focused on expansion of the retail footprint under the Mobil brand. Nipco, it would be recalled, had in a trade executed on the floor of the Nigerian Stock Exchange (NSE) in 2016 completed the acquisition of ExxonMobil Oil Corporation’s stake in Mobil Oil Nigeria Plc, in a deal worth N90 billion. Nipco in October 2016 was selected by the United States-based oil major as the preferred bidder for the acquisition of the majority stake.

Email: energyreport@businessdayonline.com, Tel: +234-8023020011; +234-7037817378; +234-8036534708

Tuesday 05 June 2018

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Energy Report

Power: Unbundling electricity metering will checkmate Disco’s excesses STEPHEN ONYEKWELU

eventy three days ago, the Nigerian Electricity Regulatory Commission (NERC) meter asset provider (MAP) regulation, took effect, to close the end-user metering gap and eliminate the practice of “estimated billing” with a few exceptions as envisaged under the said regulation. Estimated billing gives electricity distribution companies (Discos) discretion to unilaterally determine the estimation of electricity bill to be paid by consumers in the event that such consumer does not have pre-paid meter. Today, however, the official focus of the Discos is electricity tariff, which, they say needs to be reviewed upwards to allow them invest in metering. Discos have mostly used the controversial and unpopular estimated billing system, leading to protests by residents of some estates. Figures from Nigerian Electricity Supply Industry (NESI) show that out of 6,

159, 775 electricity customers, only 3, 206, 599 customers or 52 percent have so far been provided with metres leaving a gap of 2, 953, 176 unmetered electricity consumers. NERC’s new regulation, effective April 03, will hopeful quicken closure of unmetered electricity consumers. The regulation defines a meter asset provider (MAP) as a person that is granted a permit by NERC to provide metering services which may include meter financing, procurement, supply, installation, maintenance and replacement. Prior to the issuance of the Regulations, the responsibility for metering customers was handled exclusively by the electricity distribution companies (Discos). Under the Regulations, Discos remain responsible for meeting NERC’s assigned metering targets, but they are required to engage the services of MAPs. “The MAP regulation is significant because it effectively unbundles Nigeria’s electricity distribution sector, by re-allocating the responsibility for providing metering services, effectively creating a new class of

market participants” Abayomi-Olukunle, partner, private equity, venture capital and emerging companies at Balogun Harold, said in a recent comment published at BusinessDay. Will this new regulation move the market? It is too early to show. Discos show signs of financial strain and at the verge of insolvency. Eight of the 11 electricity Distribution Companies (Discos) have remitted N11.38 billion from the invoices of N44.44bn they received from Generation Companies (GenCos) for

the electricity they purchased in February 2018; data from the Nigerian Bulk Electricity Trading PLC (NBET) has shown. The update of monthly remittances for the 3,225 megawatts hour per hour (MWh/h) energy consumed by the DisCos posted on the website of NBET showed that the payment represented 25.62 per cent payment of the invoices. A sign of emerging cracks on in the balance sheets of Discos. Meter Asset Providers, considered within the context of the liquidity prob-

lems with Discos would put an end to the traditional alibi of funds as reason for the slow pace of metering customers within their coverage area, it would appear that the MAP regulation has effectively shifted the financial and liquidity challenge as relates to the provision of metering services from Discos to, hopefully, lessleveraged entities. Other things been equal, the implementation of the MAP regulations should free-up the balance sheet of Discos and allow for add-on investments in critical infra-

structure. By way of statutory mandate within the MAP regulation, Discos must now engage MAPs in order to achieve the metering targets set by law. For the electricity consumer in Nigeria, the MAP regulation means that they will now be able to get electricity meters within 30 days of payment. Consumers need not wait endlessly for free meters anymore and may choose to pay upfront in full or pay in installments through programmed deductions from payments made for electricity consumption. Prospective MAPs are required to submit an application for a MAP permit to NERC. The tenure of a MAP permit shall be for a period of 15 years. The Discos are responsible for engaging the services of MAPs to operate within their franchise area, but they must adopt the procurement process outlined in Schedule II of the Regulations. Discos are also obligated to conclude the procurement process for the engagement of the first set of MAPs within 120 days from commencement of the Regulations.

WED 2018: Chevron’s commitment to environmental protection VICTOR ANYAEGBUDIKE

he World Environment Day (WED), held annually on June 5 is the biggest event to celebrate and promote environmental awareness and sustainability across the globe. Established by the United Nations General Assembly in 1972, WED aims to raise global awareness and mobilize humans to take positive environmental action to protect nature and the planet Earth. This global event is not only the principal vehicle through which the UN stimulates worldwide awareness of the environment, but also gives a human perspective to environmental issues, empowers people to become active agents of sustainable development and advocates multi-stakeholder partnerships in support of the environment. From 1973, when the first WED was held, the event has always been marked with different campaign themes and discussions focusing on environmental stewardship. “Beat Plastic Pollution”, the theme for World Environment 2018, urges governments, industry, communities and individuals to

come together in exploring sustainable alternatives to urgently reduce the production and excessive use of single-use plastic polluting our oceans, damaging marine life and threatening human health. According to the United Nations Environment Programme, every year the world uses 500 billion plastic bags; each year, at least 8 million tonnes of plastic end up in the oceans, the equivalent of a full garbage truck every minute. Happily, some corporate bodies have made Environmental stewardship part of their social investments. One of such organizations in Nigeria isChevron Nigeria Limited (CNL), the operator of the joint venture between the Nigerian National Petroleum (NNPC) and CNL. For over 50 years, CNL has remained an active agent of sustainable development and strong advocate of partnerships in support of the environment. Explaining CNL’s commitment to the environment, the Chairman/Managing Director, Jeff Ewing noted that CNL is happy to be part of the solution to the global environmental issues wherever the company operates through its sound environmental management policy

that supports environmental stewardship and sustainable development. According to him, CNL has in place company-wide operational excellence management systems that deliver industryleading performance in process safety, personal safety and health, environment, reliability and efficiency. CNL has a record of responsible environmental stewardship everywhere it operates and has also established enduring partnerships with governments, non–governmental organizations, business organizations and communities. CNL has been supporting and sponsoring various programmes aimed at preserving the environment. These partnerships and efforts have been recognized and rewarded within

and outside the country,” he remarked. CNL’s environmental stewardship process lays the foundation for sound environmental management through inclusion of the environment in decision making from the identification, assessment and management of environmental risks from project inception to operations and through decommissioning. CNL recognizes the importance of minimizing our footprints and conserving biodiversity. NNPC/ CNL JV strives continually to achieve world class environmental excellence by assessing and reducing its footprints and potential impacts from its operations on the environment. Management of waste is an integral part of CNL’s oper-

ations and this is documented by project and operations focused waste management plans. The company states that it effectively manages its third-party waste handling contractors towards ensuring management of waste from cradle to grave (generation, storage, transportation and disposal). Chevron Nigeria’s commitment to preserving the environment has left enduring landmarks in the landscape, including the Lekki Conservation Centre (LCC) - a centre of excellence in environmental research and education reserved as a sanctuary for the rich flora and fauna of the Lekki Peninsula. This 78-hectare facility is the only one of such facilities in the Lagos area and was established by CNL in partnership

with the Nigerian Conservation Foundation (NCF) in 1992. The support for the LCC best connects Chevron’s activities to the theme of the WED 2018.The NCF is Nigeria’s foremost nongovernmental organization dedicated to environmental conservation and an affiliate of the World-Wide Fund for Nature. In 2005, Chevron established a yearly postgraduate research scholarship for PhD students in environment and conservation. In addition, Chevron hosts the annual S. L. Edu Memorial Lecture to promote environmental management awareness. Esimaje Brikinn, CNL’s general manager, Policy, Government and Public Affairs notes that beyond the awards, CNL is ever willing to continue to collaborate with all stakeholders to safeguard the environment. “We are continually working to improve our processes to reduce pollution and waste, conserve natural resources, and reduce potentially negative environmental impacts of our activities and operations,” he remarked. Victor Anyaegbudike is the External Communications Coordinator for Chevron Nigeria Limited

BDTECH

BUSINESS DAY

Tuesday 05 June 2018

In association with

‘We use technology to provide convenience, reach and fulfilment in lottery’ Tawa Bolarin is the CEO of GBAM Lotto, a scratch and win lottery business that recently made its debut into the Nigerian market. Promising to transform the way lottery is being viewed in the country today, Bolarin talks to Jumoke Akiyode-Lawanson on how the company intends to build trust in Nigeria’s lottery system, leveraging technology with its online platform for easy gaming and instant cash out experience. Excerpts.

What motivated your team to decide to launch scratch and win lottery business in Nigeria? cross the world, lottery is a very large sector; however, it is relatively young in Nigeria and the market is still not as mature as some other nations, even though there are a number of successful lottery providers in the Nigerian market. What you find very popular in Nigeria is sports betting, as well as the draw lotto type of lottery. The reason why GBAM has come is that when you look at the contribution that the different types of lottery systems make, they are almost equal in size, but scratch and win is one particular product that Nigeria has never seen. There has been a couple of limited attempts to do scratch and win in terms of skills but GBAM is the first scratch and win type of lotto that will publicly come out and deliver exactly what it promises. The reason why it is purely different is that it is obviously simple to play because you don’t need to have any passion for sports or be able to predict scores and numbers for you to try your luck. The concept of lottery is the concept of trying your luck. For me to try to win in sports betting, I must understand the science of sports betting and to do that in draw lottery, I must generate what I believe is some spiritually motivated numbers either a date of birth or what I believe to be my lucky number and then wait for the draw to be called. For scratch and win, there is very limited thinking that goes into it. It is just a pure concept of trying your luck by scratchinga card to reveal your winnings and it is instantaneous. We have made it even better for customer fulfilment that the moment you win, you get paid. It does not require you to go anywhere, you can just sit down on your phone, download the game, play, win, cash out instantly. So it addresses a very big gap. How did you come up with the

counts. We are tying up with banks today to give people options, so that if you win and you don’t have a bank account, we will open instant bank accounts for you because we don’t encourage physical cash movement where it is not secure for the winner and also not secure for us as the payer. With our solution, there is a Tier 1 account under the CBN policy that needs only basic information to open for minimal levels of denominations, we will open that account for you and put the money in it for you. So these people will still need to go into the bank to cash it.

Tawa Bolarin

name GBAM Lotto? We went through a very extensive process of trying to find the right name that will depict the personality of the organisation that we wantedto create and the first time we were talking about the idea of instantaneous winning; the name came up. GBAM in Nigeria means sudden or immediate/ instant, so we decided that it was a good name even long before we went live. What is Gbam doing to build the trust of Nigerians in the failed lottery system especially because a number of people think lottery is a scam and if they scratch 100 cards they probably still would not win anything? You are totally right. We are a new brand that is here to stay, so we are building trust with evidence. It doesn’t matter what you announce or advertise or put on paper; the evidence will really show in how many real life stories you can tell of how

easy it is to win and cash out. For GBAM, our model is very simple. We want people to use any channel to play and we will be live in retail very soon but now we are online. We want people to win and be able to instantly go to our website to cash out or call a phone number in your local language, put in your winning number, put in your bank account details and get paid without having to see anybody. For winnings above N100,000, you will need to send an email with a valid means of identification and you will receive your money immediately once we have verified that the details in the email and ID correspond. We deliver exactly what we promise. However, we also realise that there is a large percentage of Nigerians that are unbanked, so there is a financial inclusion agenda; especially because we would have a lot of lottery players with the segment that we are dealing with that do not have bank ac-

What are your strategies to sustain all your ideas for GBAM lotto considering that the Nigerian lottery market is not fully developed? Some of the things that we did during our build phase was to look at what other people did wrongly without wanting to be arrogant. It is really not about a great idea, but a lot of what you do to achieve success is in execution. What we have done is to change the way the fulfilment journey is for scratch and win cards; to look at Nigeria in its own uniqueness and to change the fulfilment journey. So execution has been at the core. The second thing the brings about the success of an organisation are the people. To be honest, the calibre of people and the competence of the people you have to run the organisation also determines how excellently you can execute and we have a very strong and diverse board with people that have very strong pedigrees. Before now, I’ve worked in telecoms for about two decades, our chief sales officer also worked in telecoms and our chief strategy officer is from Italy and has experience in scratch and win lottery, our chief operating officer is an IT expert and has worked in telecoms and a few other software developing companies, so we combine all this expertise to deploy effortlessly to the customer. We would make sure that ourstores are comfortable

and well maintained because of the respect that we have for our customers. Also, you can buy a scratch and win card and play it anywhere you are; so there is a convenience and reach aspect to it and that is why it is taking us slightly longer to go offline. We looked at the distribution model and how do you make a product so pervasive that everyone can reach it. GBAM is such a simple product that we want to delayer the distribution structure so that anybody can be a GBAM partner with just N10,000. These are things that are so easy for an economy that is so challenging like Nigeria, for people to have alternative means of income. What type of lottery licence does GBAM have and does this allow it to achieve its wide reach aim? We have a national licence but we also understand that between the national and the state segments, there are some misalignments that make it difficult for businesses to operate, so we are are taking each of them one by one. In addition to our national licence, we also have a Lagos state licence. We are hoping that very soon, we would have a situation where state and national – similar to telecoms,can work effectively together, but until then, for markets that we are going to, we will discuss with the local regulator to see what the rules of engagements are and we would comply. What value is GBAM Lotto contributing to the Nigerian economy? There is enough revenue in taxation from the government apart from the license fees and the annual renewal fees. We also have to pay monitoring fees for every revenue that we generate and there are other multiple taxes. The NLRC collects a proportion of our total revenue after we have paid out our winnings. There is also a nation al lottery fund fee which is not fully defined yet, but they are work-

Continues on page 22

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BDTECH

E-mail: jumoke.akiyode@businessdayonline.com

Experts identify ways to successfully drive innovation in Nigeria

paramount in everything we are talking about today, whether formal or informal. The lady who teaches mathematics in local language is an inspiration, because no nation survives or develops without education. So, Techpoint Inspired is such a wonderful platform to expose young people to the dynamics of modern economy, which is part of the education we are talking about,’ Ikiebe said. Adewale Yusuf, founder of Techpoint.ng and convener of the event, said the platform was borne out of the need to ex-

plore the tech-trends that will shape the economy’s future in the years ahead. ‘Unemployment is skyrocketing, therefore, as a people we need to pay attention to the right solutions. That’s why this event was conveyed to trigger interests to topics around robotics, machine learning, robotics, etc. It is not like there are no jobs but the skills are few. To make matter worse, the few skilled ones are being poached by international companies. So, we need to address these issues. That is the essence of Techpoint Inspired,’ Yusuf said. On his part, Gbenga Adegbiji, the general manager of MDXi, a subsidiary of MainOne West Africa said, ‘connectivity is at the heart of the digital economy where the young people are playing key role. MDXi recognises this which informed our long-term investment plan to inspire a new generation of technology innovator who wouldn’t find it difficult to access infrastructure of ride on and reach the world. ‘Thus, our activities align with inspiring people in the SMEs space to be the best they can be, Adegbiji added. The annual event provides a unique platform for industry leaders such as CTOs and CIOs, visionaries, innovators to meet and inspire those who want to break through and see their ideas as reality.

dress the current trends in the ICT sector and an overview of government policies and how business has been impacted by these policies. Other various side events would hold discourse that would look at best practices in ICT regulations. “The 2018 ICTEL expo will provide a platform of opportunities for networking, exhibitions, conferences and other entrepreneurship promotion activities. There would be a special focus on tech start-ups and how they are impacting this present age and the future. This year’s edition is being packaged to deliver added value to all stakeholders involved in the project,” Idahosa said. The ICTEL Expo is a specialised annual exhibition or-

ganised by the LCCI with the full endorsement and collaboration of the Federal ministry of science and technology, Lagos state ministry of science and technology, Nigerian Communication Commission (NCC) , the Nigerian Information Technology Development Agency (NITDA), computer Society of Nigeria (CSN), Nigeria Internet Group, Association of Licensed Telecommunications Operators of Nigeria (ALTON) and Computer Professionals Registration Council of Nigeria (CPRCN) among others. The official social media hash tag #Life is digital, to enable people follow the conversation and air their views and expectations for this year’s ICTEL EXPO via social media.

JUMOKE AKIYODE-LAWANSON

xperts who spoke at the Techpoint inspired conference have identified possible ways to drive innovation in all sectors through knowledge, leadership and technology, which are the main factors responsible for boosting economy in Nigeria and Africa at large. The conference, organised by Techpremier Media Limited, publishers of Techpoint.ng which attracted over 5000 participants from different parts of Nigeria and other African countries, had speakers focus on the fast evolving world as a result of continuous technological advancement. In her presentation, Rolayo Akhigbe, the Divisional Head, Transactional Banking at First City Monument Bank (FCMB), said that although technology has changed the way people live, learn, communicate and execute assignments, however, improved education and awareness will further drive innovations in the ecosystem. According to Akhigbe, a lot more people are spending more time and money online and this has shifted business emphasis to digital sources of revenue and digital channels, as a result, the financial industry still requires startups to innovate on tackling issues

L-R: Gbenga Adegbiji; General Manager of MDXi, a subsidiary of MainOne West Africa, Richard Ikiebe; Senior Fellow and Director, Centre for Leadership in Journalism, SMC, Pan-Atlantic University, Adewale Yusuf; Founder of Techpoint.ng and convener of the event, and Rolayo Akhigbe; Divisional Head, Transactional Banking at First City Monument Bank (FCMB), at the Techpoint Inspired conference 2018, held in Lagos on Tuesday May 29, 2018.

around financial inclusion. Narrowing it down to the conference theme: “The Future is Now”, Akhigbe maintained that the startups themselves must understand the key elements to build businesses that stand the test of time. In the same vein, Omoke Adebanjo, area head, West Africa at Mastercard said that banks and the fintech need to collaborate more to spark further innovation in the financial sector. According to her, tackling financial inclusion collabora-

tively will be a win-win situation for the brick and mortar banks and the fintech operators. Richard Ikiebe, senior fellow and director, Center for Leadership in Journalism, SMC, Pan-Atlantic University said that one thing this conference has reminded us is that Nigeria is a country of very young people. Young people are known for creativity which connects with the theme of the conference. ‘This also brings us to the issue around education; it is very

LCCI to hold fourth edition of ICTEL EXPO

he Lagos Chamber of Commerce and Industry (LCCI) on Thursday announced the fourth edition of the annual information Communication Technology EXPO (ICTEL EXPO) scheduled to hold from the 25th to 26th July, 2018 in Lagos. This year’s edition themed ‘Developing Efficiency and Competitiveness in the Digital age’ will provide a platform that brings together the key players in the Nigerian Information and Communication Technology sector towards a greater contribution of ICT to national economic development. In his opening remarks, Babatunde Paul Ruwase, the president of the Lagos Chamber of commerce and Industry

FCA, stated that the ICT sector has continued to drive entrepreneurship, innovation and sustainable business models in Nigeria and beyond. Buttressing on this, Ruwase said that technology-driven service and mobile payment solutions have transformed the way we do business today and the ICT sector could contribute more to our national development of the needed infrastructure and policies are in place. Urging the government and the private sector players, he said that exploring Publicprivate-partnership model to mobilize needed investments for ICT infrastructure would be key to growth of the sector. He also made it clear that this could only happen if the gov-

ernment provides a conducive policy environment where ICT businesses can thrive. The ICTEL EXPO is a veritable platform to explore new technology possibilities and trends and with this unveiling, we expect the commencement of engagement and talks for possible sponsorships and participation. At the unveiling was the Gabriel Idahosa, chairman, Trade and promotion board, Lagos Chamber of Commerce and Industry, who highlighted that the event offered two days of information, inspiration, innovation, optimal brand exposure and a platform for diverse business and investment opportunities. The event is poised to host conferences that would ad-

‘We use technology to provide convenience, reach and fulfilment in lottery’ Continued from page 21 ing on making some definitions on it but we have gotten a bill. We are not sure if the fee will be an annual fee of a value or a percentage of revenue. In addition to that, Lagos state also has fees for all lottery in Lagos. Apart from the fees, there is also a lot of social benefits. We

are generating employment, entrepreneurship and giving people the opportunity for them to quadruple their income streams and live better. What level of technology is GBAM using to drive its business? The primary service fulfilment structure in GBAM

is about self service which provides convenience and the technology makes all of this possible. What GBAM is using technology to do is to provide convenience, reach and fulfilment for its customers, so that they don’t feel the need to have to go somewhere or leave what they normally do in order for them to get served.

Our online system has also made it possible for us to cover people with cards and people without because we understand that not everyone has a bank account and not everyone with a bank account has a card. We work with flutter waves, NIBBS, pay stack which are credible payment companies that all banks also work with to pro-

cess transactions securely. Unlike other lottery companies we do not hold your winnings, you can cash out as little as N200 if you don’t want to use to to play again. Our website is designed to be compatible and accessible through any mobile device. It is a mobile optimised website but GBAM is also working on our mobile app.

FG commends FinTrack software solutions at Indo Africa ICT Expo JUMOKE AKIYODE-LAWANSON

he federal ministry of communication has commended FinTrack Software, an indigenous financial technology firm for its outstanding performance in Nigeria’s tech sector. The company hosted Adebayo Shittu, Minster of Communications at its booth where it showcased its different software solutions alongside other global brands at the recently concluded 2018 Indo Africa ICT Expo held in Lagos. Shittu who toured the Expo to interact with local ICT firms reiterated government’s support for local content and indigenous entrepreneurship. “We are very impressed with what FinTrak as an indigenous firm is offering to Nigerians. We believe that firms like these are what we need to put the country at the forefront of ICT and we hope to work with FinTrak in the near future,” Shittu said to the media during the expo tour. FinTrak boasts an array of bespoke Enterprise Resource Planning (ERP) software and business intelligence solutions. The solutions dynamically integrate information into the management operations and decision process that improve business performance in many organisations. The company has also demonstrated adeptness in services like enterprise process digitisation, core banking system, IFRS solution, risk management, data warehouse and business intelligence. Others are core business and enterprise budget planning, processing and control. Bimbo Abioye, group managing director, FinTrack said; “We are here as a Nigerian firm to showcase our solutions to the world. Fintrak solutions are in tune with global best practice. We have demonstrated that a Nigerian firm can deploy critical solutions like core banking, ERP software and implement financial reporting based on IFRS in many banks. We believe that this exposure and the minister’s positive remarks to our solutions would go a long way to further expose our products and services to private and public sector consumers.” Fintrak has deployed solutions in Nigeria, Benin, Togo, Gambia, Senegal, Rwanda, Congo, and Zambia.

