BusinessDay 05 Mar 2019 by BusinessDay

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major regret of President Muhammadu Buhari when he first came to power in 2015 was that Nigeria was importing virtually everything from toothpick to tomatoes. He then promised to change the narrative and make the country one of Africa’s biggest manufacturers. “ We a re d e t e r m i n e d t o change Nigeria from a consumer nation to a producing nation,” Buhari said in 2017, two years into his tenure. Four years after Buhari took office, and with his second tenure in the bags, the situation has not much changed. Rice import between January and November 2018 was 3 million tonnes, which is 400,000 metric tonnes more than the quantity of the product imported in 2017, according to the United States Department of Agriculture World Markets and Trade Report. Milk import is still $1.3 billion annually, as $3.3 worth of steel and scraps still enter the country yearly. The Manufacturers Association of Nigeria (MAN) says only a policy shift on multiplicity of taxes, credit, energy, infrastructure and incentives can make the sector competitive and curb im-

ports as Buhari returns to power. “We want better and improved business environment,” MAN

said in one of its publications. “The business environment is still perverse with over-reg-

ulation and multiple taxes and levies, which inhibit investments Continues on page 34

13.89

NGUS AUG 21 2019 362.50

10 Y 0.08

20 Y 0.31

13.95

14.15

NGUS FEB 26 2020 363.40

Manufacturers yearn for energy, tax, port reforms in Buhari’s second term ODINAKA ANUDU & GBEMI FAMINU

FGN BONDS

TREASURY BILLS

PDP challenges outcome of presidential poll in court today ... To petition UN over militarisation of elections ... Lawyers divided over decision OWEDE AGBAJILEKE, ABUJA

he People’s Democratic Party (PDP) on Monday indicated that it would approach the court on Tuesday, March 5, to challenge the outcome of the February 23 presidential election and reclaim its mandate which, it said, was stolen by the ruling All Progressives Congress (APC). The main opposition PDP also decried the silence of national leaders and members of the National Peace Committee over the irregularities that allegedly characterised the election. “The decision to go to court Continues on page 34

Inside Understanding the economy of Nigeria’s 36 states – Kano & Katsina

President Muhammadu Buhari (l) receiving Samira Buhari, group general manager, public sector, Aiteo Group, who came to deliver Aiteo’s congratulatory message to the president on his re-election.

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Tuesday 05 March 2019

FX market picks up as trade on I&E Window increases by 65.81% ENDURANCE OKAFOR

he Investors & Exporters’ (I&E) FX Window reported a trade increase by 65.81 percent for the week ended February 22, 2019. The total value of trades recorded in the I&E Window for the review week closed at $1.94 billion (N701.94bn), from $1.17 billion (N423.34bn) reported in the previous week ending February 15, 2019, according to figures released by FMDQ OTC, a securities trading platform. The I&E Window was established by the Central Bank of Nigeria (CBN) in April 2017 to boost liquidity in the foreign exchange market and ensure timely execution and settlement for eligible transactions. Trade on the window for the week ended February 22, 2019 brings the year-to-date (YTD) value of trades at the window to $8.69 billion (N3.14trn). A review of trading activities in the Spot FX market amongst banks for the week ended February 22, 2019 also revealed an increase of 103.46 percent, as a total turnover of $559.42 million (average daily turnover of $111.88 million) was recorded, from $274.95 million (average daily turnover of $54.99 million) reported the week ended February 15, 2019. The trading activities in the Spot FX market between the DMBs and their clients stood at $2,196.16 million (average daily turnover of $439.23 million) for the review period, representing a decrease of 20.64 percent when compared to the $2,767.44 million (average daily turnover of $553.49 million) recorded the week ended February 15, 2019. A further analysis of the data by FDMQ revealed that in the OTC FX Futures market, $675.78 mil-

lion worth of OTC FX Futures contracts were traded in the 46 deals, compared to a total of $512.25 million traded in 37 deals for the week ended February 22, 2019. Meanwhile, Nigeria’s apex bank, in its periodic supply of US dollars in the FX market aimed at stabilising the naira, offered a total of $100.00 million to the Secondary Market Intervention Sales (SMIS) Wholesale window on February 26, 2019. The CBN also sold $55.00 million each to both the Small and Medium-scale Enterprises (SMEs) and the Retail (Invisibles) segment. The bank released the results for its auction of Chinese Renminbi and (US) dollar under the Bilateral Currency Swap Agreement (BCSA) and SMIS-Retail held on February 22, 2019, selling ¥46.30 million and $268.40 million at both sessions, respectively. The bank’s effort to maintain the country’s currency value may have rubbed off on the I&E Window considering that the naira appreciated at the Window in the week ended March 1, 2019, gaining N0.46 to close at $/N361.03 compared to $/N361.49 recorded the previous week, resulting in a spread of $/N3.03 between the BDC market rate and I&E FX Window rate. The spread between the BDC market rate and the CBN official exchange rate fell by N1.05 to close at $/N53.15, indicating a decrease of 1.94 percent from the $/N54.20 recorded in the previous week. Also, the 32nd OTC FX Futures contract, with contract amount of $563.55 million, matured and settled on Wednesday, February 27, 2019. The CBN introduced a new contract, NGUS FEB 26 2020 for $1.00 billion at $/N63.40, to replace the matured contract and refreshed its quotes on the existing 1- to 11-month contract.

DMO auctions 2 FGN savings bonds in March at lower rates OLUWASEGUN OLAKOYENIKAN

he Debt Management Office (DMO) has commenced auction on two-year and three-year Federal Government of Nigeria (FGN) Savings Bonds for the month of March at lower interest rates. The two-year and three-year Savings Bonds would be offered at 11.62 percent and 12.62 percent interest rates per annum, respectively as against 12.05 percent and 13.05 percent interest rates placed on the instruments in the previous auction. The two-year bond is expected to mature on March 13, 2021, while the three-year debt instrument would be due on March 13, 2022. The DMO, which offers the bonds for subscription on behalf of FGN, said subscription for the FGN Savings Bonds began on Monday, March 4, 2018, and is expected to close on Friday,

March 8, 2018. The state-funded debt agency assured that the bonds, which have quarterly coupon payments from the issue date, are backed by the full faith and credit of the Federal Government of Nigeria and charged upon the general assets of the nation. It also guaranteed a bullet repayment of the principal on the maturity date. The bonds are offered at N1,000 per unit subject to a minimum subscription of N5,000, with increases thereafter in multiples of N1,000 up to a maximum of N50 million. The FGN Savings Bonds are targeted at encouraging lowincome earners to save and earn more interests than the regular bank savings. The bonds are issued to assist the government finance its budget deficit, but also help in promoting savings culture and enhancing financial inclusion in the country as income earned from it is exempted from taxes.

L-R: Olumide Bolemole, divisional head, listing business division, Nigerian Stock Exchange (NSE); Oladipo Aina, MD/CEO, Signet Investment and Securities Limited; Patrick Ezeagwu, chairman, Association of Stockbroking Houses of Nigeria (ASHON); Ifeyinwa Rita Ejezie, MD/CEO, Cashville Investments & Securities Limited, and Jude Chiemeka, divisional head, trading business division, NSE, during the Fixed Income trading workshop for dealing members at the exchange in Lagos. Pic by Pius Okeosisi

24 months after Aero facility upgrade, airlines spend N7bn on aircraft maintenance abroad ... as Ghana inks deal with Aero to commence C-checks IFEOMA OKEKE

wenty-four months after Aero Contractors upgraded its facility to carry out maintenance on Boeing 737 aircraft in Nigeria, domestic airlines still spend about N7 billion annually to maintain their aircraft outside the country. There are not less than 23 Boeing 737 aircraft operating in Nigeria, but Aero Contractors has been able to carry out Cchecks on only three aircraft in its facility. The remaining 20 aircraft are still being maintained outside the country. Out of the 23 Boeing 737 operating in Nigeria, Air Peace operates 12, Azman operates three, Medview operates three, Allied Air has two, JetAir operates one, and two other charter services operate two Boeing 737s, BusinessDay checks show.

A C-check on a Boeing 737, which is conducted after 12 to 18 months, costs airlines between $800,000 (N288 million) and $1 million (N360 million) per aircraft. This amount does not include the cost of ferrying the aircraft abroad and other charges. On the other hand, carrying out a C-check in the Aero facility in Nigeria costs between N50 million and N60 million per aircraft. With an exchange rate of N360/$, airlines operating in the country will pay at least N7 billion to maintain the other 20 Boeing 737 aircraft outside the country, whereas carrying out C-checks in-country for all 23 aircraft at the cost of N50 million-N60 million will save airlines between N5.47 billion and N6.9 billion on maintenance. But while Aero has been able to successfully carry out only three aircraft maintenance in 24 months, it has received ap-

proval from Ghana Civil Aviation Authority (GCAA) to conduct checks on their aircraft, Ado Sanusi, managing director and chief executive officer, Aero Contractors, told BusinessDay. “In the past 24 months, we have done three C-checks for the airlines. We have saved huge amount as foreign exchange,” Sanusi said. The Aero boss said an average C-check costs the airlines between $800,000 and $1 million, but Aero is carrying out C-check at N50 million-N60 million. “It is now in naira. We have cut down the cost of ferrying the aircraft, the cost of over flight charges and the turnaround cost. We have carried out Cchecks for a couple of local and regional airlines and we are in discussion with two regional airlines that want us to conduct two Continues on page 34

UK to inject £30m through new partnership with AU Commission HOPE MOSES-ASHIKE

he United Kingdom is set to inject up to £30 million into prosperity and security projects across Africa as it steps up its investment in the continent, Harriett Baldwin, UK minister of State for Africa, said on Monday. The funding boost comes as Britain signs a new strategic partnership with the African Union (AU), strengthening the

engagement between the continent and the UK government. “From our support to observers ensuring free and fair elections in Nigeria and Senegal this weekend, to the crucial training our Armed Forces provides to security forces in Kenya, the UK’s partnership with African countries continues to help empower and upskill people across the continent, and this funding will allow us to boost those efforts,” Baldwin said ahead of the sign-

ing of the partnership at the AU Commission headquarters in Addis Ababa, Ethiopia. “Our new partnership will also cement our relationship with the African Union, building on growing economic ties to forge new opportunities for young people and reinforce our close bonds,” Baldwin said. The partnership will strengthen cooperation on security and prosperity, and Continues on page 34

Tuesday 05 March 2019

BUSINESS DAY

Tuesday 05 March 2019

Prioritise oil sector reform, BudgIT tells Buhari HOPE MOSES-ASHIKE

udgIT has called on President Muhammadu Buhari to assign a higher priority to oil and gas sector reforms in the second phase of his administration. The civic organisation made the call following the outcome of the Presidential Election, which returned Buhari government to Aso Rock. Recall that President Buhari rejected last August the Petroleum Industry Governance Bill (PIGB) passed by the National Assembly after 16 years of back and forth. Needless to reiterate, the PIGB would liberalise the governance structure of the oil industry, strengthen institutions and entrench transparency. For these critical reforms, we ask that the Bill be reconsidered. In a statement signed by Shakir Akorede, communications associate, BudgIT also demands dire attention in the issue of beneficial ownership. BudgIT notes that a lot of oil companies seem to operate under fake identities. According to BudgIT, “A lasting example is the case of Malabu Oil scandal in which Dan Etete, petroleum minister under the Abacha regime, acquired “OPL 245” through Malabu Oil and Gas Limited, a camouflage of his personal company, to perpetuate one of the biggest frauds in the history of Nigeria’s oil sector.” Besides, our analysis of NEITI’s last audit report revealed: Losses arising from crude oil theft and sabotage in the upstream and downstream sectors amounted to $869.02 million and $3.55 billion respectively in 2016. “If properly structured back into the economy, the whopping amount that goes down the drain, courtesy of these lapses, will go a long way in contributing to the economic recovery and growth plan of the government,” noted Gabriel Okeowo, BudgIT’s principal lead. Lack of transparency and accountability remains the biggest challenge in the oil and gas sector. To solve this, ensuring capacity building as well as the development of effective business models that are profit-driven, calls for decisive reforms can no longer be ignored. More so, we strongly believe that the reforms will go a long way in enhancing good governance and processes that are flexible to the peculiarities of Nigeria’s oil and gas industry.

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NIWA imposes $300 daily passage fee on ocean, seagoing vessels AMAKA ANAGOR-EWUZIE

ational Inland Waterways Authority (NIWA) has introduced $300 per day passage fee to be paid by owners of all ocean-going and coastal vessels that come into the nation’s inland waterways. NIWA, in a memo dated February 4, 2019, and signed by Muazu Sambo, general manager, Lagos Zone of NIWA, said forthwith, all ocean and sea-going vessels that come into the inland wa-

terways must pay a passage fee of $300 per day or naira equivalent. “In line with Section 28 subsection 1 of the NIWA establishment Act and the NIWA approved tariff 2017 edition (Section U.I and subsection U.1.2), any sea/ ocean/coastal going vessel that comes into the inland waterways is liable to pay passage fees of $300 per day or its equivalent,” the NIWA memo, which was addressed to chairman, Lagos Pilotage Berthing Meeting and titled ‘Passage Toll for Seagoing Vessels,’ stated.

Sambo, however, enjoined the pilotage berthing meeting to ensure that all sea-going vessels that berth at its jetty comply with the provisions of the law to avoid any form of embarrassment that might arise from non-compliance. “You are kindly enjoined to give maximum support to the authority in its effort to ensure that all lawful revenues due to the treasury are collected and remitted as and when due,” Sambo said in the memo. Reacting, Lucky Egbede, secretary of the Lagos Pilotage Berthing Meeting,

said the leadership of the meeting had asked members to disregard the notice because, according to him, the body is not under the supervision of NIWA but the Nigerian Ports Authority (NPA). “NIWA said any seagoing vessel that comes into the port will pay $300 per day. For example, if on the average, there are 20 vessels inside the port, and each of the vessels is paying $300 per day, and we have berthing day of about three days for a vessel to stay in the port, invariably, they are saying a ship should pay $900 for

the three days,” he said. He further said: “NIWA is a government agency, they will be issuing charges. They have called us at the NIWA office and we have told them we are not going to pay the fee because our principals are NPA. We don’t do business with NIWA. We need to hear from NPA first.” Egbede, who called on other relevant government agencies to intervene on the issue, said the NIWA was supposed to be registering tugboats and badges, but he wondered their concern about oceangoing vessels.

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L-R: Kojo Boakye, public policy manager, access and connectivity, Facebook; Ibrahima Ba, network investments lead for emerging markets, Facebook; Funke Opeke, CEO, MainOne, and Kazeem Oladepo, business executive, MainOne West Africa, during the Mobile World Congress, in Barcelona, Spain, recently. Facebook and MainOne recently announced a partnership to build open-access fibre networks in Edo and Ogun states.

UK-based medical expert institutes lecture series, scholarship fund at Edo Poly … as Obaseki lists gains of APC-controlled House of Assembly

mpressed with the dedication and focused leadership at the Edo State Polytechnic, Usen, a United Kingdom (UK)-based medical practitioner, Yusuf Amuda Garuba, has instituted a lecture series and scholarship package at the Department of Food Technology at the institution. The first edition of the lecture series holds on March 5, with the topic: ‘The burden of food borne related toxicity and liver disease in Nigeria,’ and is to be delivered by senior lecturer and researcher at Department of Medical Laboratory Science, University of Benin, Igharo O. G., at the polytechnic’s complex in Usen, near Benin City. The Polytechnic has recorded improved performance in the last one year

since the state governor, Godwin Obaseki, commenced revamp of the institution. The new direction of the institution steered by Abiodun Falodun, a professor, has seen the institution record increased academic and research activities as well as infrastructural development. Speaking with journalists, Rector of the institution, Falodun, said the school community was pleased with the growing list of Nigerians in the Diaspora, who were looking homeward and contributing to the institution’s growth. According to Falodun, “Aside the lecture series and the scholarship for the best graduating student in the Department of Food Technology, Dr. Garuba has a standing relationship with

Afreximbank appoints Abel Osuji as director HOPE MOSES-ASHIKE

he African ExportImport Bank (Afreximbank) has appointed Abel Osuji as Director of its Internal Audit Department following the upgrade of that function into a full department. Until the appointment, Osuji had, since 2010, served as Senior Manager heading the internal audit function of the bank, which operated at the unit level. Osuji joined Afreximbank from Masters Energy Limited, Nigeria, where he was Assistant General Manager, Internal Audit, until 2010. Prior to that, he had served as Head, Investigation and Business Risk Monitoring Unit, at Intercontinental Bank (now Access Bank), Nigeria, between 2000 and 2010, and as Trainee (staff Accountant),

Senior Accountant to Audit Supervisor, at EY (formerly Ernst & Young) Nigeria, from 1994 to 2000. The new director received a Master of Science in economics from Enugu State University of Technology, Nigeria, in 2005, and an MBA from University of Lagos in 2000. He also holds a Bachelor of Science in accounting from the University of Port Harcourt, Nigeria, received in 1992. Osuji was elected Fellow of the Institute of Chartered Accountants of Nigeria in 2013 and holds a Certified Risk Analyst certification, which he received from the International Academy of Business and Financial Management in 2013. He attended the Advanced HighPerformance Leadership programme at IMD in Switzerland in 2018.

the department and would contribute to its growth. He has also donated some equipment to the school’s health centre. As a medical practitioner, he is willing to contribute his expertise and other forms of support to the polytechnic.” Noting that the institution is poised to contribute meaningful to societal growth through research and development, he said, “As a polytechnic, we have a mandate to provide practical solutions to problems in society. So, aside the lecture series, we are also engaging in in-depth applied research across different disciplines.” Meanwhile, the state governor, Godwin Obaseki, has itemised the benefits of having an All Progressives Congress-controlled state House of Assembly to include a

rancour-free relationship between the legislature and the executive arms of government, which would enhance the ease of governing. The governor, who urged voters in the state to come out en masse to elect candidates of the APC in the forthcoming House of Assembly election, said, “Under the current APC-controlled state assembly, we have had harmonious relationship that paved the way for several laws that have enhanced the wellbeing of Edo people and residents.” He said, “We were able to nip the unwholesome activities of Community Development Associations (CDAs) in the bud, through a piece of legislation that received expedited action from members of the Edo State House of Assembly.

Nsima Ekere assured of victory in Akwa Ibom gubernatorial polls

eadership of the All Progressives Congress (APC) has reassured the gubernatorial candidate of the APC in Akwa Ibom, Nsima Ekere, of victory at the polls. The reassurance, which came in Abuja shortly after the presidential acceptance speech, was given by President Muhammadu Buhari while receiving the certificate of return from the INEC chairman, following his victory at the nationwide polls. The Akwa Ibom gubernatorial candidate, Nsima Ekere has campaigned across the length and breadth of

the state, and vowed to return the state to its enviable place in the comity of states. Also, the Presidency has tasked the Independent National Electoral Commission (INEC) on the need to ensure free and fair elections, not only in Akwa Ibom, but also across the country. This became imperative following reports of alleged voter intimidation and violent activities at the last Presidential and National Assembly elections, especially in Akwa Ibom State. Ekere of the APC has promised to lead the state into an era of collective progress and prosperity.

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Tuesday 05 March 2019

Nigerian market gets new range of renewable energy solutions SEGUN ADAMS

n line with its vision to provide sustainable and reliable quality power solutions across Africa, utilising a variety of technologies, Royal Power & Energy Limited, a Lagos-based power solutions provider, launched a new array of products into the Nigerian market at the weekend. The alternative energy products add to the portfolio of the renewable energy firm, and they include Signal, Solar-hybrid Inverters; Numeric UPS, online inverters; Ritar Batteries; Signal tubular Batteries, among others. These new products, according to the company at the event in Lagos, have the capacity to meet the various energy needs of the market whether for commercial or residential purposes - depending on the product type - as they have been built with the latest technologies to ensure clean and reliable power supply. The UPS Systems, for instance, are available in a number of specifications and offer a convenient and flexible interface for user experience. Advanced DSP/Microprocessor Design, Wide Input Voltage Rage, Web Enabled Monitoring, Extended battery back-up time option are just a few of the features of the UPS devices, which can be used in hotels, industries, banks and in much other application. The Solar Hybrid Inverters

are a great option for organisations and residences as they offer a three-in-one buffer with options of solar, generator and grid power. According to Anil James, assistant general manager, Royal Power & Energy, the 3.5KVA variant, which is capable of supplying uninterrupted power to a four-bedroom apartment with its four batteries can sell for about N850,000. However, other smaller models of the inverter like the 1.5KVA are available to suit the energy demand of consumers with smaller budget size. James explained that the opportunities exist for interested customers to buy the products through a flexible payment plan, saying, “Depending on the situation, an arrangement is made through the banks to allow for instalments on a monthly basis between one and two years.” Batteries, Industrial Servo Stabilizer (AVR), Electrical control panels, Protection systems, Metering and Monitoring solutions, Compact substations, Transformers, Cables, Conductors, and Power Network equipment are other products available for the market. Asides alternative energy products offering, the company also offers consultancy and managed services as well as enjoy a reputation of providing technical skills to successfully deliver power projects on Engineering Procurement and Construction Contracts.

Tuesday 05 March 2019

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FIRS generates N12.6trn revenue in 3 years … as NBS says foreign trade records 4th consecutive rise in 2018

ederal Inland Revenue Service (FIRS) says it generated N12.62 trillion revenue from tax in the last three years. FIRS said this in a document on its achievements, a copy of which was made available to the News Agency of Nigeria by Wahab Gbadamosi, head, communications and Servicom Department of FIRS, in Abuja. A breakdown of the amount showed that N3.3 trillion was generated in 2016, N4.02 trillion in 2017 and N5.32 trillion was realised in 2018, making it the highest revenue generated in the last three years. According to the document, the FIRS under the leadership of Babatunde Fowler designed initiatives to ensure a robust tax administration that is beneficial to all stakeholders. The organisation said non-oil tax revenue increased to N2.149 trillion in 2016, N2.5 trillion in 2017 and N2.852 trillion in 2018. The document quoted Fowler as saying: “The achievements mentioned above also demonstrates the diversification of the Nigerian economy by the Federal Government. “This does not mean that we have left behind the oil tax revenue. It grew from N1.15 trillion in 2016 to N1.52 trillion in 2017 and N2.52 trillion in 2018. Nonoil tax revenue is still over in excess of the oil tax revenue. “We also do collect 4 percent in terms of cost of collection but only for non-oil revenue collected. On oil revenue collection, we do not get any commission and

we have been able to make sure that our services are more efficient and convenient to taxpayers. “This has brought about a considerable reduction in the cost of collection of actual taxes. “In 2016, it was 2.6 per cent, 2017, 2.49 per cent and 2018, 2.14 percent, meaning that our actual cost of collection is heading downwards based on the efficiency and technology that we are deploying to tax collection. “Some of the ICT initiatives that we have continued to build on are the e-payment channels which makes it convenient and easy to pay taxes anywhere in the world and to also download receipts of payment from any point one so desires,” he said. Meanwhile, the National Bureau of Statistics (NBS) says foreign trade recorded fourth consecutive rise from N16.29 trillion in 2015 to N32.26 trillion in 2018. The NBS said this in its “Foreign Trade in Goods Statistics for Fourth Quarter of 2018” posted on its website. The bureau said foreign trade in 2015 was N16.29 trillion, N17.34 trillion in 2016, N23.16 trillion in 2017 and it rose to N32.26 trillion in 2018. The bureau said the volume of total merchandise trade in 2018 was the highest recorded since 2014, almost doubled pre-recession levels. Meanwhile, the bureau said during the fourth quarter of 2018, total merchandise trade stood at N8.60 trillion compared with its value of N9.06 trillion recorded in third quarter of the year.

L-R: Olohita Iribhogbe; Olusola Oguche-Agudah; Enobong Assan; Cresta Durojaiye, and Oghomwen Ogbonmwan, members of the organising team of the Association of Productivity and Organising Professionals in Nigeria (APON), during the launch of the association in Lagos.

FAAN denies allege takeover of MMA2 on May 7 IFEOMA OKEKE

he Federal Airports Authority of Nigeria (FAAN) has denied engaging in any plan to takeover Murtala Muhammed Airport Two (MMA2) from Bi-Courtney Aviation Services Limited (BASL) on May 7, as some reports allege. Henrietta Yakubu, general manager, corporate affairs, FAAN, told BusinessDay Monday that FAAN was not aware of any plans to take over the operations of MMA2, saying maybe someone was trying to be mischievous by circulating such reports. Sahara Reporters two days ago had reported that a source close to the Ministry of Transport, Aviation Unit, said over the weekend

Refusal to institute NSITF Board slows performance – NECA ISRAEL ODUBOLA

he Nigerian Employers’ Consultative Forum (NECA) says the refusal of the minister of labour and employment, Chris Ngige, to inaugurate the boards of Nigeria Social Insurance Trust Fund (NSITF) and other Federal Government agencies under it, is hampering the performance of the private sector. According to NECA, the umbrella organisation of employers in the organised private sector in Nigeria, failure to inaugurate board members several months after they were appointed violates the laws that establish those agencies, adding that his insistence retards the growth of affected agencies. Timothy Olawale, directorgeneral of NECA, expressed disappointment that board members were yet to be inaugurated after being nominated

several months ago by President Muhammadu Buhari. Olawale said some ministers defied the directive of the President without any consequence, saying the situation was pathetic, especially for a country like Nigeria that pride itself in the rule of law. He advised that government should ensure the practice of good corporate governance at all levels, adding that the Acts establishing the agencies had provided for the composition of the board members, and in some cases institutional representatives to the boards were permissible. It would be recalled that Ngige promised to inaugurate board members in July 2018 after being pressurised and threatened with expulsion from the ruling All Progressives Congress (APC). The minister once vowed that the board would be inaugurated in order to complement efforts of the imple-

mentation team of the audit committee instituted by him, to examine the financial infractions in the Fund. The minister disclosed that the implementation committee of the audit report aimed to enforce various policy recommendations and enhance the weak internal audit system of the Fund. In August 2017, the Federal Government nominated Frank Kokori, former general secretary of Nigerian Union of Petroleum and Natural Gas Workers (NUPENG) as chairman of the board. Peters Adeyemi, former vice president of Nigerian Labour Congress (NLC); Khaleel Ibrahim, treasurer of NLC; representatives of NECA; managing director of NSITF; representatives from Central Bank of Nigeria and permanent secretary of the Federal Ministry of Labour and Employment were selected as board members.

that the ministry had given the management of FAAN the approval to take over the terminal on the expiration of the 12 years consensual agreement between BASL and the agency. It was learnt that the 12 years would elapse on May 7, 2019, which was the exact date the terminal commenced operations with flight service by the rested Chanchangi Airlines from the terminal. The report alleged that the planned takeover of the terminal was also causing some instability among the staff of BASL, already looking elsewhere for alternative jobs in case the threat by the government comes to fruition. The report added that Wale Babalakin, chairman of BASL, was also making frantic efforts through some of his contacts in the Presiden-

cy to frustrate the takeover of the terminal on the due date, claiming that the concession agreement between the two was for 36 years, but FAAN was adamant to take possession of the terminal as spelt out in the agreement by May 7. BusinessDay’s checks show that the relationship between FAAN and its tenant, BASL, has been far from rosy since the terminal operator commenced services at its facility on September 8, 2007. Both parties have consistently accused each other of violating the contractual agreement, signed after the former General Aviation Terminal One (GAT1) of the Murtala Muhammed Airport (MMA), Lagos, got burnt in 2001. The tussle is believed to be connected with monopoly of the Lagos domestic operations, and years of conces-

sion on the agreement. Part of the contentious issues, initially undisclosed, is that BASL will operate the facility as the sole domestic terminal in Lagos for a period of 10 to 15 years, with addendum for extension to 36 year as is the case for most of such investments around the world, given the huge capital nature of the venture. Apparently in disagreement with the 36 years claim, FAAN went on to build the General Aviation Terminal (GAT) to rival MMA2, contrary to the earlier agreement, especially the monopoly clause. When tested at an Arbitration Panel and law courts, up to the Court of Appeal, the rulings were in favour of BASL, including the award of the GAT to BASL, and the endorsement of 36 years concession period.

ID Africa acquires TheNETng to form marketing, media, technology powerhouse SEYI JOHN SALAU

nfo Digital Africa (ID Africa), a Nigerian digital agency, recently announced the acquisition of NET Newspaper Limited (NNL) TheNETng parent company, a strategic move to expand its frontiers in the media and marketing communications industry. The acquisition will see ID Africa take up controlling shares and oversee the management of properties such as TheNETng, NECLive, 234Star, Neusroom, Orin, NETshop and other NET News properties. While Femi Falodun, the CEO at ID Africa, has been announced as the new chief executive officer (CEO) of ID Africa after the merger. With an average year-onyear revenue growth of 40 percent, ID Africa, a creative

… appoints Femi Falodun as CEO communications and digital marketing company founded in 2015, is one of the fastest growing digital marketing, media and communications companies in Nigeria. Over the years, the digital agency has built a commendable track record, which includes executing over 150 successful marketing campaigns, contributing to the growth of various international brands, as well as creating over 20,000 hours of video content, which have amassed over 15 million views across digital platforms. It is expected that upon conclusion of the acquisition process, ID Africa will become a formidable 360 marketing communications and media company using technology and creative content to connect brands and individuals with their target audiences.

Under its new operation, ID Africa will look to deliver technology solutions, consumer products, marketing communications services, as well as media and publishing services through its news, entertainment and lifestyle content platforms. “The alliance between ID Africa and TheNETng is a strategic move intended to bring these great companies together in order to create an all-in-one communications entity within Africa’s marketing, media and tech industries. “By bringing together the best of our resources, capabilities and know-how, we will deliver the industry’s best marketing communications and media services for clients, as well as excellent technology solutions and products for a wide range of consumers.

8 BUSINESS DAY NEWS Niger tops states with illegal mining in Nigeria, five others follow JOSEPH MAURICE OGU

iger State leads the states with illegal mining of solid minerals in Nigeria, according to the latest report by Nigeria Extractive Industries Transparency Initiative (NEITI). Reporting on improving transparency and governance for value optimisation in Nigeria’s mining sector, NEITI SAID Plateau, Ebonyi, Imo, Enugu and Zamfara, in that order, were the other five states where illegal mining activities were high in the country. The report said Niger State had 10 illegal mining sites where minerals such as gold, lead, zinc and tantalite were consistently mined illegally. Tin, dolomite, barites and zinc are minerals found to be taken away illegally in Plateau State in seven different mining sites, making the state the second on the list, according to NEITI. Ebony and Imo states had five illegal mining sites each, while Enugu and Zamfara paraded four illegal mining sites each, where cumulatively, lateritic soil, lead, zinc and gold were illegally taken, the agency said. Currently, solid mineral sector contributes 0.3% to Nigeria’s Gross Domestic Product (GDP), a ratio that the Minister of Mines and Steel Development, Abubabar Bawa Bwari, hopes will increase to three percent by end of 2019. Equally, NEITI noted that if the country adequately and transparently harnesses its solid mineral resources deposited across the 36 states, the minerals could contribute significantly to the nation’s wealth. However, the amount that Nigeria loses daily due to illegal mining activities is difficult to quantify because data in the industry are either not available or not reliable, according to analysts. “It’s difficult to put a value to it, very difficult. But what is taken out illegally is huge,” Oyewole Oworo, a Lagos-based solid minerals consultant, said. “Much of the data on Nigeria’s mineral production remain unreliable mostly due to the fact that the mining operations are conducted mainly by smallscale artisanal miners, and also due to the proliferation of illegal mining across the country,” the editorial consultant of NEITI, Gbenga Okunlola, said.