BUSINESS DAY

Tuesday 05 June 2018

EDUCATION

Weekly insight on current and future trends in education

Primary/Secondary

Higher

Human Capital

‘Learning & development crucial for productivity in organisations’ Stories by KELECHI EWUZIE

lot has b e en written and said about the problems plaguing the growth of organisations in Nigeria over the years, but what may not be getting so much attention is the role that learning and development of employees plays in the overall productivity of the workforce. With organisations downsizing to accommodate the current economic realities and budgetary constraint, the unwillingness to inculcate a winning learning and development strategies as part of company goals poses danger especially with a dwindling workforce. Chief executive officers observe that for an organisation that not only wants to remain in business, but also grow and transform, good training and development programmes must play a

L-R: Bolaji Olagunju, managing director, Workforce group, Adesimbo Ukiri, chief executive officer, Avon, Healthcare and Segun, chief executive officer, Page international Financial Service at the Learning and Development Leaders’ Conference organised by Workforce in Lagos

role if they want to retain their staff. Adesimbo Ukiri, CEO, Avon Health Care Limited says for every business that wants to remain relevant, competitive and grow into the future, learning and de-

velopment is crucial. Ukiri while speaking to BusinessDay by the side of a Learning and Development Leaders’ Conference organised by Workforce in Lagos opines practitioners in the area of human resources

ICAN new president commits to fighting unemployment through entrepreneurship initiatives

he newly-elected President of the Institute of Chartered Accountants of Nigeria, Razak Jaiyeola, says he is committed to frontally addressing the twin issue of unemployment and underemployment by adopting training modules which will empower of members to be entrepreneurs and job creators than job seekers. He observed that many newly inducted members of the accounting profession cannot find jobs in an economy where there are over 37 million micro, small and medium sized enterprises. According to him, “With the move by large companies towards automation of their processes to save costs, the future appears uncertain and more challenging for young professional accountants”. Jaiyeola who spoke in Lagos during his investiture as the 54rd president of the accounting body, said as a body, ICAN is aware of the unfolding disruptive impact

of artificial intelligence and other IT- related development on the accounting profession, promising that IT-proficient professional accountants will remain globally relevant because as some jobs are phased out, others will be created. He said as a profession, ICAN must make her impact felt in public governance as this has implications for the ability of private sector players to continue to create wealth. He further said that under his tenure as president, he shall as part of his mandate support the government with policy initiatives that will bring efficiency and effectiveness to governance such that areas of waste and leakages will be plugged, adding that the institute will be in the vanguard of the campaign for value for money in the award, execution and monitoring of public projects. “If Nigerians will optimally enjoy the benefits of their huge resource endowments, greater pre-

mium must be placed on efficiency, effectiveness and economy in the use of public resources”, he said. Jaiyeola assures that the institute will intensify human capacity building initiatives to impact Nigeria’s development agenda. To him, “The institute will work with government and regulatory agencies to enhance the capacity of public institutions to deliver on their mandates trough massive investments in human capital and infrastructural facilities which hold the key to sustainable development” The new ICAN boss disclosed that to reinforce the achievement in the Federal Government fight against corrupt practices, the would collaborate with security agencies to build forensic capacity through the institute faculties, adding that the accounting body will leverage technology to give the anti-corruption crusade a new and refreshing meaning.

need to understand that the world is changing and there are many more platforms for delivering knowledge and skills than there used to be before. She observes that companies have different strategies

when it comes to the issue of learning and development, adding that for every company, the view to take in training and development is not just about survival today, but answering the question about the type of company they aspire to be in the future. According to her, “For professionals who are either leading in the area of training and development in every company, they need to get more involved and more knowledgeable about what their company’s strategy is and what the skills, competencies and abilities that are required across board within their companies to enable their companies achieve its goals both the short, medium and long terms goals. Segun Akintemi, chief executive officer, Page Financials, opines that good training and development programmes play a role in staff retention, adding that a LinkedIn research showed employees to be more pro-

ductive when employers provide employees with opportunities for continuous learning. According to him, “For an organisation that not only wants to remain in business but also grow and transform, the key to disrupting in any industry is by revolutionising their thinking “successful organizations think outside the box, but exceptional organisations think like there is no box”. Ukiri while responding to a question on the role Ceos play in accepting the concept of learning and development says every Ceo wants to the given the assurance that for every kobo they spend, it is generating income. “So for the human resource practitioners who lead and direct initiative programmes around learning and development, they must show the Ceo the value they hope to create first before talking about the monetary involvement”, she added.

Creative writing assessment to feature at Lafarge annual national literacy competition

reative writing will for the first time be featured as an assessment area in the 2018 edition of the annual Lafarge Africa National Literacy Competition. This was announced at a national planning meeting for stakeholders, held in Abuja to flag-off activities for this year. It is being done in a bid to both improve the quality of the competition and make Nigerian pupils more competitive with their global counterparts. The meeting which was put together by the leading building solutions provider was

attended by representatives of the State Universal Basic Education Boards (SUBEB) across the 36 states and the Federal Capital Territory, Abuja as well as other strategic partners. Fo la sha de Ambro s eMedebem, director of communications public affairs and sustainable development said the competition is part of Lafarge’s contribution to bridging the literacy gap in Nigeria which is essential to the continued development of our nation. Bolanle Ishola, director of academic services at the Universal Basic Education Board (UBEC) commended

Lafarge for sustaining the competition over the past 5 years and promised UBEC’s support for the competition. O n her par t, Adeola Awogbemi, the head of programmes for Ovie Brume Foundation- who are the implementation partners on the project, said the addition of creative writing was to improve the quality of the competition from other years. It was also disclosed at the stakeholder national planning meeting that the grand finale of the 2018 edition of the competition will happen in Abuja. The stage is now set for its commencement following the hugely successful meeting. The Lafarge Africa National Literacy Competition engages pupils from public primary schools across the country in activities that measure and enhance their ability to read, write and spell correctly. It also features literacy tests, essay/summary writing and spelling bees to evaluate their reading and writing abilities.

BUSINESS DAY

C002D5556

EDUCATION

Tuesday 05 June 2018

INSIGHT

Focus on special education: Individualised educational programme (IEP) Isaac Osae-Brown

ducating a child with a disability requires careful but rigorous planning to ensure that the child’s academic and functional goals are met. Educators need to employ adaptations and a variety of techniques to target certain areas of functional academics, general work habits and social skills. When you work with a population of students with disabilities, you will have to learn how to adapt and modify the curriculum to ensure a better chance of success and task completion. Adaptations and modifications must be noted in the child’s Individualised education programme so that instructional and assessment methods can be adapted to meet the needs of all students. The main purpose of the

individuals with disabilities education improvement act (IDEA) in the United States is to ensure that all children with disabilities receive free appropriate public education (FAPE) and are not discriminated against by any public school or any agency representing a public school. This special education Act focuses on goals, curriculum and assessment of all students. States are required to develop goals for children with disabilities and help them achieve progress in district wide assessments. To achieve success in meeting their goals, each child needs an individualised educational program (IEP) that is designed for progress in the general education curriculum. Clearly, Individuals with Disabilities Education Improvement Act (IDEA) was created to provide free appropriate public education (FAPE). Research reveals that achieving this goal was originally based on six basic principles: 1. Zero reject/ child find, 2. Non-discrim-

inatory assessment, 3. Individualised educational program (IEP), 4. Least restrictive environment (LRE). 5. Due process, 6. Parent participation. Many African countries including Nigeria may not have IDEA principles to provide a free and appropriate public education for individuals with disabilities in public schools, but it is essential to create an individual educational programme (IEP) tailored to meet their needs. This will go a long way to build confidence and self-determination for their adult transition into the community. What is the individualised educational programme (IEP)? The United States special education model reveals the IEP as a document developed annually using a specified process by a group of professionals including the parents. Essentially, the IEP (or for infants and children, the Individualized Family Service Plan, IFSP) is a blueprint of services necessary to meet the needs of

every child with a disability to enable him or her to successfully progress towards individual goals. An IEP provides evidence that a child is receiving a free appropriate public education (FAPE). This means that all children with disabilities are entitled to a public education. Do the Nigerian public education systems include children with disabilities and provide services to meet their individual needs at no cost to their parents? The IEP amounts to the commitment of the public schools and the government’s resources for providing FAPE. Participants of the IEP include the following: The child’s parents, a regular education teacher, special education teacher, a school administrator, direct services providers, (e.g. Speech, Occupational Therapist, vision specialist, a school nurse, psychologist and adaptive physical education specialist.) Specific components of the IEP are as follows:

Foundation deepens extra-curricular learning experiences for 2000 students

ha n g e -A- L i f e (CAL) Foundation, a social nonprofit organisation passionately driven by the need to enable and facilitate a better life for every Nigerian child organised a special programme themed “Children, Time to Take Over for 2000 students in Lagos. The event which treated 2000 children to a fun filled party was part of activities marking the foundations 15th year anniversary and the global 2018 Children’s Day celebrations. Sekinah Ayeyemi, chief operating officer of the foundation while speaking at the event held at Beko Ransome Kuti Youth Centre, Anthony Village, Lagos, said the annual event is in line with the organisation’s mandate to promote, protect and preserve the rights and welfare of children in Nigeria. According to Ayeyemi, “These wonderful children all around us remind us of the hope we have in the bright future of this great nation and we cannot but

celebrate them every year through this event because we know that they are indeed the leaders of tomorrow. We at CAL believe that what we invest in them today would come around to transform us and this is why our foundation is passionate about the development of children and the protection of their rights,” Ayeyemi stated. She further explained that the event is also remarkable because it marks

the celebration of the Foundation’s 15th year of putting smiles on the faces of all our beneficial. In her remarks, Abimbola Fashola, former first Lady of Lagos State commended the foundation for the laudable celebration. “It is very commendable that Change-A-Life foundation has continued to make immense contribution to the advancement of child rights as well as the social and academic development of the average child.

Olasunkanmi Ganiyu Bakare, proprietor, Corner Stone Private School commended Change-A-Life Foundation for their show of affection and love to the children, stating that the children would forever remember the wonderful experience. She finally called on other corporate institutions to support the annual event as a way of showing their love for children as well as in continuation of their social development activities.

Female students from Lagoon Secondary School, Lekki and Grace High School, Gbagada at a recent industrial visit to Vodacom Business Nigeria as part of the activities for the International Girls in ICT Day

Present levels of academic achievement which includes a description of how the child’s disability affects his or her involvement and progress in the general education curriculum, measurable annual goals which includes academic and functional goals designed to meet the child’s needs, short-term objectives which outlines a breakdown of measurable goals into intermediate pieces, description of how the child’s progress toward the annual goals will be measured, special education related services and date for the beginning of services and modifications. Each child’s IEP must be reviewed and revised annually. The special education law also provides for amending an IEP without holding a formal IEP meeting with written parental agreement. It is imperative that the regular education teacher of the child’s school participates in the development of the IEP of the child, including the determination of appropriate positive be-

havioural interventions and supports as well as other determination of supplementary aids and services. Many IEP plans have signature lines where a parent would officially agree to the plan. Parents have to keep in mind though that they do not have to give consent to the entire plan. They can use an addendum to give consent only to specific parts of the IEP. It is ideal for parents to always find out how they can play a role in the IEP process by connecting with their local schools. Parents should also engage in extensive research in special education and take any action necessary to carry out their responsibilities to support their children’s education. Isaac Osae-Brown works for the Compton Unified School District in California as an Education Specialist and a beginning Teacher Mentor. He is an advocate and a speaker for Special Education services in the United States and abroad. www.facebook.com/ inclusivemindset

FUT-Minna invents data, voice connection operator; communication enabled stick Oyin Aminu, Abuja

he Federal University of Technology Minna (FUTMinna) has made a breakthrough in telecommunication through the invention of Seamless Multiplier Operators, including a Seamless Data and voice connection over Multiple Operator, as well as a Mobile Communication Enabled walking stick. Abdullahi Bala, vice chancellor of the University made the disclosure of the inventions in Abuja, when he led a team of researchers, students and scientists from the university to present the technology innovation projects funded by the Nigerian Communications Commission (NCC) to the Commission. The Seamless Multiple Operator (SMO): Seamless Data and Voice Connection Over Multiple Operator enables network subscribers to have a single sim for all networks or one mobile phone with one SIM card for all networks, while Mobile Communication Enabled Walking Stick, is the innovation with mobile phone imbedded to aid the users, especially the aged and the blind/disabled persons navigate through dangerous sports, and at the same time make calls when

necessary. The projects are to the tune of N4.7million and are designed to address the issue of subscribers using multiple phones and sim cards due to poor quality of service in keeping with the consideration for national roaming that is being promoted by the commission in mind. Presenting the novel devices, the lead researcher and head, department of Mechatronics engineering FUT Minna, Abiodun Musa Aibinu explained that the first device applies to all available networks in a particular location. ‘‘We are talking about disrupting the eco-system in the telecommunication industry in the sense that with just one sim card, you can access the available networks without porting or buying multiple SIMS. ‘‘People carry a lot of phones or Sims as a result of quality of service and you are not certain of the network strength of an area, So using basic engineering and the technology behind Mobile phone, we infused in it Artificial Intelligence, AI system to enable the device take intelligent decision on behalf of the user to switch from the network with poor quality of service to another with better quality service.

Tuesday 05 June 2018

C002D5556

BUSINESS DAY

In association with

Infrastructure Maintenance With TUNDE OBILEYE

BIFM Nigeria: Enabling positive experiences in retrospect

Post recession economy moves without real estate sector …market in dismal performance in Q1 2018 Stories by CHUKA UROKO

hough recovery from economic recession has been slow, fragile and vulnerable, there has been a positive change in the narrative buoyed by a significant shift in oil price from the 2017 levels. This has impacted positively in some sectors of the economy excluding real estate which, in the last quarter of this year, actually saw motion but no movement. Close watchers of this sector say there were increased enquiries ,estimated at 10 percent, but transactional deals were sparsely closed. Market performance was low. The rise in oil price, expectedly, raised some optimism, especially among investors and developers. This explains the dominance of demand for Grade A office space by the oil and gas sector followed by technology, fast moving consumer goods (FMCG) operators, and professional services which have also seen some growth postrecession. As at the end of the first quarter of 2018, oil price (Brent Crude) grew by 5.1 percent to US$70.27 per barrel relative to US$66.87 per barrel in the previous quarter. Currently, the price is on $80 per barrel thresh-hold. But, on the domestic front, oil production remains flat, quarter-onquarter (q-o-q), at 1.8million barrels per day.

Confirming these developments, Broll Nigeria’s recent viewpoint on the commercial real estate market notes that the economy generally has witnessed some upswings even though recovery remains slow, pointing out that as at the end of last quarter, macroeconomic conditions outperformed the last quarter of 2017 . The foreign exchange reserve level grew by 19 percent to US$46.26 billion in Q1:2018, up from US$38.77 billion in the previous quarter, the highest level recorded since Q1:2013. This gave the economy a foreign exchange payments buffer of 13.4 months at the end of the quarter. The Naira appreciated marginally within key market segments in the foreign exchange market. At the parallel market, the naira closed Q1:2018 at N362/US$, a slight q-o-q appreciation of 0.03 percent. Similar instances were recorded at the interbank and Investor-Exporter Foreign Exchange (IEFEX) windows, with the naira closing the quarter at N305.65/US$ and N360.2/US$ respectively. The consequence of these developments was a significant rise in business and investor confidence, leading to renewed interest in the real estate market, particularly in commercial office sub-market where enquiries for space was appreciable as at the end of the quarter. Though average asking rent for A-grade spaces in some locations like Ikoyi remained

constant at was US$750 per square metre per annum relative to Q4:2017, in the Victoria Island commercial node, the median average asking rent was US$650per square metre per annum, showing a hike from the previous quarter’s median average of US$600 per square metre per annum. Therefore, the upward rent review by landlords represents optimism about the country’s economic prospects as well as renewed investor confidence which they expect to translate into increased activity in the commercial real estate market. But the market is still challenged by supply overhang and, according to the Broll report, with the current level of supply in the market, it is still a tenant’s market where the landlord is a price taker. For that reason, many concluded transactions have recorded achieved rents that are a fraction below the initial asking rents. “Vacancy rates at prime grade buildings are currently at 77 percent and 48percent in Ikoyi and Victoria Island respectively. To remain competitive and drive up occupancy levels, many landlords are still offering concessions to prospective clients in the form of rent concessions, longer rentfree periods and flexible rental payments”, Nnenna Alintah, a researcher at Broll revealed. Renewed investor and business confidence arising from the current upswing in the wider economy means that activity in this segment of the

market is expected to continue to increase but at a gradual pace, giving a bright outlook which investors should latch on. Alintah is however of the view that the investor and business confidence is being reinforced by efforts of the Central Bank of Nigeria (CBN) to maintain the value of the naira through increase in the foreign exchange reserve level as well as liquidity in the foreign exchange market. The apex bank, after a twoday Monetary Policy Committee (MPC) meeting in Abuja last week retained the Monetary Policy Rate (MPR) at 14 percent for 10 consecutive months. It also left the liquidity ratio unchanged at 30 percent, Cash Reserve Ratio at 22.5 percent, insisting that it would not consider easing the rates until inflation falls to single digits. However, some market analysts highlight a potential risk of pressure to foreign exchange market fundamentals from increased foreign exchange demand due to the upcoming elections and seasonal factors (summer travel and expenses) in the coming quarter. “Landlords are expected to sustain current concessions offered to prospective tenants. This is on the backdrop of the current oversupply of space in the market. Furthermore, with in excess of 50,000 square metres expected to be delivered to the market in 2018, the potential for rental growth is non-existent at the moment”, Alintah observed.

s Nigeria joined the rest of the world to celebrate World Facilities Management (FM) Day, the impact of FM on the various aspects of life, whether in recreational, residential and corporate landscapes, has made the involvement of FM practitioners worthwhile. Despite the challenges, even in an environment where a lot of awareness is still needed, the excitement drives the determination to go to the next level. To emphasise the role of FM in today’s world, we remember how a difficult job at a client’s facility was handled to ensure exceptional customer experiences when not much was expected at the time. There was chaos all around due to the lack of effective and efficient system to deal with the day-to-day operations and the needs of the end-users of the facility. Being a new residential development, it is fair to say that some of the challenges were not unexpected however the approach to dealing with the issues required a well thought out plan that would yield immediate positive results. The issues faced by the tenants were multi-dimensional in nature, ranging from electrical, plumbing, roof leakages, faulty door locks, power, security etc. The estate was developed with the upscale market in mind and this made the whole situation even more difficult to accept. The first step taken was to acknowledge that the issues exist and to reassure the tenants that solutions would be provided as quickly as possible. An assessment of the problems and the extent to which each one impacted the end users individually and collectively was done to determine short, medium and long term solutions. A system was designed and immediately put in place to capture, deal and resolve the challenges in order of priority. For instance, all the door locks were replaced to prevent further complaints. In the case of security, a visitor’s record book was introduced to process visitors entering and exiting the estate. Identification cards were also introduced to monitor domestic staff movement in and around the estate including identifying strangers. Major issues such as electrical, plumbing and roof leakages were handled by experts with proven record of accomplishment. With roof leakages, the short term solution was to identify areas of leakage or possible leakage and apply roofing felt for extra protection to repel water until the roof was replaced.

The result of our actions was a renewed confidence and trust in the maintenance team by the tenants who started to appreciate the effort and improvement to their living conditions. Whilst all the problems were not immediately fixed, there was a sense of belief that a plan had been put in place to find solutions. The lessons learned included having a communication plan to disseminate information as required and in good time by engaging the end users. Another lesson learned was to ensure only knowledgeable and competent personnel were engaged to provide FM services, providing training where necessary. Having a well thought-out system to ensure planned and preventative maintenance service was key to delivering superior service delivery. Going forward, a shared visionamongst all stakeholders is important to integrate end user’s individual expectations and approach of the FM team.This gives a chance to discuss shortcomings, strengths and difficulties withthe stakeholders particularly end-users. Another step to be taken is the promotion of positive culture change which creates a belief that goals can and will be accomplished when people work together. When there is a positive culture, multiple solutions are sought for every challenge. This positive culture provides the basis for moving forward towards greater accomplishments. The BIFM Good Practice Guide on Customer Experience is a good reference material for all FMs particularly at this time as we continue to promote the need for positive experiences for all stakeholders. The guide reiterates the importance of FMs understanding that ‘customer experience is essential in supporting an organisation’s objectives’. It encourages FMs to develop, implement and review strategies for improved customer service engagement and relationship management through a customer-centric culture. It also outlines best practices for engaging staff and utilising data to improve customer satisfaction. We recognise and appreciate the commendable effort of FMs across the country toward improving service delivery and best practice. We encourage you to take advantage of the rich resources available on the BIFM website and benefit from the several knowledge sharing opportunities that come with membership of the association

BUSINESS DAY

Tuesday 05 June 2018

Look for alternative location for Apple Island project, Brutai orders NAPL …as Banana Island residents resist, disrupt development CHUKA UROKO

he rumblings that erupted in Banana Island, Lagos, on Friday over the proposed development of Apple Island by the Nigerian Army Properties Limited (NAPL) was laid to rest Saturday morning following the visit of Tukur Brutai, the Chief of Army Staff (COAS), who ordered NAPL to look for an alternative location for the development for lack of ‘locus standi’ on the part of NAPL The proposed Apple Island was to be developed adjacent to the highbrow Banana Island on land to be reclaimed from the Lagos Lagoon, a development the residents of the exclusive neighbourhood resisted stoutly, citing access issues which, if allowed, would affect not just the exclusivity of the estate, but also the privacy of the individual residents. Banana Island is an exclusive locations where those considered out of the ordinary economically and socially have nestled their homes which are defined by sophistication, taste, class and luxury living. It is an enclave harbouring a large clan of the nuveau-riche. It

L-R: Chudi Ubosi, chairman, Banana Island Residents Association with Tukur Brutai , chief of army staff, and other residents at the Banana Island residents meeting with the Nigeria Army on the proposed Apple Island project by the Nigeria Army Properties Limited in Lagos at the weekend. Picture by Pius Okeosisi

is, arguably, the most expensive real estate address in Nigeria today with its rich and complex architecture in luxury homes coupled with mouth-watering land values and house prices. This curved island that has the shape of a real banana is presently the most sought after location in Lagos. Land values here have gone up by almost 50 percent in the last couple of years to N370 million for 1,000 square metres of land, up from

N260 million the same size of land sold for early 2014. This is also an island where a threebedroom apartment typically sells for well over N150 million and over N500 million for a fivebedroom stand alone house. All these are supported by solid, world class infrastructure top of which are the air-tight security and flood-free roads in a coastal environment which differentiates the estate from surrounding neighbouhoods

like Osborne Foreshore and Parkview Estate. The people living in this Island value their privacy, security and leisure highly which is why, besides the issue of access, they were angry that the site of the proposed Apple Island was the same area they, the residents, had planned to build jetties, boat club and other recreational facilities. “This island would lose its ‘virginity and sanctity’ if we al-

Residential, investment opportunity opens for mid-income buyers …160 multi-family units on offer at Lekky County Apartments

pportunity for residence and investment has opened for home seekers and investors who love quality and serene environment at Lekky County Apartments where 160 units of apartments comprising one, two and three bedrooms are on offer. The estate which is incorporated in the Lekky County Homes, a massive real estate development that is home to about 2,000 families, is configured in 16-blocks, each block comprising 10 flats made up of 32 units of onebedroom, 32 units of twobedroom and 96 units of three-bedroom. It is being promoted by Megamound Investment Limited and located close to Victoria Gar-

den City, off Lekki-Epe Expressway. From the County Lekky Homes experience where a Terrace Duplex sold for N10 million in 2010 and is today selling for N45 million, officials of the company assure investors that an investment in the new Apartments will help to secure their future in a serene environment with proper management, good infrastructure, basic amenities and, most importantly, a great capital value appreciation. Residents of this estate, which sits within the 16,000 square metres of Lekky County Homes Phase 2, have the benefits of uninterrupted power supply, sewage system, boreholes, drainages, recreational parks,

club house, fast food outlets, shopping mall, schools and pharmacy, making it a great place to live in. This means that residents will have no need going outside the estate for their shopping or looking for schools for their children. The shopping mall and the school have the added advantage of creating jobs for the residents to serve as teachers, cleaners, shop attendants, security officers, etc. On the investment side, the developers assure that with the 15 percent annual capital appreciation in investment yield, their projection is that Country Apartments with its already developed neighbourhood, is designed to yield even greater value in its first five years. “Currently, the rental value of a threebedroom Terrace Duplex within the estate is N2 million,”, Marian Diagbonyia, the company’s head of sales, disclosed at a media briefing, assuring that apartments won’t go for less consider-

ing that they come with modern and exquisite finishing. Buyers of these apartments have mortgage facility provided by Omoluabi Mortgage Bank to help to ease payments. The 18-percent interest rate facility is for 15 years, depending on the age of the taker and his risk exposure. The company also offers flexible payment plan and the expectation here is that when the apartments are completed by September 2019, buyers who would enjoy 36 months of flexible payment after an initial deposit, would enjoy 50 percent value appreciation. “Because of the quality and location of the project, buyers are sure of 50 percent value appreciation; our projects appreciate fast and this is because we take good care of our project environment with tree planting, beautiful landscaping, etc. They are well attended to everyday”, explained Olumide Osunsina, MD/CEO of the company. Megamound is a major player in the high end market but decided to build apartment blocks out of concern for the plight of low income earners who are apparently excluded in most housing schemes, and driven away from the housing market by affordability issues.

low this kind of development to happen here. We pay so much to live here and to throw this place open by giving access to this development means we have lost the exclusive nature of the estate which we paid for ”, said a resident who spoke to BusinessDay, pleading anonymity. Some over-zealous junior army officers had, Friday afternoon, come to the proposed construction site, demolished the signboard indicating intention to build the above facilities by the residents, and mounted their own signboard which displayed the name of the proposed development, the developer and the two main contractors—Julius Berger and Van Oord. When BusinessDay visited the controversial site Saturday morning, it was discovered that the angry residents were prepared for a showdown with the army developers over what they considered an invasion into their exclusive estate without any prior discussion with them. “You can’t come here to do a development of this magnitude without letting us know. We are not saying you should not do your development but access to that development is going to be a problem”, Chudi Ubosi, the chairman of the Residents

Association, told Brutai. The army chief who seemed embarrassed for not being properly briefed on the proposed development, assured the residents that he was not at the estate to flag off any project because, according to him, they were still at prospecting stage contrary to NAPL’s posturing and claims. The question some residents were asking while this ‘drama’ lasted was when the soldiers became estate developers and where the money for that size of development that involved sand-filling and reclaiming land from the sea would come from. “If the army has become commercial estate developers, why Banana Island? If it must be this Island, there are still empty land here which they can buy and develop. Why the interest in that particular area we have planned to build our boat club? This is an invasion and we must resist it”, an angry resident fumed. It was even speculated that NAPL might just be an errand boy fronting for one ‘money bag’ still lurking around the corner, because the money that would be needed to develop an island project is not an ‘akara’ ball which even a child can buy.