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Tuesday 05 March 2019

Plea bargain recognised in Lagos’ criminal justice system - CJ JOSHUA BASSEY

... urges judges to consider it

hief Judge (CJ) of Lagos State, Opeyemi Oke, says plea bargain is an integral part of the state’s criminal justice system and that the controversy associated with it whenever adopted is needless. Opeyemi made the clarification at a special training session for magistrates on plea bargain, Monday, in Lagos, saying its adoption, as a procedure in criminal proceedings, was to avoid undue delay in the dispensation of

justice. Plea bargain, also referred to as plea agreement or plea deal, is any agreement in a criminal case between the prosecutor and defendant whereby the defendant agrees to plead guilty to a particular charge in return for some concession from the prosecutor, usually, a more lenient sentence, or a dismissal of the other charges. One of the popular plea bargain case was one between Lucky Igbinedion, former governor of Edo State

(1999-2007) and the Economic and Financial Crimes Commission (EFCC) in which the former governor got a lenient term refunding far less than accused of stealing from his state. According to the Lagos CJ, the concept of plea bargain, which is gradually gaining ground in Nigeria, is famous in the legal and socio-political lexicon. “In Lagos State, the Administration of Criminal Justice Law has lent its hands in a push toward the adoption

of the concept of plea-bargain as an accepted procedure in criminal proceedings. “Arguably, since its incorporation as a feature of our criminal justice administration, it has proven to be a useful tool in aiding criminal justice administration and has also curtailed undue delays in the dispensation of criminal justice,’’ the CJ said. She argued that plea bargain saves judicial time and resources, reduces trauma on the victim, helps in prison decongestion and case management as well as reduces the number of awaiting trial

inmates. “A considerable number of high profile cases prosecuted by anti-graft agencies have been concluded using the plea bargain tool which, to my minds, is a form of criminal justice package on its own. It is here to stay and it gladdens my heart that we are here to partake of the wealth of knowledge and experience from our distinguished faculty,” she said. She said the importance of regular training for magistrates could not be overemphasised, as it would keep adding to their knowledge.

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Buhari’s re-election: A time to make Nigeria work STRATEGY & POLICY

MA JOHNSON

he way leaders emerge in a democracy is very key. Most times, leaders have always emerged through intrigues and mischief in most parts of Africa. It is the weakness of democracy that allows these flaws. When there are weak state institutions and frail democratic culture coupled with impunity in any society, one begins to see the inherent weakness of democracy. Irrespective of the imperfections of democracy, Nigerians took their destiny in their hands once again regardless of the pranks of tribal and religious die-hards to vote for a president and also members of the National Assembly (NASS) of their choice on 23 February 2019. Although, there were many political aspirants jostling for the number one position in the country, the political battle was mainly between former Vice President, Atiku “Atikulate” Abubakar, of the People’s Democratic Party (PDP) and President Muhammadu Buhari (PMB) of the All Progressives Congress (APC). Before the election, it was crystal clear what Nigerians wanted- a new era. They wanted a new era with an active, dynamic and vibrant president that will make Nigeria work again. Many frustrated Nigerians

wanted someone else to lead the country because of the poor state of the nation’s economy. Unfortunately, the election did not usher in a new era. By the time results of the election were collated and announced, PMB was re-elected as the President of Nigeria. Nigeria’s desire for change was motivated by choice and desire for a prosperous nation. With the emergence of PMB as the President for a second term, Nigerians will not have a change in leadership at the opulent and cozy Presidential Villa. The emergence of PMB for a second term was not without violence as gun-wielding tugs took charge of some polling units in some parts of the country. Even security operatives were not left out in ballot box snatching. A pity as the show of shame was observed on social media. Going by the tension created by politicians before and after the elections, one predicted erroneously though, that the elections was going to end up in a scuffle among political party supporters across the country. But for divine intervention, the elections could have ended up in a disaster. Discussing democracy and conduct of elections in Nigeria, it appears we are still in the Stone Age. Some politicians and their supporters see political succession as a do-or-die affair. So they deploy all forms of archaic and crude tactics to ensure that they remain in political office. The situation is so bad that some Nigerians wonder why the black man is in love with power. It’s most unfortunate that many of our politicians arrogate power to themselves as if they will live as long as Methuselah. “Methuselah is a biblical patriarch who lived and died

at the age of 969 years.” Our politicians have forgotten that power is momentary and God-given. Once our kind of politicians are elected into political office, they abuse power. The tussle by politicians before elections for political offices is not because they want to serve the people. It’s due to easy access to public funds. But this time, the electorate realized they are in the midst of “political wolves.” So most voters adopted a biblical strategy in which they were wise as serpents and harmless as doves. They adopted this biblical strategy so that democracy can survive in Nigeria. In spite of the tensed atmosphere, PMB won by 56 percent to 41 percent but the turnout was 36 percent, according to reports. The apathy displayed by many voters to stay away from polls was perhaps, due to Nigerians’ disappointment with the political elites and their ability to improve their wellbeing. This victory gives PMB the second chance to polish his image in order to solve Nigeria’s numerous ills. PMB has been given a chance to convince Nigerians and our friends in the international community that he is truly a democrat, not a dictator. Nigerians are hereby congratulated for their patience and loyalty to the nation. We need to congratulate ourselves for loyalty and patriotism to our dear nation during and after the recently concluded presidential and NASS elections. We have demonstrated to the world by our conduct that Nigeria is our country and there is no place like home. Events during and after elections show that we are democratic despite our inadequacies. And that we are an assemblage of responsible people, able and willing to take ownership of our country only by choice and sound

‘

PMB has been given a chance to convince Nigerians and our friends in the international community that he is truly a democrat, not a dictator

judgment. Elections were regarded as peaceful but with some flaws just like the ones in previous years. Atiku Abubakar has vowed to go to court to challenge the outcome of the presidential elections. Some Nigerians are saying he should not go to court. But why should Atiku not go the court, I asked? It’s one of his rights as a Nigerian to go to court if he has grievances about the election results. I hope he has sufficient facts and evidence to help him prove his case before the court. Anyway, it is cheering news that investors will carry on with business in Nigeria regardless of decision by Atiku to challenge the outcome of the election in court. Now that PMB has been given the opportunity to prove to Nigerians that he is a genuine leader made up of gold, and not lead of inferior quality; he must stop blaming the past for the nation’s economic woes. He must focus on having a competitive economy. His ministerial nominations and appointments of service chiefs must be anchored on competence bearing in mind federal character. PMB must bridge communication gap and engage better with Nigerians. A fair and dogged fight against corruption and insecurity must continue. Above all, PMB must work assiduously towards reuniting Nigeria. In 2019 elections, mischief makers will not profit from their venture. As we prepare for the last phase of elections on 09 March 2019, I wish Nigerians the best and God’s speed! Johnson is an eclectic researcher, writer and columnist whose articles cover maritime, defence, technology and public policy issues and other areas of human interests. He is a member of the BusinessDay Editorial Advisory Board)

A post election post-mortem

Bola Adediran

n his classic, A Tale of Two Cities, Charles Dickens wrote: “It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to heaven, we were all going direct the other way”. Indeed, at the moment, no such equivocation can be made regarding Nigeria. These are plainly difficult and dangerous times, with nothing in between. I fail to see hope, and I despair greatly, and so should you. Over the last four years, we have seen a ruling class collectively exhibit an unprecedented level of cluelessness in addressing a sputtering economy. The economy contracted in 2015 and 2016, and

grew by a meagre 0.8 percent in 2017 and 1.9 percent in 2018. We have seen a dictator increasingly bare his fangs and reverse democratic gains by sacking the Chief Justice of the federation. We have also seen his cronies unabashedly trample on basic democratic norms. For instance, in the run up to the election, the self-styled emperor of Lagos State-a career politician-confidently said that he is richer than Osun State. And as if to empirically back up his claims, on the day of the presidential election, bullion vans were pictured in his Bourdillon residence, ostensibly dishing out cash, buying loyalty, and making nonsense of the electoral process. In saner climes, not only would there be a near universal expression of disgust at the statement and his action, it would certainly have instigated a criminal investigation. Yet, both went without as much as a whimper from anyone, or any institution-even the opposition carried on as if this were a nonissue. Of course, that is not surprising; after all, the opposition bled the country white in 16 years as the ruling party, and took corruption to an obscene level. I suspect that this particular fact is partly why the APC feels emboldened and almost defiant in the way its party lieutenants have been conducting themselves. They seem to be operating with the logic that because the PDP failed miserably, Nigerians must be content with their

glaring incompetence. But Nigeria deserves better. It deserves better than a political class that governs unconcerned about the complete trivialisation of the human life in many parts of the country, that politicises the ethnic cleansing being conducted by the Fulani herdsmen, and continues to allow the Bokoharam insurgency constitute an existential threat to the country. In a country of 190 million people, Nigeria certainly deserves better than the two dim-witted presidential candidates fielded by the major political parties. Another 4 years? I do not have much hope for the next four years. Failure and incompetence have certainly been rewarded with a fresh mandate. A mandate to further institutionalise and consolidate Nigeria’s ignoble position as the poverty capital of the world should fill anyone with dread. But in all honesty, what was the alternative to Buhari? Atiku Abubakar? Bloody no! Between 1960 and 2012, Nigeria lost more than US $400billion to corruption and US $32billion under Jonathan’s administration according to several international agencies, including the DFID. Yet, in a recent interview, Atiku offered a ludicrous explanation for the allegations of corruption that have always dogged him. According to him, he is not corrupt because he has not been indicted or charged. Frankly, that explanation is

not only laughable, but insulting to our collective intelligence. It is akin to a thief insisting that he is not a thief because he is yet to be caught. Atiku Abubakar must now realise he has nothing to offer. No one has flip-flopped as much he has over the last decade in his bid to realise his ambition of becoming president. That he and the PDP have lost to an ailing president and his much beleaguered party that had both become deeply unpopular proves this in no uncertain terms. Having said that, I have been impressed by Atiku’s tenacity, especially his attempt to cast himself as a bridge between the old and the young -- remaining clearly unconcerned about the optics of such a claim from a 72 year old grandfather. And the PDP? Its electoral future lies in its ability to successful shed the toga of corruption. In these dangerous times, painful as it is to say, the PDP might be Nigeria’s best hope. I would like to see it gradually build up its credibility and become an effective opposition in the intervening period. But then again, Nigerians are notoriously great at forgiving impossible sins. It may indeed be that by the next election the PDP’s litanies of sins would have been all forgiven, and nothing would have changed! Dr Adediran is a Senior Lecturer in Politics and International Relations at the University of the West of England, Bristol. He writes via bolarinwa.adediran@gmail.com and tweets at @bholarinwa.

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Nigeria decides 2019: Post-election note (2) Rafiq Raji

Turnout conundrum ne of the facts that struck me after the release of the 2019 presidential election results in the last week of February was the relatively low turnout. Hitherto, anecdotal evidence suggested turnout was ‘impressive’. On a relative basis, it was not. But it was indeed impressive on an absolute basis; especially in light of the prevailing factors of the one-week delay of the poll, security fears and the logistical challenges of the Independent National Electoral Commission (INEC). 29million registered voters were accredited for the 2019 presidential poll; the same number of voters that participated in the 2015 poll. Relative to the number of registered voters, however, the 36 percent that voted this time around was lower than the 44 percent of 2015. 82 million Nigerians registered to vote in 2019, more than 20 percent higher than the 67 million that registered to vote in 2015.

A well-known public figure made an interesting point about what could be responsible for the relatively low turnout. His view was that the turnout figures for the elections in 1999 (30 million), 2003 (42 million), 2007 (35 million) and 2011 (40 million), which did not use card readers for voter accreditation, were probably bloated. Put simply, they were higher because it was easier to rig elections back then when card readers were not part of the process. So, the more reliable base to compare the 2019 turnout of 29 million should be the 2015 poll figure of the same amount. Why? Card readers were first used in 2015. In a nutshell, the turnout would be poor or good depending on whether you choose to look at the proverbial ‘glass of water’ as half-full or half-empty. Still, there was indeed significant voter apathy. And it is likely the one-week delay contributed to the disinterest. Nothing wrong with going to court I have been asked whether the decision by the main opposition People’s Democratic Party (PDP) candidate Atiku Abubakar to go to court is good or bad for the economy. My view is that it is good for our political development. Thus, unlike the popular view that Mr Abubakar should choose to be a statesman by conceding defeat, I think he would do a greater service to the nation by going to court. Since it is highly unlikely Mr Abubakar would prevail in court, his primary object in taking legal action should be the improvement of our democracy. It could be hoped that the process would reveal

certain irregularities and mis-steps that could in the aftermath of his legal action be corrected by a better electoral law. Reform INEC & electoral process There is clearly a need to unbundle INEC, for instance. While it could never be ‘independent’ in the real sense of the word, it could certainly be made more efficient. I would certainly recommend that the sequencing of the presidential, parliamentary and governorship elections be revised. A suggestion might be for the three to be held on the same day. Because after the presidential and parliamentary polls, which are held on the same day, there is a tendency for most politicians and voters to align with the ‘winning’ party in subsequent polls down the line. Another reason is already palpable. After winning re-election for its presidential candidate, Muhammadu Buhari, the ruling All Progressives Congress (APC) almost momentarily suspended Imo state governor Rochas Okorocha and Ogun state governor Ibikunle Amosun for anti-party activities. While the party is justified in doing so, in light of their quite well-known political preferences, it is highly unlikely the party would have made the move before the presidential poll, when their political capital was needed to support President Buhari. Is the Abdul-Salami Abubakar peace committee wasting its time trying to nudge the opposition PDP’s Abubakar to concede defeat? Not really. But I do not think it is necessary. Mr Abubakar has promised to only go to court. He has not, however, said he would engage in

‘

A potential legal action by PDP’s Abubakar could also engender continued debate about how we want to move Nigeria forward, how to move our politics to one of ideas and not the pocket

any form of public disturbance. Besides, the court action, which could take up to a year to finalise, may serve the additional purpose of keeping Mr Buhari on his toes. What do I mean? There is a risk of complacency in any second presidential term. An active opposition may help to ensure that Mr Buhari’s administration is more inclusive this time around. The Kenyan precedence When Raila Odinga, the main opposition presidential candidate in the 2017 Kenyan presidential election lost to the incumbent, Uhuru Kenyatta, an aggrieved Odinga engaged in protests, and even swore himself in as substantive president. A wise Kenyatta, after initially taking the aggressive route, came to the realisation that both of them actually wanted the same thing. They both loved their country. They both wanted to fight corruption. They both wanted a more inclusive politics and government. They both wanted Kenyans to have better lives. In what is now termed the ‘Handshake’, President Kenyatta and Mr Odinga decided they would work together instead. And today, the fight against corruption in Kenya is gaining momentum. And a referendum towards a more inclusive government is now in the works.

Note: the rest of this article continues in the online edition of Business Day @https://businessday.ng “Dr Raji is chief economist at Macroafricaintel. He was previously an Africa Economist at Standard Chartered Bank, London, UK. (Twitter: @ DrRafiqRaji)”

Both principle and economics explain Nigeria’s presidential result

Ola Bello

wo divergent visions of Nigeria’s political and economic future were presented by the leading candidates in the just concluded presidential contest. Both the incumbent Muhammadu Buhari and his main challenger Atiku Abubakar offered policy details in their manifestos. Encouragingly, it was on a level that is unprecedented in Nigeria. Their competing visions have been ‘atikulated’ and a winner now declared. It confirms that starting 29th May, Nigeria indeed will be heading onto the ‘next level’, whether for better or worse. Patriots nationwide hope that it’s the former. Meanwhile, a number of lessons have emerged which we must reflect on to build a more democratic and harmonious future. The number game Atiku fought a valiant battle. His bid though was seemingly circumscribed by at least two difficult sets of trade-off. The first is about numbers, challenging him to reconcile the cold electoral arithmetic with his oft-repeated principled priorities. Few could have faulted Atiku’s repeated assertion that President Buhari must appear more as a unifying national figure, pursuing steps meaningfully to douse tensions. It is a valid observation, whether in reference to the Igbo sense of exclusion, anxieties over farmer-herder conflicts in the middle belt, or other myriad existential challenges that have

festered since 2015. Consistent with unifying, Atiku chose as his running mate Peter Obi from the Ibo heartland of southeast Nigeria in a widely applauded move. Obi and his famed personal integrity was also seen as a veritable foil for Atiku’s corruption perception challenge. To win comfortably, Atiku though needed to muscle in on Buhari’s numbers in the most populous regions, particularly the northwest and southwest (respectively stronghold to President Buhari and home region to Vice-President Osinbajo). If Atiku had chosen a running mate that did not reflect his own avowed stance on inclusiveness, that would have left him open to charges of unprincipled opportunism among some commentators. Ultimately, the numerical pathway to victory for the Atiku-Obi ticket would have been much wider were Nigerian elections not so riven by ethnicism on all sides. In the end, neither Atiku’s choice of running mate nor his raft of policy announcements through the campaign homestretch persuaded enough of the Buhari loyalists. Uncommitted voters and Atiku-doubters also did not gravitate away from Buhari’s orbit. The challenger was never going to muster superior numbers from the southeast and south-south alone to unseat the incumbent. Atiku’s lack of competitiveness in the northwest, especially, which largely contributed to Buhari’s over three million lead nationwide, sealed the contest. Perception matters Just as important as numbers, this election also turned on both perceptions of economic competence and personal integrity and trust. That runs counter to the challenger’s party strategy, which focused the campaign almost exclusively on Atiku’s promised economic revitalisation. With arguably an unassailable edge over Atiku on managing security and fighting corruption, Buhari’s campaign proved astute in presenting his candidacy as the pro-poor one in a narrower economic sense. His promise of

more inclusive, distributive growth proved to be a major draw for many voters. To be sure, Atiku’s broader promise of growing the economy did resonate. Nevertheless, his specific plan regarding ‘sale’ of the NNPC state oil company, whilst failing to add the necessary policy nuances, probably alarmed more voters than were reassured. Moreover, Atiku’s expressed preference for recovering looted assets without prosecuting the perpetrators, plus his casual justification for ‘enriching friends’, likely proved fatal in the wider public perception. By contrast, Buhari pushed populist schemes such as ‘trader moni’, which doled out public funds to market women. He consistently rehashed his administration’s ‘pro-poor’ and statist preferences. From managing the naira exchange rate to expressing doubts about the wisdom of wholesale privatisation of state assets, Buhari’s key campaign mantras seemed to have played well. Most importantly, Atiku the challenger erred in donning the toga of an insensitive impresario. He countered Buhari in ways which unfortunately cemented his image as candidate for the rich. If anyone doubts the need to strike a propoor tone beyond trickle down proposals in this election, they should look at the polling figures for Lagos. Though it is Nigeria’s economic nerve centre with an unmatched concentration of successful business people, many of them with serious misgivings about Buhari’s statist preferences, the proportion of Lagos residents who actually voted is dismal. The two leading candidates split the vote in Lagos. Atiku failed to secure a clear numerical advantage over Buhari in the wider southwest. These patterns held consistent nationwide except for the southeast and south-south where Atiku swept the stakes. Sadly, pockets of violence and lousy election day logistics further depressed participation in these solidly Atiku regions with their relatively smaller number of registered voters. Back to the future Many observers have expressed doubts

about whether the 2019 presidential election represents a clear advance on progress recorded in 2015. INEC’s late night postponement of the votes by one week was unfortunate. It interfered unhelpfully with the process, arguably depressing turnout in opposition strongholds more than in president Buhari’s bastions. This highlights an important lesson for INEC on improving its overall organisational approach. Otherwise, it risks damaging its reputation as a neutral umpire for future elections. Nigeria’s democratic maturation also seems stuck in reverse with presidential contenders that have spurned all opportunities to partake in presidential debates before fellow citizens. This must change in 2023. Finally – and most worryingly – voter apathy continues to grow. This renders the whole democratic exercise almost meaningless. There cannot be a progressive democracy without voters. With justover one million of Lagos’s six million registered voters contributing to the final presidential tally for example, it is time to take urgent measures to promote meaningful participation. Seamless voter registration that is information technology driven will help, as will better overall election logistics. From updating the voters’ list to the actual vote, quantum improvements are needed. Recent hard-won legislative changes saw nearly one hundred parties contest this time. This underscores how a technology-enhanced voting process will be needed to prevent unwieldy future polls. It is perhaps time for Nigeria to consider imposing fines for wilful absentee ballots, but government must first do its part to ensure all necessary enablers are in place. Only then can it take the punitive moral high ground. Overall though, the sense of greater citizen oversight and vigilance of the voting process is growing. That offers perhaps the only truly bright spot in this year’s election. Dr Bello is Executive Director Good Governance Africa (GGA) and a Resource Governance Expert

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Tuesday 05 March 2019

A dumping ground for scraps

igeria’s car sales have been shrinking in the last four years. For instance, Total number of new vehicles sold in 2016 was only 36, 000, lower than the 48, 000 sold in the previous year of 2015. For 2017, the figure was a little less than 10, 000. With an estimated population of 200 million, only about 10,000 new cars will be sold in Nigeria to both individuals and corporates. This ranks Nigeria as one of the worst places on earth to sell new cars, an irony considering that Nigeria is Africa’s largest economy. Based on the 2016 data, South Africa, which boast of less than one third of Nigeria’s population and is the second largest economy on the continent, records the largest number of “light vehicle” sales in Africa, with about 561, 000 cars sold in the country in 2016, which is about 11.7 percent lower than the 590,000 cars sold in 2015. It ranked 23 in terms of

global auto market sales down from 21 in 2015. Egypt, Africa’s third largest economy, which has about half the population of Nigeria is estimated to have recorded 217,000 new car sales in 2016, down by 20.8 percent from the about 274,000 sold in 2015. The drop in car sales in Egypt pushed the country’s global ranking to 40 in 2016 down from 33 in 2015. There were about 164,000 “light vehicles” sold in Morocco in 2016 up from 132,000 in 2015. This improved Morocco’s ranking on the global auto market sales market to 45 in 2016 from 49 in 2015. Morocco has a population of just about 35 million people, which is about one fifth of Nigeria’s population. Another North African country, Algeria, with a population of just about 40 million, recorded new vehicle sales of 129,000 in 2016 almost 50 percent down from 256,000 in 2015. Among the top 100 auto markets in the World, only Kenya ranked lower than Nigeria with its sales record of 13,000 cars in 2016. Now, based on car dealers’ projec-

tion, Nigeria is going to likely fall behind Kenya and out of the top 100 auto markets in the world in 2017. Dwindling car sales in Nigeria has been fuelled by rising inflation and weaker naira which has led to a fast rise in car prices across the country. A recent report by BusinessDay shows that a brand new 1.6 litre Engine Kia Cerato automatic transmission saloon car, which used to sell for N3.6 million in early 2015 is now selling for N9.54 million. A base model Toyota Corolla, one of the most preferred brands for many Nigerians, which used to sell for N4.45 million three years ago now sells for N18.9 million. Even corporates that used to be the biggest buyers of cars in the country for staff and business activities have since cut down on their demand, monitising it for their staff and outsourcing car services. More unfortunately, even Tokunbo or second hand vehicles are now going out of reach of most Nigerians. Due to the automotive policy that increased tariff on import-

ed cars to 70 percent, most (about 70 percent) vehicles imported into the country (through the seaports) are now very old and accidented vehicles to avoid the punishing tariffs and levies. A visit by BusinessDay to one of the terminals at the Tin-Can Island Port, Nigeria’s foremost roll-in, roll-out terminals for the importation of vehicles, most vehicles brought in by vessels were mostly low quality and damaged vehicles. Meanwhile, the reason for the imposition of the punitive tariff has not happened. The lack of effective demand for new cars has stymied any plans of establishing vehicle assembly plants in Nigeria by car manufacturing companies. The rational thing for the government to have done was to do away with the tariff but that is yet the happen. The implication is that the country is being turned into a dumping ground for used, old, accidented and vehicles and scraps. The economic, social, health and human costs of this foolery will be with us for a long while.

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Buhari’s return lacks fanfare of 2015, but businesses expect rejig of economic team Stories by Daniel Obi Media Business Editor

here appears to have been a total contrast between the type of fanfare that welcomed the emergence of Muhammadu Buhari as president in 2015 and his return in 2019. In 2015, some members of the elite class, including former President Olusegun Obasanjo, danced to celebrate the victory. Some market indices such as the Nigerian Stock Exchange All-Share Index also reacted to the success. Following the declaration of Buhari as the winner of the presidential election in 2015 and the immediate acceptance of the result by Goodluck Jonathan, the Nigerian Stock market recorded a big rise. It was reported that at the close of trading then, the market capitalisation of the listed equities surged by N904bn or 8.4 per cent from N10.717tn to N11.621tn, with the Nigerian Stock Exchange All-Share Index also rising by 8.4 per cent or 2,635.32 points to close at 34,380.14 points. But such depth of euphoria and enthusiasm across board appears to be lacking in 2019 re-election. Everywhere looks calm. The Independent National Electoral Commission, INEC, in the early hours of last Wednesday declared Buhari winner of the presidential election, securing a second term in office. With Buhari’s win, the question is, will things including economic condition change for better or remain the same with recorded increase in poverty and unemployment. “With Buhari’s return, the business community is not expecting anything different, instead investors are trying to adjust to cope with the president’s economic policies”, says an analyst who prefers anonymity.

Earlier business operators had told BusinessDay that if President Muhammadu Buhari eventually won, the economic situation might remain the same. But they argued that if Abubakar Atiku, his main opposition emerged winner, it might take some time before his policies would begin to impact on the economy. As the nation prepared for the elections, many organisations shelved some critical business decisions and plans, waiting for the outcome of the elections. However, some experts expect Buhari to rejig his team for better economic management in his second four-year tenure. “He should continue to pursue his anti-corruption agenda but he should set up economic management team to drive growth”, the analyst said. Recently, MAN tasked the current administration to double its efforts on infrastructure improvement. It also told the government to consider partnering with the private sector to speed up action. This is to further stimulate Nigeria’s economy and its growth trajectory from the present 2.4 percent last quarter against 1.8 percent, in the period before. Though the Economic Recovery and Growth Plan of the present ad-

ministration is focused on tackling the long-existing poor infrastructure such as electricity, rail, roads and ports and improving ease of doing business, MAN insists that further focus and greater attention on the infrastructure in Nigeria will assist its members to create more jobs and improve the GDP. Stating the position of MAN whose members’ operations are directly affected by poor infrastructure, its president, Mansur Ahmed, estimated that if manufacturing sector’s capacity utilisation could be increased from the present 57 percent on account of improved infrastructure “the amount of new jobs the sector will create immediately would be enormous. The chief executive officer of Jumia Nigeria, Juliet Anammah has called on the government to prioritize making significant investment in infrastructure development She emphasised that for Nigeria to win the race to achieving potential economic output growth and its millennium development goals, huge investment must be committed to addressing the infrastructure deficits in the country, because the bulk of most business transactions - citing Jumia as an example - depend heavily on logistics.

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Why the rise of digital commerce holds promise for Africa

0 million young people will benefit from the rise of digital commerce in Africa by 2030, according to a new report released by the Mastercard Foundation in partnership with BFA. The study, Digital Commerce and Youth Employment in Africa, reveals that digital commerce (or e-commerce) is an emerging sector across Africa, and by 2030, more than 10% of its largely informal workforce will be using digital platforms. These workers will participate in digital commerce as consumers and, with a supportive policy environment, may also become a new group of workers called iWorkers. These digitally connected young people who are entering the workforce will generate income in the ‘gig economy’, through direct employment with large platforms such as Amazon and Alibaba, and through small enterprises, eventually leading to more formalised work. Tricia Williams, senior manager, strategy and learning at the Mastercard Foundation says, “A substantial number of young people could benefit from the rise of digital commerce in Africa, lifting themselves and families out of poverty. Policymakers have a distinct opportunity to shape the

future of work for African youth by designing growth-enabling policies. These policies need to unlock the potential of digital commerce while addressing its risks.” Preparing for growth The report goes on to say that governments in Africa can immediately adopt three approaches to futureproof themselves and African youth for the various scenarios associated with the undeniable emergence of digital commerce. They include: • Gathering better data on digital commerce and employment. • Monitoring evolving trends and promoting a wider understanding by policymakers of the issues of digital commerce. • Prioritising the development of digital commerce skills in digital customer relationship management and marketing. David Porteous, founder and chair of BFA, recommends policymakers to “take a test-and-learn approach - targeted experimentation to formulate more comprehensive strategies and policies over time, such as a digital version of the public works programme targeting youth or testing the exemption of certain labour and tax laws to encourage an active iWorker policy.”

Culled from Bizcommunity

Nigeria’s Indigo clinches ‘West African Best in Class PR/Communications Service’ Award

ntegrated Indigo Limited, one of Nigeria’s foremost full service Public Relations and Event Management Consultancy firm has won the ‘West Africa’s Best in Class Public Relations and Communication Service Company of the Year 2019’ award category at the 2018 West Africa Brands Excellence Awards held recently in Lagos. Indigo emerged the winner of the category at the third edition of the annual awards following the verdict of a technical committee’s Research Report conducted by the Institute of Brand Management of Nigeria (IBMN) for marketing communication companies operating in West Africa. Speaking on the award criteria at the presentation ceremony, Registrar/Chief Executive Officer of IBMN,

Desmond Esorougwe described the selection of Integrated Indigo Limited as the outcome of rigorous research and findings which placed the agency ahead on varying parameters. Receiving the award, Chief Executive Officer of Integrated Indigo Limited, Bolaji Abimbola expressed profound appreciation to the organizer for the recognition describing it as a another significant milestone in the journey of the agency regarded as the fastest growing Public Relations firm in Nigeria. Abimbola dedicated the award to the clients for providing the opportunity and enabling environment for the agency to thrive promising that it would continue to offer the best initiatives that would not only improve the corporate reputations of their business but also drive revenue.

How ingenious campaign, ‘Oto-ge’ concept created change in Kwara senatorial election

hat Senator Bukonla Saraki lost in the last election is no longer news. Perhaps, what could be of interest in the entire saga, is the unseen hands in “O to ge” that emerged and how the campaign was conceived to achieve the unthinkable which it did. The campaign conceived and executed by Lagos agency, The Hook Creative Agency, a partnership of four young musketeers, has recorded massive traction as did their “Disgusting Ad” of last year. Premised on the knowledge that election cannot be won on a campaign of calumny, lousy talks, and name-calling, neither do these unseat a sitting president or any other elected official for that matter. The Lekki based agency is an unusual set-up with Akinwale Muse who functions as Director, Business Development & Strategy while the trio

of Toheeb Balogun, Sam Ochonma, Adebayo Owoshina are Creative Directors. Like the Obama Change campaign, the shoestring budget but highly strategic “Oto ge” campaign, reflects an idea movement as against the commonplace rabble-rousing campaigns, Akinwale hinted. Most often, political campaign handlers are reactionary instead of being proactive and single-minded in their campaigns, noting that situations like this often confer on the incumbent unfounded air of superiority and unmerited unfair advantage over the challenger, Balogun interjected Going into the background of the campaign, the Strategy Director explained that the political hegemony of the state has always resided or is seen as the property of one family. The late Saraki Patriarch, Olusola Saraki was the state’s kingmaker and a

Senator of the Federal Republic. He presided over the hallowed chamber twice 1979 – 83 (though aborted). His son, Dr. Bukonla Saraki, was a 2-term governor of Kwara State between 2003 -2011 courtesy the Sarakis’ political dominance in Kwara. For the uncharted in history, he added, when no Saraki is interested or available to take up a position, the family firms out such to whoever it

Bukonla Saraki, senate president

pleases. Such were the interregna of Mohammed Lawal 1999 and 2003 and Abdulfatah Ahmed 2011 -2015 both spent a term. The brief for the strategic communication, Ochonma noted, was followed by a detailed research and reputation audits to uncover the missing links and fix the yawning communications gap. Thus an image and environmental audits yielded a harvest of disillusionment, a sense of servitude and bondage, a source familiar with the business revealed. Therefore, the campaign was premised on the basis that for the last 34 years has been with one family deciding the fate of all. “We want this no more, enough is enough”. To achieve optimal effect and secure immediate buy-in by the vast rural community, the communication consultants distilled “Enough is Enough” to Yoruba dialect – “O to

ge”, a shorter, sharper, more direct and impactful slang that sits beautifully with the people, addresses the person of the usurper, his class and the issue at hand. Like a wildfire, “O to ge” became the buzzword and the most important line in Kwara politics, Balogun added. While lamenting that Kwarans may have been complacent in the past, he noted that progressive minds in the state were fed up with the system as initial campaign revealed. Hence, the “O to ge” concept was berthed to speak the people’s mind and address the situation. Speaking in a statement on the ‘O to ge” narrative, Bolaji Okusaga, CEO, Precise Communications & Design, disclosed that he had the privilege of working closely with the Hook Creative Agency guys who came up with what he calls an “ingenious slogan” - Otoo ge! Enough is enough.

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BRANDING How retail brands can survive attack of the algorithm …In a world where big data is king, brands need purpose to stand apart Ana Andjelic

he combination of algorithms and retail is irresistible. By matching supply and demand as closely as possible, they learn about our preferences and shopping behaviors, predict what we’d like, develop tailored recommendations—and increase the likelihood of a transaction. That’s why there’s an entire new industry emerging around shopping aggregators and wardrobe-curation services. By turning products, services and content into commodities, algorithms, by default, are the opposite of brands. Some investors have even concluded that algorithms will replace the role of brands in conveying trust and guiding us through our choices. That’s why the modern test of brand strength is its resistance to the algorithm. The true challenge for retail, then, is not how to accelerate algorithm-induced product commoditization, but how to circumvent it. Otherwise, retailers will find themselves on the same path of self-destruction as publishers, which put their faith in the hands of Facebook and Google algorithms. The ongoing digital media carnage is brought on precisely by the belief that on the internet, anyone can be a content creator, and the algorithms will do the rest. When the race turned into search results and

clicks, everyone joined the business of clickbait and covering the same things. The competition for indistinguishable offerings became stiff, and many couldn’t survive it. And just as “there were too many of us doing the same job” in publishing, as Caroline McCarthy writes in her Spectator USA article, “How Digital Media Killed Itself,” in retail there are now too many newcomers offering the same things. And much like Google and Facebook, Amazon won’t help them differentiate. Amazon is for the products of the world, but “Amazon is not a home for brands,” says Melanie Travis, the founder of swimwear brand Andie. “They basically want to reduce us from a brand to a product.” Once that happens, it will make these

AWIEF marks International Women’s Day with key event in Nigeria

he Africa Women Innovation and Entrepreneurship Forum (AWIEF), which will celebrate its 5th anniversary this year, will host an event celebrating International Women’s Day in Nigeria on 13 March 2019, with the theme “Building for a Better Tomorrow”. AWIEF is a pan-African women’s economic empowerment organization that promotes and supports female innovation, technology and entrepreneurship across Africa through a portfolio of high impact programmes. AWIEF’s mission is to foster the economic inclusion, advancement and empowerment of women in Africa through entrepreneurship support and development International Women’s Day is on 8 March and to accommodate the elections in Nigeria, AWIEF is hosting their event a week later, on 13 March at the Lagos Continental Hotel, Victoria Island, Lagos, Nigeria, from 8am to 3pm. The special business networking event, will celebrate the economic and social achievements of women, connecting with local and international business leaders, entrepreneurs, government officials, and community advocates. “International Women’s Day is set aside for the global celebration of the social, economic, cultural and political achievements of women.

Across Africa, women are driving change and disruption and contributing to job creation and socioeconomic growth in their countries and communities. African women have come a long way, but there is still a lot left to be done to achieve gender balance,” explained Irene Ochem, Founder and CEO of AWIEF. “Sub-Saharan Africa is the only region globally where women make up the majority of self-employed individuals. This is not merely an indication of the redefinition of women’s economic roles; it also reflects how African women are reshaping the modern global economy. Yet, women own just one percent of the world’s wealth and only a fraction of that is attributable to African women.

products directly compete with Amazon’s private-label business. Algorithms also don’t exactly level the retail playing field. Similarly to how Google and Facebook favor popular content, retail algorithms favor the most affordable, frequently purchased and frequently reviewed items, often preventing smaller brands from being discovered. Amazon has also never overcome its fake review problem, and it’s not alone. Last fall, cosmetics brand Sunday Riley drew attention for encouraging its employees to post fake product reviews on Sephora. Meanwhile, a recent New York magazine article, “How Much of the Internet Is Fake?” noted that less than 60 percent of web traffic is

human; click farms, bots and fraudulent traffic account for the rest. In this context, retailers increasingly realize that the best way to pass the Turing test is to be human. Companies that have a point of view and stand for something beyond what they sell are more likely to influence purchasing decisions, attract and retain customers and create a long-term competitive advantage. According to Accenture Strategy’s Global Consumer Pulse, 63 percent of global consumers gravitate toward buying products and services from companies that have a purpose and share their personal values and beliefs. Products are a way to express identity, belong to a community and convey one’s passion and beliefs. Patagonia and some of its customers share values of social responsibility. In comparison, Stitch Fix’s “save time, look great” pitch doesn’t seem to give it the same lift, at least when looking at the brand’s engagement rate on its Instagram account. (StitchFix has an engagement rate of less than 4 percent; Patagonia’s is above 5 percent.) Despite the hype, retail algorithms are mostly incremental improvements on the traditional retail model where the core user activity is product purchase. Brands today are in the race of offering more. The next wave of retail disruption is happening not in the domain of targeting and efficiency, but in the domain of purpose. –Culled from Adage

Nigerian Bottling Company appoints Ekuma Eze Public Affairs and Communications Director

igerian Bottling Company (NBC) Limited, a member of Coca-Cola Hellenic Bottling Company, has announced the appointment of Ekuma Eze as the Public Affairs and Communications Director effective from March 1, 2019. In a statement issued by the company and signed by the Managing Director, George Polymenakos, Eze is expected to bring his robust wealth of experience to bear by consolidating on the company’s strategic business growth trajectory and developing talents in the Public Affairs and Communications team to deliver on the company’s strategic goals. In this new role, he is also expected to build on the good reputation of the company amongst its publics, stakeholder groups as well as effectively manage every aspect of NBC’s corporate relations. Eze joined Nigerian Bottling Company (NBC) Limited in February 2010 as Regional Manager, Public Affairs and Communications and was responsible for supporting the objectives of the company through strong relationships and effective communications with all stakeholders as well as coordinating timely execution of its sustainable CSR programs, among other tasks. Prior to this appointment, he was the Country Manager, Corporate Social Responsibility, saddled with the task of developing sustainability

Singapore’s Gas Academy partners Modion Communications on LPG West Africa 2019 Forum & Exhibition

ne of Nigeria’s fast growing Public Relations and Communications solutions providing agency, Modion Communications, has entered into an exclusive partnership with Singapore’s Gas Academy PTE to drive stakeholder participations, marketing communications and public relations support for the scheduled LPG West Africa 2019 Forum and Exhibition. With the partnership, Modion Communications is saddled with the responsibility of securing sponsorships, promotion and sales drive, and ensuring the corporates and individual participation in the LPG West Africa 2019 Conference. The LPG West Africa 2019 Forum and Exhibition, which has the endorsement of the World LPG Association (WLPGA) is tagged, ‘Building LPG Businesses in West Africa’ and is scheduled to hold at the Eko Convention Centre, Eko Hotel & Suites, Victoria Island, Lagos from Tuesday, April 9, to Wednesday, April 10, 2019. It is the first energy event the Gas Academy will be hosting in Africa following a host of successful signature portfolios in Indonesia, Cambodia, Myanmar, and Vietnam. Commenting, Odion Aleobua, the Chief Executive Officer of Modion Communications said in a statement; “We are very pleased with this partnership as it is a testament of being the partner of choice in providing cutting edge service delivery in event marketing, marketing communications and public relations in the West Africa’s sub-regional and Africa’s markets”

AAAN inducts Big & Bold Communications

B Ekuma Eze

strategies and implementing them in support of NBC’s strategic business priorities as well as conceptualizing, developing and facilitating the implementation of projects related to the company’s commitment to community relations. Before joining NBC, he spent a couple of years in the banking industry where he managed media relations, internal communications, brand management, Corporate Social Responsibility and External Relations for three different banks. Eze also had a stint with journalism in Daily Independent Newspapers where he distinguished himself as a political reporter and production editor and later moved on to the banking industry from where he joined NBC.

ig and Bold Communications Limited, one of Nigeria’s one-stop marketing communication agency has been inducted as a member of the Advertising Agencies Association of Nigeria (AAAN). Speaking at the induction ceremony held recently in Lagos, the President, Advertising Agencies Association of Nigeria (AAAN), Ikechi Odigbo stated that Big and Bold was being inducted into the Association having satisfied all the requisite requirements for membership of the Association. While congratulating Big and Bold on its induction, Odigbo admonished the company to abide by the code of standards and practice of advertising as well as other laws and regulations laid down by the association in relations to the practice of the advertising profession in Nigeria. Speaking on the significance of the induction, the Chief Strategist, Big & Bold Communications, Jide Adeyemi stated that the company is now better positioned to serve its clients and continue to build brands that resonate with the consumers and community whilst helping them to develop interesting story that creates emotional bond between brands and consumers.

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UK plans £30 million investment in Africa after new partnership with AU

Pg. 15

C O M PA N Y N E W S A N A LY S I S A N D I N S I G H T

CONSUMER GOODS

Coca-Cola grows revenue by 6% amid currency woes in key markets DANIEL OBI

oca-Cola Hellenic Bottling Company grew revenue by 6 percent in 2018, as currency fluctuations in Russia, Nigeria and Switzerland weighed on the nonalcoholic beverage giant. Although the revenue was above the company’s target range, “the impact of foreign exchange fluctuations from Russia, Nigeria and Switzerland was heavy,” said Zoran Bogdanovic, the Chief Executive Officer of the company. Net sales revenue for 2018 came in at EUR6.66 billion. Bogdanovic disclosed this in a statement obtained from the London Stock Exchange website while offering details for the first time on Coca-Cola’s business performance since taking over in May last year. Bogdanovic said, “In 2018, the company delivered another very good performance with revenue growth

above our target range and another step up in margins. Strong volume growth in all our segments was helped by a record number of new product launches, whilst price/mix improved for the eighth consecutive year. “This growth supported margin progress, which we delivered while increasing our investment in marketing.” Comparable earnings before interest and tax was EUR680.7 million, 9.6% higher on 2017, compared to consensus of EUR682.3 million. The comparable Ebit margin was 10.2%, up from 9.5% in 2017, against consensus of 10.3%. According to FTSE 100 company, Coca-Cola HBC’s volumes rose 4.2% to 2.19 billion unit cases, meeting consensus, with growth witnessed in all three segments. Bogdanovic expressed confidence that the company would continue to witness unparalleled business growth considering its recent investment in both human

L-R: Olubunmi Davies, member, NECA’s Network of Entrepreneurial Women (NNEW); Ekaete Etiebet, treasurer, NNEW Lagos Chapter, Mrs. Folakemi Fatade, member NNEW; Oluyemisi Situ, treasurer, NNEW; Jumoke Oduwole, senior special adviser to President Muhammadu Buhari on Industry, Trade & Investment; Eunice Obasohan, chairperson, NNEW Lagos Chapter; Titi Eko, executive director, NNEW; and Aisha Ime-James, PRO, NNEW Lagos Chapter, at NNEW Network meeting in Lagos.

and material resources. “Our sharp focus on cost efficiencies continues while we invest in the business for growth. The shape of the business, capabilities and commit-

ment of our people and our overall commercial proposition give us confidence in our ability to continue to grow revenues and margins,” he added. With necessary infrastruc-

ture now made available in all its plants across the globe, Coca-Cola HBC is expected to grow its volume across all the segments in 2019 regardless of any economic slowdown.

Coca-Cola HBC has also identified EUR33 million of restructuring savings in 2019, bringing EUR17 million of benefit on top of that from 2020.

MARKET

AB InBev records 25 percent revenue surge in Nigeria market amid challenging global markets OLUFIKAYO OWOEYE

he world biggest brewer, AB InBev says its sales growth improved in the final quarter of 2018. In its financial results full year 2018, it recorded a solid revenue growth of 4.8% coupled with operating leverage drove EBITDA growth of 7.9% with margin expansion of 130 bps and $8.6 billion of underlying profit, all despite currency and commodity headwinds. Also, volume revenue and market share growth was achieved in many of its important markets such as, Nigeria, Mexico, China, Western Europe, Colombia and several African countries with consumption contraction in key markets such as Brazil, Argentina, United States.

According to the brewer, its growth in Nigeria accelerated throughout the year following the introduction of our new brewery midyear to meet demand, with revenue growth of more than 50% in last quarter of 2018 and more than 25% in FY18 driven by double digit volume growth and continued market share gains. Also, EBITDA margins expanded by more than 2 000 bps in 4Q18 as a result of the alleviation of capacity constraints and Budweiser’s entry into the premium segment. BusinessDay analysis of the financial result show that the brewer is till lumbering under a substantial load of borrowings from its 2016 acquisition of SAB Miller. Although its net debt plummeted from $104 billion in December 2017 to

$102 billion same period 2018, the company said it expects net EBITDA to fall below 4 times by the end of 2020, compared with 4.6 times at the end of 2018. Also the planned selling of a stake in its Asian operation

through an IPO will deleverage its debt book. “Net debt to normalized EBITDA decreased to 4.6x for the 12-month period ending 31 December 2018 from 4.8x for the 12-month period ending 31 December

2017. We expect our net debt to EBITDA ratio to be below 4x by the end of 2020,” the report noted. In what used to be a twohorse race between Heineken’s Nigerian Breweries and Diageo’s Guinness, the

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

Nigerian Beer market has since changed with the entrance of AbIn-Bev into the Nigerian market. In 2017, AB InBev acquired 72.17% of SABMiller’s shares in International Breweries Plc, in a series of transactions which resulted in AB InBev acquiring controlling interests in the company. With its entry into the market, AB In Bev was able to increase volume as it flooded the market with its regional premium brand, Trophy lager, while simultaneously introducing its international premium brand, Budweiser, into the Nigerian market. This boosted supply, constrained volume growth and forced key competitors (Nigerian Breweries and Guinness), to hold off plans to pass on the burden of the new fix charge to consumers.

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Business Event

DEALS

UK plans £30 million investment in Africa after new partnership with AU LOLADE AKINMURELE

he UK is set to inject up to £30 million into prosperity and security projects across Africa as it steps up its investment in the continent, Minister of State for Africa Harriett Baldwin has announced. The funding boost comes as Britain signs a new strategic partnership with the African Union, strengthening the engagement between the continent and the UK Government. Speaking ahead of the signing of the partnership at the African Union Commission Headquarters in Addis Ababa, Ethiopia, Baldwin said: “From our support to observers ensuring free and fair elections in Nigeria and Senegal this weekend, to the crucial training our Armed

Forces provides to security forces in Kenya, the UK’s partnership with African countries continues to help empower and upskill people across the continent, and this funding will allow us to boost those efforts. “Our new partnership will also cement our relationship with the African Union, building on growing economic ties to forge new opportunities for young people and reinforce our close bonds.” The partnership will strengthen cooperation on security and prosperity, and support a joined up approach to tackle climate change. The funding, which forms part of the partnership agreement, and will be spread over three years, will be used to train peacekeepers in Kenya, assist free and fair elections, and support the next phase

of negotiations for the African Continental Free Trade Area. The signing of the strategic partnership also allows the UK to support African-led ambitions with British expertise, to create more opportunities and more jobs. Baldwin’s visit to Ethiopia comes after Prime Minister Theresa May visited Nigeria, Kenya and South Africa in August to set out her vision for the UK’s future partnership with Africa and the UK’s aim to be the largest G7 investor in Africa by 2022. It also follows the rapid expansion of the Foreign and Commonwealth Office’s diplomatic network in the region, including plans to open new embassies in Djibouti, Chad, Niger, Eswatini and Lesotho, and recruit more diplomats with new skills-sets, including in trade and investment.

L-R: Peter Ashaolu, manager, card operations, Stanbic IBTC Bank; Hannah Olugbemi, head girl; Adeoye Adebowale, principal; Oluwaferanmi Aribisala, head boy, all of Ilupeju Senior Secondary School, and Uyi Uhunmwangho, legal services department, Stanbic IBTC, during the bank’s Employees Volunteering and Mentorship Programme at the school in Lagos. Pic by Pius Okeosisi

TECHNOLOGY

Swift Networks recognised as company to inspire Africa in 2019 JUMOKE AKIYODE-LAWANSON

wift Networks Limited has been listed by the London Stock Exchange Group as one of the 360 companies to inspire Africa in 2019. The ‘Companies to Inspire Africa 2019’ report from the London Stock Exchange Group (LSEG) picked out 360 high-performing companies for recognition, spanning 32 countries and a range of sectors with the report launched recently at the London Stock Exchange. Although over 5,000 companies were nominated for inclusion, the final list was selected based on set criteria such as growth, transparency, and innovation. The company says this is a further attestation to the visible impact it makes in

Nigeria’s technology and telecommunications industry. Charles Anudu, managing director of Swift Networks Limited, expressed the company’s appreciation to all stakeholders for their continued partnership over the years which he said has been largely responsible for the success of the brand in the Nigerian market. He noted that 2018 was a very positive year for the company despite a difficult recession the country was emerging from. “The company in addition to providing excellent broadband internet service to its teeming enterprise and consumer customers launched various segmental value propositions including Swift unlimited and Swift SME to address the specific needs

of certain segments,” he said. While Swift unlimited targets heavy internet users with need for streaming a lot of movies, music and games, Swift SME wraps its arms around the peculiar needs of SMEs who are poorly catered for by the telecommunications industry. The offering includes high speed internet and low cost business software on a rental basis as this category of customers find it steep to acquire and maintain the ownership of the requisite software to run their businesses and grow. The company also launched the Red Cheetah Free internet app and Red Cheetah news portal in keeping with its core values of being at the forefront of innovation in the industry.

INSURANCE

Sunu Assurance gets regulatory approval to delay financial report GBEMI FAMINU

unu Assurance Nigeria Plc has received approval from the Nigerian Stock Exchange to file its 2018 full year financial results in April. The insurance company requested an extension of the required date for submission of its audited financials from the NSE which has been approved. In a signed statement addressed to the company’s shareholders and the general public which was sent to the exchange, it stated that “the application for extension will enable the company to obtain the approval of its Audited Financial Statements for the year ended 31st December 2018 from the National Insurance Commission.” “The Board and Management are optimistic that the Audited Financial Statements would be submitted to the. Ni-

gerian Stock Exchange not later than 30th April, 2019.” The Audited Accounts is expected to be forwarded to the National Insurance Commission (NAICOM) for approval, following the endorsement of the Board, before the release of the results on the floor of the Nigerian Stock Exchange. BusinessDay analysis of the insurance company’s interim financials over a 6 month period which ended June 30th 2018 in comparison with the previous year results of the same duration show that the group’s gross premium written dropped by 2.16 percent in 2018 to N1.704 billion from the N1.742 billion recorded in same period of 2017. Similarly, its net premium income also dropped by 10.44 percent to N975 million from N1.089 billion in the comparable period of 2017.

The insurance company’s gross premium income also declined by 6.8 percent from N1.412 billion in 2017 to N1.315 billion in 2018. It can be recalled that earlier in 2018, the company changed its name from Equity Assurance to Sunu Assurance with approval from its shareholders and regulatory agency, NAICOM. Furthermore, in the fourth quarter of 2018, the company disclosed that Morufu Apampa, the Chief Executive Officer (CEO) tendered his resignation which was approved 2018and from November 2018. In an effort not to leave the position vacant, Samuel Ogbodu, Executive Director, Technical and Operations was made the acting CEO, while the company’s board of directors worked on filling the position before the NAICOM’s 90 days deadline.

L-R: Opeoluwa Ojumu, Sophos product manager at Mart Networks Nigeria Limited; Akintunde Opawole, manager, FLIMS Business Unit, Sidmach Technologies Nigeria Limited; Christopher Odutola, sales engineer, Sophos, and Lanre Adelanwa, head, marketing , Sidmach, during Sophos/Sidmach Lunch & Learn event in Lagos.

L-R: Francis Meshioye, branch chairman, Ikeja Manufacturers’ of Association of Nigeria (MAN); Segun Ajayi, director general, MAN; Ahmed Mansur, president, MAN and Okey Akpa, managing director, SKG Pharma Ltd, during the visit of MAN to SKG Pharma Ltd Lagos.

L-R: Kesavan Madhavrao, deputy MD, Royal Power & Energy Limited; Sola Odeku, MD, Schon-Peesal Energy; Kevin Mbawuike, chief operations officer, Eco-Power Resources Ltd, and Sasha Israni, MD, Royal Power and Energy Ltd, at the Signal Gold Inverter and Tubular Batteries Launch in Lagos.

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Weekly insight on current and future trends in education

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Human Capital

Why reforms in Nigeria’s University education is key to economic growth KELECHI EWUZIE

eter Okebukola, former executive secretary, National Universities Commission (NUC ) while delivering a keynote address on the Reconstructing the Shattered Education Mirror: Hard Choices We Cannot Side Step observed that university education system in the years leading to the oil boom of the 1970s attracted respectable funding and the quality of delivery was comparable to what obtained in institutions all over the world. Okebukola pointed out that between 1965 and 1970; Nigeria contributed the highest in Africa to the international literature in science, engineering, medicine, social sciences and arts. He however, observes that the oil boom of the early 70s upstaged the system as the huge injection of funds into the system started to wane. This triggered a slight depression in the quality of delivery, though not dramatic enough to upstage the eminence of Nigeria in the African higher education space. Those familiar with the matter in the education sector opine that the importance of reforms in a critical level of education like the universities holds the key to Nigerian economy when looked at from the immerse contribution from her human capital assets. United Nations Educational, Scientific and Cultural Organisation (UNESCO) identify higher education as crucial to the attainment of economic wellbeing, innovation and knowledge-driven growth. Nigeria with a population of over 180 million is estimated to

have about 60 percent of the population within the ages of 18 to 35 years who fall into the category of eligible university candidates. Be that as it may, Universities are set up to among other things produce human capital, knowledge and research necessary to help in economic growth across all sectors. Figures from the National Bureau of Statistics indicate that an estimated 1.8 million graduates enter the job market yearly. Industry close watchers in the education sector said that to channel the human resources capability of this number of job seekers, there is the need for a more desirable and meaningful strategy to tackle the challenges facing the Nigerian university level of education, adding that reforms in that space should be approached in a more pragmatic manner that would ensure sustainability. Reports indicate that the long years of neglect by suc-

cessive governments trigged numerous challenges ranging from, underfunding, eroded ethical values and academic standards, poor planning and implementation, among others have over the years hamper the university education from performing one of their major and most important roles which is, being the major driver of Nigerian’s economic development. Stakeholders observe that the current 7 percent of the education sectorial allocation cannot achieve the needed or aspired economic growth and development. According to them, “It is therefore recommended the government should endeavour to meet up with and even strive to exceed the 26% benchmark allocation to education as recommended by the UNESCO”. Tolu Odugbemi, a former vice chancellor, university of Lagos was quoted to have

said that the role of university education in economic growth is clear; stressing those managers of the economy must develop and strengthen tertiary institutions in the country through knowledge sharing and skill attainment. He opines that the country’s knowledge creating institutions must be nurtured to solve the problems unique to us. Nigeria has a vast potential that continues to go untapped. We must harness it! Not only do they produce and train talent needed for a 21st century economy, but also nurture minds that can create the next innovation in issues such as sustainable development, waste management, communications among others. Okebukola is worried that Tertiary education are failing to prepare students for the world of work and failing to contribute to national regeneration.

KELECHI EWUZIE

AAA Atayero (Middle ), vice chancellor, Covenant University, Otta; Oluwatobi Stephen, creator of Edustart and other facilitators at the season two of the Edustart summit held at covenant University.

Educational loans, Insurance on offer as 400 schools attend National fair arents, students will get clearer insight on latest educational loans, Insurance, School management software among other incentives as over 400 top schools from across the country take part in the 2019 Nigeria Schools Fair in Lagos. The event scheduled for March 23 will showcase the nation’s leading educational institutions as well as educational product/service providers. Steve Ike, event director, National Schools Fair (NASFAIR) in a press statement announcing the programme said national schools fair was conceived as a platform to match Nigeria’s educational

Greensprings, Kanu Football Camp plans educational scholarship for students

institutions with parents and prospective students who are looking to gain admission into schools for the 2019/2020 academic year and beyond. Ike said the organisers have identified seven special considerations when parents are looking for the right school for their children including location, size, educational philosophy, curriculum, faculty, fees and facilities. The National Schools Fair will provide parents with a unique opportunity to “one-stop shop” many different kinds of schools to begin to find the right fit for their children. Representatives from more than 400 schools will be available to provide both on-site

and take-home information. These school representatives will be available to answer questions, as well as provide information on the application processes, tuition fees, facilities curricular and extracurricular offerings, class size, and what makes their school unique. The fair, expected to be graced by over 5,000 admission-ready students and their parents will present prospects for educational institutions to showcase and market educational opportunities, admit prospective students, create new partnerships/alliances, and boost their school’s brand exposure. Aside from the exhibitions,

the NASFAIR will feature series of seminars and workshops aimed at updating school owners, administrators, teachers and non-teaching staff with the latest trends and body of knowledge that will assist them to better manage, administer and teach in their schools. These well tailored and expertcurated seminars will deliver topics covering school management and administration, financing, security and safety, health and psychology. School officials also will have the opportunity of meeting and networking with their contemporaries; engage and explore the latest information you need to help administer and grow your school!

reensprings/Kanu Football Camp set up to enhance football skills of children between the ages of 5 and 17 years has announced plans to give an educational scholarship into Greensprings School to the most promising player. A statement by the organisers called on parents with children that are passionate about football, and are ready to become the next superstar, to register their children for the annual Greensprings/Kanu Football Camp taking place in Lagos. The 5 days football camp scheduled to hold from Sunday, April 14th to Friday, April 19th, 2019 will at the end of the programme give awards based on the performance of participants at the camp. During the camp, children get first class training by coaches from West Bromwich Abion Football Club UK and Dutch Football Association Netherlands, supported by coaches from the Lagos State Football Association. The participants also get a lifetime opportunity to receive direct mentoring and coaching from Nigerian football legend, Kanu Nwankwo. According to the statement, this year’s edition promises to be more exciting and impactful with top financial institution Union Bank, on board as a sponsor. Among other benefits, the bank’s support will enable five football loving children from underserved communities, to experience world class football training and compete for the ultimate prize of an educational schol-

arship to study at Greensprings School. “It is noteworthy that since the inception of the football camp, nine students from underserved communities have been awarded educational scholarships into Greensprings School. Some of these students have progressed into the Under-15 National Team of Nigeria, while some others have had the opportunity to play in European football clubs. In return, Greensprings School hopes that when these students become superstars, they will give back to the society through youth empowerment initiatives”, the statement reads. Drills to look forward to at the camp include; cone exercises, circle of cone, cut-backs, shooting from a square pass, one-touch shooting, three goal drill, lay-offs, turns, chest control, headers on goal, basic short passes, shuffling passes, stamina drills, tackling, sliding tackle, goalkeeping and other exciting drills. Other activities include; 5 aside football matches, mentoring sessions, mental stimulation, swimming, playing basketball and basic networking. In furtherance to the school’s commitment to the development of young African children; Greensprings School introduced the SPONSOR-ASTAR project, to encourage corporate organisations to sponsor children with potentials to excel in the game of football. The statement further says that by sponsoring a child, you are also contributing towards the school’s Corporate Social Responsibility initiative of supporting a life-saving heart surgery via the Kanu Heart Foundation.