Buying property: Need to know legal documentations

ost times when buyers step out looking for property to buy, little or no consideration is given to what happens after a property is sold and bought. Usually, a good knowledge of legal documentation which is as important as the money that changes hands is lacking. When, therefore, a group known as Power Brokers Circle, a network of real estate agents and professionals created by Fine and Country West Africa, gathered recently in Lagos, the issue of legal documentation dominated discussions. The Circle provides a platform to train and engage with real estate brokers and professionals with a view to fostering collaborations, leveraging on the collective expertise of agents and creating business opportunities in the real estate industry. The gathering with the theme, ‘Marketing in the 21st Century’, highlighted two topics which are fundamental to successful real estate transactions. These are Marketing and Legal Framework. Fine and Country, a leading marketing and leasing agent in Nigeria, revealed in a recent survey that 60-65 percent of real estate transactions fall through due to lack of adequate knowledge and/ or improper documentation. Some of the vital documentation and legal framework required to complete real estate

transactions are Deed of Assignment, Certificate of Occupancy (C-of-O), Survey Plan, etc. A deed of Assignment is an agreement between the seller of a land or property and a buyer of that land or property, showing evidence that the seller has transferred all his rights, his title, his interest and ownership of that land to that seller that has just bought the land. The danger of not having this document is that the buyer could lose his number one evidence against another person that is trying to claim ownership of that same land. C-of-O is a document issued by state governments in Nigeria to landowners and property buyers as a legitimate proof of ownership. This document also spells out what the land can be used for—a residential, commercial or mixed development. It is important to have this document so that the buyer knows, for sure, that his land or property is not already under acquisition. A Survey plan is a document that measures the boundary of a parcel of land to give an accurate measurement and description of that land. Not having a survey plan means the buyer may not be aware of areas known as Committed Land. This is pieces of lands that the government has committed for road expansions, future government estates or government reserved areas for major developments.

Tuesday 05 June 2018

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BUSINESS DAY

Markets + Finance

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Jaiz Bank’s gross income hits five year high of N6.94 bn BALA AUGIE

aiz Bank Plc, a leading non interest bank in Africa’s most populous nation has been thriv ing in the last five years amid the daunting economic challenges. The lender has defiled all odds that such a banking model may not flourish since it is non interest banking. The bank was created out of the former Jaiz International Plc which was set up in 2003/2004 as a special purpose vehicle (SPV) to establish Nigeria’s first full fledge Non Interest Bank It obtained non interest banking license from the Central Bank of Nigeria (CBN) on the 11st of November 2011 and began operation as a Non Interest Bank in Nigeria on 6th of January 2012 and 3 branches located in FCT, Kaduna and Kano. Non Interest Banking is

Hassan Usman, managing director/chief executive, Jaiz Bank Plc

profitable growing global phenomena practiced in nearly 70 countries across

We are proud of our success story as we have broken the world record of being the first Islamic bank in the world to start making profit in the first three years of operation; no other bank has achieved this height before

the world including United Kingdom, Canada, the United States of America, the United Arab Emirate, Malaysia, China, Singapore, South Africa, Kenya, etc. Finan c ial Performance for 2017 Gross revenue grew by 538 percent to N6.94 billion in December 2017 from N1.09 billion in 2013. This translates to a compound annual growth rate (CAGR) of 45 percent. Since Jaiz Bank broke even in 2014, it has been recording an uptick in profit. Profit after tax increased by 72.55 percent to N537.11 million in December 2017 from N311.27 million as at December 2016. Profit before tax followed the same growth trajectory has it surged by 160.27 percent to N894 million from N343.08 million the previous year. The interest bank’s capital base hit N15 bil-

lion in 2017 from the initial N5 billion when it started operations five (5) years ago. This translates an annual rate of 30 percent, which makes it one of the strong players in Nigeria’s banking industry, with plans to be one of the leaders in the market in the next 5 years. Deposit grew by 211 percent to N68.1 billion in December 2017 from N21.93 billion as at December 2016.Deposit has grown by CAGR of 25 percent. Financing and investment assets leapt by 320 percent to N48.30 billion in December 2017 from N11.5 billion as at December 2013; this represents a CAGR of 33 percent. Total assets were up 4.11 percent to N13.67 billion in December 2017 as against N13.13 billion as at December 2016. Assets have grown by a CAGR of

25 percent in the last five years. Jaiz Bank is efficient in curtailing costs while bolstering profit as cost to income (CIR) has improved in the last five years. CIR has fallen to 86 percent in December 2017 from anì all time high of 252 percent in 2013. Return on equity (ROE) improved to 6.54 percent in December 2017 in the period under review from a negative figure of 12.73 percent in December in 2013. In other words, the leading non interest bank has utilized the resources of shareholders in generating higher profit. Return on assets (ROA) improved to 0.62 percent in the period under review as against a negative figure of 2.19 percent as at December 2013. “We have been able to make Jaiz a household name in the Nigerian Banking Industry, and one of the reasons why we having this interview today is to further create awareness among Nigerians for the Bank”, said Hassan Usman, chief executive officer of the bank. Hassan noted that the bank had been involved in the financing business prepositions relevant to the development of the real sector of the Nigerian economy, pointing out that business and employment opportunities which the bank offers are open to all Nigerians, and foreigners alike, irrespective of creed. “We are proud of our success story as we have broken the world record of being the first Islamic bank in the world to start making profit in the first three years of operation; no other bank has achieved this height before. “We are also have a plan in the pipe line to be a

BD MARKETS + FINANCE (Business Team lead: PATRICK ATUANYA - Analysts: BALA AUGIE and LOLADE AKINMURELE)

universal bank as we continue to grow our network through opening of additional new branches across the country” he added. Positive Outlook Jaiz Bank expects gross income to hit N23.51 percent by 2022 from N10.06 billion as at December 2018. Profit after tax will rise to N3.82 billion by 2022 as against N927 million recorded in December 2018. Total assets will grow to N262.80 billion by 2022 from N123.61 billion as at 2018 Total equity otherwise known as shareholders’ fund will rise to N35.22 billion by 2022 from N28.60 billion as at December 2018. The leading non interest bank sees improvement in key profitability and efficiency ratio in the next five years. It said that cost to income ratio will fell to 68.22 by 2022 compared to 82.62 percent as at December 2018. Return on equity (ROE) will increase to 11.22 percent by 2022 as against 4.39 percent as at December 2018. Return on assets (ROA) will rise 1.59 percent by 2022 from 0.88 percent as at December 2017. Jaiz Bank has been using Islamic banking services to deepen financial inclusion in Africa’s most populous nation. It has provided loans to the poor in the rural areas, especially women and farmers that fret about collateralized assets. Currently, 50 percent of Nigeria’s population is Muslims craving for such products. According to a recent survey by Enhancing Financial Innovation & Access (EFInA), out of 96.4 million adults in Nigeria, 56.3 million (58.4 percent of the adult population) are now financially served.

Tuesday 05 June 2018

BUSINESS DAY

THE BIG HEART DIGEST In association with Delta State Micro, Small and Medium Enterprises Developement Agency (DEMSMA)

Echoes of 2018 Democracy Day: Delta celebrates people-oriented projects, peace, better days ahead …DEMSMA boss points out Gov Okowa administration’s visible achievements MERCY ENOCH, Asaba

uesday last week, Delta people from their diverse ethnic groups gathered in Asaba, the state capital for a praise and worship and thanksgiving, a programme held to commemorate the Democracy Day. The celebration held despite the verbal attacks from the opponents of the Okowa-led administration alleging that there was nothing to celebrate under the current administration. Various segments of the society were represented at the occasion, including present and previous top government functionaries, the political class, the religious bodies and their leaders, the traditional rulers, the community leaders, the youths, women groups and the men folks, the organized private sectors, captains of industries amongst others. The event which took place at the Event Centre, saw renowned musician led the people the in a series of praise and worship to bring down God’s glory. Chioma Jesus, Sammie Okpozo, David G., Samsong, Oyelade Elijah, Prospa Ochimana all took their turn to lead in songs and praises that lunched the people into spiritual realm where they began they saw themselves in awesome wonder of the blessings of God upon the land. In that atmosphere, they appreciated God and gave him thanks in anticipation of the better things to come. Renow ned evangelist, Umah-Ukpai was also on ground to pray and make prophetic declarations upon the state and the entire country. The celebration was Okowa-

led administration’s style of celebrating the Democracy Day since May 29, 2015 when he mounted the number seat of the state, just as other states across the country marked the day in their own ways. As a prelude to this day, Okowa-led government is seen to have prioritized the inspection of projects awarded by his administration. This exercise climaxes as the Democracy Day beckons, hence yearly, he tours the 25 local government areas and then inspects and commissions developmental projects there. He then caps the tour up with a town-hall meeting with the people of the area he visited. Besides, the commissioners of the various ministries and heads of parastatals are made to appear at the press ministerial briefing to brief on what the administration has done for the people of the state. This year is no different as he was seen to have increased his efforts in project inspections and commissioning, tour-hall meetings and even media briefings on the achievements of his administration. Opponents from the major opposition party, the All Progressives Congress (APC) kicked and accused him of not doing tangible developmental projects. This, Okowa lovers sew as an action aimed at distracting the governor from concentrating on delivering his campaign promises to the people of the state. Gov Okowa on his part, seemed not deterred by the opposing forces. The endorsements he has so far from various groups and individuals from the state, calling for his second tenure, seemed to have spurred him the more to continue to deliver on his SMART agenda

Dela State Governor,Senator Ifeanyi Okowa (4th left); his wife, Edith; and others at the praise session of the democracy day in Asaba

rather than being demoralized by what he described as negative criticisms. Therefore, at the Praise and Worship and Thanksgiving programme, he thanked Almighty God for bringing him to power and for sustaining his administration for the third year running. He attributed the success of his administration to the glory of God and expressed confidence that more people oriented projects would continued to be executed. “We believe our God that it will get better and better”, he exclaimed. “As we give thanks to God for what He is doing for us in Delta State, I wish to appreciate every one of you, every Deltan, you have played different roles for things to get better. When you have Jesus as your Lord, nothing can go wrong”, he declared. Continuing, he said “we promised our people that we will create jobs, we have created a lot of it, and we have continued to build on the foundations laid by former Governors James

Ibori and Dr. Emmanuel Uduaghan. We will continue to execute projects that will impact on our people. Our state is peaceful and we need the cooperation of everybody to sustain the peace. Investors are coming and more investors will still come.” He went on: “In the next few months, we will create a new Delta State that we all will be proud of. We have encouraged youths participation in sports through the Principal and Headmaster’s football championships, the Ministry of Basic and Secondary Education will organize athletics competitions, and in August this year, 54 African countries will converge in Asaba for the 21st African Senior Athletics Championships, the Asaba Airport has been opened for business and the airport without sounding immodest, has the best runway in Nigeria.” He disclosed that a lot of projects would be commissioned across the state in the next few days. The President, Pentecostal

Fellowship of Nigeria (PFN), Felix Omobude, a reverend doctor, had said that power belongs to God and urged those in authority to use their positions for the benefits of the masses. He stressed that the people deserve good governance and accountable leadership, adding that Nigerians should be actively involved in the democratic process to choose the right leaders. In assessing the governor, the Executive Secretary of the Delta State Micro, Small and Medium Enterprises Development Agency (DEMSMA) while assessing Okowa’s administration, told The Big Heart Digest in an exclusive interview, “His administration gave a lot of priority to infrastructural development – roads, drainages, bridges, school renovations, and certain buildings. This, she said reflected in the budget allocation as the larger share goes to works, housing, basic education and also health. “Of course, the job creation is very important to him, to en-

sure there is prosperity for all Deltans – a lot of the youths including the YAGEPreneurs and the STEPreneurs,” Bello added. He also values artisans and market women, ensuring that little sums of money for micro credit goes to the people. So, he did put in funds towards that, she said. She went on to point out peace of one of the things the people of the state have enjoyed under the current dispensation. “A lot of efforts, a lot of brainwork, a lot of activities, a lot of decisions were intentionally made to ensure there is peace in Delta State because without peace, there is no development, no progress and nobody would even come here to invest. And no government can do all investments themselves. They need the organized private sector to come on board. So, peace is an important aspect of Gov Okowa’s SMART agenda.” She observed that the state capital now has a facelift. It looks beautiful. We are very proud of what we see – wonderful flowers. At roundabouts, we are seeing private sector partners like the UBA, Zenith Bank coming on board to ensure that the state looks good.” She therefore expressed hope that other financial institutions would be coming on board in the development of the state. She noted the beyond the state capital, the entire state is wearing better face as other areas are experiencing the developmental touch of the Okowa’s administration. “We are trying to ensure we keep a clean Delta, we keep an organized Delta, we keep a prosperous Delta. This will be the visible things that I’m sure by now, you and I can see”, she expressed.

Editorial coordinator’s corner:

Understanding Delta’s 2018 fiscal direction:

Five small business & investment opportunities in Deltak IGNATIUS CHUKWU

10 Small Business Investment Opportunities in Delta State 1. Oil Servicing Business t is important to repeat this publication. Delta state is one of the few states in Nigeria where oil servicing business can thrive simply because of oil exploration in the state. All you need to do to get started is to ensure that you do your due diligent to know the services that is required by major oil producing companies. You

could help in pipe line installation and repairs or you could help in general maintenance of facilities. Just ensure that you go through the Corporate Affairs Commission to legally register your company and then obtain the required business license. 2. Transportation Business If you are an entrepreneur looking for a viable and profitable business to start in Delta state, then you can consider starting your own transportation business. You can choose to major on interstate transportation or intrastate transporta-

tion. The bottom line is that if you manage your transportation business very well, you are sure going to get good returns on your investment because transportation in Delta state is still being dominated by private investors and not the government and the industry is still open for more investors to come in. 3. Restaurant and Bar Restaurant and Bar is yet another very lucrative business that an entrepreneur can successfully start in Delta State. Just ensure that you choose a

very good location to setup your restaurant and bar. Although, you can setup your restaurant and bar in any part of Delta State, but it is more viable in places like Asaba, Warri, Agbor, Umunede, Ugheli and Abraka because of the number of visitors that troop to this towns on a regular basis. 4. Cinema/Viewing Centre Nigerians are known to be lovers of sports particularly football. An average football enthusiast has a foreign football club that they are supporting and are always eager to go

watch them whenever they are playing. So, if you love football and you are looking for a business to start, then you can consider starting your own football viewing centre. It is indeed a profitable business and you will definitely get good returns on your investment. If you are looking for a futuristic business to setup in Delta State, then you may think towards starting your own cinema. 5. Cleaning Service The services of cleaners are in high demand in Delta State; places like hospitals,

government facility, Airport, and business premises need the services of cleaners. So if you are looking for a business to start in Delta state, then you should consider starting your own cleaning service. You should not restrict your cleaning business to only corporate cleaning of facilities; you can as well add dry cleaning services. Just ensure that you position the business in such a way that it will be easier for you to attract clients that cut across all sectors of the economy of Delta state.

BUSINESS DAY

Tuesday 05 June 2018

Features Godwin Emefiele @4, emerging from the scars of a macroeconomic turbulence Godwin Emefiel, governor of the Central Bank of Nigeria (CBN) on June 4, marked his fourth year in office. It has been four years of trying to stabilize a turbulent macroeconomic environment, writes HOPE MOSES-ASHIKE.

mefiele became governor at a time when the country was running into a turbulent election which was reverberating on the economy. He assumed office on June 4, 2014, a few months before the 2015 presidential election. His appointment was announced in the midst of the storm created by the departure of Sanusi Lamido Sanusi, former governor who was suspended by President Goodluck Jonathan in February. It was also a period when the years of high oil prices was beginning to lose steam. He therefore assumed office with the immediate task of protecting a naira coming under pressure and ensuring macroeconomic stability amidst dwindling revenues. He summarised his plans to reposition the nation’s economy in a 10-point agenda, part of which was to pursue a gradual reduction in key interest rates, and include the unemployment rate in monetary policy decisions; maintain exchange rate stability and aggressively shore up foreign exchange reserves; strengthen riskbased supervision mechanism of Nigerian banks to ensure overall health and banking system stability; build sector-specific expertise in banking supervision to reflect loan concentration of the banking industry, among others. But then even before he settled in, the storm hit. There was an over 70 percent drop in the price of crude oil, which contributes the largest share of the country Foreign exchange earnings; global growth slowed down and geopolitical tensions along critical trading routes in the world; and normalization of Monetary Policy by the United States’ Federal Reserve. “On the management of the CBN, I score the Godwin Emefiele above average in view of the fact that unlike many of his predecessors, he surmounted a difficult

challenge of implementing monetary policy during a period characterized by stagflation, high inflation with negative growth in real GDP”, Uche Joe Uwaleke, professor of finance and Capital Markets/Chair, Banking and Finance department, Nasarawa State University, said. Faced with dwindling oil sales, the country saw depletion of FX Reserves, bottoming at about US$23.6 billion in October 2016 from as high as US$40 billion in January 2014. Inflation also started rising peaking at over 18 percent in January 2017, from as low as 9 percent in January 2016. Then there was depressed GDP growth, which culminated in a recession with five consecutive quarters of GDP contraction bottoming at -2.3 percent in the third quarter of 2017 having grown by nearly seven percent in previous years. Not surprisingly, unemployment rate started rising peaking at 18 percent ion fourth quarter of 2017. The banks also got hit as Non-Performing Loans (NPLs) deteriorated in line with the difficulties in the macro economy; and banking system exposure to foreign loans threatened to undermine their health. Emefiele was forced to respond to all these challenges with little help from the fiscal side as a new government struggled to understand the rudiments of governance and budget delays became the norm. With oil prices not looking to go up and economic diversification lagging, Emefiele had to adopt demand management strategies through the restriction of FX for imports of goods that can be produced in Nigeria and withdrawal of the de facto subsidy for the importation of 41 nonessential commodities with unfolding successes. The policy was vigorously criticised by stakeholders but has helped in reduction of import bills. From an average of about US$5.5 billion, Nigeria’s monthly import

Godwin Emefiel

bill has fallen consistently toUS$2.1 billion in 2016 and US$1.9 billion by half year 2017. The CBN under Emefiele’s administration embarked on a cycle of tightening to rein in inflation, with MPR hiked in July 2016 from 12 percent to the prevailing 14 percent. As regards exchange rate management, the CBN took a number of actions to stabilize the exchange rate amidst escalated pressures from speculators, bettors, round-trippers and rentseekers. The CBN encouraged increased FX inflows from remittances by licensing International Money Transfer Organizations (IMTOs), more FX sales into the

Interbank Market as well as establishment of the Investors-Exporters Window in April 2017. The introduction of the NAFEX and the Investors-Exporters FX Window increased the transparency of market and has helped stabilise the rates. Aimed at diversifying the economy away from over-dependence on oil revenues for financing the budget and source of FX inflows and consistent with the development agenda, the CBN under Emefiele continued its development finance activities. It came up with targeted interventions at specific high-impact sectors like agriculture, including introducing the Anchor Bor-

The growth in foreign reserves was not only as a result of the recovery in crude oil price and production but equally due to the innovative demand management strategies put in place by the CBN

rower Programme (ABP). The total amount of money disbursed under the Anchor Borrower’s Programme (ABP) in partnership with the state government and private sector group since the commencement of the programme, stood at N55.526 billion to over 250,000 farmers. Two years into the implementation of the Anchor Borrowers programme, the programme has contributed to the creation of an estimated 890,000 direct and 2.6 million indirect jobs. The result of these policies and interventions revealed that presently, there has been steady decline in inflation, rebound in oil prices and increase in production level, as well as the continued stability in the foreign exchange market. Cons equently, real Gross Domestic Product (GDP) for Q4 2017 was revised upwards from 1.92 percent to 2.11 per cent, while a growth of 1.95 per cent was recorded in the first quarter of 2018, up from a contraction of 0.91 per cent in the corresponding period of 2017, according to the National Bureau of Statistics (NBS). In his assessment of the performance of the CBN governor, Uwaleke said any objective assessment of the performance of the CBN Governor can only be done against the backdrop of the primary function of the CBN which is to maintain price stability. “In this regard, Godwin Emefiele’s tenure has been largely successful given the downward trend in inflation rate and relative stability in exchange rate”, he said. “The story of the country’s exit from recession cannot be complete without giving credit to the role played by the CBN in hastening the exit from a recession that many predicted would last longer than it did. The introduction of the Investors and Exporters window by the apex bank in April 2017 played a major part in improving liquidity in the forex market as well

as boosting investors’ confidence in the economy”. “The growth in the agricultural sector even during the period of economic recession is not unconnected with the CBN’s Anchor borrower programme which many agree is a success story. “Today, rice imports have dropped on the back of improved production in rice production. Generally speaking, the CBN’s interventions as part of its development function are helping to gradually diversify the economy away from oil”. According to him, the growth in foreign reserves was not only as a result of the recovery in crude oil price and production but equally due to the innovative demand management strategies put in place by the CBN under the leadership of Godwin Emefiele. The restriction of access to official forex with respect to 41 items helped to conserve scarce foreign exchange especially during the period of economic recession. It was also a boost to the import substitution strategy of the government as many products, including toothpicks, hitherto imported are now manufactured in the country. He said the tight monetary policy that has been in place for some time is responsible for the relative price stability the economy has enjoyed. The fact that the CBN Governor did not cave in to pressure to float the naira thereby leaving the fate of the local currency at the mercy of market forces, marks him out as a patriotic Nigerian. “My advice is that he should also begin to consider interventions in human capital development especially education and health as a complement to government’s efforts. Also, given that the capital market is the barometer for the economy, any intervention geared towards boosting liquidity in the capital market will help maintain financial system stability”, Uwaleke added.

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Tuesday 05 June 2018

Why Buhari has not signed the budget - Udoma TONY AILEMEN, Abuja

resident Muhammadu Buhari’s decision to carry out a thorough re v i e w o f t h e 2018 budget has led to the delay in signing the Appropriation Bill recently passed by the National Assembly. The National Assembly had raised the budget to N9,120,334,988,225 from the N8.6 trillion presented by President Buhari, showing an increase of N508 billion on May 10, 2018. Minister of budget and national planning, Udoma Udo Udoma, disclosed this to BusinessDay in an exclusive interview at the Presidential Villa after meeting with President Buhari on Monday. Buhari had on November 7, 2017 presented the N8.6 trillion “Budget of Consolidation” to a joint session of the National Assembly. According to Udoma, “The President is currently reviewing the budget and as you know, we have a minimum window of 30 days.” Pressed further on when

the budget would eventually be signed, Udoma said, “The President is currently reviewing it and as soon as he is through, he will sign it. That is what l can tell you for now.” After six months delay, the National Assembly finally passed the N9.120 trillion and fiscal deficit of N1.955 trillion or 1.73 percent to GDP. The amount represents an increase of N580 billion above the N8.612 trillion proposal submitted by President Buhari. The 2018 Appropriation Bill, the largest in the nation’s history, was premised on key revenue assumptions of oil price benchmark of $51 (an increase of $6 above the $45 proposed by the Presidency); but retains 2.3 million barrels per day and exchange rate of N305/$. Sectors regarded as critical - Power, Works and Housing, Defence as well as Transportation got the highest capital allocation of N1.090 trillion out of total sum of N2.873 trillion in the 2018 budget.

Jigawa records highest fertility rate in Nigeria - NBS BUNMI BAILEY

ut of the 36 states in Nigeria, Jigawa recorded the highest level of fertility rate in 2016, according to the latest demographic statistical bulletin data 2017 by the National Bureau of Statistics (NBS). BusinessDay analysis of the demographic data from the NBS shows Jigawa had the highest TFR (TotalFertilityRate)of8.5outof10, while Kano and Kebbi states had TFR of 7.7 each. Rivers State had the lowest TFR of 3.3, followed by Kogi at 3.7 and Lagos at 4.0. The TFR for Nigeria in 2016, according to the Multiple IndicatorClusterSurvey(MICS2016/17) report, was 5.8 compared with 5.7 in 2011 Fertility, as a demographic indicator, is the actual reproduction performance in a population based on the number of live birth that occurs in the population. It indicates the actual number of children born alive. “Northern states usually have the highest fertility rate in the

country. By tradition, once a girl sees her menstrual cycle the family or parents of the lady will just marry her out. They hardly use contraceptivesbecauseitisagainst theirIslamicbelieve,”Okechukwu Ekemezie, a gynaecologist with Dangote Oil Refinery, said. The use of contraceptives, which is a birth control method, is not encouraging in Nigeria; ranging from a high of 38 percent in the South West to a low of 3 percent in the North East. Contraceptive use in urban areas is three times that of rural areas. Also, contraceptives use is higher among people who are educated. Accordingtothedemographic report, 86.6 percent of Nigerian women who are currently marriedorinaunionarenotusingany contraceptive method to prevent unwanted pregnancy. It further shows that Ebonyi State had the highest 97.0 percent of women who are married and are not using any contraceptive methods to space their child, while Oyo State had the least 65.7 percent

L-R: Oscar Onyema, CEO, Nigerian Stock Exchange; Fatima Mohammed, executive director, Visionscape Sanitation Solutions, and John Irvine, CEO, Visionscape Sanitation Solutions, at the Visionscape sponsored FT Nigeria summit 2018 in Lagos

Plans to boost tourism potentials on under way Influence, leadership, international TONY AILEMEN, Abuja

ederal Government, Monday, said Nigeria’s music and movies industry and other tourism potentials, currently taking the world by storm, are set to further explode on strong government intervention and support. President Muhammadu Buhari disclosed this while speaking at the 61st meeting of the United Nations World Tourism Organisation (UNWTO) Commission for Africa (CAF) at Transcorp Hilton, Abuja, saying the world was yet see the best of the creative young talents in Nigeria. The tourism potentials remain limitless, coming from a robust population of over 180 million people, with over 250 ethnic groups, each with a unique story finding expression in movies, music and many other creative ideas. Speaking on the theme: “Tourism Statistics - A Catalyst for Development,” Buhari, represented by Secretary to the Government of the Federation (SGF), Boss Mustapha, listed efforts by government to boost the sector to include providing “Pioneer status to all major tourism projects; Minimum tariff on imported tourism equipment, amusement park equipment and materials for hotel construction and furnishing, dedicated transportation for tour operators and equipment for restaurants not manufactured in Nigeria.” He noted that government was committed to providing

public safety and security to all Nigerians, investors and tourists. “Government is also investing a lot of resources into building the inventory of equipment and capacity of security agencies to keep the country safe,” he said. Others include allowing minimum duty on Casino equipment; Work permit for foreign workers with specialised skills within the industry, and Land at concessionary rate by state governments to tourism investors. Government said it was also deepening the legislative and institutional capacities for the protection of intellectual property rights in Nigeria, which he said, “Will give all investors the assurance of security of their rights especially in the creative industry.” Buhari had noted that the meeting could not have come at a better time than now, considering the significance of Tourism Statistics and Tourism Satellite Account (TSA) in measuring the contribution of the tourism sector to the national economy. “The importance of tourism and its potentials to national economies cannot be overemphasised. “Tourism, as we all know, contributes to the wealth of nations and the well-being of citizens, largely through foreign exchange earnings, generation of revenue, creation of employment, knowledge, cultural integration as well as increase the GDP of the country.”

expansion mark Women in Business meeting

n Africa today, only 5 percent of CEOsrunninglargecompanies are women. Yet, the positive impact of women executives on a company’s financial performance has been proven: African companies with the most women on theirexecutivecommitteesachieve 20 percent higher profit margins than the average for their sector of activity. Following on the success of the AFRICA CEO FORUM’s “WomeninBusiness”initiative,the first Women in Business Annual Leadership Meeting, organised in partnership with ESSEC Business School and the International Organisation of La Francophonie, aimstotangiblystrengthenAfrican women leadership. Building and maintaining an influential network, how to manage your image and assert leadership in an era marked by social networksandsuccessfullygrowing a business internationally as the African Continental Free Trade Area comes into effect are some of the topics that were covered at the meeting. These were the themes developed during high-level panels, testimonialsfrominspiringwomenleadersandinteractiveworkshopsrunby expertsfromMcKinsey&Company andESSECBusinessSchool. Several Nigerian women business leaders have already confirmed their participation for the two-day event, such as: Toyin Sanni,CEO,UnitedCapital;Ibukun Awosika, chairman, FirstBank; Adebola Okunsanya, Country

Manager, Mercuria Energy; Helen Majemite, CEO, Oeetrot Concept; Aisha Babangida, founder, Africa 500 or Patricia Obozuwa, director, communications and public affairs, GE Africa. The Women in Business AnnualLeadershipMeetingwillclose with a session devoted to creating the first circles of influence for African women leaders. Each circle will be headed by a member of the “Women in Business” initiative board, which will also be introduced at the meeting. The board is made up of eight African women business leaders, who embody the continent’s success and are keen to play a role in strengthening African female leadership: Snowy Khoza, Executive Chairperson, BIGEN (South Africa), Elisabeth Medou Badang, Senior VP and spokesperson, Orange MEA (Cameroon), Cathia Lawson-Hall, Head of Financial Institutions for Africa, Société Générale (France), Lucy Quist, Co-Founder, Women Network, (Ghana),ToyinSanni,CEO,United Capital, (Nigeria), Anta Babacar Ngom, managing director, SEDIMA, (Senegal), Carole Kariuki, CEO, KEPSA, (Kenya) and Nadia Fettah, managing director, Saham Finances (Morocco). The board meets physically twice a year, at the Africa CEO Forum and the Women in Business Annual Leadership Meeting. The main role of its members is to use their experience and vision to initiate and guide the actions of the“WomeninBusiness”initiative.

EU won’t give up on EPA – new ambassador

… says Nigeria is EU’s biggest trade partner in Africa with 25.3bn trade in 2017 IGNATIUS CHUKWU

uropean Union (EU) says it will not give up on its effort to convince the Federal Government of NigeriatosignontotheEconomic Partnership Agreement (EPA) proposed by the EU to West African states. The immediate past EU ambassadortoNigeriaandECOWAS, Michel Arrion, had worked hard on the deal but departed Nigeria without breaking down the barri-

ers to the EPA proposition. Nigeria is said to be the only ECOWAS country yet to sign onto the proposed deal, which offers low or no export duty to partnercountries from West African into Europe, in return for giving EU countries increased access to the ECOWAS market. Some products are to be exempted in the deal to allow ECOWAS countries have monopoly in sensitive sectors. EU had proposed to help Nigeria meet its production quota in order to compete better under

EPA, but Nigerian manufacturers urged the government not to endorse the deal, saying the sweeteners were meant to hide inner poisons. The Federal Ministry of Trade had said in 2017 it was engaging in more consultations with various national groups to smoothen EPA’sroughedges,buttheEUfears that Nigeria may be left behind in a new deal with ECOWAS in gaining access to European markets at very low export duty fees. ThenewEUambassador,Ketil

Karlsen, said in Port Harcourt last week that the EU would not give up on getting Nigeria to join other ECOWAS countries to sign up on the trade deal. He spoke at the ‘Investors Lunch Network’ by the Rivers Entrepreneurs and Investors Forum (REIF) in conjunction with the EU, attended by the UK office in Nigeria. Industry and government leaders in attendance examined the idea of ‘Entrenching Purposeful Leadership for Rapid Economic Development.’ Issues

on de-risking the Rivers business climate were treated by a special panel. The diplomat said it was not true that it was healthy for Nigeria can stay behind when other ECOWAS countries or its competitors move on. The EU had at previous engagements with NigerianbusinessesinPortHarcourt warned that if other ECOWAS countries export into Europe at zero to 6 percent rate under EPA and Nigeria continues to export at about 12 percent rate, that Ni-

gerian products would be more expensive than its competitors. Also, the EU had promised under EPA to help ECOWAS countries produce international standardqualitygoodsthatwould pass EU tests. The implication is said to be that other producers in West Africa would produce higher quality goods and leave Nigeria behind. If this is added to the refusal of Nigeria to sign the Africa Union common market deal, it may mean that Nigeria be an isolated giant.

Tuesday 05 June 2018

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Reps, stakeholders ask Buhari, EFCC to re-open probe of Ajaokuta asset stripping … further spending after $8bn investment, a waste - minister KEHINDE AKINTOLA, Abuja

igeria’s House of Representatives and other stakeholders on Monday urged President Muhammadu Buhari and Economic and Financial Crimes Commission (EFCC) to revisit the probe of asset stripping at the Ajaokuta Steel Company Limited (ASCL). They gave the charge at the ongoing investigative public hearing into the comatose Ajaokuta Steel Company, where they urged President Buhari to jettison ill advises being given by sycophants, which had led to the prolonged delay in the completion of the complex. To this end, the lawmakers urged President Buhari to visit the complex with a view to take informed decision on the project, which has potential of achieving the country’s industrialisation plan. Speaking earlier, Natacha Akpoti, legal practitioner and social entrepreneur who frowned at the state of the complex, harped on the need to prosecute promoters of the

shell companies for economic sabotage. According to Akpoti, a serving governor and former son of late head of state were responsible for the lingering crisis bedevilling ASCL, just as she called for revisit of the bilateral agreements signed between Nigeria and Russia for defaulting in meeting the technology transfer. She stressed the need to hold somebody responsible for ‘organised crimes,’ by unravelling the owners of the shell companies for holding Nigeria to ransom. “Shockingly, it must be noted that ex-AGF Adoke memo mentioned in item 6. (a) that: ‘In light of the fact that a presidential committee had estimated damages payable to Global in the region of $525 million, the agreement of Global to wave its right to damages is a substantial achievement. “This singular statement goes a long way to prove that: It was not the International Arbitration Court in England that indicted Nigeria to $525 million but a presidential committee.

“That this committee was made up of Nigerian individuals and agencies. Nigerians would like to know: How the Presidential Committee arrived at indicting Nigeria against the foreigners to such a huge amount of $525 million when Inuwa Magaji’s report proves contrary,” Akpoti stated. In his presentation, Bawa Bwari, minister of state for mines and steel, confirmed that the N2 billion included in the 2017 budget for audit was part of the concessionning process, adding that between $500 million and $1 billion was expected to complete the project. In his remarks, Gbajabiamila reiterated the resolve of the House towards the industrialisation of Nigeria through a steel based socioeconomic and infrastructure development. “We all known that any country that has not migrated to the level of steel production development has not started as a true independent nation and that such national interest us the only religion that is pursued.

Edo links EDPA, MIXTA Africa’s $100m 1,800 housing-unit project with local manufacturers

do State governor, Godwin Obaseki, says the state will ensure that industries domiciled in the state will get the lion share of the $100 million to be spent on raw materials in the development of the 1,800 affordable housing units in Benin City by the Edo Development and Property Agency (EDPA) and real estate developer, MIXTA Africa. Obaseki gave the assurance during a working visit to Yongxing Steel Company at Utesi, in Ikpoba-Okha Local Government Area of the state, to inspect the quality of products being produced. According to Obaseki, “We have insisted that raw materials to be used for constructing the 1,800-unit housing project by EDPA and MIXTA Africa, should be sourced locally from industries in the state. This will assist the industries contribute to the growth of the local economy.” He expressed appreciation to the management of the company for sponsoring an investment forum held in China to attract investors to the state, where over 60

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Chinese companies and over 100 participants attended. “The state government organised the working visit to know how the company is operating and see how it can assist in strengthening the company’s operations. We will also see how we can create more markets for your products across the country,” he said. Managing director of Yongxing Steel Company, Zhang Xiang Iyaz, expressed appreciation to the governor for the working visit, noting that the company would continue to support the state government in its vision to drive industrial growth for the state. He explained that the company’s products which are sourced from scrap, are supplied to different parts of the country, where demand is high, noting, “In Utesi, where the company operates, we have different companies producing doors, glass, ceramics, steel and aluminium. We are here to provide quality service to the people and are counting on the state government’s support to get more patronage for our products.”

Anambra targets 613,000mt of rice annually EMMANUEL NDUKUBA, Awka

nambra State government has planned to produce 613,000 metric tons (mt) of rice annually from its agricultural investments. Governor Willie Obiano revealed this during a tour of JOSAN Giant Rice Mill in Umumbo in Ayamelum Council of the state on Monday. Obiano recalled that when he assumed office in 2014, total rice production in the state stood at 80,000mt per annum, but as of today Anambra was producing 302,000mt per annum. “We want to move to 613,000mt in the next three planting seasons. And to be able to achieve that, we must renovate the irrigation system in Omor also in Ayamelum Council Area, in partnership with the Federal Government,” he said. The governor said JOSAN Rice Mill in Umumbo had a capacity to produce 50,000mt of rice but that his administration had plans to beef up the production output of the mill to 100,000mt.

CIBN, AICPA sign MoU to enhance productivity in banking CHINWE AGBEZE

hartered Institute of Bankers of Nigeria (CIBN) has signed an agreement with the Association of International Certified Professional Accountants (AICPA) to upscale the skills sets of the workforce in banking to enhance productivity. Uche Olowu, president/ chairman of council, CIBN, said this during the official ceremony for the execution of collaboration agreement between both parties in Lagos recently. ‘‘We say we are going to collaborate with international best institutions for value and this memorandum of agreement is a combination of various discussions that happened and today we are formalising it. ‘‘This is important for us because our members will leverage on the opportunity that this organisation is about the foremost professional accounting body globally. So, giving our members that leverage is our dream and we are quite excited that it has come to fruition today,” Olowu said. According to Olowu, this means that bankers can now get qualifications that will further enhance their ability to practice a profession that they are in. ‘‘For us, this is one of the best things that can happen to the institute and we will continue to see that we make sure that we collaborate with more strategic institutions that will drive value to our members within and outside their working career,’’ he said. ‘‘This is just a tip of the iceberg of what people should expect because we believe in quality. We are going to get the best institutions to collaborate with us because better equipped

skill force will enhance productivity in banking and by extension, the economy.’’ He also spoke about his fivepoint agenda and focus in the next two years. ‘‘We are guided by our act and our act directs that every person seeking to work in the banking industry must come under the umbrella of chartered institute of bankers. It’s true they have signed code of conduct but for me, I believe that you cannot be covered under that umbrella if you are not a member and so, we still have pockets of bank workers that have not officially registered,’’ he said. ‘‘We want to bring everybody under that umbrella and for us; we have said that for corporate organisations, the law of the land must be respected. Our act is an act of parliament. Therefore, we will pursue with every inch of our strength to make sure that rules, standards, ethics and governance issues are respected.’’ Continuing, he said, ‘‘Up scaling the skills and competences of our members is very critical for us. A knowledgeable workforce drives for productivity. We must not miss this revolution in the fourth revolution that is coming on which is driven by technology. We also have to equip our members with the right skills to intervene in their workplace. ‘‘Advocacy is critical but we have to follow this advocacy through research and insights into facts and evidence base interventions. We are going to intervene properly in terms of the budgeting process of the government, economic policies and collaborate with our various partners; stakeholders’ engagement occupies a critical place for us.’’

L-R: Festus Akinola, MDS Logistics; Kunle Malomo, CEO, Great Place To Work, presenting award to Taiwo Aiibola, MDS Logistics managing director; Mojisola Bakare, and John Gradidge, during Great Place To Work 5th Award 2018 in Lagos.

Reforms in basic education, health, agricultural will drive job creation - Obaseki

overnor of Edo State, Godwin Obaseki, says ongoing reforms in basic education, health and agricultural sectors will create more jobs and wealth for youths in the state. Obaseki said this when he visited the chairman of the All Progressives Congress (APC) in Etsako West Local Government Area, Edo State, Akokhia Abubakar. According to Obaseki, “Reforms in basic education, health and agricultural sectors will continue to attract investors to the state. This

will, in turn, create more job opportunities for youths. We are working with investors to revive the Agbede Farm, which will create jobs for our people.” The governor added that the state government would continue to embark on reforms that will make life more meaningful for the people, especially youths and discourage them from embarking on illegal migration or become prey for human traffickers. He said the state would not relent in the fight against human trafficking which caused

the illegal migration of at least 10,000 persons from the state, in the past one year. The governor, who also visited Usman Shaghadi, a state leader of the APC, and lauded Shaghadi for his contributions to the growth and stability in the state chapter of the APC. He noted, “We appreciate your contributions to the growth of the party, especially the role you played during the local government elections and the state congress, which has been adjudged peaceful by independent observers.” The APC chairman, Et-

sako West Local Government Area, Abubakar, expressed appreciation to the governor for the visit, and assured that the people in the local government area will continue to support his reforms to make the state better for all. Similarly, Shaghadi commended the governor for the peace being enjoyed in the state, adding, “security has greatly improved in Edo State. We appreciate your effort, approach to handling security issues and your style of leadership, which has improved security across the state.”

BUSINESS DAY

STRATEGYBRIEFING

Tuesday 05 June 2018

IDEAS THAT POWER HIGH PERFORMANCE

The strategy and execution gap

Closing the gap that breeds corporate mediocrity

tatistics available from statista. com indicates that advertising spending in Nigeria in 2017 amounted to US$618.06 million and is expected to increase in 2018. That’s a lot of money. This spending only represents a part of what companies spend on their sales effort. Borrowing from the words of Mark Twain, ‘put all your eggs in one basket, then watch that basket’. Meaning if you are going to spend that much money on sales, then you better take your sales very seriously. Unfortunately business executives don’t seem to do this. Research indicates that sales is, by far, the most expensive part of strategy execution in many companies. Yet, on average, companies deliver only 50% to 60% of the financial performance that their strategies and sales forecasts have promised. And more than half of senior executives (56%) say that their biggest challenge is ensuring that their daily decisions about strategy and resource allocation are in alignment with their companies’ strategies. That’s a lot of wasted money and effort. This limits growth, impedes superior performance and therefore a case of serious concern. What this mean is that the decisions,

behaviours, allocation of time and other resources at many companies cannot enable them follow in the strategic direction they have determined. So even though a company may have committed resources to the development of a strategy, it cannot translate into a superior performance. The reason for this is not difficult to find. Strategy is still generally misunderstood by many executives. Of those that understand, misconceptions about strategy shuts them out of strategic effectiveness. For example an assessment by GrowthPlay, a sales focused consulting firm among senior executives and sales professionals indicates the problem stems from gaps between the perceptions, attitudes, and information flows between executives and sales reps. The results from the assessment shows that executives have a high level of understanding of their companies’ strategic priorities, while sales professionals usually not involved in the crafting of their company strategy did not demonstrate the same understanding. Senior leaders have a better relative understanding of the company’s direction than sale reps, but are concerned that they lack the right sales processes and people to executive the strategy.

On their own, sales processionals are confident in their abilities to produce results but admit they have little understanding of the strategic direction, and its implications for their behavior. When sales professionals lack the understanding of their companies strategic direction, they more efficient at their routines, even when these same routines keep the firm, and its top team, from gaining experience with procedures more relevant to changing market conditions. Why does this happen? Why are the front line sales professionals and senior executives in such disalignment even at the expense of superior performance? Well to begin with many companies don’t even have a strategy even though think they do. They have mission statements, they have shared values, they have particular intentions they want to pursue like internationalizing but for them any of these might be the strategy. Unfortunately none of that constitutes a strategy. If there is no strategy how can senior executives communicate something that does not exist? Strategy is a company’s unique approach to competition and the competitive advantages on which it will be based. Its not a particular action, its holistic and cuts across all the functions.