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Tuesday 05 March 2019

EDUCATION Corona, Headmaster Academy partner to promote youth development KELECHI EWUZIE

s part of its drive to promote youth development and empowerment through education and sports,Corona Secondary School, Agbara in collaboration with Headmaster Sports Academy Limited is set to organise ‘Easter Soccer Camp in April. The camp scheduled for 7th of April to 12th and 22nd of April to 27th according to the organiser will present an opportunity to inculcate high moral and ethical values in over 300 students both within and outside the wall of the classrooms, and also to enrich the sport portfolios of all participating youths and students from within and outside the school environment. Chinedum Oluwadamilola, Principal, Corona Secondary School, Agbara, while about the event said aside the school’s commitment to always bring out the best from its students, help them stay true to their dreams and follow through their passion, the school agreed

L-R: Bola Adebanjo, director, Headmaster Sports Academy Limited; Chinedum Oluwadamilola, Principal, Corona Secondary School, Agbara; Adejumo Olubunmi, Vice-Principal, Pastoral, Corona Secondary School and Mutiu Adepoju, former Super Eagles midfielder/director, Headmaster Sports Academy Limited, during signing of MoU between Corona and Headmaster on the forthcoming Easter Soccer Camp , held at the school premises in Agbara.

to go into the partnership because of the personality of Mutiu Adepoju, former Super Eagles icon On the objective for this partnership, Oluwadamilola that the school management, with the approval of the school board, decided to partner with the Headmaster Sports Academy Limited to drive the school’s

educational services in the areas of sports just as many corporate organisations partner with celebrities to drive or market their products. She further said this partnership will enrich the sports portfolio of students with a view to giving them an edge when they are seeking admission through scholarship

nterswitchSPAK Volunteer Drive, an initiative geared towards promoting the teaching and learning of Science Technology Engineering and Mathematics was recently launched in Ajuwon High School, Ajuwon and Community High School, OjoduAbiodun, Ogun State. This activity, which featured Interswitch staff, teaching science subjects in select public secondary schools, is aimed at promoting STEM education, as well as, encouraging a culture of volunteerism. Oremeyi Akah, chief core operations officer, Interswitch, who volunteered, said the opportunity to inspire young people to better engage with, and continue to study STEM subjects, and to also explore STEM careers, was the motivation behind her participation. She encouraged students to adopt STEM education and its application, stating that its relevance in the real world cannot be overemphasized, as STEM has the power to transform lives and societies. The principals of the participating schools could not hide their excitement and gratitude as they appreci-

ated the entire Interswitch Group. Oshewa Omolara of Ajuwon Senior High School said she hopes to see more of this initiative in the future and commended Interswitch Group for making a difference in the education sector. Emuobosa Akpene, CSR/Events and Sponsorship Specialist, Interswitch Group, said that the volunteer drive was created to compliment the InterswitchSPAK initiative, “As it allows us the opportunity to further promote the learning and adoption of STEM education, by engaging with many more students that may necessarily not engage directly with the InterswitchSPAK quiz competition” she said. Emuobosa thanked all Interswitch staff who took part in the exercise, as well as the schools for being great hosts. She concluded by reiterating Interswitch Groups’ commitment to advancing and supporting quality STEM education in Africa. Interswitch Group is an Africa-focused integrated digital payments and ecommerce company that facilitates the electronic circulation of money as well as the exchange of value between individuals and organisations on a timely and consistent basis.

children by providing a solid platform in pursuing their football career, providing professional Coaches with the required equipment to train them in becoming the best both locally and internationally. Commenting on the partnership, Dotun Coker, Member, Youth Football Development Committee, Nigerian Football Federation (NFF), said “The partnership is a landmark event. I am aware they have approached about 10 schools, and we are so delighted that Corona accepted to partner Headmasters Sports Academy, their values are in sync and in line with our youth football development policies as well. “The important thing here is to see these students turnout to be superstars in future and have an empowerment background to fall on. And we are encouraging more of this type of partnership”, Coker added. A parent, Habeeb Abiru described the partnership as “wonderful”, noting that there is nothing comparable to academic and sports, as both works hand-in-hand to better develop a child.

The importance of health and fitness for human capital development

Interswitch promotes STEM subjects in public schools KELECHI EWUZIE

into foreign universities. “To give participants the opportunity to express their talents, improve their skills and become exposed to modern techniques in football. And to enable participants to acquire values such as teamwork, endurance and resilience which they will find useful and applicable to life outside sports,” she said.

Mu t i u A d e p o j u , E xSuper Eagles Midfielder/ founder, Headmaster Sports Academy, said, expressed his delight to be associated with a programme which is centered on improving and invigorating the mind of our children in sport, exposing them to the value, ethics and the wonderful world of football. “Our company, Headmaster Sports Academy Limited (HSAL) is a sport, education and tour planning organisation that is established in Nigeria to influence children in sports and other academic activities both locally and internationally. The targeted age group of participants is between seven and 17 years and they are expected to be students,” Adepoju said. Speaking on his mission for the forthcoming event, Adepoju said HSAL in partnership with Corona has come up with soccer camp programme that is designed to connect, expose and integrate children into the international world of football. “The Youth soccer camp is a section of HSAL, which is established to create the best football experience for

OYIN EGBEYEMI

wareness over the matter of health and fitness in Nigeria has now become more of an everyday topic rather than the unpopular conversation it was many years ago. Back then, people did not seem to pay as close attention as they do now to this new “fit fam” era. They even had such traditional theories as the need for slim people not to pay as close attention to their health as others, or that with wealth and age, one must “fatten up” to demonstrate their perceived superior well-being. This traditional mindset might still exist, but in today’s world where the occurrence of health issues such as allergies, genetic deformations, obesity, diabetes and cancer is on the rise, reality is leading us to see that we have to be extremely careful of what we do with our bodies. People are now very aware that we are now exposed to so many toxic conditions, some of which we have little or no control over unfortunately such as air and water pollution, global warming etc. As a result, these illnesses are so common

these days, especially with the younger generations and even with children. According to the World Health Organisation (WHO), worldwide obesity has doubled since 1980; more than 65% of the world’s population lives in countries where being overweight kills more people than being underweight; and more than 40million children under the age of five are overweight. Furthermore, according to the Centre for Disease Control and Prevention (United States), the prevalence of food allergies and cancer incidence rates amongst children under the age of 18years is growing. While these statistics are representative of the population in the United States, we cannot hide the fact that these diseases are becoming very common in Nigeria as well. However, notwithstanding our knowledge of such issues, we may not be doing all the right things to ensure that we and our children are not at risk, at least to the extent within our control. Diseases such as obesity, for instance, are preventable. Additionally, as Africans, we also need to be careful, because we are at higher risk of diabetes due to our diet and lifestyle choices. So when we are preparing meals, we have to be mindful of the following: 1. Chemical Additives: These serve the purpose of preserving and fortifying food with taste. Some, such as MSG (Monosodium glutamate),

found in many seasonings, are very high in sodium and promote fat retention. This is a silent killer that may be worse than alcohol, nicotine, and drugs. 2. Genetically Modified Food: These are essentially protein-engineered food, some of which the direct effect on the human genetic and immune system is unproven, yet they are still out there and available for us to consume. 3. Fast Food and Junk Food: Food should not be a quick fix. There should be nothing “fast” about it. Shouldn’t the fact that food is now readily available to be consumed within such few minutes make us question the authenticity? Fast food and junk food are very heavily processed and are also quite far from their natural form. They have high fat and sugar content, and barely any valuable nutritional value (including some so called healthy snacks and fruit juices). So every time we eat, we should really think beyond just satisfying our hunger or need to snack on something. We should bear in mind what value we are getting out of what we put in our bodies. We should also stat to involve our children and ourselves in more cardiovascular activities; avoiding the sedentary lifestyle of sitting down with our eyes glued to the screens of our televisions, computers and IPads. Gradual

changes like taking the stairs instead of lifts once in a while or calm evening strolls with the family could go a long way. In the short term, a healthy diet has the added benefit of helping to develop and improve cognitive strength, agility, concentration, physical appearance and health in general. Visits to the doctor will not have to be a common occurrence in our lives. In the long term, we would live longer and save a lot of money that would be otherwise spent on hospital bills. This is all easier said than done, especially in our environment where we in addition to a generally unhealthy diet and rise in the number of fast food outlets, our physical and economic environments add to our stress levels thereby leading many to become hypertensive or have stress-related diseases. However in whatever way we can we must try our best as ignorance could lead to many dangers. The world is inevitably becoming a more toxic place to live in and we must do our best to protect ourselves as well as our children, the next generation. We must also ensure that we educate them about these things as well, so that they can take such healthy lifestyle practices beyond childhood.

Oyin Egbeyemi is an executive administrator at The Foreshore School, Ikoyi, Lagos.

Tuesday 05 March 2019

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Housing

How private capital is driving devt, tapping opportunities in student housing CHUKA UROKO, OKAFOR ENDURANCEtels are able to provide accommodation for only 30 percent AND TEMITAYO AYETOTO of the university students

tudent housing is still a new investment frontier in Nigeria but, increasingly, especially in the last couple of years, it has been gaining traction, as much private capital has gone into that space, driving development, tapping the opportunities it offers and creating jobs across real estate value chain. With 70 percent of Nigeria’s growing college population seeking alternative accommodation outside poor campus hostels, the country’s student housing industry is a goldmine waiting to be tapped. The increase in student population is a reflection of the national population growth which, as at October 31,2018, according to United Nations estimates, was 197.4 million—an equivalent of 2.5 percent of the total world population. The country’s annual growth rate is estimated at 2.6 percent. According to UNESCO, there are over 100million young adults studying courses in Polytechnics, Universities, and Colleges of Education across Africa and out of which 15 million are in Nigeria. Checks by BusinessDay shows that Nigeria’s already dilapidated on-campus hos-

whose annual enrolment rate stands at 12 percent. “Hostels for students are an opportunity that is crying for investment and if a developer has an understanding with an institution, it is a worthwhile investment,” Rotimi Akindipe, MD/CEO of Groveworld Realties, a Lagosbased real estate development company, told BusinessDay. This was affirmed by Godwin Asuelimen, Head, Core Product, Propertypro.ng as he said investment in student hostel is very viable, especially in areas with high number of tertiary institutions. “It is a booming market and something that is growing at the moment. You see a lot of people investing, especially off-campus. It has been higher in areas that have booming student population like Lagos, Benin, Enugu and PortHarcourt,” Asuelimen said. Uzo Oshogwe, CEO, Afriland Properties, a property management, investment and development company, agrees, saying that the structured, private off-campus investment model is catching on gradually. Afriland is into student housing and is presently perfecting plans to partner with the authorities of the University of Lagos to provide

hostel accommodation for the students of the institution on build, operate and transfer (BOT) arrangement. Joel Amawhe, CEO, myPadi.ng, an online housing marketplace that connects college students with landlords for the purpose of making renting and house hunting easier, also affirms that investment in school hostel “is very lucrative and the interesting part is that it brings in more return than the regular buy-to-let properties, because there is more certainty of vacancy than the regular tenant property.” Student Accommod8 is a relatively young company that opened for business four years ago. The company is quite bullish in providing students hostels. It has already provided over 400 beds across three sites with plans to start construction on 2,500 beds across five sites. Expectation is that in the next five years, the company shall have provided 8,000 beds which, it says, is just a scratch of the surface. “This investment asset gives about 22 percent returns which is more than double what commercial real estate gives, not to talk of residential real estate which gives 4-5 percent returns per annum. For this reason, we are encouraging other developers to come in”, Abayomi Onasanya, Founder/CEO of Student Accommod8, told BusinessDay

in interview. The company’s latest development is Cedar House, a N350 million facility comprising 140 beds situated in Pan Atlantic University (PAU) campus along Lekki-Epe Expressway, Lagos.

Apart from the good lifestyle living experience it offers, Cedar House also offers fees which Omotoyosi Belgore, the company’s chief operating officer, says is quite competitive at N850,000 per annum for single bed space; N700,000

for a double bed space, and N580,000 per student for a room with four bed spaces. Amawhe affirms that students are spending, on the Continues on page 20

Infrastructure

Cement sector sets for recovery amid fragile growth, weak infrastructure industry has started to revive. Players have diversified their sources of fuel and have equally embraced local input sourcing. Stability in the foreign exchange market since mid-2017 has, to a great extent, eased pressure on operating costs of cement makers. With the diversification of input sourcing, cement makers now have the long-term buffers to absorb currency risk, in case it occurs.

ISRAEL ODUBOLA

here are indications that the cement sector of the Nigerian economy is on recovery part despite threats posed by sluggish growth of the macro-economy, steep naira devaluation, militancy in the Niger Delta region and weak infrastructure spending by private and public sectors. The sector was drastically affected by the underwhelming performance of the economy mainly because the demand for cement tracks the performance of the macroeconomy as well as government policies, reforms and spending on infrastructures. A report on the Nigerian cement industry titled ‘In Search of Growth Triggers’ by Afrinvest Securities, an independent investment banking firm, shows the sector grew 4.5 percent in 2018 compared to -2.2 percent in 2017 as real GDP rose to 1.9 percent in 2018 from 0.8 percent a year earlier. The sector which accounted for over 0.8 percent in real GDP in 2018 saw growth moderating to an average of -1.0 percent in the last three years

Key trends driving the sector

compared with 16.9 percent in the previous decade. The 2016 recession which saw growth declining to -1.6 percent from 2.8 percent in 2015 thwarted the fortunes of cement business as the sector contracted 5.4 percent in 2016 compared with 22.1 percent in 2015. Consequently, the country’s consumption per capita dipped 20.5 percent to 97kg in 2017, lower than South Africa (234 kg), Senegal (222kg), India (217kg) Ghana (202 kg) and the sub-Saharan African

region (116kg). In addition, the devaluation of the naira between 2014 and 2017 triggered operating costs of cement companies given their exposure of energy costs ( as gas is priced in dollars and coals are imported) coupled with debt to foreign currency risk, which consequently hiked cement prices. Lafarge was badly bruised due to its foreign currency loans. Dangote was unaffected owing to its long dollar position on the back of its recorded earnings from revaluation

gains. Also, activities in the real estate and construction sectors that ought to support growth of the sector are uninspiring. Both sectors grew less than 2.5 percent in 2018. Infrastructure spending is still below the recommended $50 trillion or N18 trillion based on Nigerian Integrated Infrastructure Master Plan (NIIMP). Steps taken to address the issues

The opulence of the cement

According to the report, new investment opportunities are gaining momentum in the sector amid overcapacity. An estimated 7.1 metric tonnes (MT) was added to the sector’s capacity since 2016 though utilization is less than 50 percent. Additional 12 MT is expected to come on board given Nigeria’s growing population and export opportunities. The report pointed out that cement makers have started optimizing fuel mix, and this gave them upper hand to benefit from cheap fuels such as coal. Optimizing fuel mix is expected to spike earnings on the back of reduced energy cost.

Given the growing demand for cement, players are now moving to other parts of the country to exploit excess capacity in the exports market. Trucking remains the major means of transportation as infrastructure remains deplorable. Outlook The outlook for the sector is positive. The sector expanded 4.5 percent in 2018 as against -2.2 percent in 2017. Energy cost is expected to trend southwards given diversification of input sourcing and mild currency risk. Based on this, volume as well as earnings and profitability are expected to surge. However, the report noted that growth of the broader economy will underperform the population growth rate close to 3 percent in medium term, thereby affecting demand for cement. The enforcement of executive order 007, which grants tax credits to companies for funding public infrastructure, is expected to reduce tax expense and boost earnings of cement makers.

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Tuesday 05 March 2019

How private capital is driving... Continued from page 23

Project

Blue Water Lagos embraces the latest in city lifestyle, living Stories By CHUKA UROKO

he five 17‐to‐20 storey residential buildings, comprising 1, 2 and 3bedroom contemporary luxury apartments sitting on 37,000 square meters of sea view land embraces the latest in lifestyle and living in contemporary and cosmopolitan city of Lagos. With its contemporary luxury apartments, exclusive resident’s recreational park, internationally branded retail and leisure mall and waterfront living, Blue Water Lagos is not located in Ikoyi, Banana Island or Victoria Island where opulence defines architecture and dictates designs, but embraces the best and latest which these upscale neighbourhoods offer. Located in Lekki Phase 1, a fast-developing urban community providing home for few upper and a large number of middle class population in Lagos, the development is conceived as an ultimate lifestyle destination with restaurants, shopping, entertainment and leisure facilities conveniently nestled within walking distance of the apartments and homes. Before the economic downturn of the last three years, whose effects are yet to leave the country especially at individual level, Nigeria had a burgeoning middle class population estimated then at 40 million, representing about 23 percent of the country’s large and growing population. MKO Balogun, CEO, Global PFI, notes that developers used to focus on

the upper class but are now turning their attention to the small-size multi-family units for mid-income earners where t demand resides. Over 60 percent of people looking for homes today are not out for four or five bedroom apartments, but one or two-bedroom. That is where the market is at the moment”, he notes. Obi Nwogugu, Head of Real Estate at African Capital Alliance (ACA), agrees, saying, “as investors and developers, our confidence in the market derives from our belief that there is demand and we can always identify products where there is demand even in a recession like this. The fact that there is a cycle does not mean that is how the market is going to be forever. There is going to be changes and forceful improvements which will improve project attractiveness”. Blue Water Lagos targets the middle class as well as high net-worth individuals in the Lagos society. It promises a 10,000-square meters retail and leisure mall, all on 10,514.76 square meters of built up area for the first phase of the development. This facility is the latest residential development from the stable of ACA working in collaboration with Alalan Group. ACA is a leading panAfrican investment firm sponsoring funds and managing investments of over $1.2billion Founded in 1997, ACA is an independent private equity firm focused on investing in Nigeria and the Gulf of Guinea. It has raised aggregate commitments of over US$1.2 billion since its inception and has a track re-

cord of successfully exiting investments and delivering strong returns to investors. Although the company has only nine years of experience in the real estate sector, out of its two decades of experience investing in the Africa Region, it has very strong footprints in real estate resulting from its thorough understanding of the market and variables that can affect investment results. Elalan Group, on the other hand, is one of the fastest growing and most dynamic construction and civil engineering companies in Nigeria. Over the past three decades, ElAlan has successfully delivered a multitude of project spanning a broad range of asset classes that including No 4 Bourdillon, Tango Towers, Olympic Towers, and WAPIC Head Office. The three-phase development, which first pahseThe Saphire- will be deliv-

ered in December 2019, is designed to be self-sustaining. The second and third phases will each deliver two residential towers situated above a two-level retail and leisure mall. Development facilities will include recreational park, retail and leisure mall, adult and children’s swimming pools, children’s play area, tennis and basketball courts, gymnasiums, club lounges, resident’s ventilated underground parking, etc. Besides its excellent location in close proximity to Victoria Island, Ikoyi and Lagos Island, its live, shop and play proposition with restaurants, shopping, entertainment and leisure facilities are conveniently located within walking distance for enhanced livability. Its innovative design ensures energy and water efficient systems, fire alarm and sprinkler protection,

water and sewage treatment plants and high speed broadband. As a serviced community, residents are assured of on premise concierge and facility management services with uninterrupted power supply, 24 hour security and access control systems. The development’s waterfront living gives beautiful views of the sea, harmonic waves, and soothing breeze. This is complemented by ample open exterior spaces with gorgeous resident’s recreational park that offers interaction with the environment and promotes passive recreation. The quality of the developers contributes significantly to the safety of the investment. Investors are assured of significant capital appreciation even before construction is completed and good rental yield based on excellent location for rental investments.

Funding

Family Fund seeks collaboration with developers on affordable housing scheme …targets 20,000 housing units for low income earners

s part of efforts at bridging the staggering housing demandsupply gap estimated at 3 million units in Lagos, Nigeria’s commercial capital, the Family Home Fund (FHF) was in the sprawling city recently to explore potential partnership for a large-scale affordable housing scheme with a specific focus on low income Lagos residents. FHF is a special purpose investment vehicle which has the Nigerian Sovereign Investment Authorit (NSIA) and the Federal Ministry of Finance Incorporated as founding shareholders. It has an ambitious target of supporting the development of over 500,000 homes and

creating 1.5m jobs for Nigerians on low income by 2023. So far, the fund has completed the construction of 400 homes with an average cost of N3.5 million in Grand Luvu, Nasarawa State and this is part of over 4,000 homes under construction in five states of the federation namely Ogun, Nasarawa, Kano, Delta and Kaduna. Femi Adewole, FHF’s managing director, disclosed in a brief interview in Lagos that the partnership which the fund was exploring would include a significant element of regeneration that would ensure that older parts of the city were brought back into use to provide much

needed affordable homes. With a large and growing population, estimated at 20 million, Lagos has a very challenging housing situation, especially at the low income level. It is estimated that 65 percent of its residents live in rented accommodation, spending over 50 percent of their income on house rents. This is as a result of lack of affordable homes in the city’s very expensive housing market. The inter vention by FHF is therefore considered critical and, according to Adewole, the proposals for the partnership involve a significant number of homes, assuring that there was space for participation

by a number of developers who met the criteria and demonstrated that they were committed to the delivery of homes that were affordable to Lagosians on very modest incomes since this was the area of interest for the Fund. “We have a strong commitment. We have invested over N20 billion in housing projects to support Nigerians who are earning below N100, 000; we are also providing financing for developers who will build homes ranging from N2.5 million to N5 million. In addition, we are providing some assistance to the buyers of those houses and we are giving them a deferred

loan for up to 40 percent cost of the houses’’, the managing director assured. Besides providing quality homes, the fund will also be looking at creating jobs for Lagosians. Other aspects of the scheme include a commitment to the environment and climate change issues. “This is important for future generations of Lagosians given that Lagos is a coastal city. We think about the future of Lagos being a coastal city. So far, discussions have been very fruitful and are now advanced. The partners are very committed. I’m hopeful that in the nearfuture, we will have a full announcement,” Adewole assured further.

average, about $1000 every year on hostel fee and, specifically in Lagos, students spend about $300- $360 for a bed space per annum, that is, for the ones that are semi-furnished. “For fully furnished, you will see hostels that go for as high as N700,000-N850,000 per year,” he added. Oshogwe noted that student housing was a viable long term investment if an investor gets his or her parameters right. This means that the investment is, however, not without its challenges. “Student housing has not reached full potential. The constraints such as high cost of construction due to lack of cheap funds; expensive quality building materials, high cost of perfecting land titles, building approval and the length of time it takes to secure same, etc, have impeded growth,” Oshogwe said. According to her, “some federal universities are offering land to private investors and developers on a build, operate and transfer (BOT) arrangement. However, the 25 years or less lease period for the BOT arrangement is not sufficient to allow for a healthy return on investment (ROI) that, at least, exceeds the treasury bill rates.” The lack of enough bedspaces to accommodate the millions of students in Nigerian colleges doesn’t come as a surprise as Education funding in Nigeria has been on a steady decline from 12.46 percent in 2015 to 7.04 percent of the total Federal Government budget in 2018, as compiled by BudgIT, a civic startup that liberates budgets and public data. Commenting to government budget for education sectors, Amawhe said there is a huge deficit problem, as schools are not able to build enough hostels for reasons of lack of capital. “You have very little coming from the government to schools and a lot of these schools are not really making much from their Internally Generated Revenue (IGR); this means the universities are heavily reliant on government, and alumni associations for funds; if you go round some universities you will be shocked at the deplorable state of even the available hostels that they have,” he noted. BusinessDay checks revealed that lack of enough offcampus student hostels also affects the business of housing agents as they are most of the time unable to find desirable hostels for students. An estate agent who introduced himself simply as Jerry with an office in the Akoka area of the University of Lagos, noted, “sometimes it pains me that, I have clients who are looking for hostels and after going round and calling most of my colleagues we still end up not seeing a cheap and neat hostel for them”. This means that opportunities in this segment of the real estate sector is limitless and present a good haven for private investors with strong yield appetite.

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Real Estate Fund can be used to address Nigeria’s housing shortage — FSDH ENDURANCE OKAFOR

igeria’s housing industry with a shortage of over 17 million units can be addressed, according to FSDH Research, through an investment vehicle, the Real Estate Fund (REF). REF is an investment vehicle that pools resources together to invest in real estate, therefore allowing individual investors to partake in the benefits of the underlying properties. “Real Estate Fund is an investment vehicle that can be used to address Nigeria’s housing shortage and encourage economic activity in the real estate sector,’ FSDH Research, a subsidiary of the FSDH Group explains. In monetary terms, Nigeria may require between N170trillon – N200trillion to bridge the housing gap if each unit is estimated to cost N10million. Meanwhile, Niger ia’s real estate developers are in search of viable alternative sources to fund real estate projects in a country where cost of funds has made bank credit inaccessible, unaffordable and unattractive to the sector. Commercial banks are not an ideal or suitable medium for financing real estate

projects because whereas commercial bank deposits are short-term in nature, real estate is for the long term which is usually vulnerable to the vagaries in the economy such as changes in interest rates, exchange rates, and the rate of inflation.

Andrei Ugarov, partner at PricewaterhouseCoopers (PwC) says players in the industry are making use of other financing options to fund real estate development projects, adding, however, “Nigeria is still a viable market even though capital is a

challenge.” Affirming Ugarov’s submission is the bank lending report by the figures compiled from National Bureau of Statistics (NBS) for the third quarter of 2018 which showed that the real estate sector was among the least

attractive industries to the country’s commercial banks as it got one of the smallest portions of loan in the review quarter. The figures by the state stats revealed that the property sector was only able to attract N710.2 billion in Q3 2018 as against the N744.56 billion and N784.2 billion it got in Q2 and Q1 in 2018 respectively. Speaking on how the mortgage industry in Nigeria has contributed to bridging the huge demand-supply gap in the country, the Association of Housing Corporation of Nigeria (AHCN), an umbrella organization for all federal and state housing agencies, said underdevelopment of Nigeria mortgage sector in driving home ownership is worrisome as more than 90 percent of new homes utilise funds from personal savings for incremental construction. FSDH Research believes REFs can be used as one of the measures to boost activity in the real estate sector. “As patronage for REFs in Nigeria increases, more funds would be available to buy and develop more real estate properties; consequently, the real estate sector would begin to experience increased activity,” it said. That is not yet the case

for Nigeria’s REFs as data on the Security and Exchange Commission (SE C ), the industry regulator, shows that as at the week ended January 18, 2019, only three REFs listed on the NSE; Skye Shelter Fund, Union Homes Real Estate Investment Trust (REIT) and UPDC Real Estate Investment Trust. The REFs Net Asset Value (NAV) of N43.74 billion only represents 6.7 percent of the entire market share at N642.12 billion “The housing shortage keeps increasing, meanwhile, developments in the real estate sector of the Nigerian economy, which is where activities that will close the housing shortage will take place, have not been impressive,” FSDH research told BusinessDay in a mail response. Meanwhile, figures by the state funded bureau showed that Nigeria’s real estate sector plunged further into recession in Q4 2018. In real terms, the sector contracted by 3.85 percent in Q4 (year-on-year), which is 2.07 percent points better than the -5.92 percent recorded for the fourth quarter of 2017. The sector’s contraction for the review quarter was after it showed signs of rebound for two consecutive quarters through to Q3 2018.

Construction

Why JB, Cappa & D’Alberto dominate Nigerian construction industry ISRAEL ODUBOLA

or years, the construction industry in Africa’s biggest economy has been dominated by Julius Berger (JB), Cappa & D’Alberto, Elalan and ITB Nigeria Limited, a subsidiary of the Chagoury Group. The local construction companies in Nigeria are predominantly small and medium-sized, with their participation in major construction works marginal. Experts at the School of Environmental Studies, Federal Polytechnic Idah, in their publication titled ‘The Characteristics of Nigerian Construction Industry in Infrastructure Development’ maintained that local construction firms undertake about 5 percent of civil engineering construction and 25 percent of building works, while the bigwigs handle about 90 percent of civil and building construction projects in Nigeria. “Local companies are neglected from the ‘real business’ in the industry basically for their technical incompetence, weak financial capacity, low exposure and dubious attitude of local contractors to enrich themselves with funds meant for contracts, hence government’s

preference for the bigwigs”, the experts submitted. The heavyweights control a large chunk of public sector construction. They have won many projects and poised to win more, leaving nothing for the smaller ones. The increasing number of contracts won by these bigwigs in the public and private space begs the question why they keep dominating the industry. A few factors have been identified:

Ties with government A major advantage the construction giants have over smaller ones is that they are closer to the government. For long, they have been enjoying goodwill from Nigerian government for execution of heavy projects in many parts of the country. “They virtually get all their contracts from the government. They have their big boys in the Senate and House of Representatives”, he noted.

Not ‘JJC’ in industry According to Babatunde Nathaniel, Rigger Supervisor at Planet Projects, the bigwigs have been in the industry for decades, thereby making it difficult for small/medium ones to overthrow them. Cappa & D’Alberto’s presence in Nigeria dates back to 1932. Julius Berger completed its first project in the country in 1965. Chagoury Group, parent company to ITB Nigeria Limited came to the fore in 1971. Elalan commenced operations in 1982. CCECC signed its first contract agreement in Nigeria 24 years back. “Julius Berger has been in Nigeria before my birth. I grew up knowing Cappa & D’Alberto”, Nathaniel said.

Strong financial capacity This is yet another edge the bellwether companies have over local ones. Local construction companies oftentimes encounter difficulty to acquire funds to execute projects. The high cost of funds in Nigeria is another disadvantage local firms have. Where the big foreign firms raise capital from their home countries at 3-4 percent interest rate, the local firms get their funds at 20-25 percent rate. These make them a turn-off compared to the bigwigs who are financially capable, and allies of construction heavyweights in Asia, Europe & North America. For instance, Eko Atlantic project costs billions of dollars, and is wholly funded by South Energyx

Nigeria Limited, a subsidiary of the Chagoury Group. Smaller and medium companies definitely lack the resources to fund huge projects and also to procure the needed equipment. Technical competence It is widely believed that bigger construction companies are more technically competent than smaller ones. Often times, small and medium-sized contractors are booed for lack of experience and technical know-how in handling projects. But the industry heavyweights possess the requisite resources, men and machines, to undertake heavy projects, hence government preference for them, thereby putting the smaller ones in tight corner. Adaptation to dynamism Construction practice across the globe is becoming more complex, technical and administrative-wise. The increasing demand for specialized construction projects gives the heavyweights an edge over the upcoming ones. Many people believed that the smaller ones lack the needed level of skills and exposure to execute world-class projects, making the bigwigs ‘hot cake’.

Standards The big players embrace professionalism in their construction projects. They uphold the tenets of ethical practice. The fact that these big players successfully executed projects in the past encourages government and large corporates to award contracts to them. “Julius Berger remains dominant in the industry because their designs are usually innovative and are known for timely project execution”, the experts posited in their publication. Also, Cappa & D’Alberto positioned themselves as Engineering Procurement and Construction (EPC) contractors, implying that they are directly responsible for every step in their projects from start to finish. “A good number of local contractors have low patronage as they are known to compromise standards for personal gains”, Damilola Ijalade, building agent at PWAN Homes once told BusinessDay. Asked if there was chance for the upcoming ones to dethrone the industry leaders, Nathaniel tagged it impossible. “I don’t think that can happen because the smaller ones cannot access the benefits the big ones are enjoying”, he reasoned.