Another issues and its a pretty one is that most senior executives are scared that communicating their strategy will expose them to strategy theft. But come to think about it, such executives should understand that they stand a more serious problem than strategy theft. You see strategy is useless without execution. Preserving your strategy so that your competitors don’t know about it and at the same time shutting your people out means it will not be executed and that means you will at best play along others as a corporate mediocre. How often have you read about the strategy of Google, Apple, Bulberry and Nike? For example it took US car manufacturers many years to get good atToyota’s lean manufacturing methods,even though Toyota willingly

gave factory tours to it’s rival executives. More recently,traditional companies continue to struggle to adopt the digitally powered methods of online leaders like Amazon.com and Google,although the outlines of these methods are well known. What does it show? Communicating your strategy doesn’t compromise your position if you really have a strategy (read my article on ‘Nigerian companies rarely have a. strategy’) In a world with a global infrastructure of consulting firms and others paid to disseminate corporate information, confidentiality as a reason for not communicating strategy is myopic and a pathway to failure. Your people cannot execute what they don’t understand. This gap is the reason most companies only struggle along.

Brian Reuben(@brianoreuben) is an advisor on strategy and leadership. He regularly conducts keynote presentations and senior executive workshops with companies around the world on strategy and leadership. He heads BusinessDay Training Was this article helpful? Share your thoughts with us on Facebook @bdtraininglive or email us on trainings@businessdayonline.com

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Tuesday 05 June 2018

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CBN okays wider profit margin for BDCs … offers $100m to wholesale segment … invisibles, SMEs windows get $55 m each Hope Moses-Ashike

he Central Bank of Nig er ia (CBN ) has approved an upward review of the trading margin available to operators of Bureau De Change (BDC) in the country. Consequently, BDC operators are now to buy the United States dollar from the CBN at the rate of N357/$1 and sell at N360, thereby leaving them with a positive margin of N3.00 per dollar sold. Confirming this to newsmen on Monday, in Abuja, the Acting Director, Corporate Communications Department, at the Bank, Isaac Okorafor, said the decision was aimed at giving

BDCs a level playing field to enable them compete favourably with other authorized foreign exchange dealers. Okorafor therefore urged BDC operators to abide by the new guidelines and not seek to exploit eager customers by selling above the N360 band, just as he warned that erring BDCs will be sanctioned in any case of infraction established against them. It will be recalled that the CBN, in March 2017, had released a Forex policy, under which it directed licensed BDCs in the country to purchase forex from it at the rate of N360 to a dollar, while selling same to customers at no more than N362/$1. At the time of the directive in

2017, the aim of the Bank was to achieve convergence between the rates in the inter-bank window and that of the BDCs. With the rates in both windows now virtually converged, the objective of the Bank is to ensure a level playing field and sustain the level of liquidity in the forex market. Meanwhile, the CBN in its first sale of the month, on Monday, June 4, 2018, offered the sum of $100 million to dealers in the wholesale segment of the market to meet the requests of customers. Similarly, the Bank sold the sum of $55 million each to customers in the Small and Medium Enterprises (SMEs) window as well as those in the invisibles segment.

L-R: Segun Ogunsanya, MD/CEO, Airtel Nigeria; Adebayo Shittu, minister for communications technology; Chukwuemeka Ujani, deputy chairman, House Committee on Communications, his wife Nonyelem Ujani, and Ibironke Kazeem, representing wife of Lagos State governor, during the premiere of Airtel Touching Lives Season 4 in Lagos.

AITEO denies sponsoring Offa bank robbery: Police makes U-turn... Continued from page 4 Federation, Abubakar Malami Niger Delta protest... Continued from page 1

we have NOT instigated them to participate in any protest, we believe the object of their complaint about the persistence of illegal bunkering remains germane. All hands must be on deck to diminish and extinguish the theft of oil across the NCTL and other such national facilities and its attendant implications.” “Aiteo did not “mastermind” any of the protests by Niger Delta communities. As a socially responsible organisation, we understand that the community bears the brunt of illegal bunkering and refining activities. Indigenes of these communities remain morally and legally free to exercise their constitutionally guaranteed civic rights to peacefully protest against ills in their community till their voices are heard and desired remedial or corrective actions are taken. Aiteo utilizes this opportunity to reiterate its long-standing commitment to due process and international best practices in the discharge of every aspect of its statutory mandate.

I plan to do,” Saraki revealed. The announcement comes minutes after Vice President Yemi Osinbajo met behind closed-doors with Saraki and police chief, Ibrahim Idris, as well as the head of State Security Service, Lawal Daura, at the State House. It also comes about four hours after Saraki announced he was yet to get a police invite. The Senate president had earlier he said he dispatched his security details to the Force Headquarters in Abuja to ask the police for an invite which was not responded to. The police had said on Sunday that some of the suspects in the Offa bank robbery confessed to being sponsored by the Senate president. Meanwhile Vice President Yemi Osinbajo Monday, held meetings with heads of security agencies including InspectorGeneral of Police, Ibrahim Idris; the Attorney-General of the

and the Director-General of the Department of State Security, Lawal Daura, for over an hour. The meeting came on the heels of the police invitation extended to Senate President Bukola Saraki, over alleged link with Offa robbery suspects. President Muhammadu Buhari had earlier met with the service chiefs and heads of other security agencies. The IGP refused to speak with State House correspondents after the meeting with Osinbajo, but instead referred them to the Vice President’s Aide de Camp (ADC). The meeting held behind closed-doors at the Vice President’s wing of the Aso Rock Presidential Villa in Abuja. The meeting according to a Presidency source was said to be convened over the summons given to Senate President Bukola Saraki by the police over his alleged relationship with suspects arrested following the April 5 bank robbery in Offa, Kwara State.

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APC Convention Committee lobbies... Continued from page 1

paid a courtesy visit to some notable members of the new People’s Democratic Party (nPDP) caucus ahead of the Congress slated for 23rd June, 2018. The first meeting was held with Speaker Yakubu Dogara at the National Assembly. Badru who was accompanied by former Senate President, Ken Nnamani; Pauline Fallen, former Deputy Governor of Plateau State; and Ismaila Kawu, Special Adviser to the President on National Assembly Matters (Reps) met behind closed doors. Badru and Speaker Dogara at the end of the meeting however kept mute on the issues discussed. One of principal officers who attended the closed door meeting which lasted for over an hour, informed BusinessDay that the issue of withdrawal of Department of State Security (DSS) operatives from some principal officers of the National Assembly was also discussed at the meeting. According to him, no reason was adduced for the withdrawal of the security aides. He however decline further comment on the issue bothering on the resolution of the nPDP members. BusinessDay observed that the police operatives attached to the Speaker were also withdrawn. Recall that the DSS authorities had ordered the withdrawal of operatives deployed to Speaker Dogara and his deputy, Yussuff Lasun; Senate President Bukola Saraki and his deputy, Ike Ekweremadu on Sunday. Meanwhile, Abubakar Kawu Baraje, nPDP chairman has accused President Muhammadu Buhari of frustrating the ongoing reconciliatory dialogue. Baraje who said this via a statement seen by BusinessDay, frowned at the withdrawal of the security operatives attached to the National Assembly principal officers. Baraje in the statement said: “the public may recall that there have been ongoing talks between members of the former nPDP, the APC and the Presidency in recent days. “Nigerians may further recall that a team from the former nPDP led by Speaker of the House of Representatives, His Excellency Rt. Hon. Yakubu Dogara and four others, were to meet with the Vice President, His Excellency Prof Yemi Osinbajo today.

“However, while we are truly and earnestly committed to achieving reconciliation, harmony, truce and cohesion in the APC as we approach the 2019 general elections, it is appears that the Presidency is not interested in the talks and that they may have been negotiating in bad faith. “We were alarmed that immediately after our meeting with the Vice President last week, the presidency misrepresented what transpired at the meeting by trying to blackmail some of the principal actors involved in the discussions in a national daily. “Similarly, the leadership of the party (APC) went ahead to ratify all the Congresses from ward, local governments, states and zonal where many of our members have complaints, effectively presenting us with a fait accompli. “The persecution of our members using state security apparatus have continued unabated. We recognize the powers of the Police to conduct criminal investigations but by rushing to the public with the issue even when they have unfettered access to the leadership of the National Assembly suggests an attempt to undermine, caricature and humiliate the institution of the legislature. “It appears that there is a fouled and toxic atmosphere and environment of intimidation and threat to life in which we now find ourselves which may no longer be conducive for members of the former nPDP to continue with the talks. Given the unfolding events in the last 24 hours, where the President of the Senate, His Excellency, Abubakar Bukola Saraki and His Excellency, Alhaji Abdulfatah Ahmed, the Executive Governor of Kwara State, both of whom attended the meeting with the Vice President on Monday 28 May, 2018, have suddenly been accused of sponsoring armed robbery by the Police under the directives of the Presidency. “Similarly, on Saturday, June 2nd, 2018, the Department of State of Services (DSS) also suddenly withdrew more than half of all the security details attached to the presiding officers of the National Assembly under questionable circumstances. “The nPDP leadership has decided to brief our members on the unfortunate development and get a fresh mandate if good faith returns to the discussions,” Baraje said in the statement.

Emiefele’s policy headache isn’t getting... Continued from page 1

general elections. That’s a risk too expensive for the Central Bank Governor to take as the net outcome of this policy seems to be negative. Rising oil prices have helped to raise Nigeria’s external reserve to almost $50bn. This puts the country at a better financial position to handle the Great Exit after either the devaluation, the interest rate drop or both occur. Sometimes the best thing to do when every action seems dangerous is to do nothing and that is the decision the Central Bank has taken in all the

MPC meetings this year. As the US Federal Reserve Bank continues to aggressively raise interest rates, the risk of large capital outflows moving from emerging markets back to America will continue to materialize. Emerging markets and frontier economies may be forced to adopt a contractionary Monetary policy to protect their currencies during this period. Although, it is unlikely that Nigeria will adopt a tighter monetary policy stance to protect the Naira, maintaining the current contractionary policy seems like the best decision today.

BUSINESS DAY

Harvard Business Review TALKING POINTS Women Say They’re Ignored in Science and Tech 82%: According to research from the Center for Talent Innovation, 82% of women working in the science, technology, engineering and math fields say that their contributions are ignored. + Productivity Does Not Always Translate to Management Success 1 out of 4: Research shows that when someone is promoted to a management position based on his exceptional productivity, chances are that 1 out of 4 times he will turn out to be a less effective leader. + Sleep Might Make You Learn Faster 50%: According to a study published in Psychological Science, a good night of sleep can reduce the time it takes to practice information retention by 50%. + AI Spending Among Businesses Will Continue to Soar $100 billion: Constellation Research has found that spending on artificial intelligence technologies across all business sectors will reach $100 billion per year by 2025. + Ford Is Looking to the Future $50 million: In 2016, Ford purchased startup mobility service Chariot for about $50 million.

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Tuesday 05 June 2018

Tips & Talking Points Don’t let political discussions distract your team from their work

With our 24/7 news cycle, it’s inevitable that political topics will come up at the office. As a manager, how can you make sure these conversations don’t distract your team? Think about what kinds of situations and topics might trigger a sharp exchange among employees. Do your best to avoid anything that might ignite a partisan debate, but have a plan to handle conflict if it happens. When tensions do flare up, talk individually to the people involved, and listen to their points of view. Then ask them to put aside their disagreements and focus

Help your employees embrace a new office space

on the shared goal of helping the team succeed. Of course, if a political discussion is relevant to solving a business question, go for it — but proceed cautiously, monitor the discussion’s mood and restore balance when needed. Above all, be an example for your team by respecting diverse political views.

Many organizations are moving to open office plans in the hopes of encouraging collaboration, creativity and innovation. Sometimes it works, but often it doesn’t — and whether your open office plan is successful has as much to do with how people feel about the space as with the space itself. Leaders can help employees embrace a new office by doing several things. Before the move, convey the vision and purpose for the new space and explain how it aligns with company goals. Clearly (and truthfully) describe how the new space will contribute to the organization’s mission. After the move, model a positive and enthusiastic attitude about the new space. Your support and excitement will set the tone for the rest of the team. And encourage workers to adapt the space to their needs — give them the leeway to personalize it to their tastes and work styles. This will help people claim the space as their own.

(Adapted from “My Office Is Full of Both Conservatives and Liberals. Here’s How I Keep Us Focused on Work,” by Karen Firestone.)

(Adapted from “How to Make Sure People Won’t Hate Your New Open Office Plan,” by Brandi Pearce and Pamela Hinds.)

When a colleague sends you a snarky 4 steps to get approval for email, talk to them in person your next innovation project

To understand how you’re perceived at work, ask your colleagues

Email can be an efficient, convenient way to communicate with coworkers, but too often people hide behind it to avoid or deflect conflict. When someone sends you an email that’s argumentative, or that’s even a passive-aggressive attack, don’t respond in kind (especially if that’s what you feel like doing). Instead, reply and ask to schedule a call. Send a text message if the issue is time-sensitive: “Got your email, let’s talk. Would 2 p.m. work for you?” It’s even better to talk to the person face-to-face if you can. Diffuse the negative tone by stating up front that there seems to be a problem and

It’s not easy to understand how other people perceive us. Too often, we assume that our motivations and intentions are clear, when they’re really not. To learn how you’re perceived at work, follow this process. Select five people who observe you regularly in important work situations — bosses, executives, direct reports, peers or even former colleagues — and ask to meet with them individually. Tell them what you’re hoping to learn, and ask two questions: What is the general perception of me? What could I do differently that would have the greatest impact on my success? Be clear that you’ll keep confidential whatever they say and that you’re collecting feedback from a number of colleagues. Look for themes and points that

you’d like to solve it together. As you try to find out what’s behind the snarky email, stay calm and avoid making judgments. Clearly, something is bothering your co-worker, so show them that you’re on the same side and willing to listen to what he has to say.

(Adapted from “When an Email Exchange Turns Ugly,” by David Maxfield.)

Everyone wants innovation in their company, but getting a new idea implemented can be a challenge, especially when office politics are in play. When you’re trying to get approval for your latest innovation, follow these four steps. First, anticipate resistance. If you know what people might object to, you can plan how you’ll address those concerns. Second, understand what objections are truly about. For example, someone might say they object because of a publicly acceptable reason — say, the project is too costly — when their

real concern is political, like they’re afraid their team will lose influence. Third, find a champion for the project. This should be a senior executive whose clout and expertise can help you move the project forward. And fourth, gather a critical mass of supporters. If you have a group of people who believe in the innovation enough to try it, you’ll have social proof that the idea is a good one. (Adapted from “How to Navigate the Politics of an Innovation Project,” by Brian Uzzi.)

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

multiple people agree on. If the perceptions of you are in line with what you intend, great. If not, it’s time to change your behaviors and begin to shift people’s perceptions of you.

(Adapted from “How Are You Perceived at Work? Here’s an Exercise to Find Out,” by Kristi Hedges.)

Tuesday 05 June 2018

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BUSINESS DAY

Live @ The Stock Exchange Top Gainers/Losers as at Monday Wednesday 04 2018 GAINERS Company NB

Market Statistics as at Monday 04 June 2018

LOSERS Opening

Closing

Change

Company

Opening

Closing

Change

PRESCO

N75

N71.25

-3.75

INTBREW

N40.2

N39

-1.2

N21.85

N20.8

-1.05

ASI (Points)

36,947.10

N103

N106

GUARANTY

N38.65

N40.4

1.75

MOBIL

N164.5

N166

1.5

N25.5

N26

0.5

CADBURY

N12.5

N11.5

-1

VALUE (N billion)

N35.15

N35.5

0.35

FLOURMILL

N31.1

N30.1

-1

MARKET CAP (N Trn

ZENITHBANK FO

NSE ASI halts downtrend as investors position for short-term gains … DMO issues Savings Bonds at 10.344%, 11.344% coupon rates Stories by Iheanyi Nwachukwu

igerian stocks on Monday June 4, 2018 stopped a record loss path as investors moved to Custom Street in search of shortterm gains. Investors showed interest in largely capitalised stocks like Nigerian Breweries Plc, Guaranty Trust Bank Plc, 11 Plc (Mobil Oil Nigeria Plc), Zenith Bank Plc, and Forte Oil Plc. Lagos-based United Capital analysts had in their June 4 investment view for this week said they expect equity investors to hunt for bargains. Nigerian stocks lost about N900billion last week triggered by profit-taking after the January surge. Analysts said the turn in sentiment was sustained by the early onset of political jitters ahead of the February 2019 Elections and possible capital reversal as a result of monetary policy tightening in the United States. The Nigerian Stock Exchange (NSE) All Share Index (ASI) and market capitalisation which stood at 36,816.29 points and N13.33trillion respectively on Friday June 1, 2018 closed Monday June 4, 2018 at 36,947.10 points

and N13.383trillion. While the NSEASI increased by 0.36percent, the market cap increased by N53billion. Stock traders in 6,016 deals exchanged 314,428,748 units valued at N7.033billion. GTBank Plc, Sovereign Trust Insurance Plc, FBN Holdings Plc, Diamond Bank Plc, and Zenith Bank Plc were actively traded stocks on the Bourse. Twenty-one (21) stocks gained as against 21 losers even as the stock market year-to-date (YtD) return remains negative at 3.39percent. Nigerian Breweries Plc

or 0.91percent. Presco Plc stock price declined most by N3.75 or 5percent, from N75 to N71.25, followed by International Breweries Plc which lost N1.2 or 2.99percent, from N40.2 to N39; and PZ Cussons Nigeria Plc which also dipped from N21.85 to N20.8, recording a loss of N1.05 or 4.81percent. For investors in bond market, the Federal Government of Nigeria (FGN) Savings Bond offer for June opened on Monday the 4th of June 2018 and it will remain open for five days till the 8th of June 2018.

stock recorded the biggest advance, from N103 to N106, gaining N3 or 2.91percent; followed by GTBank Plc which gained N1.75 or 4.53percent, from N38.65 to N40.4; while 11 Plc stock price rose from N164.5 to N166, adding N1.5

The Debt Management Office (DMO) is offering the 2-Year FGN Savings Bond due June 13, 2020 at 10.344 percent coupon rate; while 3-Year FGN Savings Bond due June 13, 2021 is offered at 11.344percent coupon rate.

DEALS (Numbers)

6,016.00

VOLUME (Numbers)

314,428,748.00 7.033 13.383

FCMB wins big at Great Place to Work in Africa 2018 awards

irst City Monument Bank (FCMB) has received positive affirmation and rewards in Africa for consistently enhancing human capital development and welfare among its workforce. The Bank got two top awards at the 5th edition of the Best Companies to Work For 2018 Africa Awards organised by the Great Place to Work Institute (GPTW) held in Lagos on May 31, 2018. The awards are, ‘’Best Workplace for Females in Africa’’ and ‘’Second Best Company to Work For in Africa’’, both in the large corporates category. In addition, the Bank was presented with a certificate to further attest to its recognition as a Great Place to Work. The awards are in recognition of FCMB’s achievements in creating an enabling environment where employees can pursue their career goals and thrive. GPTW Institute is a global research firm that assesses companies, based on a trust index survey (employees’ opinion about the workplace) and culture audit (management policies and practices), with the overall objective to promote excellence in the work place. The Institute which produces the Fortune 100 Best Companies to Work For list and other top employer rankings, operates

in 50 countries, including Nigeria. For the award of ‘’Best Workplace for Women’’, GPTW institute took particular note of the various empowerments and other support programmes of FCMB Women in the areas of orphanages, girl child education, the less privileged, especially widows as well as the increased female representation in key management roles in the financial institution. For the award of ‘’Second Best Company to Work For in Africa’’, the Institute considered FCMB’s commitment over the years in championing and executing initiatives that balance the needs of its diverse workforce in key human welfare and career development areas. Among these are, career management through a self-service career portal, mentoring programmes,

talent development programmes, professional development opportunities, good medical support, employee health week providing nutrition advice, free health checks at branches, telephone counselling services for personal issues, and policies/benefits to reduce the financial burden on expectant and nursing mothers, newly married employees, bereaved employees and children education grants for long serving employees. By creating an inclusive, respectful and highperformance culture, which makes everyone feel valued. Commenting on the awards, Adam Nuru, Managing Director of FCMB said “that, the Bank would continue to provide the right environment and initiatives, anchored on fairness, respect, camaraderie and credibility that would enable its workforce to confidently pursue their career goals. Also speaking at the awards presentation ceremony, the Senior Vice President and Divisional Head, Corporate Services, FCMB, Felicia Obozuwa, described the awards as big milestones in the journey of the Bank to bring its mission to attain the highest levels of customer advocacy, be a great place to work and deliver superior and sustainable returns to its shareholders to life.

their shares on The Exchange: “Current information about mutual fund in America and Europe that are giving five percent Return On Investment (ROI) is attractive to foreign portfolio investors and they are offloading shares to take advantage of the investment opportunity. They are more comfortable with the new returns on mutual funds. “The good news is that we are having good valuations. Investors should buy on long term basis and not short term said

Adekoje. Corroborating him, Ezeagu explained that nothing was wrong with The Exchange in terms of governance structure, technology and compliance with the rules and regulations by Stockbrokers. According to him, the quoted companies are not doing badly, given the general lull in the economy and the fact that we cannot rule out the usual fear of election. He noted that these factors could elicit massive safe of shares, especially by foreign investors.

Adam Nuru

CIS, ASHON assure nervous equity investors

orried by the spate of downward movement of share prices on the Nigerian Stock Exchange (NSE) in recent time, the Chartered Institute of Stockbrokers (CIS) and Association of Stockbroking Houses of Nigeria (ASHON) have assured nervous investors of safety of their investment. In what seemed to have followed the trading proverb; “Sell in May and go away”, the Nigerian stock market reversed all the gains made in 2018 following over N900billion loss

they booked in the trading week ended June 1, 2018. Adedapo Adekoje president CIS and Patrick Ezeagu, chairman ASHON explained that performance of listed companies on the Nigerian Stock Exchange were good but the current downswing was the effect of general lull in the economy and other exogenous factors prompting both domestic and foreign investors to convert their shares to cash. The market’s major performance indicators, the All-Share Index

and market capitalization have been on downward swing in the last two weeks, sending panic to

Adedapo Adekoje, president, Council of the Chartered Institute of Stockbrokers

domestic investors. The duo noted that the market remained undervalued; hence, investors have greater chances of higher returns when the situation becomes more stable. Adekoje who was elected the CIS’ President recently noted that market fundamentals remained strong attributed the bearish trend to panic sales by foreign portfolio investors who are taking advantage of emerging higher returns on mutual funds in the United States and Europe, leading to massive sale of

Tuesday 05 June 2018

BUSINESS DAY

Politics & Policy

BUSINESS DAY

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PDP accuses APC of turning Ekiti to war zone OWEDE AGBAJILEKE, Abuja

head of next month’s governorship election in Ekiti State, the People’s Democratic Party (PDP) has accused the All Progressives Congress (APC) of turning the state into a war zone. PDP National Chairman, Uche Secondus, made the allegation on Monday at the inauguration of the Ekiti State Campaign Council in Abuja. Specifically, it alleged that the APC was training a special killer squad to kill opponents and disperse rallies organised by the PDP. The governorship election is scheduled for July 4. Recall that last week; a governorship aspirant under the platform of APC, Michael Opeyemi Bamidele was shut by a policeman at the campaign rally of the party’s standard bearer, Kayode Fayemi. Speaking at the inauguration, Secondus said: “The motive of these deliberate police state being established by the ruling party is obvious; to distract and disorganise the opponent to enable them hold on to power and establish on party state”. Secondus stated that the heightened heat in the polity was unnecessary if the APC administration is willing to face the electorate, but regretted that the party is resorting

Bukola Saraki

to devious means to undermine the democratic process. His said “The signs are there for all to see that the attitude of the ruling party is that of a drowning man desperate to survive and whose posture is ‘if I cannot make it let me go down with others’. “Information available to us shows that in Ekiti, they are trying to use all skillful underhand means to achieve goals but the people are well charged to not only come out to cast their votes on July 14 but that they are ready to defend it.

Oyegun warns Lagos, Oyo, Rivers, Delta, Taraba states APC chairmen from assuming duties JAMES KWEN, Abuja

ational Chairman of the All Progressives Congress, (APC) John Oyegun, has warned the newly inaugurated Lagos, Oyo, Rivers, Delta and Taraba states Chairmen of the party not to commence any official duties. Oyegun said the States chairmen have to wait until the outcome of the panel headed by the APC Deputy National Chairman North, Lawal Shuaibu saddled with the responsibility of investigating the issues associated with their elections. The APC National Chairman who stated this while inaugurating the 36 states and FCT chairmen of the Party at its National Secretariat, Abuja, while urging others states without issues to immediately inaugurate their State and Local Government Executives members preparatory to the National Convention. “There is serious need for quick reconciliation especially in Rivers, Taraba, Oyo, Delta, Lagos and others. Let the chairmen there wait and should not inaugurate their EXCOS like the others until the issues with the Congresses in such

states are resolved. “I am going to set up a committee headed by the Deputy National Chairman North to study the situations in such states for possible actions. There will be concessions and harmonization after the exercise within a week, Oyegun stated. He reminded the party state chairmen that they have the onerous task of maturing APC, working hard to return the party to its lost glory and making sure they work hard for the re-election of President Muhammadu Buhari. Oyegun also urged them to tell their people about the great achievements recorded by the APC government as the government is on the right course, saying, a firm foundation has been laid for the development of Nigeria and in spite of lean resources, APC has achieved much more in three years. “G et acquainted w ith the achievements put together in a document which I will make available to you. Tell Nigerians the achievements of your government. In infrastructure; a lot of roads have been constructed, agriculture; much rice is produced, transport, rail is there and power we now have 7000 megawatts”, Oyegun stressed.

“At this juncture, let me warn that if there is any attempt to thwart the will of the people in Ekiti state, there may be no general election and the entire democratic process will be in endangered”. He reminded the ruling party of the negative consequences of obstructing the will of the people expressed through the ballot box. Chairman of the committee and Governor of Akwa Ibom State, Udom Emmanuel said PDP would win Ekiti State because of the achievements of the incumbent governor, Ayodele Fayose.

Tuesday 05 June 2018

Police invitation: Coalition urges Buhari to call IGP to order SIKIRAT SHEHU, Ilorin

resident Muhammadu Buhari has been urged to urgently call the Inspector General of Police to order so as to allow the country’s hard earned democracy to blossom. The people of Offa in Kwara State, the scene of the bloody armed robbery attacks of April 5, this year, however, said that they did not agree that the Senate President, Abubakar Bukola Saraki, had anything to do with the incident. The coalition of Kwara youths under the aegis of Kwara Agenda, also asked the federal government and the Nigeria Police to stop politicising the Offa robbery incident. Similarly, elders of Ajikobi Central Ward in the Ilorin West local government area of the state, where Saraki hails from said that they received with shock the invitation of the Senate President by the police in respect of the unfortunate Offa armed robbery attack. High Chief Bayo Akinola, who addressed newsmen in Offa yesterday on behalf of Olofa, Oba Mufutau Gbadamosi Esuwoye II, said that the community had left “what has happened to God, but we don’t want the innocent to be punished. We want police to go after the real culprits”. High Chief Akinola’s view was corroborated by the national General Secretary of Offa Descendants Union (ODU), Chief Atinuke Wosilat McCarty. The elders of Ajikobi Central, in a statement signed by their coordinator, Salihu AbdulWahab Agbaji, said that,

“ it is illogical and unthinkable that the Senate President and the political leader of Kwara State will ask bandits to kill the citizens that he leads. “’The plot against our son is as a result of his growing popularity across the country, a situation which is making some of his political rivals uncomfortable. We urge President Muhammadu Buhari to urgently call the Inspector General of Police to order so as to allow our hard earned democracy to blossom.” Members of the coalition of Kwara youths during a peaceful protest from the hinterland of Ilorin metropolis to the Press Centre of the NUJ in GRA, condemned the invitation extended to Saraki by the police over the Offa robbery incident. The youths, in their hundreds, carried placards with various inscription, such as “Stop evil politics,” Be professional”, “No to over politicisation of Offa robbery”, “Saraki is not an armed robber’, “Don’t implicate Saraki.” Addressing newsmen, the coordinator, Kwara Agenda, Haruna Yakub Kannike, said that the group was surprised by police invitation of Saraki over Offa robbery incident, adding that, “nothing can be farther from the truth!”. He added: “Our attention has been drawn to a fresh plot by the Headquarters of the Nigeria Police Force, Abuja to implicate the President of the Senate, Bukola Saraki in the April 5, 2018 dastardly armed robbery attacks on banks in Offa, Kwara State. During the robbery operation that shook Offa to its foundation many innocent citizens including nine policemen were murdered by the bandit.

Women affairs minister, Alhassan joins Taraba guber race … says APC will rule Nigeria for long JAMES KWEN, Abuja

inister for Women Affairs Aisha Alhassan, has announced her intention to re-contest the Taraba state governorship election in 2019. Alhassan had contested for the governorship election on the platform of the All Progressives Congress, (APC) in 2015 but was defeated by the present Taraba State Governor, Dairus Ishaku. She disclosed her ambition to govern the state after the 2015 failed attempt while speaking with newsmen at the National Secretariat of APC in Abuja. According to the Women Affairs Minister, she actually won the election in 2015 but it was destined that she won’t be governor. “I won the 2015 election everyone knows that, even the People’s Democratic Party (PDP) and I will re-contest the election again in 2019 if God keeps me alive and well. “It is God that gives power

to whoever he desires, I won the election 2015, but God did not give me power, I will keep trusting in him and the grassroots people of Taraba and God willing, I will win the election,” She said. Alhassan expressed optimism that the ruling APC will rule ‘Nigeria forever’, assuring that her party will win more states in 2019. The Minister, who is popularly known as ‘Mama Taraba’, said the party´s coming National

Aisha Alhassan

Convention would be peaceful, adding that the current crisis in the APC was normal in every big political party across the world. Alhassan was also hopeful that the party would win the presidency and more states in the coming 2019 election inspite of some crises in some state chapters. “Crisis is normal in a big party like APC, once we can do our national convention, then we face the opposition PDP and I assure you that APC will win more states like Taraba in 2019. “I will make sure that in my zone I follow up and by God’s grace Gombe and Taraba will be taken over in 2019, and don’t even talk about Nigeria because its already APC and it will continue to be APC forever.” Reacting to the fictionalisation of APC in her state, the Minister said: “I have a right to choose who become the chairman of the party in the state, there is no faction in Taraba. We are very much together, there was no love lost in the state, we were never divided; it was all about political interest.”

Tuesday 05 June 2018

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BUSINESS DAY

FINANCIAL TIMES Donald Trump picks the wrong trade fight

US Treasuries unlikely to remain below 3% for long

Page A6

Page A5

World Business Newspaper

US ambassador to Germany seeks to ‘empower’ Europe’s right wing Berlin requests clarification after Trump loyalist Grenell breaks diplomatic etiquette A spokesman for the German foreign TOBIAS BUCK ministry said on Monday: “We have ermany has asked the US taken note of the article in a US online to clarify the latest inflam- medium. We have asked the US side matory statement made for clarification whether the statements by its new ambassador to were indeed made in the way they apBerlin, after Richard Gren- peared.” Several senior German politicians ell said he was planning to “empower” conservative political movements across were less diplomatic in their responses. Lars Klingbeil, the secretary-general of Europe. Mr Grenell, a Donald Trump loyalist the Social Democratic party, which govwho took up his post as ambassador to erns in a coalition with Angela Merkel’s Germany less than a month ago, told the Christian Democrats, tweeted: “I know rightwing US website Breitbart: “There you are still quite new at your post, but are a lot of conservatives throughout it is not part of the job description of an Europe who have contacted me to say ambassador to interfere in the politics of they are feeling there is a resurgence his guest country.” Even before the latest interview, Mr going on.” In remarks that seemed to be starkly Grenell made clear that he was happy at odds with diplomatic custom, the to stir up controversy. Just hours after ambassador added: “I absolutely want to presenting his credentials to the German empower other conservatives through- president last month, he sent a tweet in out Europe, other leaders. I think there support of the US decision to abandon is a groundswell of conservative policies the Iran nuclear treaty that included a that are taking hold because of the failed demand directed at German business: “German companies doing business policies of the left.” Mr Grenell did not specify what in Iran should wind down operations particular brand of conservatism he immediately.” The German government has left no would support, or by what means. But he voiced strong admiration for Sebastian doubt that it intends to stand by the Iran Kurz, the conservative Austrian chancel- nuclear deal and that there is no reason lor who leads a coalition government for German businesses to pull out of that includes the far-right Freedom the country. In his interview with Breitbart, which party. The alliance has exposed Mr Kurz to criticism from mainstream politicians was published at the weekend, Mr Grenacross Europe, but Mr Grenell made ell said the election of Mr Trump had clear he saw the Austrian chancellor as already served to strengthen conservaa model. “Look, I think Sebastian Kurz is tives in Europe. “There’s no question about that and a rock star. I’m a big fan,” he said. Ambassadors and diplomats nor- it’s an exciting time for me,” he said. “I mally refrain from taking a position on look across the landscape and we’ve got the party politics of the countries they a lot of work to do but I think the elecserve in, especially when that country tion of Donald Trump has empowered individuals and people to say that they is a close ally. Mr Grenell’s comments sparked an can’t just allow the political class to deimmediate backlash on social media termine before an election takes place, both in Germany and in the US. Chris who’s going to win and who should run.” In a tweet sent on Monday, the amMurphy, US senator from Connecticut, said in a tweet: “When I raised concerns bassador sought to clarify his position. to Grenell about politicising this post, “The idea that I’d endorse candidates/ he personally assured me that once he parties is ridiculous,” he said. “I stand by became ambassador he would stay out my comments that we are experiencing of politics. This interview is awful — am- an awakening from the silent majorbassadors aren’t supposed to ‘empower’ ity — those who reject the elites & their bubble. Led by Trump.” any political party overseas.”

The mystery trader who roiled Wall Street Former Blackstone executive used complex credit derivatives to become a feared hedge fund manager but left behind a trail of recriminations MILES JOHNSON AND ROBERT SMITH

or hedge funds that make their money gambling on whether companies will go bust, it was an opportunity too tempting to ignore. In 2015, brokers working on behalf of a mystery client in London, offered these funds the chance to make a trade they thought was impossible to lose: betting that a teetering Norwegian paper company would imminently default on its debt. The hedge funds snapped up hundreds of millions of dollars of the derivatives contracts that would pay out in the event of a default. By the time the buyers realised who was on the other side of the trade it was too late: they had been trapped. One hedge fund manager

recalls receiving a call from a sympathetic contact pleading with him to exit a trade. “It was an off-the-record warning in order to protect me,” he says. “He basically told me who was on the other side. It was him.” The “him” was Akshay Shah, at the time a managing director at the Blackstone Group’s GSO hedge fund unit, who for nearly a decade spearheaded a series of unconventional trades that made him the most feared operator in European credit markets, terrorising a string of rival hedge funds and costing them millions in trading losses. The aftermath of the complex trades Mr Shah helped pioneer have shaken the $10tn market for credit default swaps to its core, leaving a Continues on page A4

Richard Grenell: ‘I think there is a groundswell of conservative policies that are taking hold because of the failed policies of the left’ © AFP

Macron close adviser faces preliminary probe by financial prosecutor Prosecutor to examine whether private sector job met with civil servant transfer rules ANNE-SYLVAINE CHASSANY

mmanuel Macron’s most senior adviser is facing a preliminary judicial probe into alleged wrongdoing related to his stint as chief financial officer of Italian cruise operator MSC before the French president’s election last year. France’s financial prosecutor said on Monday that it is looking into whether the appointment of Alexis Kohler, Elysee Secretary General, at MSC in 2016 followed the rules regarding transfers of top civil servants to the private sector. Civil servants must seek the approval of an ethics commission that probes potential conflicts of interest stemming from such departures from the administration. The prosecutor’s probe follows a report by news website Mediapart alleging that Mr Kohler, who was then chief of staff of Mr Macron at the finance

ministry, hid his family ties with MSC’s majority shareholders from the commission. Mediapart also claimed that as MSC CFO, Mr Kohler participated in key meetings at the finance ministry in 2017 over the fate of STX, the troubled state-backed shipbuilding company, while also advising Mr Macron’s presidential campaign. Subsequent to this report, anti-corruption group Anticor lodged a complaint against Mr Kohler. Judicial authorities may decide to drop the case or open a formal investigation. Mr Kohler has denied wrongdoing. An Elysee aide said the French presidency “rejected these unfounded allegations.” The case may prove problematic because Mr Kohler lies at the heart of the Macronist machine. The 45 year old technocrat, often portrayed as Mr Macron’s twin brother, is the president’s most trusted aide and has proven instrumental in the government’s ability

to carry out reforms at a rapid pace. Like Mr Macron, Mr Kohler is a former graduate of ENA, the elite university that grooms top civil servants, and belongs the prestigious “inspection des finances”, an exclusive group within the Treasury. As such, he has come across privileged information related to the state’s industrial holdings and policies. The ethics commission however approved his transfer to MSC. Mediapart alleges that Mr Kohler did not reveal his mother was a cousin of Rafaela Aponte, who founded MSC with his husband. A spokesperson for the Elysee called the claims “unfounded.” Mr Kohler “has taken note” of Anticor’s complaint, which is based on “totally unfounded suspicions.” Mr Kohler “will communicate all documents proving his law-abiding conduct in all circumstances during his professional career,” the Elysee added.

Finland’s president warns EU is losing out to strongman politics Sauli Niinisto says rising geopolitical risk should be ‘a wake-up call’ for bloc ALICE HANCOCK

s he reflects on the new age of strongman politics that has left little space for nations like his own on the world stage, Finland’s president momentarily abandons the understatement for which his country is renowned. Sauli Niinisto says the EU is coming off second best in an era of “personalised global policy” under the likes of Vladimir Putin of Russia, Donald Trump of the US and Xi Jinping of China. In this age of “peak persons”, Mr Niinisto tells the Financial Times in an interview in his official residence overlooking the Helsinki waterfront, “it’s difficult to get a seat at the table because it’s a table for the strong and powerful”. For Mr Niinisto, a staunch proEuropean, today’s rising geopolitical risk should be “a wake-up call” for the EU. “Even the words, war, missiles, nuclear weapons, they are in everyday use at the moment,” he says. The 69-year-old president makes little effort to disguise the fact that Russia, Finland’s giant neighbour to the

east, is at the forefront of his concerns. He was finance minister when Finland joined the EU in 1995, which gave the country a once-in-a-generation chance to break out of the orbit of its former imperial overlord, with which it shares a well-policed 1,271km border. On the topic of Mr Putin, Mr Niinisto cites an old Finnish proverb: “A Cossack takes everything which is loose, so you have to have a very straight opinion and say it clearly.” The message is that, in dealing with Moscow, Finland’s EU partners have to combine respect with resolve. His present worry is the breakdown in transatlantic relations following the US withdrawal from the Iran nuclear deal which, according to Mr Niinisto, offers an “open window” for the Kremlin to get closer to Europe. “It is a clear setback [for the west],” he says, noting the apparent thawing of relations at the recent meeting in Sochi between Mr Putin and Angela Merkel, the German chancellor. “Friendly is too much to say, but they at least had constructive discussions.” His opinions are born of long experience. He recalls the early 1990s when

Mr Putin served in the government of St Petersburg which is still twinned with Finland’s second city, Turku. Almost three decades later, the same Turku councillors Mr Putin dealt with then, now retired, are still invited to Moscow at the Russian president’s behest. “He doesn’t forget his friends, if he has been dealt with respectfully.” Finland still treasures its nonaligned status, despite being a member of the EU with its common foreign and security policy. Yet Mr Niinisto vigorously contends that his country is far from a soft touch. It was the first nation to condemn the Russian annexation of the Crimea in 2014 and has complied with all sanctions since, even though Russia is Finland’s fifth-largest trading partner, with exports amounting to more than $3bn a year. Asked whether Finland would ever consider joining Nato to bolster its security — a move advocated by some groups in both Finland and, to a greater extent, neighbouring Sweden — Mr Niinisto suggests Nato membership is a card to be held rather than played: “It’s a security weapon in itself. Finns do not support it and I am a Finn.”

BUSINESS DAY

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Tuesday 05 June 2018

NATIONAL

Air France-KLM climbs after Accor says considering taking stake Airline group’s shares up 6% on French hotelier’s interest HARRIET AGNEW

hares in Air France-KLM took off on Monday after Accor, Europe’s largest hotelier by room numbers, said it was considering taking a minority stake in the partially stateowned airline. The French hotelier said in a state-

ment on Sunday that “over the past few years” it had held discussions with Air France-KLM, “notably with a view to developing joint digital projects as well as a joint loyalty and services platform”. As part of this project, Accor said that it considered buying a minority stake in AirFrance-KLM. The state-

ment said: “AccorHotels confirms having resumed its reflections on the matter, being at very early stage of assessing the feasibility and potential terms and conditions which will be discussed with Air France-KLM in due time.” Shares in the airline opened 6.2 per cent higher, while Accor shares dropped 1.5 per cent.

Air France-KLM is facing turmoil after Jean-Marc Janaillac, now its former chief executive, said he would leave the group after losing a staff vote over a pay deal which had already been rejected by the Air France unions. The pay deal has been responsible for some 15 days of strikes, which have cost the airline close to €400m, dragging down its financial results

The mystery trader who roiled Wall Street..

KPMG South Africa cuts hundreds of jobs in post-scandal overhaul

Continued from page A3 trail of at least three lawsuits and recriminations between the world’s largest private equity group and some of the most powerful names in finance. The trades have also highlighted a shift in the balance of power on Wall Street since the financial crisis, where the so-called non-bank lenders such as GSO have leveraged the infrastructure and reach of parent private equity groups to become more feared than the once dominant proprietary trading desks of Goldman Sachs and the other leading investment banks. “This is symbolic of a shift in power away from banks like Goldman to non-bank institutions like Blackstone,” says a former Goldman Sachs partner. The credit default swap, a financial instrument intimately associated with the losses incurred by the banks during the US subprime mortgage crisis, is most commonly used to either hedge against a company falling into trouble and possibly not paying off its debts, or as a tool of outright speculation over whether a default will occur. The GSO unit at Blackstone where Mr Shah worked became the biggest predator in the global CDS market by going beyond merely trying to predict when companies would fail. Instead it used Blackstone’s substantial influence to directly intervene in struggling businesses, changing their fates in ways that maximised profits on GSO’s trades. The strategy allowed GSO, which has $140bn of assets under management, to radically alter the odds in its favour by inventing a trade that had never been seen before: the manufactured default. It is the debt equivalent of a controlled explosion: offering a company favourable financing, such as low interest loans, to convince it to intentionally default in a way that will trigger payouts on CDS contracts, but without bringing down the whole company. By doing this GSO pushed its trading edge on rivals to the limits of what many saw as legal. “I don’t believe it’s classified as insider trading, but it’s pretty damn close,” says one retired trader who came up against GSO and Mr Shah. “It’s quite frankly shocking that they were able to get away with doing that for so long and that no one was prepared to stand up to it.” “I compare it to sports gambling,” says Aitan Goelman, former head of the US Commodity Futures Trading Commission’s enforcement division, about manufactured defaults. “If gamblers went out and paid players to throw games, everyone would intuitively know that was fraudulent. Highly sophisticated and not particularly upstanding actors are looking for any edge they can get: if they see areas of the law that are vague or poorly defined, they see this as an opportunity.”

and putting its long term viability under a spotlight. The French state owns 14 per cent of Air France-KLM’s share capital and has 23 per cent of the voting rights. Last month an Elysée spokesperson told reporters in Paris that while the government has no plans to lower its stake it may not maintain the level indefinitely.

Big Four auditor to ‘embed’ international staff in local arm as part of restructuring

JOSEPH COTTERILL

Kim Jong Un, right, has appointed Kim Su Gil, second right, as director of the general politburo of the Korean People’s Army © Reuters

North Korea reshuffles military top brass ahead of summit Analysts view Kim Jong Un’s move as attempt to keep army in check BRYAN HARRIS

orth Korean leader Kim Jong Un has reshuffled the country’s military top brass days ahead of a landmark summit with US president Donald Trump, according to the South Korean government. The move is being viewed as an attempt to keep the country’s 1mstrong army in check as anticipation grows that a deal is shaping up between Pyongyang, Washington and Seoul. On Tuesday next week, Mr Kim is set to meet Mr Trump in Singapore for the first summit between leaders of the two countries. Officials from both sides are in the midst of frantic final-stage preparations, with senior diplomats meeting daily in the demilitarised zone that separates the Koreas. Media reports in South Korea have suggested that President Moon Jae-in could travel to Singapore on June 13 — the day after the Trump-Kim meeting — to declare an end to the officially unfinished Korean war of the 1950s.

On Monday, the unification ministry in Seoul said that Pyongyang had ousted Kim Jong Gak, director of the Korean People’s Army general politburo, replacing him with Kim Su Gil. A four-star general, Kim Su Gil is believed to be one of Kim Jong Un’s most trusted officials. The soldier “was part of an entourage of adjutants who accompanied Kim Jong Un during the first two years of his leadership,” according to North Korean Leadership Watch, a website that monitors personnel changes in the reclusive country. Citing an intelligence source, South Korean state news agency Yonhap also reported that North Korea had replaced defence minister Pak Yong Sik with a more moderate official. The chief of the KPA’s general staff is also reported to have been changed. The army is a dominant force in North Korea and Kim Jong Un has been careful to regularly rotate defence ministers to prevent any threat to his rule. Analysts believe the latest reshuffle is aimed at ensuring he has a secure footing at home as he

enters potentially groundbreaking talks abroad. “The move is part of Kim Jong Un’s long process of replacing those loyal to his father [the late North Korean leader Kim Jong Il] with his own men,” said Lee Wooyoung, a professor at the University of North Korean Studies in Seoul. “But from a timing perspective, the reshuffle is meaningful as it demonstrates to the US that Pyongyang is sincere about denuclearisation.” Mr Trump hopes the Singapore summit can pave the way for Pyongyang to abandon its nuclear weapons and advanced missile programmes. The regime has said it supports the denuclearisation of the Korean peninsula, although it has not publicly set out its parameters, demands or even a timetable. Some view Pyongyang’s pledges to denuclearise as more of a vague assertion than a concrete promise. For its part, Washington is seeking the “complete, verified and irreversible denuclearisation” of the regime — a process that would take years, if even possible at all.