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Inside FPSO contract details worth $902m between First E&P, Malaysia based Yinson … FPSO expected to commence operation in Q4 2019 DIPO OLADEHINDE

ews of Lagos-based independent FIRST Exploration & Petroleum Development Company Limited (FIRST E&P) signing a long time deal with Malaysia’s Yinson Holdings to operate a Floating Production, Storage and Offloading (FPSO) on Anyala and Madu oil fields will be sending good signals to other foreign multinationals to exploit more opportunities in the Nigeria oil and gas sector. According to some salient terms of the contract seen by BusinessDay, the long-term deal will see Yinson deploy an FPSO, to be named Abigail-Joseph, on the Anyala field to exploit First E&P’s Anyala and Madu discoveries in oil mining leases 83 and 85. The Bareboat Charter deal is also accompanied by operations and maintenance deal, with the total value of both deals up to $901.79 million to be operated by Yinson Operations and Production West Africa Limited (YOPWAL) an arm of Yinson holding. “The primary term of the charter under the Bareboat Charter Contract and O&M Contract is 7 years each from the issuance date of the certificate of first oil under the Bareboat Charter Contract,” contract between First E&P and Malaysia based Yinson slated. Also, FIRST E&P shall be entitled to extend primary term by one extension period of 24 months and up

to 6 further extension periods of 12 months each under the terms and conditions set out in the respective Contract while the cumulative duration of the primary term and extension terms of each Contract shall not exceed in aggregate of 15 years. The estimated aggregate value of the contract, assuming the Extension Options are fully exercised, is approximately $901.793 million comprising Bareboat Charter Contract of $617.093 million and O&M Contract of $284.700 million while the FPSO is expected to commence operations at the Fields by the fourth quarter of 2019. Concerning the financial effect, the contracts will not have any effect on the share capital and shareholding structure of Yinson Holdings, however it’s expected to contribute positively to the earnings and net assets of Yinson Holdings and its group of companies for the financial years ending 31 January 2020 onwards until the expiry or termination of the Contracts. Yinson Holdings foresees risk factors affecting the Bareboat Charter Contract would be the construction and project execution risks including capability to have proper upgrading of FPSO and preservation of work schedule, costs and delivery timelines. “The risk factors affecting the O&M Contract would be the capability of the Group to carry out proper services of operations and mainte-

nance of the FPSO. Such risks are expected to be mitigated by the Group’s in-depth experience and expertise in carrying out the necessary works as well as internal business controls to ensure delivery of the FPSO and services as required under the Contracts,” the contracts said. Also, none of the directors or major shareholders of Yinson Holdings involved or persons connected to them will have any interest either direct or

indirect, in the Contracts. The Anyala and Madu fields are located in oil mining leases (OML) 83 and 85 in shallow waters of the Niger Delta, approximately 40km offshore the Bayelsa State, Nigeria. FIRST E&P holds a 40percent stake in the leases and is the operator which was acquired from Chevron Nigeria in February 2015, while Nigerian National Petroleum Corporation (NNPC) holds the remaining 60percent stake.

The offshore field development project is planned to be developed in two phases with a combined investment of $1.08bn. The Final Investment Decision (FID) on the project was made in July 2018, while first oil is expected in 2019. The Anyala and Madu fields are estimated to contain combined reserves of 193 million barrels of oil (MMbbl) and 0.637 trillion cubic feet (Tcf) of gas.

OPEC, U.S. in pursuit of opposing goals to balance oil market STEPHEN ONYEKWELU

he OPEC is controlling crude oil exports to stabilise the global oil market, keep oil prices high but the U.S., with eyes on lower oil prices is pumping more oil into the market, in a delicate balancing act, they both maintain the market. “Oil prices getting too high. OPEC, please relax and take it easy. World cannot take a price hike fragile!” Donald Trump, president of the United States of America had said Feb. 25 on his verified Twitter handle. Oil prices trend analysis shows dramatic fall from a high of around $114 per barrel in June 2014 to a low of around $27 a barrel in January 2016, correlating with a sharp imbalance in supply and demand. This 76 percent fall in prices was attributed to weaker global demand and a supply glut brought by U.S. shale producers, who were causing a ‘shale revolution’, which made the U.S. world’s largest oil producers. Saudi Arabia and Russia had also contributed the

oversupply. Benchmark Brent crude traded at $65.07 at 12.05 GMT on Saturday, down by $1.24 and West Texas Intermediate traded at $55.80, shedding $1.42. “Without this shale revolution we’ve seen in the U.S. the world would have been in major, major energy chaos,” Mohammad Barkindo, secretary general of OPEC told

CNBC in Riyadh on Feb. 27. Falling oil prices soon started taking tolls on producing nations especially in the U.S., whose producers have higher production costs. The Organisation of Petroleum Exporting Countries’ members and a group of non-OPEC producers led by Russia agreed in late 2016 to curb their output in a bid to balance supply and demand, and prices, in an

alliance now known as “OPEC Plus.” “The decisions that OPEC took, together with our non-OPEC partners, literally rescued this industry from total collapse” Barkindo said. Experts have said OPEC’s moderating role has allowed the U.S. oil sector to achieve record oil production and has made America a major energy exporter — something that seemed impossible less than a decade ago. More often than not in recent years, the cartel has succeeded in keeping the price of oil just high enough to spur investment in new shale fields, but low enough to keep consumers happy. But President Trump has in several tweets cajoled and pleaded with the Cartel to increase supplies and lower oil prices. And in a recent move, the U.S. House Judiciary Committee passed the No Oil Producing and Exporting Cartels Act, commonly known as NOPEC, clearing the bill for a vote before the full House of Representatives. The bills would essentially make it illegal for foreign nations to work together to limit fossil fuel supplies and set prices. They would authorise

the U.S. Justice Department to sue oil producers for antitrust violations by stripping foreign actors of sovereign immunity protections. “What may not be understood in the marble halls of Congress is that OPEC, particularly Saudi Arabia, Kuwait, Iraq and the United Arab Emirates, hold the lowest-cost oil reserves in the world” Dan K. Eberhart, CEO of Canary, an independent oilfield services company in the United States. A similar bill was first introduced in 2000, and Congress has revived it several times since then. It was most recently revived in the last Congress, where it stalled after getting House Judiciary Committee approval. The full House and Senate passed NOPEC legislation in 2007. The House passed it again in 2008; the same year oil prices hit an all-time high at nearly $150 a barrel. However, the bill languished under threat of veto from former President George W. Bush. Former President Barack Obama also opposed NOPEC, but analysts have speculated the measure could find support in the Trump White House

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Why Saudi Arabia’s plan to build refinery in India matters to Nigeria finery, Saudi Arabia is strategically positioning itself to dominate the supply of India’s oil demand which will automatically threaten Nigeria’s supply to India,” Akinbobola explained by phone.

DIPO OLADEHINDE

ews of plans by Saudi Arabia to build one of biggest oil refinery in India will be sending fears down the heart of major stakeholders in Nigeria oil and gas sector most especially the government whose oil revenue might be at stake. Saudi Arabia, the world’s biggest oil exporter is looking at making India a regional hub for supply of crude oil and will invest billions of dollars in the country to build storage facilities and strengthen refineries. “We are looking to make India a hub (for crude oil supply) in the region. We are looking to build storage facilities in India, we are looking at refineries and downstream assets in India,” Al-Jubeir said in New Delhi. The Kingdom is the subcontinent’s fourth largest trading partner, providing almost 20 percent of its crude oil imports. Why India matters to Nigeria? India is the largest buyer of Nigeria’s crude oil as Indian refineries Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd, (HPCL) buy more Nigerian crude Qua Iboe, Bonny Light, Escravos, EA Blend,

Erha, Usan and Agbami. India, is one of the world fastest growing currently among the world’s fastest growing economy, has seen its gasoline and gasoil demand climb sharply over the past few years. India is the third largest consumer of crude in the world after the US and China, using more than 4 million barrels of crude oil per day (bpd) as Demand is expected to rise in the medium-term to nearly 6 million bpd, climbing to around 10 million bpd by 2040. Implications of a Saudi Arabia’s refinery in India

Saudi Arabia’s Saudi Aramco stake in this mega refinery will be an important strategic step for the oil giant, adding a key link to its global refining chain in one of the world’s fastest-growing markets, whilst diversifying away from domestically produced petroleum products. The rapid growth in oil consumption is a major challenge for India, which has a total refining capacity of about 4.6 million bpd. Currently, that is not enough to meet local demand. India’s energy policies also restrict imports of petroleum products, placing greater strain on local refining. A partnership with Saudi

Arabia therefore, the world’s largest oil exporter, will be invaluable to safeguard future supply. India is expected to increase import of oil from countries such as Saudi Arabia and the United Arab Emirates if the US does not extend the six-month-long waiver it granted to New Delhi and several other countries to buy oil from Iran. Charles Akinbobola an energy consultant in a Lagos based oil and gas firm said Nigeria might need to start looking for other buyers of it crude products because Saudi Arabia has plans to dominate the India market. “By building the proposed re-

Way forward Despite being an economy that relies majorly on proceeds from crude oil exports, successive government in Nigeria have been unsuccessful in putting in place adequate structure that will ensure policy stability, attract foreign investors and continuity in the economy. Luqman Agboola head of energy infrastructure at Sofidam Capital said with better regulations Nigeria National Petroleum Corporation (NNPC) should be operating like Saudi Aramco by not only meeting local demands but also expanding to neighboring countries. “Nothing stops NNPC from building refineries in Benin or Togo but due to weak laws and regulations the corporation still seems to be struck in past glory,” Agboola said to BusinessDay. Over the years, Stakeholders agreed that oil and gas sector can best be described as the bride of the Nigerian economy, if it is well nurtured and can also be so fruitful that the spin-offs is expected to transform it to the much anticipated, ‘Giant of Africa,’ axiom.

Nigeria’s gas utilisation goes steady VAT data show …old challenges linger STEPHEN ONYEKWELU

alue added tax data published recently by the National Bureau Statistics show gas contribution to that basket has been steady and growing in the last five years. This means that there have been productive activities which are creating value along the gas chain and attracting VAT, which is a function of value creation in any sector of the economy. An increasing VAT means the sector is expanding and creating taxable value. Gas contribution’s steady growth points to growing adoption and utilisation amid a raft of challenges regarding gas pricing and infrastructure. In 2014 gas contributed N3.32 billion to the VAT basket out of a total of N129 billion and in 2015 gas raked in N3.30 billion out of N759 billion. Gas utilisation covers a range of projects involving marketing and distribution of natural gas for commercial purposes and includes power plant, liquefied natural gas,

gas to liquid plant, fertilizer plant, gas transmission and distribution pipelines. In 2016 gas realised N4.51 billion out of N777 billion and in 2017 it gathered N5.47 billion out of N972 billion. In 2018 gas garnered N5.74 billion out of N1.10 trillion that comprised the VAT basket. Nigeria’s Federal Government has in recent times sought to change the narrative of gas adoption and utilisation in the country. One of the significantly big plans before the FG is the Gas Master Plan (GMP) of 2008. This was aimed at leapfrogging the level of gas utilisation in Nigeria and to provide stimulus for development and production of natural gas in Nigeria. According to Nigerian Gas Flare Commercialisation Programme (NGFCP), Nigeria loses approximately $1 billion of revenue through gas flaring due to its inability to capture and sell flared gas in the country. But Nigeria will need $3.5

billion worth of inward investments into gas capture technologies to achieve its flare gas commercialisation targets by 2020. With many gas utilisations projects at various stages of completion in the country, the sad commentary is still that existing gas infrastructure

is insufficient to meet gas demand from the power sector, commercial customers, industrial and exports needs. There is still need for investments in new pipelines and other gas gathering, processing and storage infrastructures.

Inability to attain full commerciality in domestic gas prices has also hindered progress towards export parity. Even with the domestic gas supply obligation (DGSO), making gas available for domestic use at the appropriate level is yet to be achieved.

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How Afghanistan moved 20 million households to Home solar-storage programme holds lesson for Nigeria DIPO OLADEHINDE

hile million of Nigerians still spend huge chunk of their disposable incomes to maintain and run their generators, 20 million residents in war torn Afghanistan looks set to profit from the country’s first Pay-AsYou-Go (PAYG) home solar systems combined with energy storage batteries, being delivered in a pioneering new programme. The initiative which is part of a partnership between World Bank’s International Finance Corporation (IFC), leading mobile payment company Afghan Wireless Communi-

cations Company (AWCC), Global System for Mobile Communications (GSMA), seeks to provide electricity to nearly 20 million Afghans which represents over 60percent of its population who are not connected to the national grid. “With help from our strategic partners, our PAYG service will provide thousands of Afghans access to safe, clean and affordable electric lighting and power,” Amin Ramin, managing director of Afghan Wireless told Magazine Post. The IFC-led programme will start with solar systems, manufactured by California-based off-grid home solar specialist d.Light, being provided to homeowners in the Eastern and Southern provinces of Nangarhar

and Kandahar. After this pilot phase, PV systems will be offered across Afghanistan. Despite Afghanistan government attempts to expand the reach of the grid, its plans have been hindered by extreme terrain and difficult security situations and which is where solar home systems can step in. “In Afghanistan, difficult terrain, the dispersed nature of rural communities, and a precarious security situation make it extremely difficult to expand the national power grid,” said Marco Indelicato, IFC program manager of Lighting Afghanistan. IFC program manager said Solar home systems, however, can provide Afghans with a reliable, cost-effective source of electricity, which is a crucial

first step in fighting poverty and creating economic opportunities. While Afghanistan seems to be active steps in penetrate energy across its population especially those who are not on the national grid, for Nigeria status quo remain the same as One in every two Nigerians have limited or no access to the electricity grid, according to the Rural Electrification Agency (REA). In 2016, about half of Nigeria’s population was estimated to be in rural areas as the typical scenario in many of these communities is to depend on kerosene, generator kiosk (cellphone charging) and battery-powered torches for their energy needs which has negative effects on their health, environment and productivity levels.

Stakeholders said one of the barriers to energy access in Nigeria in the past was an incoherent policy environment as there was no holistic strategy to take advantage of power supply alternatives like mini-grids and solar home systems. Recall, Tanzania-based Zola Electric announced its expansion to Nigeria in September 2018. It is hoping to reach 1 million households and businesses within the next three years. The success of these companies, however, will largely depend on their ability to quickly reach as many homes as possible with their solar systems. Its success is very critical nonetheless as it’s expected to provide energy to 20 million households who lack basic electricity with access.

Innovation paves way for next stage of global energy transformation

ountries at the forefront of the energy transformation are getting more than a third of their energy from variable renewables like solar and wind, and they’re doing it in a cost-effective manner. By making use of innovative solutions that allow to integrate a higher share of renewables into power systems, innovation holds the key to a cost-effective global energy transformation. These findings come from a first-of-a-kind mapping and analysis of innovations that will transform the power sector, launched by the International Renewable Energy Agency (IRENA) today in Brussels. IRENA’s DirectorGeneral Adnan Z. Amin presented the report in the presence of EU Energy and Climate Action Commissioner Miguel Arias Cañete at an official launch event hosted by the European Commission.

The report “Innovation Landscape for a Renewable-Powered Future: Solutions to integrate variable renewables” contains the most in-depth assessment of the power sector transformation to date. It shows how synergies between different innovative solutions in business models, market design, enabling technologies and system operation are lowering the cost of integrating high shares of variable renewable energy (VRE), while making energy production, transmission and consumption more flexible and empowering a new generation of energy consumers. Decarbonising the global power sector in line with the Paris Agreement objectives will require an 85% share of renewable energy in total electricity generation by 2050, IRENA’s 2050 Roadmap estimates. By then, variable renewables would account for 60% of the total power generated globally. Moving

to a new phase where the massive but cost-effective scale-up of renewables power is crucial, the power sector transformation is strongly accelerated by innovation trends in digitalization, decentralization and electrification of the end-use sectors. Understanding and learning from the experiences from leading countries in VRE integration is crucial to replicate and enhance innovation that can accelerate this transformation. With close to 15% of VRE share in annual electricity generation today, the EU has the highest levels of variable renewables in power systems globally. “Europe has shown tremendous leadership in initiating the system-wide innovations needed to support the widespread adoption of renewables and decarbonise the global economy”, said. Amin. “The region’s success shows us that innovation is creating an energy

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

transformation that is technically feasible and economically attractive. Innovation is the engine powering the energy transition and the global pace of innovation is accelerating. IRENA’s new report will provide a clear, navigable and comprehensive guide on innovations being piloted around the world, aiming to support informed decision-making by all countries to deploy low-cost renewables and accelerate the global energy transition further.” EU Commissioner for Energy and Climate Action Miguel Arias Cañete reiterated the importance of renewable energy in helping the region to meet its climate objectives, “The EU has already started the modernisation and transformation towards a climate neutral economy. Implementing the EU’s Clean Energy package will further boost innovation, and the EU can continue to show leadership and

support the rest of the world by exporting innovative solutions in the fight against climate change. Innovation is central to our efforts, and this report from IRENA is a valuable contribution to become the world’s first major economy to go climate neutral by 2050.” t he new report identifies 30 key innovations and 11 innovative solutions in development by pioneering companies and backed by far-sighted governments around the world. By showcasing many examples of projects and pilots for the power sector transformation across the globe, it supports policy makers in adopting innovation frameworks built on the combination and synergies between innovative solutions. As a unique toolbox it will help decision makers to rethink their power systems and implement solutions that account for specific national circumstances.

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SMEs hardest hit by cybercrime, as 60% of Nigerian businesses suffer attacks

…Sophos, Sidmach reveal 92% of malware attacks are delivered via email Jumoke Akiyode-Lawanson

ybercrime has become the greatest threat to every company and country in the world, as it is estimated that 54 percent of companies globally experience at least one cyber-attack every year. The numbers are even higher in Nigeria, where about 60 percent of firma are affected by cyber attacks. Shockingly, only 38 percent of global organisations claim they have the infrastructure to handle a sophisticated cyber-attack. Meanwhile, 43 percent of cyber-attacks target small businesses, but only 14 percent of these SMEs have effective infrastructure to mitigate cyber risks, vulnerabilities and attacks. These mind bugling statistics were revealed at the one-day Sidmach/ Sophos Lunch and Learn Event held in Lagos on Thursday, February 28, 2019. According to Jimi Falaiye, country manager of Sophos (Nigeria), businesses are often concerned about security of data; unfortunately, 95 percent of security breaches are due to human error. “Cyber-criminals and hackers will infiltrate your company through your weakest link, which is almost never in the IT department”, he said, adding that it takes organisations an average of 191 days to identify data breaches. Falaiye further revealed that 92.4 percent of malware is delivered via

L-R: Opeoluwa Ojumu; Sophos product manager at Mart Networks Nigeria Ltd., Akintunde Opawole; manager, FLIMS Business Unit, Sidmach Technologies Nig. Ltd., Christopher Odutola; sales engineer, Sophos and Lanre Adelanwa; head, marketing at Sidmach, during Sophos/Sidmach Lunch & Learn event in Lagos on 28 February, 2019.

email, even as total cost for cybercrime committed globally added up to over $1 trillion dollars in 2018. Sharing more facts about cyber crimes, particularly as ransomware affects Small and Medium Businesses (SMBs), Nathanael Odofin, market intelligence and research analyst at Sidmach Technologies Nigeria Limited, said that 22 percent of organisations had to cease business operations immediately because of ransomware. “Reports reveal that 81 percent of businesses have experienced ransom-

ware; 66 percent have suffered a data breach; 35 percent were victims of ransomware,” Odofin said. He however said that anti-virus is not enough because most of them are reactive in nature. “Antivirus protects you from classic dangers like known viruses, Trojans, and worms – ‘known’ being the operative word here. An Antivirus cannot protect without a signature database for detection “But, most antivirus programs are reactive. A study has found that a typi-

cal antivirus will only stop 30 percent to 50 percent of new malware when it first appears. Unless the antivirus software has seen a particular threat in the past, it won’t necessarily protect your computer,” Odofin added. Referring to Verizon Data Breach Investigation Report, he reminded businesses in Nigeria that over half of all cyber breaches in 2017 included the use of malware. Malware activities include: stealing credit card details; revealing passwords and spreading spam. “It is why the fortification of antivi-

rus merely is not enough. You need to bolster this layer of defense with another layer (like an onion) – that of an antimalware,” he said. The cyber security experts advised participants and other organisations in Nigeria to deploy software security solutions, which Sophos has developed to “keep a very close eye on what is happening inside your system, blocking both known and unknown malware threats. It also safeguards you against any potentially harmful programs”. Earlier, Peter Arogundade, managing director of Sidmach Technologies, said that the Lunch and Learn event was aimed at assisting IT experts in different organisations to understand cost effective security dynamics, and tools that mitigate latest threats, while receiving insights to have complete visibility and control of their IT Infrastructure. Arogundade who was represented at the event by Olanrewaju Adelanwa, head of marketing, at Sidmach, described the sessions as crucial as they offered the experts new perspective on better architectures for end-to-end networks threats management with a one-stop-solution that Sophos brings. “We are not referring to security for just the hardware, the emails and everything within your network protocol that requires protection. This event, basically, was organised to bring these professionals together and expose them to insights about what is happening in Nigeria and across the world,” he said..

Western Digital unveils world’s fastest 1TB UHS-I microSD™ card

s consumer demand for high-quality content continues to rise, Western Digital Corp. is enabling a bigger, faster experience with new industry-leading solutions that give consumers the best combination of performance and capacity so they can do more with the rich content they capture. At the recently concluded Mobile World Congress, the company showcased the world’s fastest 1TB

UHS-I microSD flash memory card, the 1TB* SanDisk Extreme® UHS-I microSDXC™ card. The new card features higher speed and capacity for capturing and moving massive amounts of highquality photos and videos on smartphones, drones and action cameras. These impressive levels of capacity and speed give consumers the ability to create all the content they want without worrying about space limitations or long

transfer times. Today’s smartphones and cameras allow consumers to create high-quality content in the palm of their hands, thanks to features like multi-lenses, burst mode capabilities and the 4K resolution. Western Digital says it will continue to deliver the most advanced solutions to ensure consumers can reliably capture and share a special moment or create video content for personal or professional use.

“People trust SanDisk-brand cards to capture and preserve their world. Our goal is to deliver the best possible experience so consumers can share the content that’s important to them,” said Brian Pridgeon, director of marketing for SanDisk-branded products, Western Digital. Designed to help move tons of high-quality content faster than ever, the 1TB SanDisk Extreme UHS-I microSD card reaches

speeds up to 160MB/s. This new card allows consumers to transfer files in nearly half the time over standard UHS-I microSD cards currently on the market. The cards reach these record-breaking speeds by leveraging Western Digital’s proprietary flash technology. The new SanDisk Extreme card will also be available in 512GB capacity, and will feature the A2 specification3 for launching and loading apps at blazing speeds.

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Cisco Meraki targets MSMEs with simplified technology solutions Jumoke AkiyodeLawanson

isco Meraki, the leader in cloud controlled WiFi, routing, and security, is targeting the millions of Micro, Small and Medium size enterprises (MSMEs) in Africa by offering its simplified cloud managed IT solutions that provides unified management of mobile devices, Macs, PCs, and the entire network from a centralized dashboard, which will be of immense relief to small businesses struggling with funding for advanced digital solutions. During a round table conference held in Lagos on Tuesday 26 February 2019, to announce the offerings, Cisco said that it had become important for Meraki to provide a simplified path to powerful technology; such that can enforce device security policies, deploy software and apps, and perform remote, live troubleshooting on thousands of managed devices through a small team managing a wider network. According to Cisco, digitization is the big trend of today and it is important for businesses, whether big or small to adopt digitization. The new Meraki offerings are designed to simplify IT

L-R: Steven Kewley; EMEAR commercial regional manager, Cisco, Olakunle Oloruntimehin; general manager, Nigeria and West African Countries, Cisco, and Nick Malherbe; territory manager for Nigeria, Ghana East and Sub-Saharan Africa at a press conference held in Lagos to launch Cisco Meraki on Tuesday February 26, 2019.

solutions for small and medium businesses even in the absence of an IT specialist. The technology provides complete network visibility and control - no hardware controllers or overlay software required. Configurations and management are easily performed remotely or on-site, while trouble shooting can be done in a fraction of the time with advanced networking analytics, allowing businesses to focus on more projects that are impactful. Speaking at the event, Olakunle Oloruntimehin, general manager of Cisco

Nigeria, said, “Cisco Meraki creates the simplest, most powerful solutions, helping everyone from small businesses to global enterprises save time and money. It helps organizations to rapidly roll out digital initiatives, delivering real business value. We are committed to helping our customers overcome challenges and achieve their goals. Technology can connect us, empower us, and drive us. At Cisco, we believe that by simplifying powerful technology, we can free passionate people to focus on their mission and reach

groups previously not utilizing technology”. All Cisco Meraki devices are centrally and securely managed from the cloud using a single web-based dashboard. Their featurerich, intuitive architecture enables customers to save time, reduce operating costs, and scale as a business grows. Substantiating the importance of simplified IT solutions, Nick Malherbe, the territory manager for Nigeria, Ghana, east and sub-Saharan Africa, explained the need for businesses to use data smartly

Startups showcase transformative technology solutions at ISW 2019

and securely for business success. “In Nigeria, small and medium businesses account for 84 percent of employment attesting to the fact that they contribute greatly to the GDP of the economy. The success of this sector is key for the success of our economy, it is therefore imperative that these businesses use IT solutions that are secure, simple and intelligent. With Cisco Meraki, these MSMEs can enjoy agility, operational efficiency, and most importantly, data security that they require to accelerate their digital transformations. Our goal is to help customers benefit from digitization by simplifying IT solutions,” Malherbe said. Since inception in 2006, Meraki has grown to become an industry leader in the IT space, with over 230,000 customers and 3 million network devices and counting online around the world. Meraki was acquired by Cisco in 2012. The Company’s comprehensive set of solutions includes wireless, switching, security, communications, EMM, and security cameras, all managed through Meraki’s web-based dashboard interface which allow customers to seize new business opportunities and reduce operational costs.

Huawei showcases 5G, SoftCOM AI solutions at #MWC19

uawei Technologies has wrapped up its four-day exhibition at the Mobile World Congress 2019 (MWC19) in Barcelona, Spain where it displayed its new innovative 5G products and other IT solutions including SoftCOM AI. Aside delivering keynotes at the sessions during the conference, the technology firm also held a wide range of discussions on its endto-end 5G products and solutions with operator customers and partners from around the world. Among the new offerings were simplified 5G sites, architecture, protocols, and operations & maintenance (O&M). Huawei said the new offerings will help operators quickly deploy 5G networks on a large scale. At the event, it also

launched the SoftCOM AI solution, which will help build autonomous driving networks of the future and maximize the value of telecom networks. Huawei also expressed its commitment to helping operators expand their business boundaries and achieve new growth through innovations in networks, services, and business models. At this year’s event, Huawei showcased its endto-end 5G products and solutions, ranging from simplified 5G sites and 5G integrated transport, to 5G cloud core and simplified 5G O&M. It also demonstrated its core technologies behind the new products and solutions, including radio frequency, optical transmission, IP, and IT. Similarly, Huawei demonstrated 8K high-definition (HD) live streaming on Vo-

dafone Spain’s 5G network, and showcased new applications such as Cloud VR, cloud gaming, and cloud PCs. Under the support of Huawei, multiple European operators, including Vodafone, announced that 5G networks are now ready for commercial use. In addition, Huawei presented its idea for autonomous driving networks, as well as its full-stack, all-scenario SoftCOM AI solution, with the aim to significantly improve operating efficiency, network performance, O&M efficiency, and user experiences. The SoftCOM AI solution enables “0 bits,0 watts” and adaptive beam adjustment, thereby maximizing the value of telecom networks. Huawei is actively innovating networks, services,

and business models. It works with customers to redefine the business models and boundaries of the telecom industry, and ultimately help operators succeed. This, the company says, will be achieved through a portfolio of innovative business solutions, including IoT cloud services, personal mobile services, five-star premium home broadband, and cloud-network convergence. Huawei also signed 5G contracts with many operators from around the world. So far, Huawei has signed over 30 commercial 5G contracts with operators around the world, and shipped over 40,000 5G base stations. Its aim is to help operators jump start 5G and deliver a highquality 5G user experience. This is the first time that all of Huawei’s three business groups (BGs) – Carrier

BG, Enterprise BG, and Consumer BG –have participated in the Mobile World Congress (MWC). Huawei’s Enterprise BG showcased four star products: the industry’s fastest OceanStor Dorado series – all flash storage; the world’s first AI-powered data centre switch; the world’s first WiFi 6 access point (AP) for commercial use; and the X series cameras – the world’s first AI-powered softwaredefined cameras. Huawei’s Consumer BG showcased multiple popular devices, and launched the world’s first foldable 5G smartphone. It will be recalled that Huawei was the first company in the industry to launch commercial 5G chips and devices, and has worked with the industry to drive 5G maturity and commercialization.

echnology startups, businesses and industry representatives gathered at the first ever Innovation Showcase Week 2019 (ISW 2019), to witness the latest transformative technologies that will redefine industries and revolutionalise the economy by solving some of the most pressing business and consumer challenges in Nigeria. Over 20 exhibiting technology startups showcased the latest tech innovations to some 400 business and industry representatives at the home of West Africa’s first deep tech accelerator - NG_ HUB by Facebook. Innovation Showcase Week tagged ‘ISW 2019’ is the first technology product showcase exhibition out of the startup support programs by tech innovation centre CoCreation Hub (CcHUB) and global enterprise, Facebook. “We recognised the urgent need to accelerate innovation support to medium and large corporates who are positioned to secure significant gains for the economy through smart application of technology”, said ‘Bosun Tijani, CEO and Founder of CcHUB, “ hence, ISW was organized to close the gap between corporates and startups by being an unprecedented platform where industry leaders can experience and adopt homegrown innovations and solutions first hand”. Startups at ISW unveiled their ground-breaking innovations built in Facebook’s deeptech startup program -FBStart Accelerator - and theCcHUB 2018 Incubation program. The products on display leveraged advanced technologies such as Data Science, Internet of Things, VR and AI across 8 categories including Healthcare, Agriculture, Mobility, Energy, Education, Safety Training and, Security. These solutions proffer break-through advances to business and consumer challenges in Nigeria. On the ISW 2019 showfloor, exhibiting Artificial Intelligence (AI) and Security-focused startups Chiniki Guard, SayPeace, Identity Tech, E-Estates, DeepQuest AI and Insyt demonstrated AI’s promising power. Other products displayed for the Health and Agriculture sectors include Vetsark, Doctoora, Plantheus, TrepLabs, Gricd and Truppr. Energy and Mobility dedicated areas had Upnepa, Smart Electricity, Hydrolite, Cycles and Lara products on display and the Virtual reality and Safety Training section showcased immersive solutions from Quadron VR, Kanji Drive and Project Move.