CBA agrees largest civil settlement in Australian history Shares rise as country’s biggest bank pays A$700m to settle money laundering scandal JAMIE SMYTH

ommonwealth Bank of Australia has agreed to pay A$700m (US$532m) and admit liability to settle claims by Australia’s financial crime agency that it broke anti-money laundering and counterterrorism laws. The settlement, which remains subject to court approval, is the largest-ever civil penalty in Australia and is almost double the A$375m provision made by CBA in its half-year results in February. It follows a recent toughening of penalties by the government, which was forced to call a public inquiry into bank misconduct following the high-profile money launder-

ing case that erupted last year. “While not deliberate, we fully appreciate the seriousness of the mistakes we made,” said Matt Comyn, CBA’s chief executive, on Monday. “Our agreement today is a clear acknowledgment of our failures and is an important step towards moving the bank forward. On behalf of Commonwealth Bank, I apologise to the community for letting them down.” Australia’s biggest bank by assets said it had admitted further contraventions of Australian law beyond those it had already acknowledged, including breaching risk procedures, reporting, monitoring and customer due diligence. It is paying an extra

A$2.5m to cover the legal fees of Austrac, Australia’s financial crime agency. Shares in CBA closed up 1.4 per cent on Monday after climbing as much as 2.4 per cent as investors welcomed an agreement that can easily be absorbed by the bank, which reported A$4.7bn profit in the six months through December. “I can’t think of a larger settlement by an Australian bank but the shares have gone up because people were worried the penalty could have been a lot higher,” said Brian Johnson, analyst at CLSA. “This settlement reduces risk and brings the bank closer to performing a share buy-back with all the surplus capital that it has on its balance sheet.”

PMG will parachute in senior executives and cut hundreds of local jobs to rescue its South African business after a client exodus over a series of scandals, including the firm’s links to the Gupta business family who have been accused of serious corruption. In a statement on Monday, the Big Four global auditor said that up to four hundred people would leave KPMG South Africa and some offices in the country would be closed in order to “take into account recent client losses and current levels of demand for certain services.” The rescue will also involve “embedding in the firm for an extended period a number of senior KPMG partners from across the international network” including at board level, the group added. The restructuring underlines the scale of the crisis confronting KPMG in South Africa, where it has lost major clients including Barclays Africa and government institutions in recent months, part of the fallout from its entanglement with the Guptas. KPMG South Africa’s chief executive resigned and several partners left last year as it apologised for work including audits for a company linked to alleged money-laundering by the family, who have been accused of controlling government business through a friendship with Jacob Zuma, the former president. Both the Guptas and Mr Zuma deny wrongdoing. The firm’s reputation has since been battered further by the collapse in March of VBS, a mutual lender that KPMG gave clean audits despite regulators subsequently finding evidence of irregularities. “KPMG South Africa is an important part of our global firm,” Bill Thomas, KPMG International’s chairman, said. The decision to embed executives was “evidence of the significant investment KPMG International is providing to help ensure KPMG South Africa can continue to focus on trust, quality and integrity,” he added. Regulators in the country are investigating KPMG over the Gupta audit work and last week the South African Institute of Chartered Accountants also parted ways with the firm. KPMG South Africa will retain 130 partners and over two thousand employees while it withdraws to four major offices in Johannesburg, Cape Town, Durban and Port Elizabeth, the firm said. “These hard decisions were necessary to put the firm on a more sustainable footing, while ensuring we continue to offer our clients the best service and support,” said Nhlamu Dhlomu, KPMG South Africa’s chief executive. “We are putting quality and integrity at the heart of the business and, from now on, the firm will be focused on doing fewer things better.”

Tuesday 05 June 2018

C002D5556

BUSINESS DAY

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

US Treasuries unlikely to remain below 3% for long Peak in bond yields coincides mostly with that in the Federal Funds rate GEORGE MAGNUS

t didn’t take long for the yield on 10-year US Treasuries to drop back below 3 per cent — a level it surpassed last month for the first time since 2014. Not for the first time since the financial crisis, the US bond market confounded gathering bearish sentiment as policy rhetoric at home and unstable capital markets abroad gained prominence. With the next meeting of Federal Reserve policymakers a week away, where do bond markets go next? The bullish view about bonds is anchored by two observations. First, periods of sub-3 per cent yields are rare. According to Sidney Homer’s History of Interest Rates, you can find them only in the falling price boom at the very end of the 19th century, and then the exceptional circumstances from 1934 to the early 1950s. It is possible then, given low inflation and unusual circumstances, that this time really is different. Second, going back to the 1960s, the peak in bond yields has coincided mostly with the peak in the Federal Funds rate. On three occasions in the inflation era between 1970 and 1982, the Fed Funds rate peaked well above the 10-year yield. In the 1994 Greenspan bond bear market, the latter peaked almost 3 percentage points above the policy rate. If policymakers’ rate projections to 2019-2020 are right, bond yields have already more or less peaked. Neither perspective, though, is conclusive because the economic cycle and inflation may yet strengthen, and the structural arguments for low interest rates are still being waged. US economic growth has been about 2 per cent for a long time, but it may yet quicken. The late-cycle tax cuts are certainly boosting corporate profits and capital spending. Labour market conditions are firm,

and unemployment could fall further. The government is also rolling back important aspects of banking and other regulation. Inevitably, there is a darker side to this for markets, too, in the form of fiscal deficits rising to about 5-6 per cent of GDP, even before the onset of the surge in age-related spending, and higher capital costs and inflation deriving from more trade protectionism and a more fragmented direct investment environment. Yet, however the cycle plays out, investors also need to be focused on what policymakers are thinking about, and that goes by the sci-fi sounding name of R-star. Championed by John Williams, New York Fed president, R-star is the real, or inflation-adjusted, interest rate that occurs when the economy is at full strength. He thinks it’s about 0.5 per cent, about 2 percentage points lower than say 20 years ago, while the median view of policymakers is 0.8 per cent. Add on 2 per cent inflation, and the resting place for policy rates — and bond yields — is roughly 2.5-3 per cent. R-star is thought to be very skinny nowadays for structural reasons related to demography, productivity and the demand for safe assets. None of these, however, are as cast-iron as is sometimes made out. Any or all could end up changing our thinking about equilibrium rates. First, demographics point ostensibly to a stagnant and ageing workforce, lower labour market participation and higher levels of savings that should all suppress real rates. Yet, it is far too early to judge, because they also point to skill, educational attainment and wider labour shortages, which would raise returns to labour (higher wages), longer working lives and other phenomena that offset the alleged ageing effects on the economy and on savings.

Microsoft to buy code sharing site GitHub for $7.5bn

Biggest deal by tech group since acquisition of Linkedin in 2016 ARASH MASSOUDI

icrosoft has agreed to acquire GitHub, a code sharing platform for software developers, in a $7.5bn deal that will allow the US technology group to tap into the company’s extensive network of 28m developers. The transaction is the second significant takeover by Microsoft in recent years under its chief executive Satya Nadella, following its 2016 acquisition of professional networking site LinkedIn. Seattle-based Microsoft will pay for the deal entirely in its own shares, which have surged more than 38 per cent over the past year and briefly saw the company’s market value overtake that of Google-owner Alphabet last week. The $7.5bn price tag is significantly higher than lossmaking GitHub’s valuation after its previous fundraising round in 2015, when it was valued at around $2bn. GitHub was founded a decade ago in San Francisco as a tool that allows software developers to store, share

and collaborate on their work. It relies on open source software called Git that tracks changes to how the code is tweaked and is thought of a form of Google Docs for programmers. The company attracted venture capital backing from firms including Sequoia Capital and Andreessen Horowitz. Mr Nadella said that the deal will allow Microsoft to strengthen its work with developers and its “commitment to developer freedom, openness and innovation”. He said: “We recognise the community responsibility we take on with this agreement and will do our best work to empower every developer to build, innovate and solve the world’s most pressing challenges.” Microsoft said that GitHub’s network of developers touches more than 1.5m companies across industries. As part of the deal, Github chief executive Chris Wanstrath will join Microsoft as a “technical fellow” to work on software initiatives. Microsoft executive Nat Friedman will become the head of GitHub, when the deal closes.

Nets and Concardis to combine as payments consolidation accelerates Industry leader faces tough questions over how it already applies technology NICHOLAS MEGAW

wo of Europe’s largest payments groups have agreed to a multibillion-euro merger, the latest in a series of major deals in the rapidly-consolidating industry. Denmark-based Nets and German group Concardis on Monday announced plans to combine to create a group with €1.3bn in annual revenues and around €500m in earnings before interest, tax, depreciation and amortisation. The agreement comes less than a year after the two companies were taken over by private equity groups. Nets was taken over in a $5.3bn deal that marked the largest European leveraged buyout in almost five years, while Bain Capital and Advent acquired Concardis for around €700m.

Bain and Advent will exchange their Concardis stock for shares in Nets, diluting the holding of Hellman & Friedman, which led last year’s buyout. Bo Nilsson, Nets chief executive, will lead the combined group. He said the deal would provide “an ideal springboard” for expansion into the rest of Europe, adding: “We want to shape the ongoing consolidation in the European payments industry and further drive our panEuropean expansion. Germany offers attractive growth potential due to market size, consumer spending and the fact that around 75 per cent of all payment transactions are still cash-based.” The once-sleepy payments industry, which manages the backend infrastructure that powers billions of transactions a day, has

recently been woken up as new technology changes the way consumers make payments, prompting a wave of new start-ups and consolidation among established players. Most recently, French group Worldline won a fight to buy Swiss stock market operator SIX’s payments unit for €2.3bn, narrowly beating a rival bid from Nets owner H & F. Last year CVC Capital Partners and Blackstone bought British group Paysafe for £3bn, while US processor Vantiv paid £9.3bn for Worldpay. Robert Hoffman, Concardis chief executive, said: ”Combining our product knowledge and technological capabilities will allow us to go to market even quicker with state-ofthe-art and customer-friendly products, underlining our joint ambition to be at the forefront of innovation”

Stocks to watch: DS Smith, Smurfit, SIG, Alfa Financial, Hunting UniCredit’s merger plans have put SocGen in play, says Kepler BRYCE ELDER

ackaging maker DS Smith jumped to a record high after announcing the proposed acquisition of Madrid-listed Europac for €1.67bn. DS Smith said it intended to fund the deal with a £1bn rights issue and £700m of new debt. “The acquisition, should it complete, would propel DS Smith into a leading position in the Iberian packaging market and generate what the company describes as ‘substantial’ cost synergies,” said JPMorgan Cazenove. Goodbody forecast that the purchase would add 22 per cent to 2019 earnings on a pro forma basis, including synergies. Sector peer Smurfit Kappa led the FTSE 100 fallers after the Irish Times reported that the chances were receding of International Paper agreeing a takeover. Neither side has engaged with the other since midMay, when the Irish Takeover Panel set the deadline of June 6 for the US group to formalise its approach, the paper reported. Société Générale edged higher on news that Italy’s UniCredit has been examining a merger with its French peer. No formal approach has been

made but SocGen directors have also been studying the possibility of a combination, the FT reported. Kepler Cheuvreux, which upgraded SocGen to “buy” from “hold”, argued that the French lender now seems “ready to give up its independence after two attempts to take it over failed”. While both banks could claim a merger of equals based on current market values, UniCredit’s outperformance following the appointment of Jean-Pierre Mustier as chief executive in 2016 gives it the upper hand, meaning SocGen “is now at play, in our view”, Kepler said. Air France-KLM was the top performer in the Stoxx 600 after AccorHotels confirmed it had held early-stage discussions over a partnership with the airline and could acquire a minority stake. The companies had talked about “developing joint digital projects as well as a joint loyalty and services platform”, Accor said. Les Echos had reported on Sunday that the French government was considering selling all or part of its 14.3 per cent stake in Air France. Sellside Stories Liberum upgraded SIG, the insulation supplier, to “buy” from

“sell” with an unchanged 157p price target. Liberum argued that SIG’s “excessive” costs are holding back margins, which have not recovered since the 2008 crisis, so determined action from turnround specialist Meinie Oldersma, its new chief executive, should deliver a sustainable improvement to profitability. “We believe there is significant margin recovery potential in SIG, and back the new team to reach its target of improving operating margin from 3 per cent to 5 per cent. The group’s overheads are very elevated against its own history and against peers, suggesting there is much inefficiency to eliminate.” Berenberg downgraded Alfa Financial to “hold” from “buy” in the wake of Friday’s warning from the software maker that a top-three customer had delayed a project. “It seems as though the company is experiencing an almost worst-case scenario in terms of the timing and magnitude of lost revenue,” said Berenberg, which halved its 2018 earnings forecast. “With a higher degree of conservatism by management on the 2019 pipeline also, we believe this magnitude of earnings cut will take place in outer years also.”

BUSINESS DAY

C002D5556

Tuesday 05 June 2018

ANALYSIS

Italy’s eclectic new cabinet raises eyebrows Populist government tries to strike balance with technocrats and politicians JAMES POLITI

Donald Trump picks the wrong trade fight America should focus on digital innovation rather than squabble over peanut butter RANA FOROOHAR

f you want to understand Donald Trump and his recent trade sanctions on Europe, Canada and Mexico, you could do worse than to study professional wrestling. Unlike rules-based boxing, pro wrestling purports to be a no-holds-barred morality play. It is a comic book world in which “good guys” fight “bad guys”, throw folding chairs, and engage in a lot of posing and fakery. There is no strategy, only psychology. This is what we are dealing with in the latest round of global trade tiffs. Imagine President Trump in tight red briefs with an American flag painted on his chest and an “I love Mom” tattoo on his bicep and you have the idea. There is no real plan; he is just playing to his Rust Belt base before the midterm elections. But there is a big problem: the US has gone to war with the good guys, not the bad. By slapping tariffs on America’s allies, Trump has put the US in the worst of all positions: he has alienated the very countries that could help the US fight strategically important trade battles with China. These are not so much about steel and aluminium as who will set the standards for the digital economy and take the lead in areas such as 5G telecoms

standards, the internet of things and artificial intelligence. This is where the vast majority of global growth is going to be over the next decades. Trade in old line goods and services has been flat for years, while digital trade flows increased 45fold from 2005 to 2014, according to the McKinsey Global Institute. The new world economy is based not on metal bashing, but on computing power and data. There is tremendous opportunity for productivity growth here, which the world desperately needs. According to another MGI report, we must roughly double productivity growth over the next decades to preserve today’s global living standards. But to reap those gains and ensure that they are widely shared, we also need a new set of rules for everything from tax and intellectual property protection to trade. All of this calls for a coherent internal economic strategy, which of course the US administration does not have. Mr Trump has yet to appoint someone to head the Office of Science and Technology Policy, the agency best positioned to connect all those dots. On trade, rather than duking it out with allies over motorcycles, peanut butter and whisky, we should be looking at issues like 3D printing

and its effect on origin rules, which determine the nationality of products. Those regulations have been a sticking point in the renegotiation of the North American Free Trade Agreement. But will they be relevant in an era in which you can simply email product blueprints around the world and print them locally? The US and Europe should be sitting down to discuss shared standards for 5G, and a fair split of the profit-sharing pie in the coming era of connected machines. This will require negotiations between America’s big technology companies, EU telecoms as well as automakers and small and mid-sized companies in both regions. China is already thinking about all of this. Over the past few years, it has quietly boosted its influence at the International Telecommunications Union and other standards bodies that will drive the adoption of 5G and artificial intelligence technologies. China is playing the long game, even as the US goes it alone. It is particularly alarming that the Trump administration has picked a fight with its European allies at a time when the EU is moving closer to China. The Middle Kingdom recently overtook the US as Germany’s largest non-European trading partner.

China scales back investment in Ethiopia

East African economy pressured by rising debt and foreign exchange scarcity

JOHN AGLIONBY AND EMILY FENG

hina is scaling back investment in Ethiopia in the face of rising foreign exchange shortages and government debt, highlighting the fragility of the African nation’s economy as the new prime minister prioritises political reform to quell three years of deadly social unrest. For much of the last decade Ethiopia has been a leading investment destination in sub-Saharan Africa, particularly for China. But Beijing’s waning enthusiasm for the region’s fastest-growing economy reflects the challenges facing Abiy Ahmed, the prime minister, as he juggles demands from a public hungry for both democracy and development and myriad vested interests. Business people, diplomats and bankers said Chinese entities, which have loaned more than $13bn between 2006 and 2015 for everything from roads and railways to industrial parks, were now taking a “more cautious approach” to Ethiopia. “The Chinese have said they’ve

reached their limit,” one diplomat in Addis Ababa said. “’We’re way overextended here,’ they told us openly.” Two investors said that Sinosure, China’s main state-owned export and credit insurance company, was no longer extending credit insurance to Chinese banks for projects in Ethiopia as willingly as it used to. “There’s a new reluctance to back investments in Ethiopia,” one investor said. “It’s not completely clear why but it appears they’re worried about the debt profile and forex crisis.” This reluctance comes as some flagship Chinesefinanced projects, such as freight rail services from Addis Ababa to Djibouti, are running below the expected capacity. Analysts applaud Mr Abiy for opening up the political environment since he became prime minister in April — on Saturday the cabinet recommended lifting the state of emergency two months early. But they warn the economy is on “autopilot”. The International Monetary Fund forecasts growth of 8.5 per cent this year, which while high for the region represents a fall from the highs of recent

years. “There’s a lot of excitement around the political opening,” said Hallelujah Lulie, a political and economic analyst in Addis Ababa, referring to the release of thousands of political prisoners, unprecedented engagement with opposition politicians and promises of greater democratisation. “We’ve never witnessed such a level of optimism, hope and unity. But the economy is not getting the attention it deserves. “The moment people are over with the political excitement the economic reality is going to bite and it’s going to bite hard.” Ethiopia’s economic headwinds centre around the increasing shortage of foreign exchange as imports have outstripped exports by around 400 per cent each year for at least the last five years. Foreign exchange reserves held by the National Bank of Ethiopia, the central bank, are thought to be only sufficient to cover a little more than one month of imports, according to Ethiopian bankers. The NBE did not respond to requests for data or comment.

hen the EU was last immersed in budget negotiations in 2012, the lead negotiator for Italy was Enzo Moavero, a 63-year-old veteran of European institutions close to Mario Monti, the technocratic prime minister at the time. In an unexpected twist, Mr Moavero will soon be returning to Brussels but this time as foreign minister of a new populist government in Rome — led by the antiestablishment Five Star Movement and the far-right League, which built their political fortunes on attacks against austerity measures pushed by Mr Monti’s government. The selection of Mr Moavero may seem bizarre for two parties that have vowed to shatter the traditional ways of doing business with the EU. But it reflects a delicate balance in the composition of the new cabinet, which mixes technocrats with politicians, hardliners with more

including comparisons of Berlin’s contemporary economic policy with its military expansion in the 1930s — had alarmed the Italian president. However, in a concession to the League, who championed Mr Savona, Mr Mattarella allowed him to take office in a less powerful post. “Savona’s positions are not crypto-nationalist, he is not anti-European. He wants a different Europe — which is how Stiglitz or Krugman see it,” says one former Italian official who knows Mr Savona, referring to the two US economists, who have questioned whether the architecture of the single currency was viable. “But he is stubborn and even a bit rancorous, he had felt put to the side, excluded from power in recent years,” the former official added. According to Prof D’Alimonte, two little-known figures in key positions could tip the balance one way or the other. One is Giuseppe Conte, the 53-year-old civil law professor who has emerged as prime minister of the governing coalition. Mr Conte has been close to Five

conciliatory figures, Europeanists with nativists, and is designed not to give a political advantage to one party over the other. The new government was sworn in on Friday, ending a political crisis that has gripped the country for nearly three months and alarmed investors. It is expected to overcome the final hurdle — votes of confidence in both houses of parliament — early this week. “This is a government like we have never seen in this country before and I can’t think of anything similar in other countries,” said Roberto D’Alimonte, a professor of political science at Luiss University in Rome. “It’s a new animal, a goat-stag. It’s half political and half technocratic,” he said. Mr Moavero is firmly on the more pro-EU side of the spectrum, which could prove reassuring to policymakers who fear that Rome will slip away from its traditionally Europhile and transatlantic moorings, perhaps turning more towards Moscow in the coming months. But on the other hand, Mr Moavero’s old portfolio as EU minister will be taken over by Paolo Savona, an 81-year old Eurosceptic economist, who was rejected as finance minister by Sergio Mattarella, the Italian president, because of his staunch criticism of the single currency and his calls for a plan B to leave the euro. Not only was Mr Mattarella concerned about Mr Savona’s views on the euro but the Germanophobic tone that laced his commentary —

Star in recent years, but has no political record to speak of, and his views on Italy’s ties to Europe — or the country’s foreign policy, are sparse and hard to pin down. In a rare comment this week as he stepped into a taxi, Mr Conte denied his government would take the country out of the single currency. “To be precise, we never spoke about no-euro, never. It’s not in the platform. This issue was never on the agenda,” Mr Conte said. It is also difficult to pinpoint the approach that will be taken by Giovanni Tria, the professor of political economy at Rome’s Tor Vergata University who was tapped to be finance minister. While Mr Mattarella would have been satisfied that he did not have the same degree of hostility towards the single currency as Mr Savona, his views have raised eyebrows. “Those who invoke an exit from the euro as a panacea are not right, but Mario Draghi, the ECB president, is also not right when he says the euro is irreversible, if he does not clarify what the timing and the conditions are for the reforms needed for its survival,” Mr Tria wrote in Il Sole 24 Ore, last year, in an article co-written with Renato Brunetta, a centre-right MP. “The worst danger is implosion, not exit,” he said. Ultimately, the political line of the new government will be dictated by Luigi Di Maio, the Five Star leader, and Matteo Salvini, the League leader, who are both vicepremiers.

Tuesday 05 June 2018

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BUSINESS DAY

NEWS ‘Providing guarantees for farmers’ output will extend gains of fertilizer initiative’ DANIEL OBI

hairman of MFB Fertilizer Company, Kaduna, Abullahi Kanti Mohammed, has called on the various tiers of government in Nigeria to provide strong and reassuring guarantees to cover the volume of crops produced by registered farmers in the country as a sure means of making the most gains out of the current fertilizer initiative of the Federal Government. According to Kanti, such a guarantee has become necessary following records of improved crop production as a result of the successful PFI programme that has enabled farmers access fertilizers early in the planting season and at affordable prices. Kanti, who made this known in a statement, fears that farmers may soon begin to face a fresh wave of challenge bordering on lack of off-takers for their output, and believes that by providing a government guarantee against this, farmers will better concentrate on growing output and not worry about the consequences of a growing inventory. “The Federal Government has correctly fixed the problem of fertilizer production and distribution in Nigeria, and the complaints by farmers of lack of inputs appear to have been permanently solved. But I foresee a bigger future challenge, which

is how to secure the farmers’ increased output to enable them concentrate on production and not worry about marketing and mounting inventory. “What I want the government to do, in addition to what we have seen so far in the PFI programme is to be a mechanism through which whatever the farmers grow are purchased by the government. “Believe you me, if you do that, farmers’ output per year will continue to double and even triple in some cases. As it is now, most farmers, after a year of bountiful harvest, would find it difficult to sell their products at a price that are reasonable,” he says. He advises the Federal Government not to rest on the gains already recorded through the PFI programme, but to constantly continue to evaluate its impacts as a means of identifying potential challenges and opportunities with a view to solving them as quickly as they arise. Reminding the government of how farming was becoming a lot more attractive following the availability of affordable high quality multi-nutrient fertilizer blends in Nigeria, he pleads for efforts to be put in place to avoid a possible future situation where people who were attracted to farming as a result of the PFI programme would begin to face frustrations when they begin to find it hard to reduce their inventory.

Firm to partner Nigerian companies on global best practices … as 45 firms get Great Place To Work awards

he new country director for Great Place To Work Nigeria, an affiliate of Peoples Productivity Solutions (PPS) Africa, the parent company of Great Place to Work UK, Gonzalo Shoobridge, has pledged the company’s commitment to partnering Nigerian companies on global best practices. Great Place To Work is a global research, consulting and training firm that helps organisations identify, create and sustain great workplaces through the development of high trust workplace cultures. Shoobridge, who replaced Michael Thomas as country director, said Great Place to Work UK would bring to bear on Nigerian organisations best global practices that conform to the UK and other European companies where the firm had operations. Speaking at the fifth award ceremony of Great Place To Work Nigeria, which held on Thursday, at The Landmark Event Centre, Lagos, Nigeria, Shoobridge said: “We are bringing best practices here so we can share them with Nigerian organisations that want to become best work places.” Forty-five companies across Africa were recognised as great places to work in various categories at this year’s award by Great Place to Work Nigeria, the fifth in the series. Group managing director, PPS Africa, Kunle Malomo, said the companies were recognised

for demonstrating the main attributes of a great workplace. “These companies have the courage and confidence to build the kind of workplace where you achieve organisational objectives with employees who give their personal best and work together as a team or family-all in an environment of trust,” he said, in his welcome address. Apart from Best Companies to Work For (large corporates and small and medium size businesses), which was the star category of the awards, the 2018 edition of the awards, which was the 5th in the series, also included Certified Companies 2018. There were also special award categories, including Best Workplaces for Millennial Generation, Fun and Friendly Workplaces, Health and Wellbeing Excellence, The Best for Learning & Development, The Best Workplace for Female. While Andela trounced Namibia Breweries Limited and FCMB to clinch the Best Companies to Work For, in the large corporate segment, Courteville Business Solutions Plc emerged winner for the Best Companies to Work For in the small & medium size businesses segment. Andela, Namibia, FCBM, and Courteville were also amongst the 18 companies across Africa presented with certificates as Certified Companies 2018.

Police activate Lagos road traffic law against motorcycles … to enforce apron wearing by operators from June 15 JOSHUA BASSEY

agos State Police Command is waking up to activate the provisions of the Lagos Road Traffic Law 2012, which prohibits the operation of commercial motorcycles on highways, bridges and in some designated areas of the state. Thereactionarymoveiscoming after some commercial motorcycle operators allegedly set ablaze a police patrol vehicle in Ibeshe,Ikorodu,inprotestagainst thedeathofoneoftheirown.The deceasedwassaidtohavelosthis life after he ran into a gully while onmotioninanattempttoevade arrest by policemen on duty in Ibeshe, on May 30. Angered by the death of their colleague,somemotorcycle operators were said to have mobilised to the Ibeshe police station and attempted to burn it down. They were, however, stopped by a police team, but they returned to the road to burn a stationary police patrol van, leading to the arrest of several. Edgal Imohimi, the state police commissioner, subsequently met with the leadership of motorcycle unions in the state, last weekend, where the police resolved to begin the full implementation of the road traffic law. The law among other things also prohibits riding motorcycle without helmet and carrying more than one

passenger. The law enacted under the past administration of Babatunde Fashola was to curb the loss of lives from incessant motorcycle accidents as well as check the use of motorcycles by criminals to rob, especially in gridlock, for which Lagos, given itshugepopulation,isnotorious. Chike Oti, spokesperson of the Lagos Police Command, who confirmed the meeting of the commissioner with the motorcycle unions, on Sunday, said the clampdown would begin from June 15. “From June 15, all commercial motorcycle operators are restricted from plying the highways and the bridges. Every commercial motorcycle operator must register with any of the approved unions for the purpose of accountability and easy identification. “Every commercial motorcycle operator must wear an apron which must indicate the union he belongs and bear boldly, his identification number. “There will be a joint taskforce, comprising the police, the Lagos State Taskforce on Environmental Sanitation and members of the motorcycle unions to oversee the implementation of the resolution reached and the enforcement of the Lagos State traffic laws,” Oti said.

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Organisations need to enhance employee engagement – Experts CHINWE AGBEZE

here is an overriding need for organisations to devise ways to enhance employee engagement to boost productivity and sustain profitability, experts in the academia, business and human resources have advised. The experts who spoke at the fifth edition of the Work and Family conference 2018 organised by the Institute of Work and Family (IWF), noted that there has been an increased recognition by organisations on the need to pay close attention to their employe-experience in the work place and how it affects their productivity or lack of it. The conference with the theme, ‘Humanistic management and employee experience’ noted further that with the continued economic recession in Nigeria, there is

need for organisations to find creative ways to boost their businesses and keep their employees fully engaged and happy at work. Charles Osezua, chairman, IWFI who was represented by Patrick Irahre said the aim of the conference is to look beyond the performance management system by examining the impact of policies and the environment on the people and next generation of workers. Enase Okonedo, Dean of Lagos Business School, who was represented by Chris Ogbeche, said the theme of this conference was apt, in an environment that is fast losing human touch. ‘‘The marketing people have taught us that when they invest in building and creating pleasant customer experience, they see significant improvement in the company’s performance,’’ said Ogbeche, adding ‘‘if we invest

in enhancing experience, we will also benefit from the improvement in company performance.’’ According to him, most present-day companies are looking at creating shared values for the company, employee and the society. ‘‘They are no longer thinking of how do we maximize profit but how do we actualise profit by having employees that are fully engaged and have pleasant experience in working in the organisation but also by ensuring that social objectives of the company are also met,’’ he said. In his lecture on ‘Virtuous leadership and Humanistic management’, Santiago Martinez, CEO/founder, Providential Limited, Helsinki, Finland, stressed the need for employees to find happiness at work, adding that it’s the responsibility of the employer to ensure that employees are happy.

Tuesday 05 June 2018

PIB: Stakeholders warn against excessive powers to Commission … as government agencies absent at public hearing OWEDE AGBAJILEKE, Abuja

takeholders in the nation’s oil and gas sector have given divergent positions on the three Petroleum Industry Bills. The bills include the Petroleum Industry Fiscal Framework Bill (PIFB), Petroleum Industry Administration Bill (PIAB) and Petroleum Industry Host and Impacted Communities Bill. At a public hearing on the bills, organised by the Joint Committee on PIB in Abuja on Monday, some stakeholders opposed discretionary powers of the President to award oil blocs and licences. While the PIAB seeks to transform the administration of the upstream, midstream and downstream sectors of the Nigerian petroleum industry, PIFB aims to enhance Nigeria’s

competitiveness by making the country a choice destination for oil and gas investors, even as the Petroleum Host and Impacted Communities Bill provides a legal framework for the development of the petroleum host communities. In his presentation, the group managing director, Nigerian National Petroleum Corporation (NNPC), Maikanti Baru, said the state oil firm was in ‘full agreement’ with the bills as initiated by the National Assembly. Represented by the Corporation’s chief operating officer, Gas and Power, Saidu Mohammed, Baru said government is in support of bills that will ensure a win-win situation for all stakeholders. “It has always been known that it is government desire to put in place a robust and desirable legislation that engender

transparency, accountability and fairness in the regulatory, operational and administrative aspect of the entire oil and gas industry,” Baru stated. While advocating for the ownership of the oil in the states, the NNPC GMD said: “Incentivising oil and gas operations in other to attract investment is very key to us. The growth of this industry depends on injection of large sums of amount of money to develop both exploration and exploitation of these vast resources. “We are also advocating that the fiscal systems be simplified for ease of implementation. “At the same time, we also want the bills to ensure that regulatory issues are taken out of the legislation so that we allow the regulator or the Commission to regulate the industry effectively.

New therapy beats terminal breast cancer

he life of a woman with terminal breast cancer has been saved by a pioneering new therapy, say US researchers. It involved pumping 90 billion cancer-killing immune cells into her body reports the BBC.. Judy Perkins had been given three months to live, but two years later there is no sign of cancer in her body. The team at the US National Cancer Institute says the therapy is still experimental, but could transform the treatment of all cancer. Judy - who lives in Florida had spreading, advanced breast cancer that could not be treated with conventional therapy. She had tennis ball-sized tumours in her liver and secondary cancers throughout her body. She told the BBC: “About a week after [the therapy] I started to feel something, I had a tumour in my chest that I could feel shrinking. “It took another week or two for it to completely go away.” She remembers her first scan after the procedure when the medical staff “were all very excited and jumping around”. It was then she was told that she was likely to be cured. Now she’s filling her life with backpacking and sea kayaking and has just taken five weeks circumnavigating Florida. The technology is a “living drug” made from a patient’s own cells at one of the world’s leading centres of cancer research. Dr Steven Rosenberg, chief of surgery at the National Cancer Institute, told the BBC: “We’re talking about the most highly personalised treatment imaginable.” It remains experimental

and still requires considerably more testing before it can be used more widely, but this is how it works: it starts by getting to know the enemy. A patient’s tumour is genetically analysed to identify the rare changes that might make the cancer visible to the immune system. Out of the 62 genetic abnormalities in this patient, only four were potential lines of attack. Next researchers go hunting. A patient’s immune system will already be attacking the tumour, it’s just losing the fight between white blood cells and cancer. The scientists screen the patient’s white blood cells and extract those capable of attacking the cancer. These are then grown in huge quantities in the laboratory. Around 90 billion were injected back into the 49-yearold patient, alongside drugs to take the brakes off the immune system. Rosenberg told me: “The very mutations that cause cancer turn out to be its Achilles heel.” These are the results from a single patient and much larger trials will be needed to confirm the findings. The challenge so far in cancer immunotherapy is it tends to work spectacularly for some patients, but the majority do not benefit. Dr Rosenberg added: “This is highly experimental and we’re just learning how to do this, but potentially it is applicable to any cancer. “At lot of works needs to be done, but the potential exists for a paradigm shift in cancer therapy - a unique drug for every cancer patient - it is very different to any other kind of treatment.”

L-R: Zurab Pololikashvili, secretary-general, UN World Tourism Organisation; Lai Muhammed, minister of information, and Ahmed Mansur, executive director, stakeholder management and corporate communication, Dangote Group, during the presentation of award to the Dangote Group at the ongoing 61st UNWTO Regional Seminar in Abuja, yesterday.

OMO auctions drive 515.93% transaction values at interbank HOPE MOSES-ASHIKE

alue of transactions in the interbank funds market increased significantly by over five folds to N32.91 trillion in 2017, from N5.34 trillion in 2016, driven by regular Open Market Operation (OMO), according to the Central Bank of Nigeria (CBN). Open Buy-Back (OBB) transactions accounted for 94.83 percent of the total value of interbank deals, while transactions at the unsecured interbank segment accounted for the balance of 5.17 percent, compared with 80.62 and 19.38 percent, respectively, in 2016. OBB is a money market instrument used to raise short-term

capital. A breakdown of the transactions at the interbank market shows an increase in call placements by 76.87 percent to N1.60 trillion, from N906.84 billion in 2016. At the OBB segment, transactions increased significantly by over six folds to N31.20 trillion, from N4.30 trillion in 2016. The sharp increase in the volume of transactions in 2017 was attributable largely to the liquidity squeeze in the banking system occasioned by the frequent OMO auctions and the sale of foreign exchange. The CBN’s 2017 annual activity report released on Friday states that interest rates at all segments of the

market mirrored the level of liquidity in the banking system, and market players’ response to the bank’s policy direction. The fiscal operations of the Federal Government, effects of CRR maintenance, settlement for foreign exchange interventions, maturity of OMO Bills and liquidity withdrawals through the conduct of OMO by the bank were the dominant factors that influenced the banking system’s net liquidity levels and the movement in interest rates. According to the report, the annual average overnight interbank call and OBB rates were 21.36 and 24.61 percent for 2017, compared with 14.31 and 10.95 percent in 2016, respectively.

The average monthly interbank call rates ranged from 8.29 to 58.73 percent, while average monthly OBB rates were between 7.59 and 46.07 percent in the same period. The rate at the overnight segment was 8.29 percent in January, peaked at 58.73 percent in April and closed at 9.64 percent in December 2017. Correspondingly, at the OBB, the rate was 8.26 percent in January, peaked at 46.07 percent in April and closed 7.59 percent in December. The Nigerian Interbank Offered Rate for call and 30day tenors averaged 25.49 percent and 25.21 percent in 2017, compared with 14.81 percent and 14.29 percent in 2016, respectively.

BUSINESS DAY

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NEWS YOU CAN TRUST I TUESDAY 05 JUNE 2018

Opinion

Shall we tell the President? OSELOKA H. OBAZE Obaze is the author of a public policy book, Prime WitnessChange and Policy Challenges in Buhari’s Nigeria, published recently by Safari Book Ltd.

i g e r i a’s d e mocrac y has advanced another year. Yet three years into President Muhammadu Buhari’s presidency, telling him and his team how well or badly the administration has fared remains a hotbutton issue. The opposition dwells on it. Nigerians regardless of social strata, consider it topical at the coffee table or buka joint. The polls try to stay neutral and reflective of the national consensus. Still as members of the ruling party and Buhari aficionados underline the accomplishments, they also upbraid anyone who says otherwise. On the cusp of a general election year, what is required is unvarnished assessments. Nigeria needs someone or persons who can tell the president the truth, but not in President O basanj o’s s elf-s er ving ways. Indeed, PMB needs to know the state of play, as he seeks re-election, if

indeed he wants to correct past mistakes and move the nation forward. To mark the president’s third anniversar y in office, a public opinion poll conducted by NOIPolls in partnerships with Gallup (USA), evaluated ten critical governance and sectoral issues, and produced a cumulative result. The president did not reach the fifty percentile mark in any specific category. The president’s highest score was 43% on security and his lowest 12% on poverty alleviation. His other performance indicators ranged from 32% for corruption; 34% for agriculture; 25% for healthcare; 21% for infrastructure; 24% education; 16% for economy; and 15% for job creation. Overall, the cumulative average is not-tooheart-warming. Bluntly, it was non-stellar. For street voices in Nigeria there’s nothing to celebrate. Then again, we must also consider that subjective core areas like national cohesion, peace and stability, patriotism, dividends of democracy and trust were not even ranked. Looking forward, shall we tell the president he has not done so well without encountering a hard push back? Who will tell the president that our democracy, having arrived at the beyond nascent point, is

experiencing de-consolidation. In my recently published book, Prime Witness - Change and Policy Challenges in Buhari’s Nigeria, policy performances relating to these ten categories, amongst others, were similarly evaluated, albeit, within the president’s first two years in office. As I noted at a recent b o o k p re s e n t a t i o n , m y book, like every opinion poll, and constructive assessment seeks to “analyze evolving policies from the very onset of the Buhari administration; focusing on lessons learned, missed opportunities and choices before Nigeria.” Undertaking such assessment, more so, where it is non-partisan remains a national imperative. Yet any foray into that realm is not for the fainthearted. O n the balance, one must acknowledge on its face value, Minister Lai Mohammed’s contention that “President Buhari’s administration had achieved a lot in the delivery of dividends of democracy and campaign promises despite the challenges it encountered in the last three years. We are putting our nation on the path of sustainable growth and development, diversifying our economy like never before, tackling corruption at its very core and devising creative measures to secure life and property.” A cogent

assessment ; but one with equally cogent flip-side. As I observed recently, Nigeria’s democracy is foundering on the issue of restructuring. The contending point; were Nigeria to be doing so well, the clamour and clangour for transformation and restructuring would be at a lower din and decibel. If our national debate and assessment of government is dichotomous, reasons for such disposition abound. Nigerians have become escapists in confronting critical national issues collectively. Now, expediency and convenience decree compartmentalization and sectionalism. Consequently, critical issues, “national questions, the quest for parity in resources, and attachment to identity” suddenly and conveniently become divisive, creating unwarranted dichotomy. Nonetheless, the assessment of any leadership, more so in a democracy cannot be avoided. The observations and conclusions in my book are broad and the concluding assessment pointed. Some who have read the book have chided my seeming empathy towards President Buhari. One in particular, a revered “Silk” hitherto a hard core Buhari supporter wrote, “It appears to me that the marks...ought to be less charitable and patronizing

than you awarded.” My response is that my evaluation was of policies not personalities, even as both often intertwine and are fungible. Borrowing paragraph from my book might address and clarify the interface. “Effective political leadership is generally perceived as one that delivers on it’s promises. Statesmanship, on the other hand, entails employing great tact in steering the affair of state and in better management of unanticipated crisis that other leaders would have in similar circumstances.” It’s pertinent to recall that even President Buhari’s biographer, when confronted with a heady question on Buhari’s presidency and leadership prospects, responded thus: “Whether he can achieve further political change in Nigeria is hard to predict.” So as we look back to President Buhari’s three years in office and look to his next year or next five years, we must assess the state of play forthrightly and with hope. Yakubu Mohammed hit the bull’s eye with this summation, “government usually gives hope that tomorrow would be better.” His views dovetail well into my closing summation in Prime Witness : “Buhari has the remaining part of his tenure to remediate his governance style and redeem his already damaged

leadership image. He can do so by drastically altering his leadership style and running a much more inclusive government, where a crop of bipartisan skilled personalities can help him deliver his change agenda for Nigeria.” A d v i s e r s a ro u n d t h e president must accept that outside counsel or criticism have their salient value and merit. They must also recognize their unique role. They need to accept the ultimate public service dictum, paraphrased thus; “I have one master, Mr. President. I have one mistress, the Federal Republic of Nigeria.” They must serve both pari passu. That considered, shall we all resolve to tell the president the truth. Things ain’t as rosy as those in officialdom paint it. Nigeria and Nigerians can do better. And Nigerians remain hopeful. Here is the upshot of our present circumstances. As president, the buck stops at President Buhari’s desk. He is the one Nigerians elected to lead them. Not everyone w h o e va l u at e s Bu ha r i’s presidency constructively, or even trenchantly is a traducer, detractor or opposition. Most speak truth to power in order to better and save Nigeria. Many still believe in the president as a change agent. Yet the realization persist that for Nigeria, it is not yet eureka.

Funding the National Health Service requires higher taxes •Political cowardice obstructs solution as the population ages and costs increase MARTIN WOLF Wolf is the Chief Economics Commentator of The Financial Times.

he contemporar y British, it is said, do still share a common religion: the National Health Service. But however much they may desire a firstclass service, free at the point of use, they have been unwilling to pay the taxes needed to sustain it. After years of stringency, underfunding has become severe, even though the spending has been relatively protected. Public spending on health (and grossly underfunded social care) must rise in the years ahead. Politicians must discuss higher taxation. Anything else is an evasion. To help the discussion, we have the benefit of a superb

new report, securing the future: funding health and social care to the 2030s from the Institute for Fiscal Studies and The Health Foundation. Its headline conclusion is that UK spending on healthcare will have to rise by an average of 3.3 per cent a year over the next 15 years just to maintain NHS provision at current levels, and by at least 4 per cent a year if services are to be improved. Social care funding will need to increase by 3.9 per cent a year. Ageing is the main reason for the pressure. But so is the rising relative cost of inputs. If spending on the NHS were to rise by 4 per cent a year, it would go from 7.3 per cent of national income to 9.9 per cent over 15 years (based on the Office for Budget Responsibility’s forecast of 1.9 per cent for annual average economic growth). Overall, spending on health and social care would need to rise by 3

per cent of national income. As I have noted before, this sort of analysis raises big questions. Is the prospective rise reasonable? Answer: yes. Spending on health (as a share of national income) of a number of prosperous European countries — Germany, the Netherlands and Sweden, for example — is already higher than the UK’s would be in the 2030s. They afford it. Why could the UK not do so too? Is the NHS perhaps exceptionally inefficient? UK spending on health is close to the average of the EU-15 (which excludes the countries that joined in the 2000s). This does not suggest extraordinary waste. Moreover, notes the report, “unusually, since 2010 measured productivity in the health service has been growing faster than productivity across the economy as a whole”. Comparative data suggests

health outcomes for the UK are mediocre by international standards. This performance is in line with its moderate relative spending. At the extreme, in terms of ineffectiveness, is the US: there, governments spend a higher share of national income than the NHS, while not beginning to cover the population and delivering, to take one example, a life expectancy that is 2.2 years lower than the UK. Would charging add significantly to efficiency or the resources in the system? No. Charging is inegalitarian: the higher the charges, the more unequal the outcome. It will also discourage people from what turn out to be necessary visits to doctor. The idea that making health free risks persuading many people to go to the doctor unnecessarily is quite implausible: it really is not fun. Is compulsory insurance a

better system? Obviously not. Compulsory insurance is a tax. In this respect at least, critics of the “mandate” in what came to be known as Obamacare were right. If it quacks like a tax, it is a tax. Is there a trick way of raising the additional revenue? The report under discussion and a recent paper by Richard Murray of The King’s Fund analyse the possibility of a tax dedicated (or “hypothecated” in the jargon) to health spending. Such a tax would be either stupid or a fraud. It would be stupid to adjust spending up and down in response to changes in revenue from a single tax. It would be a fraud if we did not link the two in this way. In essence, those who favour hypothecation believe that people will be persuaded to pay more tax if they are told it pays for health (even if does not do so). But fibs, however clever, are politically corrosive.

Suppose, instead, that the UK simply accepted that dealing with the pressures of today and those still to come requires higher spending and, correspondingly, higher taxation. That would still leave the average tax ratio in the UK far below economically more successful northern European countries. A rise of 3 percentage points in the UK’s ratio of government revenue to national income, for example, would leave it 6 percentage points below Germany’s today. Under plausible assumptions, it should also allow a substantial rise in post-tax incomes. If it did not do so, it would be because of economic failure, not the higher taxes. This nettle has to be grasped. The decision to fund health though taxation was a perfectly reasonable one. Political cowardice is no reason for refusing to live up to the evident consequences.

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: 08116759801, 08082496194. Subscriptions 01-2950687, 07045792677. Newsroom: 08022238495 Editor: Anthony Osae-Brown. All correspondence to BusinessDAY Media Ltd., Box 1002, Festac Lagos. ISSN 1595 - 8590.