Tuesday 05 March 2019

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Odunayo Oyasiji

Case Review

Afrotec Technical Services (Nig) Ltd. V. Mia & Sons Limited & Anor (2000) LPELR-SC.132/1992

hat to note: This matter was decided at the Supreme Court of Nigeria on the 15thof December, 2000. This matter bothers on commercial law issues like rights of a seller, lien, contract of sale, sale of goods, credit sale transaction and hire purchase. We will touch on some of these issues in the course of the review. Facts The plaintiff (MIA & Sons Limited) and defendant (Afrotec Technical Services (NIG) LTD) are both limited liability companies. The head office of the plaintiff is in Kaduna while that of the defendant is in Lagos. The plaintiff is a customer to the defendant. On February 8, 1978 the plaintiff ordered for Parker 5245 crushing plant combination (N476,600), Foden Dump Truck (N84,000.00 ) and BD 440440 KVA generating set (N66,000.00). The parties also agreed on the supply of spare parts for crushing plant (N38,000), transportation of equipment to Kotangora at the cost of 28,000 naira and commissioning fee of 10,000 naira. The total cost of everything is N702,600. The plaintiff subject to some terms and conditions contained in its letter of March 28, 1978 gave an undertaking to pay the defendant the sum of N702,900 being the cost of the equipment and other expenses agreed upon. The plaintiff claimed that it made a payment of N281,160 (representing 40% of the agreed sum of N702,900). On the basis of the payment, the defendant installed the equipment at Kotangora as instructed by the plaintiff. It was agreed that the 60% balance is to be paid in six equal instalments. The plaintiff gave post-dated cheques to cover the outstanding 60% balance. The cheques are to be presented for payment on April 27, August 27 and September 27. The plaintiff defaulted in the payment of the instalments. The reason the plaintiff gave for its failure to meet up with its payment obligations is that the equipment broke down soon after it was installed and the defendant failed to supply spare parts to fix it. The plaintiff requested that the defendant should transfer the equipment to Kaduna in 1980 and install it. The plaintiff agreed and dismantled the equipment for the purpose of transferring it to Kaduna. However, the plaintiff kept the equipment in its warehouse claiming that it had repossessed it due to failure of the defendant to fulfil its payment obligation. On the basis of the above, the

diate possession” clauses, following the failure of the plaintiff to complete the payment for the equipment. (c) Whether the said rights of lien and “immediate possession” have been waived by the conduct of the parties. (d) Whether the plaintiff has by pleadings and evidence, established the defence of waiver. (e) Should the Court of Appeal have granted the relief that the equipment be delivered to the plaintiff subject to the defendant being paid the entire sum? (f ) Was the Court of Appeal right in holding that the plaintiff had established a legal right to the equipment?” The court adopted the issues raised by the appellant/defendant for the determination of the matter. plaintiff instituted an action in the High Court of Kaduna State. The High Court dismissed the claims of the plaintiff and the plaintiff further appealed to the Court of Appeal. The Court of Appeal gave judgement in favour of the plaintiff. The defendant being dissatisfied appealed to the Supreme Court. Issues for determination The seven issues below were submitted to the court by the appellant/defendant“(i) Whether the Court of Appeal was right in its view that Ownership in the equipment passed to the plaintiff on proper construction of Exhibit 1 merely because the defendant had delivered the equipment at the site of the plaintiff at Kontagora. (ii) Whether the Court of Appeal was right in its view that acceptance of negotiable instruments as payment for the equipment had converted the conditional sale of these equipment into an absolute sale. (iii) Was the Court of Appeal right in its view that the only remedy open to the defendant was an action for the recovery of the balance of the sum unpaid and not in its exercise of the right of lien or Repossession of the plant when the agreement between the parties provided for those remedies? (iv) Was the Court of Appeal right in holding that plaintiff has established a legal right in the equipment as to entitle it to the Equitable reliefs sought? (v) Was the Court of Appeal right in holding that the defendant has waived all the restrictive conditions in Exhibit 1 when the waiver of the same as a defence was not specifically pleaded nor were circumstances and facts amounting to waiver pleaded in answer to the plaintiff’s pleadings?

(vi) Was the Court of Appeal right in making an order to enforce the second agreement when the respondent failed to fulfil its obligation under the first contract? (vii) Whether the Court of Appeal was right in making an order that the said equipment be delivered to the plaintiff subject to the plaintiff paying

‘

An unpaid seller still reserves some rights with regards to the property sold out. ...where the sale of goods is made subject to the fulfilment of some conditions, the ownership of the property will not pass until and unless the conditions are fulfilled the entire sum outstanding as balance of total cost of the equipment taking into account N381,160.00, the plaintiff has so far paid to the defendant when such relief was not placed before the trial court.” The respondent/plaintiff on the other hand submitted the issues below“(a) Whether having regard to the pleadings and evidence led, the defendant established any legal right to the equipment in dispute. (b) If so, whether such legal right could be defeated by the “right of lien” or “right to imme-

Arguments/Submissions The learned counsel to the appellant argued that the appellant by virtue of the agreement between the parties have the right to repossess the property if the respondent fails to fulfil its payment obligations. Therefore, the appellant exercised its right under the agreement by repossessing the property since the respondent has defaulted in payment. The respondent’s counsel on the other hand argued that the conduct of the appellant with regards to parting with possession before full payment and charging of interest on the outstanding balance after the plaintiff defaulted is a clear sign of intention to transfer the property. He further argued that the appellant didn’t insert any clause that reserved its ownership right. Therefore, ownership cannot pass at the point of repossession after earlier delivering the equipment to the respondent. Judgement The Supreme Court in allowing the appeal and giving judgement in favour of the appellant held that- “An unpaid seller can exercise the statutory right of resale of the Goods in his possession whether or not properly, the goods has passed to the buyer or not and the new buyer acquires good title in such goods… Under section 48 of the Sales of Goods Act, the unpaid seller retains the right to sell the identified property, where the buyer has become insolvent. The right of sale can be exercised by the seller under this section where he has been in continuous possession of the goods or where he has regained possession by exercising his right of lien or stoppage of the

goods in transit. This right is available to him whether or not the property in the goods has passed to the original buyer who has become insolvent by his failure to pay or tender the purchase price as agreed in the contract, within a reasonable time. The intention to sell the goods must be notified to the insolvent buyer. What is a reasonable time in this context is a question of fact”. It was further held that “The object of sale of goods is generally to transfer its ownership to the purchaser from the seller. See sections 16-19 of the Sale of Goods Act, 1893. But where a contrary intention is shown, the property in the goods only passes to the buyer at such time as the parties to the contract intend to. And for the purpose of ascertaining the intention of the parties, regard must be had to the terms of the contract the conduct of the parties and the circumstances of the case. “ Also, the court noted that “where a contract for the sale of specific goods, as in the present case, is made subject to a condition which to all intent and purposes suspends the passing of property, the property will not pass to the buyer at the time of the making of the contract, but only when the agreed condition as stipulated by the parties is fulfilled. Until then, the contract takes effect as an agreement to sell, and not an outright or absolute sale of the goods.” With regards to the nature of credit sale, the court held that “in the credit sale transaction, there is a sale on credit. The credit may take the form of payment of the entire purchase at an agreed future time or payment of the purchase price by agreed instalments. In a credit sale, there is no question of an agreement to purchase the goods at a future time. A purchaser of goods under a credit sale agreement does not have the option, which the hirer has, of returning the goods and freeing himself from the obligation to pay further instalments…It is evident that a credit sale is not a hire-purchase transaction. A credit sale is a sale transaction subject to the same principles in regard to the passing of property in sale transactions which are not on credit.” Conclusion An unpaid seller still reserves some rights with regards to the property sold out. Furthermore, where the sale of goods is made subject to the fulfilment of some conditions, the ownership of the property will not pass until and unless the conditions are fulfilled.

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

Dangote Cement delivers higher returns to shareholders BALA AUGIE

ement companies have been feeling the shooting pains of a slowing economy. The devaluation of the currency in 2014 and 2017 balloon cost of production and debt due as the industry was exposured to foreign currency risk. Additionally, low consumer purchasing power resulted in price hike that undermined cement volumes while incessant delays in the passage of budget since 2015 have slowed construction activities since public sector capital expenditure spending are the major drivers building materials activities. Perhaps more worrisome is the weakness in the real sector where activities drive cement growth as lack of supportive policy frame work for to drive mortgage activities continue to slow growth. Between 2014 and 2017, the cement sector expanded at a robust Compound Annual Growth Rate (CAGR) of 13.70 percent. However, growth has averaged -1.0 percent in the past three years, with only a marginal recovery of 4.50 percent in 2018. Despite the above monumental challenges hindering cement makers from taking advantage of the infrastructure deficits, growing population that crave for consumption, Dangote Cement Plc, the largest

producer of the building material in Africa’s largest economy have surmounted the headwinds as the company continues to deliver higher returns to shareholders. Dangote Cement just released its 2018 audited financial statement that showed it recorded improvement in key profitability and efficiency ratios while it continues to stamp its foot prints across Africa. Steady revenue growth since 2013 Dangote Cement revenue trajectory has been remarkable, with sales increasing at a CAGR of 23.14 percent between 2014 and 2018. This was driven significantly by increases in prices in cement prices, volume, as production volume grew at a single digit rate of 6.26 percet to 22.79 million metric tons. However, the cost of importing fuel and raw materials imposed significant constraint. Cost of sales ratio was higher at 42.53 percent in 2018 from 36.50 percent in 2014. The company faced energy challenges in 2016 when incessant attacks by Niger Delta militants on gas pipelines balloon costs because it relied heavily on gas to power plants at factories. Gas was also priced in dollars which brought foreign exchange risk. Post 2016, the management of Dangote Cement has changed its energy mix and transited to coal consumption, which is mined by

Aliko Dangote, chairman and CEO, Dangote Group

parent company. The benefits of the new strategy are that it reduces exposure to foreign exchange risk and lower costs. Indeed benefits of excellent energy is having a positive impact on the company’s numbers as cost to sales improved to 43.60 percent in December 2018, from 43.60 percent in December 2017and 52.64 percent in2016. Profit margins spike on taxes credit and lower costs Amid rising operating expenses, Dangote Cement’s profit after tax has risen at a fast pace of CAGR of 25.07 percent to N390.32 billion between 2013 and 2018. A breakdown of bottom line figures showed profit more than double from N159.90 recorded in December 2013, thanks to lower costs and tax credit on some of its production lines. Earnings before interest and taxation (EBITA) nearly doubled to N338.69 billion as at December 2018, from N187.10 billion recorded in 2013, despite increased operating expenses. Gross profit was up 14.0 percent to N517.90 billion in the period under review as against N454.29 billion as at December 2017. Dangote Cement has been turning each Naira invested in sales into higher profit since the country existed recession in 2016 while contemporaneously deploying shareholders resources in underpinning bottom-line. Net profit margin was 43.31 percent in December 2018, a figure that is more than the 40.73 percent recorded in 2013,and analysts are optimistic margins will be improve in 2019. Gross profit margins increased to 57.47 percent in December 2018 as against 47.36 percent recorded in 2016, which means the company earnings N0.57 in gross profit for every N1 invested in sales. EBITA margins followed the

same growth trajectory as it rose to 37.58 percent in the period under review as against 29.67 percent in 2016. Return on average equity (ROAE), a measure of profitability moved to 39.56 percent in December 2018 as against 23.03 percent in 2016, and even eclipsing 27.14 percent recorded in 2013. Return on average assets (ROAA) increased to 23.04 percent in the period under review as against 12.21 recorded as at December 2013. Dangote Cement has been utilizing fixed assets in generating higher sales since 2o14, an excellent strategy that validates higher

BD MARKETS + FINANCE Analysts: BALA AUGIE

returns to shareholders. Fixed asset turnover increased to 75.60 times in December 2018 from 52.37 times as at December 2014. Giant of the Cement Industry Dangote Cement transited from trading from a cement manufacturing in 2007. Today, the company is Nigeria and Africa’s largest as well as tenth largest cement manufacturers with an install capacity of 45.6 million metic tones. The company has extensive operations in ten other Africa countries with a total capacity of 15 million metric tones. In Nigeria, the company is the market leader with an estimated 61.30 percent share of total install capacity

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INSIGHT

The Dating 102 Guide to Recruitment

Misan Rewane Misan Rewane is co-founder and CEO of WAVE, an organization focused on rewiring the education-toemployment system to create a level playing field for every African youth to access the skills and opportunity to become what they imagine.

A Tale as Old as Time omeone I know, recently had his heart crushed. He needed someone to enrich and improve a part of his life. For months he pursued her. She turned him down. He offered to give her twice as much of the things she wanted. She turned him down again. He couldn’t figure out why. She said it was because she was with someone, someone she was devoted to. She wanted to stay and make it work. The person who suffered this heartbreak was a client of WAVE’s, and when he came to us with his tale of woe about being rejected by someone he was trying to recruit, we couldn’t help but think how familiar it all sounded. Needing a manager for a new business unit you had formed in your organisation... Reaching out to them and making an offer... Being rejected... Believing if you sweetened the deal the candidate would capitulate...Offering a higher salary only to be rejected again... Being told by the candidate you so desperately wanted to employ, that they were happy with the company they were with... They wanted to help build it..They were grateful for your interest but didn’t want to move...Being heartbroken because the position in your company remains unfilled...Wondering what you did wrong and if you will ever find the right person. The story I just told, accurately describes my client’s unfortunate foray into recruitment. Yet, it is no accident that my first account of events is also a spot-on description of his experience. Sometimes the process of finding

the right people for your team can feel like the plot of a sad romance novel. Ships Passing in the Night Nigeria has a human capital problem. There is a serious disconnect between the skills our youth acquire in educational institutions and the skills our businesses require to run efficiently. What this broken connection results in is a limited pool of capable talent. Finding the right people to increase your organisation’s productivity and profits can be challenging. At the end of the day, a jobseeker and a prospective employer are just two strangers trying to make a connection. Much in the same way you can meander in the dating world, failing time and time again to find the perfect match, you can stumble in the recruiting process, struggling year after year to find the right people and keep them on board. Heartbreak Hotel Many, if not most, Nigerian employers are familiar with disappointment. Some of them discover their perfect candidate only for their efforts to be thwarted by the commitment, loyalty, integrity and initiative that attracted them to said candidate in the first place. Other employers swim through an ocean of potential without finding that one good fit; and wash up on shore fatigued and filled with disillusionment. The majority make what they believe to be the right hire, only to discover that it was a mirage. Many employers can’t understand why their turnover is so high, despite all of the benefits they believe they provide to their

employees.

this even worth it?

They look at their insufficient or inadequate staff and wonder: Could things have worked out differently? Where did we go wrong? Is it them? Is it us? Is there any hope at all?

• The Soul-searching What do we want this person for? Why are we even looking?

Finding ‘the One’ Both the recruitment process and the dating world require time and effort that can engender deep despair and real frustration. WAVE’s experiences in recruitment, both within our own organisation and with the businesses of our clients, has given us insight into how to become a more effective recruiter and employer. A firm understanding of the principles and processes that govern making a good hire, will improve your odds of success. An informed implementation of these principles might even give you a chance at a match made in heaven. About the Series The Dating 101 Guide to Recruitment series is designed to help you streamline (or completely overhaul) your recruitment policies and processes. We’ll do a deep dive into the key decisions, tools, and actions that every employer needs to begin making great additions to their team. We’ll cover 10 main topics, each in its own instalment: • The Big Picture What’s the point of it all? Is all

• Setting the Standards How can this person give us what we need? Will they be able to make us happy? • Self-reflection Who are we? What do we stand for? What do we have to offer? • What Makes Us Special? How are we different? Why should we be the chosen ones? • Putting Ourselves Out There How do we make the people we want see our specialness? • Making a Match How will we decide who we want? What if it isn’t meant to be? • Making It Work How will we live together? How will we maintain peace and harmony? • Making It Stick How do we keep the music playing? How do we make it last? Going the Distance Shall we grow old together? Were we made for each other? Our hope is that by tackling, from the perspective of dating, the ins and outs of successfully staffing your company/organisation, WAVE can simplify the seemingly complex process of securing the right candidate and building a great team.

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Tuesday 05 March 2019

Live @ The Exchanges Top Gainers/Losers as at Monday 04 March 2019 GAINERS Company

LOSERS Opening

Closing

Change

N25

N27

GUARANTY

N35.5

N37.2

1.7

ZENITHBANK

N23.95

N24.5

0.55

DANGFLOUR

N9.9

N10.4

N196.6

N197

NTBREW

DANGCEM

Market Statistics as at Monday 04 March 2019

Company

Opening

Closing

Change

N13.45

N12.15

-1.3

N8.5

N8.25

-0.25

DANGSUGAR

N14.65

N14.5

-0.15

0.5

GLAXOSMITH

N12

N11.9

-0.1

0.4

UCAP

N3.35

N3.25

-0.1

PZ UACN

ASI (Points)

32,129.94

DEALS (Numbers)

3,544.00

VALUE (N billion)

2.614

MARKET CAP (N Trn

Stock market opens week on a positive note, gains over N100bn Stories by Iheanyi Nwachukwu

espite the reactions of some investors after the presidential and national assembly election results, bargain hunting activities started this week to drive positive trading at the Nigerian Bourse. As investors rushed to Custom Street to take up undervalued stock, it resulted to the market gaining 0.95percent. The All Share Index (ASI) increased from an open price of 31,827.24 points to 32,129.94 points. The year-to-date (ytd) return increased to 2.23percent. In 3,428 deals, stock traders exchanged 217,698,665 units value at N2.530billion. UBA Plc, Diamond Bank Plc, Zenith Bank Plc, Access Bank Plc and Transcorp Plc were actively traded stocks on the Nigerian Stock Exchange (NSE). The value of listed

L-R: Olumide Bolemole, divisional head, Listing Business Division, The Nigerian Stock Exchange (NSE); Oladipo Aina, managing director/CEO, Signet Investment and Securities Limited; Patrick Ezeagwu, chairman, Association of Stockbroking Houses of Nigeria (ASHON); Ifeyinwa Rita Ejezie, managing director/CEO, Cashville Investments & Securities Limited and Jude Chiemeka, divisional head, Trading Business Division, NSE during the Fixed Income Trading Workshop for Dealing Members at The Exchange in Lagos on Monday.

equities increased to N11.981trillion from preceding trading day’s level of N11.868trillion, indicating N113billion gain. International Breweries Plc recorded the highest advanced from N25 to N27, adding N2 or 8percent; GTBank Plc stock price

advanced from N35.5 to N36.35, adding 0.85percent or 2.39percent; while Dangote Flourmills Plc increased from N9.9 to N10.4, adding 50kobo or 5.05percent. Zenith Bank Plc recorded 35kobo gain, from N23.95 to N24.3, up by

1.46percent; while Cutix Plc gained 20kobo, from N2.05 to N2.25, up by 9.76percent. On the losers table, Dangote Sugar Refinery Plc declined most, from N14.65 to N14.5, down by 15kobo or 1.02percent; followed by Glaxo-

ued at N58,461,391.49 belonging to the family of Akin Olugbade; and therefore committed an offence contrary to Section 516 of the Criminal

Code Act, laws of the Federation of Nigeria 2004 and punishable under the same Section. The offence is alleged to have been committed between

2004 and 2014 in Lagos. Adebanjo pleaded not guilty to the charge when the case came up for hearing last week and the court adjourned the matter to March 19, 2019 while the defendant is to be remanded in prison custody till the next adjourned date. Recall that Mary Uduk, Acting Director General of the Securities and Exchange Commission (SEC) had severally assured investors that the Commission will not hesitate to invoke the full weight of the law on any capital market operator that is involved in fraudulent activities. Uduk therefore urged

11.981

Nevin speaks at ACTN breakfast meeting on 2019 Economic and Business Outlook SmithKline Consumer Nigeria Plc which dipped from N12 to N11.9, after losing 10kobo or 0.83percent. “Given the reaction of investors to the election results last week, we highlight the possibility of negative sentiment persisting in the market this week. “That said, we expect bargain hunting to drive positive trading as investors take up undervalued stocks leading to a mixed session at week start,” said Vetiva research analysts in their March 4, 2019 note. “This week, we expect to see some buying activities particularly in the early part of the week as positive earnings results as well as bargain hunting drive buy interests. “Nevertheless, we expect this to be short-lived as weak investor sentiment stoked by the ongoing elections is expected to weigh on market performance. Thus, we maintain our bearish outlook over the near-term,” said research analysts at Lagosbased Afrinvest in their March 4 note.

Brentonwoods Managing Director docked for alleged N58m capital market fraud he Managing Director of Brentonwoods Limited, Samuel Adebanjo and his company have been charged before Justice M.S. Hassan of the Federal High Court 12, Ikoyi Lagos on a two count charge of fraud relating to illegal sale of shares of a client. Brentonwoods Limited and Samuel Adebanjo are alleged to have conspired within themselves to commit a felony to wit: defraud by selling and convert to their own personal use the proceeds of 537,872 Units of Nigeria Breweries Plc shares and 21,260 Units of Guinness Nigeria Plc shares all val-

228,484,355.00

VOLUME (Numbers)

investors to take advantage of the various initiatives put in place by the Commission to ensure that proceeds from sale of shares goes directly into the investors accounts to avoid mismanagement by Operators. According to her, “We are doing a lot to boost investors confidence and ensure their funds are not mismanaged. We have a number of initiatives that we have put in place to boost investors’ confidence. “We have the electronic -Dividend Mandate System (EDMS), the Direct Cash Settlement (DCS)as well as multiple subscription in place.

he Association of Corporate Treasurers of Nigeria (ACTN) is set for its breakfast meeting which holds on Thursday March 28, 2019 at the Lagos Continental Hotel, Victoria Island, Lagos. The Association of Corporate Treasurers of Nigeria is a professional association established to foster the interests of Corporate Treasurers of the buy-side and non-bank sell-side of the Nigerian financial markets by providing a platform for policy advocacy, discussions on issues of mutual interest, education and standard development of the corporate treasury function. Andrew S. Nevin, Advisory Partner and Chief Economist at PriceWaterhouse Coopers (PWC) will be the keynote speaker at the Breakfast Meeting which focuses on the “2019 Economic and Business Outlook”. As the Chief Economist of PwC, Nevin leads Nigeria’s most prominent economics teams and is one of the pre-eminent voices speaking about the Nigerian economy. “Nigeria has continued its economic recovery in 2018 on the back of an increase in oil revenue; however, fluctuating energy prices, increasing debt and the aftermath of the elections in the first quarter (Q1) of 2019 could pose challenges to the economy as all macroeconomic performance indicators are still either in the negative or in sluggish recovery”, said Patrick Ajunwoko, executive secretary/ CEO, Association of Corporate Treasurers of Nigeria. He noted that ACTN provides value for its members, organisations and the Nigerian economy through advocacy, standards development and education/enlightenment scheduled the breakfast meeting with focus on the possible impacts of the business environment within the year and ways of restoring confidence in the Nigerian financial markets.

Tuesday 05 March 2019

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Tuesday 05 March 2019

Prices for Securities Traded as of Monday 04 March 2019 Company

Market cap(nm)

Price (N)

Change

Trades

Volume

Company

Market cap(nm)

Price (N)

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Trades

Volume

PRICES FOR MAIN BOARD SECURITIES (Equities) BANKING ACCESS BANK PLC. 172,121.43 5.95 0.85 186 21,006,110 263,335.54 7.70 1.32 191 31,060,548 UNITED BANK FOR AFRICA PLC ZENITH BANK PLC 769,214.10 24.50 2.30 451 28,868,418 828 80,935,076 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 287,162.34 8.00 3.23 201 8,995,909 201 8,995,909 1,029 89,930,985 BUILDING MATERIALS DANGOTE CEMENT PLC 3,356,979.96 197.00 0.20 104 2,611,158 LAFARGE AFRICA PLC. 112,754.57 13.00 0.78 48 1,350,288 152 3,961,446 152 3,961,446 EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 364,247.18 619.00 - 10 6,670 10 6,670 10 6,670 1,191 93,899,101 REAL ESTATE INVESTMENT TRUSTS (REITS) SKYE SHELTER FUND PLC 1,900.00 95.00 - 0 0 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) 11,300.89 45.20 - 0 0 15,876.20 5.95 - 1 300 UPDC REAL ESTATE INVESTMENT TRUST 1 300 1 300 OTHER FINANCIAL INSTITUTIONS NIGERIA ENERYGY SECTOR FUND 411.91 552.20 - 0 0 3,312.39 103.20 - 0 0 VALUEALLIANCE VALUE FUND 0 0 0 0 1 300 CROP PRODUCTION FTN COCOA PROCESSORS PLC 440.00 0.20 - 1 50,000 OKOMU OIL PALM PLC. 76,312.80 80.00 - 10 15,642 PRESCO PLC 75,000.00 75.00 - 12 9,386 23 75,028 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 511.20 4.26 - 0 0 0 0 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 1,830.00 0.61 -8.96 19 591,500 19 591,500 42 666,528 DIVERSIFIED INDUSTRIES A.G. LEVENTIS NIGERIA PLC. 900.08 0.34 - 2 19,000 202.36 0.52 - 1 387 JOHN HOLT PLC. S C O A NIG. PLC. 1,903.99 2.93 - 0 0 51,216.47 1.26 1.61 134 16,976,162 TRANSNATIONAL CORPORATION OF NIGERIA PLC U A C N PLC. 23,770.70 8.25 -2.94 40 456,622 177 17,452,171 177 17,452,171 BUILDING CONSTRUCTION ARBICO PLC. 711.32 4.79 - 0 0 0 0 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 36,300.00 27.50 - 13 160,590 ROADS NIG PLC. 165.00 6.60 - 0 0 13 160,590 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 4,962.94 1.91 - 0 0 0 0 13 160,590 954.53 0.20 - 0 0 DN TYRE & RUBBER PLC 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 12,135.72 1.55 - 1 1,067 GOLDEN GUINEA BREW. PLC. 242.22 0.89 - 0 0 GUINNESS NIG PLC 147,084.21 67.15 - 15 8,779 INTERNATIONAL BREWERIES PLC. 232,088.27 27.00 8.00 14 2,103,741 NIGERIAN BREW. PLC. 639,752.16 80.00 - 73 256,382 103 2,369,969 FOOD PRODUCTS DANGOTE FLOUR MILLS PLC 52,000.00 10.40 5.05 152 7,695,514 DANGOTE SUGAR REFINERY PLC 174,000.00 14.50 -1.02 34 271,898 FLOUR MILLS NIG. PLC. 81,802.57 19.95 - 31 54,132 HONEYWELL FLOUR MILL PLC 10,467.86 1.32 -2.22 34 2,188,260 MULTI-TREX INTEGRATED FOODS PLC 1,340.10 0.36 - 0 0 N NIG. FLOUR MILLS PLC. 766.26 4.30 - 0 0 NASCON ALLIED INDUSTRIES PLC 50,869.22 19.20 - 15 8,634 UNION DICON SALT PLC. 3,676.41 13.45 - 0 0 266 10,218,438 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 19,533.30 10.40 - 17 104,782 NESTLE NIGERIA PLC. 1,196,910.94 1,510.00 - 26 22,992 43 127,774 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 22.10 - 7 34,427 VITAFOAM NIG PLC. 5,003.38 4.00 - 8 126,238 15 160,665 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 48,241.30 12.15 -9.67 32 765,448 UNILEVER NIGERIA PLC. 222,331.71 38.70 -4.39 49 1,288,129 81 2,053,577 508 14,930,423 BANKING DIAMOND BANK PLC 57,900.97 2.50 8.23 109 33,026,905 ECOBANK TRANSNATIONAL INCORPORATED 256,893.72 14.00 - 44 1,843,382 FIDELITY BANK PLC 68,380.52 2.36 0.43 109 8,631,846 1,094,839.87 37.20 4.79 288 10,888,579 GUARANTY TRUST BANK PLC. JAIZ BANK PLC 18,562.48 0.63 6.78 9 1,615,815 SKYE BANK PLC 10,687.83 0.77 - 0 0 STERLING BANK PLC. 71,400.24 2.48 - 246 7,556,812 UNION BANK NIG.PLC. 195,109.04 6.70 - 29 112,843 UNITY BANK PLC 10,871.08 0.93 - 2 2,288 WEMA BANK PLC. 32,402.55 0.84 9.09 34 2,458,417 870 66,136,887 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 0.20 - 0 0 AIICO INSURANCE PLC. 5,059.05 0.73 - 23 784,395 AXAMANSARD INSURANCE PLC 23,100.00 2.20 - 5 2,220 CONSOLIDATED HALLMARK INSURANCE PLC 2,113.80 0.26 -7.14 11 2,846,447 CONTINENTAL REINSURANCE PLC 19,811.94 1.91 - 0 0 3,682.38 0.25 - 5 94,400 CORNERSTONE INSURANCE PLC GOLDLINK INSURANCE PLC 2,001.98 0.44 - 1 500 GUINEA INSURANCE PLC. 1,228.00 0.20 - 0 0 INTERNATIONAL ENERGY INSURANCE PLC 487.95 0.38 - 0 0 LASACO ASSURANCE PLC. 2,416.73 0.33 6.45 11 896,500 2,234.09 0.52 -5.45 6 400,510 LAW UNION AND ROCK INS. PLC. LINKAGE ASSURANCE PLC 5,040.00 0.63 - 1 30,000 MUTUAL BENEFITS ASSURANCE PLC. 2,160.00 0.27 - 8 175,000 NEM INSURANCE PLC 12,884.43 2.44 -2.40 10 323,505 NIGER INSURANCE PLC 1,857.48 0.24 - 6 104,558 PRESTIGE ASSURANCE PLC 2,906.58 0.54 - 1 20,000 REGENCY ASSURANCE PLC 1,800.56 0.27 8.00 4 156,862 SOVEREIGN TRUST INSURANCE PLC 2,085.21 0.25 8.70 7 340,024 STACO INSURANCE PLC 4,483.72 0.48 - 0 0 STANDARD ALLIANCE INSURANCE PLC. 2,582.21 0.20 - 0 0 2,800.00 0.20 - 2 176,359 SUNU ASSURANCES NIGERIA PLC. UNIC DIVERSIFIED HOLDINGS PLC. 516.46 0.20 - 0 0 UNIVERSAL INSURANCE PLC 3,200.00 0.20 - 0 0 VERITAS KAPITAL ASSURANCE PLC 3,328.00 0.24 - 0 0 WAPIC INSURANCE PLC 5,353.10 0.40 - 1 4,268 102 6,355,548 MICRO-FINANCE BANKS FORTIS MICROFINANCE BANK PLC 11,799.67 2.58 - 0 0 NPF MICROFINANCE BANK PLC 3,612.89 1.58 9.72 10 195,885 10 195,885

MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 4,116.00 0.98 - 1 4,000 7,370.87 0.50 - 0 0 ASO SAVINGS AND LOANS PLC INFINITY TRUST MORTGAGE BANK PLC 5,922.05 1.42 - 0 0 RESORT SAVINGS & LOANS PLC 2,265.95 0.20 - 2 1,500 2,949.22 3.02 - 0 0 UNION HOMES SAVINGS AND LOANS PLC. 3 5,500 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 9,500.00 4.75 1.06 88 2,606,759 CUSTODIAN INVESTMENT PLC 35,585.28 6.05 - 11 601,600 660.00 0.44 - 0 0 DEAP CAPITAL MANAGEMENT & TRUST PLC FCMB GROUP PLC. 43,565.96 2.20 5.77 74 15,245,828 1,800.88 0.35 6.06 8 458,000 ROYAL EXCHANGE PLC. STANBIC IBTC HOLDINGS PLC 476,185.71 46.50 - 12 171,855 UNITED CAPITAL PLC 19,500.00 3.25 -2.99 55 2,229,679 248 21,313,721 1,233 94,007,541 HEALTHCARE PROVIDERS EKOCORP PLC. 1,680.29 3.37 - 0 0 UNION DIAGNOSTIC & CLINICAL SERVICES PLC 1,065.94 0.30 - 2 124,500 2 124,500 MEDICAL SUPPLIES MORISON INDUSTRIES PLC. 544.04 0.55 - 0 0 0 0 PHARMACEUTICALS EVANS MEDICAL PLC. 366.17 0.50 - 0 0 FIDSON HEALTHCARE PLC 7,425.00 4.95 - 3 5,000 14,230.93 11.90 -0.83 16 299,545 GLAXO SMITHKLINE CONSUMER NIG. PLC. 4,140.56 2.40 - 9 36,564 MAY & BAKER NIGERIA PLC. NEIMETH INTERNATIONAL PHARMACEUTICALS PLC 1,329.41 0.70 4.48 11 237,124 556.71 3.62 - 0 0 NIGERIA-GERMAN CHEMICALS PLC. PHARMA-DEKO PLC. 325.23 1.50 - 0 0 39 578,233 41 702,733 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 710.40 0.20 - 0 0 0 0 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 1,470.89 0.50 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 2.54 - 0 0 648.00 6.00 - 0 0 NCR (NIGERIA) PLC. TRIPPLE GEE AND COMPANY PLC. 381.11 0.77 - 0 0 0 0 PROCESSING SYSTEMS CHAMS PLC 939.21 0.20 - 2 228 12,306.00 2.93 - 0 0 E-TRANZACT INTERNATIONAL PLC 2 228 2 228 BUILDING MATERIALS BERGER PAINTS PLC 2,391.04 8.25 - 10 90,549 23,800.00 34.00 - 12 16,052 CAP PLC CEMENT CO. OF NORTH.NIG. PLC 262,870.02 20.00 0.25 27 416,400 FIRST ALUMINIUM NIGERIA PLC 612.00 0.29 - 2 37,800 286.87 0.54 - 0 0 MEYER PLC. PORTLAND PAINTS & PRODUCTS NIGERIA PLC 1,999.41 2.52 - 1 4,000 1,279.20 10.40 - 0 0 PREMIER PAINTS PLC. 52 564,801 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,256.91 2.09 - 2 205 CUTIX PLC. 3,962.97 2.25 9.76 14 315,733 16 315,938 PACKAGING/CONTAINERS BETA GLASS PLC. 39,497.79 79.00 - 1 1 GREIF NIGERIA PLC 388.02 9.10 - 0 0 1 1 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 62.50 - 0 0 0 0 69 880,740 CHEMICALS B.O.C. GASES PLC. 1,577.57 3.79 - 1 1,000 1 1,000 METALS ALUMINIUM EXTRUSION IND. PLC. 1,803.64 8.20 - 0 0 0 0 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 0.20 - 0 0 0 0 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 50.60 0.23 - 0 0 0 0 1 1,000 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,440.42 0.23 -4.35 14 1,396,673 14 1,396,673 INTEGRATED OIL AND GAS SERVICES OANDO PLC 71,480.62 5.75 -0.87 122 3,002,090 122 3,002,090 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 64,907.15 180.00 - 9 12,362 CONOIL PLC 15,960.90 23.00 - 21 96,586 5,738.24 4.40 - 9 87,370 ETERNA PLC. FORTE OIL PLC. 36,469.47 28.00 - 18 59,842 MRS OIL NIGERIA PLC. 6,354.80 20.85 - 11 16,179 TOTAL NIGERIA PLC. 67,904.37 200.00 - 9 11,780 77 284,119 213 4,682,882 ADVERTISING AFROMEDIA PLC 2,219.52 0.50 - 0 0 0 0 AIRLINES MEDVIEW AIRLINE PLC 16,576.10 1.70 - 2 1,570 2 1,570 AUTOMOBILE/AUTO PART RETAILERS R T BRISCOE PLC. 411.72 0.35 - 0 0 0 0 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 3,242.23 5.50 - 4 3,145 TRANS-NATIONWIDE EXPRESS PLC. 304.75 0.65 - 2 1,100 6 4,245 HOSPITALITY TANTALIZERS PLC 642.33 0.20 - 0 0 0 0 HOTELS/LODGING CAPITAL HOTEL PLC 4,801.22 3.10 - 0 0 IKEJA HOTEL PLC 4,427.84 2.13 - 2 2,030 TOURIST COMPANY OF NIGERIA PLC. 7,862.53 3.50 - 0 0 TRANSCORP HOTELS PLC 45,222.40 5.95 - 1 250 3 2,280 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 4,800.00 0.40 - 0 0 0 0 PRINTING/PUBLISHING ACADEMY PRESS PLC. 241.92 0.40 - 1 1,000 LEARN AFRICA PLC 1,157.18 1.50 - 4 3,871 STUDIO PRESS (NIG) PLC. 1,183.82 1.99 - 0 0 UNIVERSITY PRESS PLC. 970.67 2.25 - 2 20,700 7 25,571 ROAD TRANSPORTATION ASSOCIATED BUS COMPANY PLC 895.16 0.54 - 4 3,370 4 3,370 SPECIALTY

Tuesday 05 March 2019

BUSINESS DAY

34 BUSINESS DAY NEWS Energy, credit, port reforms top... Continued from page 1 and economic activities, particularly in the manufacturing sector,” MAN said. The 2019 World Bank Doing Business report puts Nigeria on the 146th position out of 190 countries, with a score of 52.89 points. Experts told BusinessDay that the number of taxes paid by investors across the country has risen from 37 to 54 since 2015 as taxes remain un-harmonised. Cost of production is rising rapidly, with firms shedding jobs or closing branches to stay afloat. Procter&Gamble shut down its $300 million Agbara plant in 2018, while Unilever sold its spread segment. Swiss Pharma has been bought by an investor after experiencing struggles, while Evans Medicals has gone

under. The combined administrative and distribution expenses of 24 largest manufacturers quoted on the floor of the bourse were up 7.59 percent to N196.61 billion in October 2018. Forty percent of manufacturing expenditure goes to alternative energy. Manufacturers have spent N212.85 billion on alternative energy sources between the second half of 2016 and the first half of 2018, according to data from MAN. This is over 100 percent higher than what was incurred in the previous four halves. Manufacturers told BusinessDay that logistics costs have risen by 50 to 100 percent in the last two years, owing to poor state of roads and lack of good transport system. “Nigeria has the potential

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to generate 12,522 megawatts (MW) of electric power from existing plants, but most days is only able to generate around 4,000 MW, which is insufficient,” the United States Agency for International Development (USAID) said in its Power Africa’s Fact Sheet for Nigeria. Olufemi Akowe, executive director, Lexssz Plastics, which recycles pet bottles in Ogun State, said the firm has been running on diesel and coal, which impacts its production cost negatively. “We want a policy that will make energy cheap for manufacturers,” Akowe said in Lagos on Monday. MAN says it wants a review of some of the requirements for the uptake of the 2,000MW stranded electricity so that manufacturers can leverage on the initiative. In the first half of 2018, average interest rate charged to

Nigerian manufacturers stood at 22.9 percent, representing 0.25 percentage point higher than 22.65 percent recorded in the same half of 2017, according to MAN. Manufacturers say they want recapitalisation of the Bank of Industry and the Bank of Agriculture to enable them to give out single-digit loans. About 85 percent of the $1.4 billion worth of textiles that flood the country’s market is smuggled, mainly from neighbouring countries, according to Nigeria’s Textile Manufacturers Association (NTMA). Aisha Abubakar, Buhari’s minister of state for industry, trade and investment, was in Lagos in 2016 on a courtesy visit to textile firms, particularly rug manufacturers. She was told that the biggest challenge facing the industry was smuggling. Three years after, smuggling is at its peak. Smuggling has made the hitherto manufacturing hubs in Kano, Kaduna and Lagos now solitary camps with most of their factories used as event centres and warehouses to store smuggled textile materials. “We cannot compete with the

Tuesday 05 March 2019

level of smuggling and counterfeiting going on now. We used to have about 127 textile firms in Nigeria but that has come down to two or three now,” said Grace Adereti, president, NTMA, at a Made-in-Nigeria stakeholders’ meeting in Lagos. Manufacturers are struggling to bring in their raw materials as Apapa and Tin Can ports stagnate production process. Exporters too are unable to move their goods to other countries due to unnecessary delays. “There is a need to extend reform action plans of the Presidential Enabling Business Environment Council (PEBEC) to Eastern ports, air and land ports,” Babatunde Paul Ruwase, president, Lagos Chamber of Commerce and Industry (LCCI), said at a recent press conference. “The concessioning of Onitsha seaport should be finalised, while government should improve the security situation along and within the Warri port in order to ward off militants and touts. Stakeholders request that government should approve and publicise a bouquet of incentives to importers and exporters that patronise ports outside Lagos,” Ruwase said.

24 months after Aero facility upgrade... Continued from page 2

L-R: Mohammed Adamu, acting inspector general of Police; Abdulmajid Ali, DIG operations, and Jibrin Yakubu, DIG, during thepolice evaluation meeting on the just-concluded presidential and National Assembly election in Abuja. Pic by Tunde Adeniyi

PDP challenges outcome of presidential... Continued from page 1

has been finalised and agreed and the process is on. The lawyers have been assembled. We may be in court tomorrow (Tuesday). No one can stop us,” Uche Secondus, PDP national chairman, said at the Expanded PDP Caucus Meeting in Abuja on Monday. “No matter the propaganda of APC, we will seek justice till the last drop of our blood. We believe justice will be done and God almighty will give justice,” he told party leaders. Buhari polled 15,191,847 votes ahead of Atiku’s 11,262,978. Consequently, Mahmood Yakubu, chairman, Independent National Electoral Commission (INEC), declared Buhari winner of the election. Atiku Abubakar, presidential candidate of the PDP, rejected the outcome of the election and pledged to challenge it in court. Prominent Nigerians and organizations, including Olisa Agbakoba, a senior advocate of Nigeria, have advised Atiku against approaching the court but to accept the election outcome in faith. But the main opposition party and its candidate have insisted on taking the legal route. “Nothing will make us waver

in the pursuit of justice. The decision to go to court has been finalised and the process has begun. We will file our petition today (Monday) or tomorrow (Tuesday). No matter what anyone will do or what the APC will say, we will seek justice to the highest court of the land,” Secondus said on Monday. He also said the party would petition the United Nations and the international community on the militarisation of the elections. But lawyers have been divided over Atiku’s decision to go to court. Ralph Agama, a constitutional lawyer, described Atiku’s decision to approach the court as laudable, adding it is the constitutional right of an aggrieved person to seek legal redress in the law court. “Atiku’s decision to approach the court is the best thing that could happen to our democracy. Until we learn to use the constitutional framework to develop our democratic institutions, we will not get it right. If there are people from any quarters saying he should not go to court, are those people now saying he should take laws into his hands? The answer is no because that will not better the lot of Nigeri-

ans, neither will it add value to our democratic practice,” Agama said. “So, I feel his decision to approach the court to challenge the outcome of the election is the best thing that should be done rather than going to declare that he is forming a parallel government, which will cause a state of anarchy in the country,” he said. Buhari had thrice approached the courts to challenge the outcome of the elections when he lost his presidential bid in 2003, 2007 and 2011, although nothing positive came out of it. “Atiku is entitled to go to court provided he is not raising a false alarm. It is one thing to go to court and make a claim, it is another thing to lie against others. The choice to go to court is up to him. This does not necessarily mean he has a good case. It may just be for showmanship,” Shehu Bashir, a legal practitioner, said. “As far as I am concerned and as far as most Nigerians are concerned, this election has been adjudged free and fair. He is probably looking for a way to whip up sentiment for whatever reason. There is nothing wrong for him going to court so long as he is exercising his constitutional right. But I don’t see him succeeding in whatever he is wishing for. For me, it is going to be an exercise in futility,” he said.

C-checks for them,” Sanusi said. “We have also got the Ghana Civil Aviation Authority to conduct checks on their aircraft. We are talking to Niger, Cameron and Central African Republic and other West African countries for their maintenance,” he said. Fourteen years after the liquidation of the former national carrier, Nigeria Airways, Aero Contractors, which is under the management of Assets Management Corporation of Nigeria (AMCON), was given approval to operate C-checks in its new maintenance facility. Before now, major C-checks were carried out in Israel, Jordan, South Africa, Ethiopia, Morocco and America. Airline operators and stakeholders in the industry have applauded the initiative, saying it would conserve foreign exchange and reduce capital flight in the country. John Ojikutu, member of

aviation industry think tank group, Aviation Round Table (ART), told BusinessDay that domestic carriers are still taking their aircraft outside the country for maintenance because of unhealthy competition. “All the domestic airlines are in competition with each other. Aero is in competition because it is still flying commercial aviation. This means the maintenance is additional money for them. If domestic airlines can go out and spend dollars, why can’t they do it here? They take the labour out when there are people in the country who can do it,” said Ojikutu, who is also CEO of Centurion Securities. “Aero is the oldest airline in the country after Nigeria Airways. Why can’t we find a way to sustain the airline? They rather want the airline to die. No private airline has made it up to 10 years in Nigeria. They need to start seeing Aero as a partner rather than a competitor,” he said.

UK to inject £30m through new partnership... Continued from page 2

support a joined-up approach to tackle climate change. The funding, which forms part of the partnership agreement and will be spread over three years, will be used to train peacekeepers in Kenya, assist free and fair elections, and support the next phase of negotiations for the African Continental Free Trade Area. The signing of the strategic partnership also allows the UK to support African-led ambitions with British expertise, to create more opportunities and more jobs.

Baldwin’s visit to Ethiopia comes after Prime Minister Theresa May visited Nigeria, Kenya and South Africa in August 2018 to set out her vision for the UK’s future partnership with Africa and the UK’s aim to be the largest G7 investor in Africa by 2022. It also follows the rapid expansion of the Foreign and Commonwealth Office’s diplomatic network in the region, including plans to open new embassies in Djibouti, Chad, Niger, Eswatini and Lesotho, and recruit more diplomats with new skills-sets, including in trade and investment.

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Nigeria downstream sector more attractive than other African, BRICS countries - Afrinvest DIPO OLADEHINDE

nvestors and stakeholders in Nigeria’s oil and gas downstream sector should brace up for more investment opportunities as Afrinvest, a Lagos-based investment banking firm, says its downstream sector is relatively more attractive compared with other African and BRICS countries - Brazil, Russia, India, China and South Africa. “In terms of valuation for the Nigerian downstream sector, it is apparent that the sector is relatively attractive when compared to other African and BRICS countries. This may be unconnected with the fundamentals of the sector. Given our expectation of sector deregulation over the near term, we anticipate valuation differentials between peers to narrow,” Adeoluwa Eweje, and Jolomi

Odonghanro Afrinvest analysts said. Afrinvest analysis covers four major companies operating in the downstream sector, namely Conoil Plc, Forte Oil, 11 Plc (formerly Mobil) and Total Plc, as the activities and financial performance of these companies are used to describe the sector’s performance. “The revenues of the sector have been volatile in recent years, although the trend has been generally positive, growing by 29 percent and 2.6percent in 2016 and 2017, respectively, even as the 5-year CAGR settled at 2.9 percent,” Afrinvest said. The report said its analysis of sector’s companies across select African and BRICS countries showed the undervaluation of Nigerian companies relative to comparable countries with Nigeria having the second to the lowest P/E

ratio (6.7x), only coming before Russia which had a P/E of 2.0x, while Brazilian companies were at the other end of the scale, with expensive pricing at a P/E of 15.7x. P/E ratios are used by investors and analysts to determine the relative value of a company’s shares in an apples-to-apples comparison. It can also be used to compare a company against its own historical record or to compare aggregate markets against one another or over time. Afrinvest said in Nigeria, it measured the price movements of the sector’s companies, the NSE Oil and Gas index and AllShare index, and noticed that most stocks trended in line with the market, save for some periods of volatility, especially on Forte Oil. The deviation in the price of FO followed news of the

company’s plans to divest from its power generating and upstream servicing businesses, along with a segment of its downstream operations – in Ghana (AP Oil & Gas Ghana)- to focus on its core business of marketing and distributing petroleum products and lubricants. “On a fundamental basis, our valuation models show elevated cost of equity across securities based on higher risk-free rate and risk premiums. We assumed a conservative sustainable growth rate across companies, in line with growth expectations for the Nigerian economy,” Afrinvest said Afrinvest noted that ultimately, the outlook on the sector remains hinged on the complete deregulation of all petroleum products despite evidence of progress and increasing private sector participation especially in establishing refineries.

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N3.9bn fraud: Court orders forfeiture of late Badeh’s firm, properties, $1m INNOCENT ODOH, Abuja

ustice Okon Abang of a Federal High Court, Abuja, has ordered the forfeiture of a property situated at No. 6 Ogun River Street, off Danube Street, Maitama, Abuja, traced to the late Air Chief Marshal Alex Badeh, and $1 million recovered from the property to the Federal Government. A statement issued on Monday by Tony Orilade, acting head of media and publicity of the Economic and Financial Crimes Commission (EFCC), said also ordered forfeited, are a shopping mall situated at Plot 1386, Oda Crescent, Cadastral Zone, Wuse II; a duplex located at No. 19, Kumasi Crescent, Wuse II; a duplex located at No. 14 Adzope Crescent, off Kumasi Crescent, Wuse II; a semidetached duplex at No. 8A Embu Street by Sigma Apartments Wuse II, all in Abuja. Until his unfortunate death on December 18, 2018, the late Badeh was being prosecuted by the EFCC along with his company, Iyalikam Nigeria Limited for charges bordering on abuse of office, money laundering, and converting public funds to personal use amounting to about N3.9 billion. They were standing trial for an amended 14-count

charge, to which a “not guilty” plea was taken. Justice Abang had at the last adjourned sitting on February 26, 2019, fixed March 4, 2019, for the company to open its defence. At the resumed sitting, prosecuting counsel, O.A. Atolagbe, informed the court that based on an agreement reached between the prosecution and the defence; there was a further amended charge of 10 counts before the court and a plea bargain agreement. “We filed a further amended charge dated March 1, which was filed on March 4, and also a plea bargain agreement with regards to provisions of the Administration of Criminal Justice Act,” he said, and asked that the new charges be read in open court. A “guilty” plea was thereafter, entered for the second defendant, following which Atolagbe, urged to court to enter judgement based on the plea bargain agreement, the statement said. He further prayed the court to order the final forfeiture of the said properties affected in counts one to 10 of the amended charges, and that the defendant be convicted and wound up with respect to the plea bargain agreement and Section 19 of the Money Laundering (Prohibition) Act.

APON debuts to boost professional organising industry OBINNA EMELIKE

L-R: Atiku Abubakar, former vice president; Uche Secondus, national chairman, Peoples Democratic Party (PDP), and Ike Ekweremadu, deputy Senate president, at the Expanded National Caucus meeting in Abuja. NAN

Obi thanks Nigerians, justifies PDP’s planned court action EMMANUEL NDUKUBA, Awka

ice Presidential candidate of the People’s Democratic Party (PDP) in the February 23 presidential election, Peter Obi thanked Nigerians for their support for the PDP during the election. Speaking at a press conference in his Onitsha home on Monday, Peter Obi said he was touched by the eagerness with which Nigerians came out to fulfil their civic duties of voting. He thanked, especially the youth and women, some of whom exercised their voting rights for the first time in the over 119,000 polling

booths scattered all over Nigeria. Obi also condoled the families of those that lost their lives and those that sustained various degrees of injuries during the election, and appealed to them not to allow their spirit become dampened towards the performance of their civic duties in the future. Speaking on the general conduct of the election, Obi said it was anything but a transparent, free and fair election, which certainly fell far below the standard established by the 2015 Presidential Election. According to Obi, it was characterise by deliberate

voters’ suppression and intimidation throughout the South East and South South, actions he described as the highest form of corruption. He lamented that the two zones under reference witnessed different sets of rule, saying, “While some zones voted strictly using the card readers, other zones, as part of the manipulation orchestrated by the ruling party, APC were allowed to vote without card readers contrary to the guidelines INEC issued before the election.” On the way forward, he said he aligned fully with PDP as a party, the Presidential candidate, Atiku Abubakar, and well-meaning Ni-

gerians in condemning the exercise. He said as law-abiding citizens that the PDP as a party, its Presidential candidate and himself, had decided to go to court because of their belief in the rule of law. “Though elections give citizens a means to hold their leaders accountable by voting incumbents out of office or promising to hold to account those leaders successfully elected, the process is more important than the outcome as the rule of law must always prevail. “Thus, the consequences of Nigeria without rule of law will be unimaginable chaos and tyranny,” he said.

ssociation of Productivity and Organising Professionals in Nigeria (APON) held its official launch recently in Lagos. Some well-known professionals attended the launch in the productivity and organising industry in Nigeria, who would be starting the association as pioneer members. Activities of the day centred on introductory remarks on what APON was about, discussions on impact and challenges of professional organising in Nigeria, networking and photo sessions. During her opening remark, Cresta Durojaiye, the association’s chairperson, said the launch was the first of its kind, “as it sets the pace and ushers in a new industry platform, to grow and support all productivity and organising businesses in Nigeria.” In same vein, Olusola Oguche-Agudah, vice chairperson of APON, in her speech, said, “As the year 2019 unfolds, APON plans to host training for existing and upcoming productivity and

organising professionals. “Top on the association’s bucket list are sensitisation and networking events, geared at fostering bonding among its members and boosting awareness of the industry in Nigeria and globally.” Highlight of the day was the joint cake-cutting session by the association’s pioneer members, amid fireworks and loud cheers. The leadership of the association assured that the birth of APON was a breath of fresh air and something new to look out for, among professional industries in Nigeria. According to the association’s leadership, APON’s immediate objectives are to roll out solutions to help its members scale up their businesses and implement strategies to mitigate against challenges currently faced by productivity and organising professionals in Nigeria. APON also urged the general public and stakeholders to keep an eye on the association as it matched its promises with actions to positively highlight Nigeria on the global map through productivity and professional organising.

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Solid Minerals business

Nigeria earningNigerian $60bn Symbol capable Mining toofunleash annually from irontoore geologist mining potentials the-world … as group advocates for local processing companies Stories by JOSEPH MAURICE OGU

S N

JOSEPH MAURICE OGU

ymbol Mining, an Auscan earn tralianigeria company opabout $60bnis erating in Nigeria, from posedannually to showcase the iron success stories of the deposits country’s in the country, mining industry to the world a consultant geologist has through its own achievements said. in the industry. This potential can only Symbol Mining is currentbe realised if the resources ly operating in Bauchi State are well managed, Oyewola through its subsidiary comOworu, a consultant geolopany, Joint Venture. gist at Imperial Walled Resources Ltd, is building a repusaid.“Symbol He spoke recently at safe and trusted mining atable, one-day sensitisation focompany Nigeria, and hopes rum on inopportunities in to raise awareness Nigeria’s the country’s solidofminerals potential as a mineral resource sector, tagged “Potential of producer,” Tim Sector, Wither, the Nigeriansaid Mining ” CEO, Symbol organised byMining. the Nigerian Apart from Imperial Joint Association of Chambers of Venture, Symbol Mining has Commerce, Industry, Mines another subsidiary (NACCIcompany and Agriculture in Nasarawa State, Tawny Joint MA), in Lagos. Venture, which partners with Nigeria has itidentified 34 Adudu Farms Nigeria Ltd. solid minerals that are availoperation quantiin NigeableStarting in commercial ria in 2012, Symbol Mining has in the last six years “completed over 12,000m of exploration

drilling,” according to Wither, exploit the country’s who added that “ourmineral maiden deposits. resource demonstrated a minHe saidzone the of investments eralisation high-grade would flow into zinc and lead.” the country because, according to him, Looking forward, the coma lot of people are eager to pany integrates the developbuy the minerals. “I can asment of its hosting communisure you that Nigeria will ties into its plans, with which eventually become a mining it enjoys good collaboration. destination,” Oworu said op“Central to our future suctimistically. cessInis2012 the support of the local Ian Bruston, an community and development of Australian researcher and a skilled workforce. Our core valbusinessman, announced ues include respect and acceptthe discovery of iron ore of ance from the local communities commercial quantity in Kogi in which we operate, State, making it the and firstthis everis only achieved open and honJORC Iron by Ore resources est conversations, ” Wither said. discovered in Nigeria, acWhiletothe company started cording Bruston. mining activities in Juneto 2018, Nigeria is reported be it has nonetheless made trehome to some 500,000 armendous impact thenot intisanal miners whoin are dustry. Although most of its documented, according technically workforce 2018 report skilled by International is still being sourced abroad Institute for Sustainable Dedue to the infant stageshould of the velopment. But this company, it however to not be a source worryplans for the train local people to have the necessary technical skills from where the company will source

its technical skilled workers. industry in order “Our vision is to to complegrow cament government’s ” pabilities in-house byefforts, training Sanni said. people from the and educating Reeling out the local community. Thisbenefits will supof investing in the inport our aggressive mining exploration dustry, Sanni said different and growth strategies and help vacuums exist in the mining expand the mining industry in value chain that needed to Nigeria,” he said. be leveraged on by potential “Ideally, we would like to investors. be the employer of choice for “There is a value chain the mining industry in Nigeria,” gap, I can boldly tell you Wither that thesaid. industry is in dire One legacyminerals, the comneed of major processed pany establish in Nias weplans speak,tothe majority of geria is to demonstrate to the miners in the country are arwhole and world of the striving tisanal therefore do not mining environment have thebusiness resources to mine in Nigeria, thereby encouraging and process. other investors to invest the “I can tell you that inproindustry in Nigeria, which will cessors make more money in turnminers. benefit the country and than Processing is mining communities. safer than mining,” he said. wants to compademon“All“Symbol these Chinese stratethat Nigeria’s as a nies comepotential to buy our mineral resource minerals, it is not producer. as if they Our success will to help grow the buy them just sell them awareness of Nigeria mining that way, they take it back to sectorcountry and willfor also attract adtheir processing, ditional sell the supporting processed industries, minerals,” Wither assured. and make their money,” he explained. He wondered why Nigerian investors could not process the minerals locally before selling. “There is a need for us to sensitise investors on the benefits in mineral processing,” Sanni added. Nere Teriba, vice chairman of Kian Smith Trade & Co Ltd, the company that is at the verge of rolling out Nigeria’s first gold refinery, stated that Nigerians have a lot of expectations from her company and assured that the company would not fail. This is one of the reasons her company carries everyone involved in the gold value chain along, without leaving anyone out. “We are positive and optimistic that we won’t fail, we have a refinery and what we have done is work with the full value chain from the miners to the processors, to the suppliers, to the dealers, even banks and dealers,” he riod,” said Stephen Ayodele, site noted. “We are not cutting engineer, Quarry Construction anybody off; we are takCompany, Abeokuta. ing into consideration the The depositofofdealers, bitumenwe in specification Ondo State is huge such that are even covering the taxes non-exploration could cause of some miners,” Teriba said. environmental degradation While acknowledging the on the farmland and water. N30bn intervention fund Exploration of this material injected into the industry canthe reduce the environmental by present administrahazard. Investing in bitumen tion, Sanni said the indusexploration in Ondo Statethat will try needs more money notstrategically only be friendly to the enviis inherent in ronment, it will also the budget over a create periodjobs of for Nigerians, the nation time, becauseenrich the one-time throughintervention tax, and alsofund invite N30bn is prominent local and internainadequate for the sector. tional investors.

Bitumen, untapped mineral awaits investors ties. These include copper, gold, iron ore, limestone, and dolomite. The sector is yet to take off fully in the country. “The sector is not where it is supposed to be because the initial level of legislation and support for local activities were not there and that led to a downturn in mining activities in Nigeria, Oworu noted at the event. Abubakar Bawa Bwari, the minister in charge of Mines and Steel Development, noted this January that Nigeria had an iron ore deposit panning of over 3approximately billion metric tonnes amongst otherbitmen steel120km, Nigeria’s making raw materials. deposit is the the secondHe in expressed largest the world,concern waiting however over the economic fact that to be turned into “out of a global production prosperity. of 1,689 million tons and The estimated probable African production of 15 reserves of bitumen in Ondo million only State is 16tons, billionNigeria barrels, while produced an estimated that of tar sands and heavy100 oil tons. ” is estimated at 42 billion barat the Larels,Oworu almostnoted twice the amount gos event that the present of existing reserves of crude government had stepped up petroleum, according to data the process of providing legfrom the Federal Ministry of islation and financial supMines and Steel Development. port for the sector, which he whichinvestors occurs both saidBitumen, would bring to on the surface and sub-surface,

potential investors because the artisanal miners can only mine the secondary aspect of the mining while the main mining requires machinery and funds, neither at which is at the disposal of the artisanal miners. “The artisanal miners are just mining the secondary arrangement. The primary source of gold is buried underground and it will need a huge investment to get into it. In terms of number, the artisanal miners are many but in terms of production, what they are doing is not much, ” Oworu said. is found in Ondo, Lagos, Ogun, Sanni, naandShehu Edo States, and the occurs in tional president of Miners both forms. Association Nigeria, said One of theofuses of bitumen that the majority of miners is in road construction. It is also in theincountry are artisanal used waterproofing prodand therefore do have ucts. Constructions not are heavy the resources to mine and projects constantly on going in process. Nigeria. This means that indusMeanwhile, the Mintries in bitumen enterprise will ers of Nigeria, haveAssociation both local (Nigeria) and called investors from othforeignon targets as their markets, er sectors to show interest in as bitumen is high in demand the mining sector in Nigeria for both road constructions and in order to make it vibrant. other construction uses. “We appeal to other play“Investing in bitumen in ers in different sectors of Nigeria promises a high return the economy to join mining for investors in the shortest pe-

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Tips & Talking Points

Harvard Business Review

How to approach an office romance: very carefully

Hollywood’s Big Player 7th: This year, Netflix joined the Motion Picture Association of America as a member, becoming the seventh major studio to do so. +

Retail Roadblock 10%: Less than 10% of female retail managers are promoted to chief executive positions, according to a report from global nonprofit Catalyst. + Balancing Gender 2020: Ikea set a companywide goal in 2015 to reach 50% gender parity by 2020. + The Future Is Bright for AI 1 in 4: One in 4 British children, aged 8 to 18, consider pursuing a career in artificial intelligence, according to research from Sage and YouGov.

ots of people meet their spouse or partner at work, but dating a coworker can get complicated fast. Before moving forward with an office romance, think through the risks. There’s a chance the relationship won’t work out, of course, which could make things awkward at the office. Some companies prohibit employees from dating at all, or require disclosures, so be sure to investigate the policies at yours. It’s best not to date a manager or subordinate, as conflicts of interest will undoubtedly arise. And it’s a good

When moderating a panel discussion, keep the audience in mind

idea to consider how the relationship may look to colleagues, especially if you and your romantic interest are at different levels in the organization. Even if you’re at the same level, think about whether the relationship could affect your reputation — if you make decisions about the person’s work, for example. After weighing the risks, if you decide to pursue the relationship, set some boundaries. Have a conversation about when and how you two will talk about work and about your personal lives.

(Adapted from “How to Approach an Office Romance (and How Not To),” by Amy Gallo.)

For a team to work smoothly, tou need 3 things

experience for the audience. Ask specific questions that will be of interest to listeners, direct them at the panelists who will have the most relevant answers and follow up when needed. And keep track of who’s talking too much — the point of a panel is to hear from many people, not just one or two. Don’t be afraid to politely cut off someone whose answer is turning into a monologue.

(Adapted from “How to Moderate a Panel Discussion,” by Dorie Clark.)

f your colleagues aren’t working well together, there are a few ways to change the team dynamic. Everyone — including you — should consider how they can improve three things: internal selfawareness, external selfawareness and personal accountability. — Internal self-awareness is about understanding how your values affect your decisions. To improve, consider how your emotions and assumptions in a situation lead you to act a certain way. Resist the urge to act until you understand what’s driving you.

Expertise It’s in our DNA FirstBankofNigeria

— External self-awareness is about understanding how your actions affect other people. To improve, pay attention to how your colleagues react to things and ask yourself (or them) what could be behind their behavior. — Personal accountability helps you assess how you are contributing to a problem. To improve, accept that you probably share some blame for what’s going wrong. Use internal and external selfawareness to think carefully about how you may need to change.

(Adapted from “To Improve Your Team, First Work on Yourself,” by Jennifer Porter.)

hen your employees are struggling with mental health, they should be able to open up and ask for help. Think about how you can create a work environment that makes them feel safe enough to do so. For example, pay attention to the language you and your team use in the office. Comments like “Mr. OCD is at it again” or “She is being so bipolar this week” stigmatize issues that employees could be struggling with, and make it harder for people to come forward. If you hear employees using that kind of language, discourage them from continuing,

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e all need to keep learning new things to grow in our careers. But sometimes the urgency of our schedules gets in the way. To find time for learning, make it a part of your day-to-day tasks. One way to do this is to look for ways to pick up skills from those around you. Notice how your boss handles a negotiation, ask sales people about industry trends, get feedback from your peers after you give a presentation. Of course, there will be times when something piques your interest but you’re too busy to explore it. When this happens, try creating a “to-learn” list: Write down concepts, ideas and practices that you want to return to at a later time. And create a learning channel for your team, whether it’s through Slack, SharePoint or somewhere else. Add links to resources you’ve found valuable — it will encourage your colleagues to do the same.

(Adapted from “Making Learning a Part of Everyday Work,” by Josh Bersin and Marc Zao-Sanders.)

Make your office a safe space to talk about mental health

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

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Weave learning into your everyday work

When Stars Align 71%: In a survey published by the Center for Talent Innovation, 71% of U.S. professionals who mentor rising talents said that they share the same gender or race as their mentees. +

s you rise in your career and your visibility grows, you may be asked to moderate a panel discussion. Unifying several people’s perspectives into a conversation can be challenging, so create the conditions for a meaningful exchange. Before the event, give your panelists time to prepare by asking for their thoughts on the topic, whether over email or with a phone call. You can also share the questions you plan to ask. During the panel, remember that your goal is to ensure a great

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and, if necessary, explain why it’s hurtful. You can also set the tone by sharing your experiences with mental health and making yourself available to team members in need. When someone confides in you, be ready to tell them about the mental health resources your company has. One simple resource to offer is sick days: If an employee needs a day off to focus on their mental health, tell them to take it.

(Adapted from “ 5 Ways Bosses Can Reduce the Stigma of Mental Health at Work,” by Diana O’Brien and Jen Fisher.)

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Cooperation key to aviation security amid evolving threats, passenger demand Stories by IFEOMA OKEKE

he International Air Transport Association (IATA) has called on industry and governments to work together more closely to keep aviation secure in the face of evolving security threats and the forecast doubling of passenger demand to reach 8.2 billion by 2037. “Flying is secure but keeping it that way is not an easy task. Threats are evolving. The geo-political landscape is complex. Technology is rapidly changing and the volumes of both cargo and travellers keep growing. Global standards and collaboration—among governments and industry—is the bedrock of our continued success,” Alexandre de Juniac, IATA’s Director General and

CEO, said during a speech to the AVSEC World Conference in Miami, Florida. IATA urged stakeholders to focus on global standards, information-sharing, riskbased analysis and emerging threats to secure aviation for decades to come. Global Standards Global standards for aviation security were agreed by governments through the International Civil Aviation Organisation (ICAO) and are codified in Annex 17 of the Chicago Convention. “It’s been 45 years since Annex 17 was added to the Chicago Convention. Still, far too many states are struggling to implement the Annex 17 baseline requirements. A weakness anywhere in the system affects everyone. The goal is 100% implementation. There is an urgent need for developed

countries to provide more comprehensive assistance to developing countries to ensure the baseline security measures are met,” de Juniac said. “Threats will continue to evolve and become ever more complex. Those wishing to do aviation harm have no state al-

legiance; they cross borders to share information and collaborate to refine their methods of causing chaos and destruction. The focus of governments must be on protecting people. And that cannot be done with insular thinking. We must get better at sharing information,”

de Juniac said. Sustainable risk-based solutions “In the years since 9.11 investment in aviation security has grown exponentially. There is no doubt that this has made flying more secure. But the efficiency of the system needs to be constantly challenged. Governments need to pursue risk-based security concepts that focus resources where the need is greatest,” de Juniac said. Critical areas to address include: Securely vetting the millions of airport and airline staff who have access to aircraft, ending extra-territorial measures that often require airlines to take on government responsibilities, improving the security experience for passengers, even as the number of passengers is set to double

ABX World, SAHCO target 800 tons of agro export daily …Crashe logistics costs by 40%

BX World a globally recognised courier and cargo firm, in partnership with the Skyway Aviation Handling Company Plc (SAHCO), has disclosed plans to create a logistics initiative to bring down the cost of delivering Nigeria’s fresh agro exports to various European and other global markets. The initiative, the partners disclosed on Wednesday during a strategic meeting with agro-exporters, farmers and Flour Mills Nigeria PLC also seeks to ramp up Nigeria’s export in this category to 800 tons per day. The move, according to the organisations, was in response to the challenges faced by Nigerian exporters, which have diminished their competitiveness in the international market while forcing agro products to rot away between farm gates and the market places.

Lamenting the bottlenecks created by government agencies which have imperiled the agro export business while lots of efforts to bring a change have not yielded results, the organisations resolved to move ahead with their own solutions. Speaking at the meeting, John Okakpu, the managing director of ABX world, said, “we have decided to take a different turn on how do we reduce the logistic cost, and we have an alternative solution, while waiting for the government, that will at least take us off the ground. “Our people are suffering and we really need to engage the government to review some of the policies regarding export. “So the logistic cost we have now is quite reasonable and I believe within the next two months it is going to explode and it is going to get better and I am going to assure you that

L-R: A.A Mihammed, custom comptroller SAHCO Plc; Basil Agboarumi, managing director of SAHCO; John Okakpu, managing director of abx world; Magnus Masader, Ethiopia Airlines representative; executive director, Olaniyi Adigun, sales and marketing, SAHCO, and Olajide Kadipe, head cargo services, SAHCO, during the strategic meeting at SAHCO complex.

we are here to stay. “Our ultimate goal is to do about 600 to 800 tonnes every day. The facilities and the structures in place are the reasons we are here today like the operation manager of

SAHCO said, they have a cold room completed for more than two years ago and has not been used. So, the issue of damage or products not being fresh, SAHCO has resolved that. “The reason why we choose

to work with SAHCO is that they are ready to invest in the structures and infrastructures we need in this industry.” Commenting on the readiness of SAHCO Basil Agboarumi, the managing director, said that the company foresaw the need for adequate facilities to ensure preservation of agroproducts for export. To this end, he said that SAHCO had in the last five years invested millions of naira in building modern facilities which are now ready for execution of the export projects. “Recently we made an investment in buying a modern scanning machine which I just signed yesterday for the machines to come in. I can tell you that we have been prepared for long and just waiting for a day like this to come. That is why as a company we are happy to be partnering with ABX world to drive this vision.”

over the next two decades. Adapting to new security threats IATA called for greater government and industry attention on emerging threats, including cyber threats. “The digital transformation of the airline industry holds immense promise. But we must ensure that our aviation systems remain safe, secure and resilient against cyberattack. Constructive dialogue and timely information-sharing among industry, technology providers and governments will be critical if we are to achieve this,” de Juniac said. IATA is working with airlines, industry stakeholders and other sectors to deliver a strategy early next year that will be a step-change in how we as a sector address the cyber threat challenge.

Tim Mapes named Delta Chief Marketing and Communications Officer effective May 1

elta has announced that upon John “Ned” Walker’s retirement on May 1, Tim Mapes will assume the role of Chief Marketing and Communications Officer, leading the company’s global marketing and communications strategy. “Tim is a world-class communicator. His more than 30 years of brand, marketing and communications experience inside and outside of Delta make him a strong leader to continue to elevate the momentum we have today,” Ed Bastian, Delta CEO said. Mapes’ scope of responsibilities will include Delta’s internal and external corporate communications and marketing functions, including advertising, corporate brand management and community engagement.

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Can Agbaje afford to spend 50% on his Education BIG IDEA? Folarin Osikomaya

he Jimi Agbaje 50% education debate seems to have really heated up, if the social media is anything to go by. The recurrent question is whether Jimi Agbaje, the PDP Gubernatorial candidate for Lagos State knows what he is talking about. He has even in one article been referred to as being naïve and ignorant of the workings of government. How can you divide up the budget into two and spend one half on education? This question really prompted me to do a bit more research into this ‘vision’ of his, especially because it is rather bold and its bold statements like this that are usually based on some ‘joker’ up one’s sleeve that creates the confidence to make such pronouncements. The first discovery I made, studying the BIG IDEA document of Agbaje, which I borrowed off an attendee at his engagement with the Lagos Business School Breakfast club, was that Agbaje would invest massively in the eco-system that surrounds education, its infrastructure, facilities requirement, including the value chain that deliver and make education, skills development and training possible. There was mention of a strong focus on engineering and information technology. Strongly linked to this was also the setting up of economic zones, on which the skills and education training will be focused. Somewhere in the document he describes, with some examples how the ministries, department and agencies will be challenged to devote as near 50% of their resources as possible – human, material and financial to this Education economy. The penny dropped for me at that point. It is really about the commitment of 50% of the

Jimi Agbaje

State’s resources and not ‘budget’ as we know it. But however, I also made a coincidental discovery. I stumbled on a table comparing the recurrent budget on education of the old Western region with the total regional budget and it was averaging 40-45% from 1954 to 1966, whilst within the same period, the percentage of grants devoted to primary education was over 80% in some years. We all know what that singular initiative by Obafemi Awolowo did for the Yoruba’s at that time. So, Agbaje was beginning to make sense to me at this stage. We honestly dare not say Agbaje does not know what he is talking about. A few of us seem to need lessons on what has worked in the past, but more importantly, what we desperately need to do. You just cannot argue about the need for sound education. The problem is that we are so far behind. My issue however was how we would survive

living in Lagos as this education vision rolls out over the years, but there was an answer to that as well. Agbaje has a plan to jumpstart the economy and at the same time rejuvenate the inner city, riding on this Education paradigm. His strategy is to align all economic activities in the state around one strategic initiative, which is to create an Education driven economy. Within the first 6 months of his government, he plans to rehabilitate the over 1,700 primary schools in the state – every single one! This rehabilitation will include fixing up the classrooms, desks, chairs, boards, power generation (solar possibly?), internet connectivity (non-negotiable, but apparently offered free in the past by Google to the current state government but was dead on arrival because the state demanded payment for right of way!!!), water – boreholes, proper playgrounds for sports, school halls, not to mention upgrading

teachers and other staff skills and welfare package etc. Interestingly enough, the Ministry of Works is to prioritise the fixing of access roads, including pavements and lighting, to the schools. There is also this plan to locate as much as possible, primary health care centres near or within the premises of every primary school to be manned by qualified doctors and nurses, which Agbaje says will most likely be private, working within the Health Insurance scheme. These will then serve as neighbourhood clinics to deal with basic everyday ailments. Such Clinics will thus have access to power and water facilities provided and also benefit from the secure environment provided by the school. Quite an integrated community strategy indeed and speaking to the promise of focusing on human capital development. It is estimated that at least N100bn will be required within the first 6 months to execute this first initiative, creating opportunities for many vendors and injecting money into the inner-city economy, from which most of the services must be provided. He also wants to open up these opportunities to the locals and not those described as “the chosen few”. However, the various Ministries will play their role in vetting vendors based on agreed and open specifications and criteria, very much in the vein of integrity and equity, which Agbaje will clearly bring into Lagos State’s governance. Clearly Agbaje has some serious advisers behind him, when he mentioned the use of Block chain technology to manage the vendoring and procurement process. It seems there will be no more ‘jobs for the boys’!! Part of the benefit of re-anchoring Lagos through education, training and skills development is the revitalization of the Lagos economy

from the business and entrepreneurial opportunities arising from the extensive participation in the initial reconstruction, rehabilitation and enhancement of the schools. The new Lagos economy will revolve around the education value chain and its eco system. Education will cover primary, secondary through to tertiary and technical vocational training including industrial technical certification. This revamp will include Oil and gas, power, general engineering, construction, agriculture, technology, manufacturing; in addition to the traditional professional services of finance and commerce. Agbaje does make a proviso to this desire to invest up to N500bn on this Lagos Education Economy in each year and that is the absorptive capacity of the state for such an aggressive injection of funds. The very problems that he wants to solve, which include skills development and therefore create employment opportunities, could hamper him in terms of the capability of the locals in each community to deliver. This has to do with the lack of available skills and competence to respond adequately to these new opportunities. When you have been out of practice for so long, or never even got into the game, there will be a massive learning curve for all. The larger corporates will step in where necessary, but I would advise that some form of forced partnering must take place with similar smaller SME vendors in the local community so the training can start. But then, isn’t that what all this is about? I do not have a problem with Jimi’s BIG IDEA at all!! Folarin Osikomaya is an economist /statistician and Partner Folarin Osikomaya Konsult based in Ilupeju, Lagos

APC chieftain urges members to vote PDP governorship candidate in A/Ibom ANIEFIOK UDONQUAK, Uyo

chieftain of the All Progressives Congress (APC) in Akwa Ibom State, Enefiok Ekefre has urged members of his party to vote for Udom Emmanuel of the People’s Democratic Party (PDP) in the forthcoming governorship election scheduled to hold on Saturday. Ekefre, who is a caucus member of the party in Akwa Ibom State, stated this in a widely circulated statement in Uyo, the state capital,

copies of which were made available to the media. According to the statement, Ekefre, who heads the party’s support group, also expressed delight over the victory of the PDP in the National Assembly and the presidential elections in which PDP won all the National Assembly seats. “The victory is a re-confirmation that imposition and god-fatherism is no more fashionable in Akwa Ibom State,’’ he said. In the statement, he maintained that the “victory of the PDP led by Governor Udom Emmanuel is a

vote of confidence and a stamp of authority that Udom Emmanuel leadership has something to do with the general interest of Akwa Ibom State.” Ekefre, who claims that as a leader of the party’s support group, he does not need the approval of his party to congratulate the governor and throw the weight of his group behind the PDP governorship candidate, pointed out that “democracy is all about people and that leadership belongs to God.’’ . According to him, the support

group is “entitled to associate with any idea and aspiration that will take Akwa Ibom to greater heights devoid of party coloration because community interest comes first before party affiliation. That is why we are supporting Udom Emmanuel for a second term.” He called on members of the party to come out in their numbers to vote for Governor Udom Emmanuel in his bid to be re-elected for a second term based on his record of achievements and the relative peace in the state. Ekefre rejected accusations

by his party leadership that he is a not a bonafide member of the APC, saying that he had been long enough in APC and that as a citizen of Nigeria he has the right to freely associate with any group of people in the country. “That denying my existence as an APC party chieftain is baseless because as a citizen of the Federal Republic of Nigeria, my freedom of association and assembly is guaranteed by the statutes of the constitution which is the supreme document of the country,’’ Ekefre said.

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Imo guber: Olu Owerri, other Imo groups endorse Ihedioha …say he is the best amongst all candidates GODFREY OFURUM, Aba

lu Owerri Unity Association, a socio-cultural organization, Aba branch, in conjunction with other Imo organisations in Abia State, has endorsed Emeka Ihedioha, candidate of the Peoples Democratic Party (PDP), as their preferred candidate for the 2019 governorship election, which comes up Saturday. They observed that Ihedioha has the knowledge, character and integrity to lead Imo State to a brighter future. Edmund Anyanwu, chairman, Olu Owerri Unity Association, Aba chapter, in an interview with journalists at a town hall meeting with Ihedioha, held at the Aba Sports Club, explained that the event was organised to assure the PDP candidate of their support in the polls. According to Anyanwu, “We see him as the best amongst the other candidates. We see him as someone who can carry Imo forward”. He explained that Ihedioha did

Emeka Ihedioha

well as a representative of Aboh Mbaise/Ngor Okpala federal constituency in the House of Representatives for three consecutive terms, stressing that he attracted 180 developmental projects to his constituency and State at large.

Delta guber: Isoko nation reaffirms Okowa’s endorsement Francis Sadhere, Warri

s the Governorship and State House of Assembly Elections draw near, the Isoko Development Union (IDU) and the entire people of Isoko nation worldwide have reiterated their support for the re-election bid of Governor Ifeanyi Okowa. Speaking at the meeting held at the IDU Secretariat at the weekend in Oleh, President General of the Isoko Development Union (IDU), Iduh Amadhe, said Governor Ifeanyi Okowa has done well for the Isoko people and deserves to be re-elected for a second term. According to Amadhe, “We have put all previous governors on a scale and it is important to state that Governor Ifeanyi Okowa has performed very well in developing the Isoko nation. We cannot forget in a hurry how he assisted us in resolving the Ibrede crisis and his commitments to the development of the Isoko communities in Ndokwa East LGA. “Under the Okowa administration, we got full accreditation for the engineering and law faculties, accreditation of courses at Ozoro Polytechnic as well as construction of several roads in Isoko nation. If you go to Ofagbe Technical College you will see the huge investments the Governor has put in there. “Beyond his performance, the Isoko nation is in support of the

rotational arrangement of the governorship position and going by that arrangement, Governor Okowa again fits in properly as regards the zoning arrangement.” Also speaking, Isoko North Council Chairman, Hon. Emmanuel Egbabor warned against the use of security agencies to intimidate and harass the Isoko people, stressing that the government will not take it kindly with anyone found using security agencies to witch hunt anyone before, during and after the election. At the end of the meeting, the Isoko nation resolved to vote massively for Governor Ifeanyi Okowa to enable him complete some of the ongoing projects he is carrying out for the Isoko people in particular and Deltans in general. The meeting which had in attendance, Majority Leader Delta State House of Assembly, Hon. Tim Owhefere, Chairman of Isoko South Local government Council Hon. Itiako Ikpokpo and his Isoko North counterpart Hon. Emmanuel Egbabor, Arch. Joseph Ogeh, Bashorun Askia Ogieh, Daniel Omoyibo, Prof. Saliba Mukoro, Nelson Ejakpovi, notable APC leaders. Others are, former NDDC Commissioner, Dr Ogaga Ifowodo, Chief John Araka, Prince Okareme Maikpobi, Isoko North and South APC Chairmen, traditional rulers, President-Generals of communities, political party leaders, youths, women, among others.

Some of those projects include the dualisation of Owerri-Elele road (Imo-Rivers States), construction of Isi-Nweke-Onicha Uboma-Imo River Umuahia express way, Okigwe, construction of Okpala-Igwuruita road (Imo-Rivers States), construc-

tion of a bridge across Nwaorie River9Nekede Owerri), construction of bridge across Oguchie River, Ngor Okpala, construction of Mbaise ring road and the reconstruction and dualisation of Aba-Owerri road. In his words, “He also knows a lot of people. There are people, who go to do that job, but you will only hear about them over the radio or read about them on the pages of newspapers, but in his own case, he toured every community that he represented. “And even now, he has toured all the communities in Imo State, soliciting for their votes. There are candidates for the same position, who we haven’t seen in any other place, except Owerri or perhaps in their immediate localities. And so, this encouraged us to say among the lot, he might be the best On how they are going to achieve their aim, Anyanwu stated, “The groups that are here have been working hard towards changing the government in Imo State. And to make that effective, each uniuon was asked to mobilize their members to register at home, during the registration exercise. So, we are

not just talking, we will also vote to ensure we achieve our aim”. He also observed that coming from Owerri zone is a plus for Ihedioha, as the area is the least to lead the State since its creation in 1976. “Owerri zone is the only zone in Imo that has the least chance of leading Imo since the advent of democracy in Nigeria. Orlu zone has done 16 years, while Okigwe has done 9 years, then in our own case, the only time we had contact with Douglas House (Imo Government house) was when Evan Enwerem, was there just for a year and some months, before the military struck, consequently, he is truly qualified along that line to contest. “Already we have convinced our people that he has the knowledge, character and integrity to lead Imo State to a brighter future. We have already canvassed that. “So, amongst all of them, not just because he is from Owerri zone, he is the best amongst all the candidates for the Douglas House,” he observed. Recall that Ihedioha was elected deputy speaker of House of Representatives in 2011-2015.

Defectors are liability to PDP in Kaduna - DD Campaign Abdulwaheed Adubi, Kaduna

eputy Director General of Atiku/Ashiru Campaign Council, Danjuma Bello Sarki has described defectors who recently resigned their membership from People’s Democratic Party (PDP) as liability to the party in the state. Sarki said that until their defection, they were moles planted in the party to play the card of the ruling All Progressives Congress (APC) and work against the interest of PDP in the state. Danjuma, while speaking to our reporter during a telephone chat yesterday evening, said that the defection of the said people did not come to them as a surprise, adding that PDP was in the picture of their negative role in the party. He noted that their defection to the ruling APC will never deter Kaduna residents and PDP supporters in their resolve to wrest power from the ruling party in the state come March 9, 2019. “Their defection has vindicated the party’s stand that they are in PDP to destroy the party”, he said. He added that none of the defectors are relevant in their wards and that they could not even delivered their polling units. “Before the gubernatorial primaries, we are aware that Sani Sidi was negotiating with the opposition

party, and when people rejected him at the primaries he became a mole who always revealed the strategies of the Party to the opposition. So, we are not surprised with his action”, he explained. Sani Sidi, who decamped to APC alongside his political associate on Friday, was a gubernatorial aspirant of the PDP in 2018. Sani Sidi explained in a letter sent to the Chairman of PDP, Unguwan Sarki Ward, Kaduna North local government Area, states that since the party’s primaries held last year, characterised by manipulations, impunity, lack of internal democracy and intimidations of party delegates, the party’s leadership at the state or the candidate has failed to genuinely engage all aspirants towards consultation and genuine reconciliation, an important task that would have helped the party forge ahead. “Even more worrisome is the mutual mistrust that exist between the party leadership, the gubernatorial candidate and some of its members and above all the failure to showcase any meaningful blueprint and capacity on how to govern the state when voted into power,” Said Sidi. The letter further states, “it is based on these reasons and after due consultation with my political associates across the 23 local government areas, l decided to resign my membership of the party henceforth. And l thank you most sincerely for your support while in the party”.

Sani Sidi submitted alongside the letter, his membership card of the party to the ward leadership of the PDP. According to Sani Sidi, other party members who resigned their membership include: Hon Peter Adamu Adada, former Deputy Speaker, Kaduna State House of Assembly, Hon Rabiu Bako, former Council Chairman of Kaduna LGA and Commissioner of Information, Hon Kabiru Ballah, former State Secretary, PDP, Hon Sani Shahada, former Member, KSHA, Hon Nasiru Aliyu Damau, former Council Chairman of Kubau LGA and Commissioner of LGA, Hon Aliyu Saleh Ramin Kura, former Council Chairman of Lere LGA, Hon Magaji Sadiq Hunkuyi, former Council Chairman of Kudan LGA among others. Other defectors are: Hon. Ashiru K. Bomo, former State Chairman AD and State Officer PDP, Hon. Sani Rabiu Bako, Esthwhile House of Representative Aspirants, Hon Joe Machu, Alhaji Adamu Kagarko, former Permanent Secretary, KDSG, Hon. Abdulaziz Makama, former Council Chairman, Kagarko LGA, Hon. Bala Ahmed, former Deputy Chairman, Kagarko LGA, Hon. Umar Farouq Kafanchan, Former SSA, Political and Chieftaincy, Hon Barbanas Samuel, former SA, Community Mobilisation, Hon. Shehu Tafarki, former Party Chairman, Kagarko LGA, Hon. Rufai Mustapha Ango (Maradona), among host of others.

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Tuesday 05 March 2019

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FINANCIAL TIMES

World Business Newspaper

Senior Democrat suggests ‘Glass-Steagall’ law for tech companies Antitrust committee head says social media platforms should be separated from sales KIRAN STACEY

he US should consider subjecting large technology companies to the kinds of restriction imposed on global banks after the Great Depression, a senior Democratic member of Congress has said. David Cicilline, the head of the House antitrust subcommittee, has suggested imposing a version of the Glass-Steagall rules — which forced banks to separate commercial and investment banking — on the technology industry. His comments add to growing calls from senior figures in the Democratic party to curb the market power held by the likes of Facebook, Google and Amazon. In an interview with the Financial Times, Mr Cicilline said: “One of the things that we did in the financial services space is Glass-Steagall, where you separate out functions. “It’s an interesting idea whether there would be a way to think about separating what platforms do versus people who are selling products and information — a Glass-Steagall for the international [technology companies].” Antitrust enforcement is emerging as one of the main threats to the US technology industry, as politicians and regulators begin to look more carefully at whether large Silicon Valley companies are stifling competition. Last week, the Federal Trade Commission said it was setting up a task force to look at competition specifically in the technology industry, which will go as far as reviewing deals that have already been com-

David Cicilline: ‘It’s an interesting idea whether there would be a way to think about separating what platforms do versus people who are selling products and information’ © Getty

pleted. Announcing the task force, Bruce Hoffman, director of the FTC’s bureau of competition, pointed out that the agency had the power to force companies to unwind mergers if it decided to. Companies such as Facebook, for example, have been accused of ruthlessly buying up or imitating new competitors to make sure they continue to dominate their fields. Mr Cicilline is one of the most significant voices in the Democratic party when it comes to the

Newmont rejects $18bn hostile approach by rival Barrick Miner insists $10bn plan to takeover Goldcorp is better for shareholders NEIL HUME AND HENRY SANDERSON

ewmont Mining has fired back at rival Barrick Gold, rejecting its all-stock $18bn hostile takeover offer and countering with the terms of a deal to combine their operations in the US state of Nevada. After a “thorough” review of Barrick’s nil premium bid, Newmont chief executive Gary Goldberg said its board had concluded that its planned $10bn takeover of Goldcorp was the best deal for shareholders. “The combination with Goldcorp is significantly more accretive to Newmont’s shareholders on all relevant metrics compared to Barrick’s proposal, even when factoring in Barrick’s own synergy estimates,” said Mr Goldberg. “Realising value through Barrick’s proposal for Newmont’s shareholders hinges entirely on a new management team that lacks global operating experience and is only two months into its own transformational integration.” In addition, he said Newmont had approached Barrick with a joint venture proposal for their respective assets in Nevada. A merger of Barrick and Newmont would create the world’s biggest gold miner with annual

production of more than 10m ounces. However, Barrick has not offered a premium, telling shareholders they will benefit from the value created by merging the two companies. In addition, Newmont has raised doubts about the ability of Barrick boss Mark Bristow to run a global company and realise the promised $750m of annual cost savings and synergies. Mr Bristow was appointed CEO of Barrick earlier this year following the takeover of Randgold Resources, the London-listed gold producer he co-founded. “We believe that the transaction you are proposing would reduce, rather than enhance, Newmont stockholder value,” said Mr Goldberg. “The value creation of Barrick’s proposal relies entirely upon the delivery of synergies from a management team that was put in place just two months ago. This new team has never managed a global portfolio the size of Barrick, let alone the size of a potential Newmont and Barrick combination.” Under the proposed Nevada JV, Barrick would have a 55 per cent economic interest and Newmont 45 per cent, a split that would also be reflected in their respective vot-

technology industry generally, and especially to competition in the sector. His views are likely to play a key role in forming the party’s thinking on how to deal with Silicon Valley in the run-up to the 2020 election and beyond. “David Cicilline will arguably be the most powerful person in technology this year,” said Sam McGowan, a research analyst at the Washington-based Beacon Policy Advisors. “If he is making policy proposals they will carry a lot of weight.”

He added: “In many ways, the threat of antitrust action is an existential threat for these companies post-2020.” Mr Cicilline told the Financial Times he thought there was a lack of competition in the technology sector and that he was keen to find a “competition-based solution” to the problem. But he added that more stringent regulation might be needed, including a Glass-Steagall-style separation. This could work, he said, by forcing

social media companies to run their platforms entirely separately from the parts of their business that sell customer data. The Glass-Steagall rules, enacted in 1933, were repealed in 1999, a move that critics said helped lead to banks making riskier investments, thereby triggering the financial crash. “What we did in the financial services sector, that seemed to work pretty well for a long time,” said Mr Cicilline. “We then repealed it and had a big problem.”

Imran Khan recast as statesman after deft touch eases India crisis Pakistani PM wins plaudits but questions remain over Islamabad’s backing for Islamists AMY KAZMIN AND FARHAN BOKHARI

hen Imran Khan was elected Pakistan’s prime minister last year, the former cricketer was seen internationally as a political novice whose pledge to build an Islamic social welfare state belied the reality of an economy in deep crisis. Yet last week, the erstwhile cricketing all-rounder demonstrated he was as deft and steely nerved a player on the political stage as on the sports pitch, coolly navigating Islamabad’s most serious crisis in relations with India in decades. After India launched a “preemptive” missile strike inside Pakistani territory last week, sparking a Pakistani response and raising fears the conflict between the nucleararmed neighbours could spiral out of control, Mr Khan declared that he would repatriate an Indian air force pilot captured in the skirmishes as a “peace gesture” to India. The move seems to have defused the immediate crisis. The decision also earned Mr Khan plaudits internationally and at home for appearing statesmanlike, and suggested he was sincere in his stated desire to improve relations with Pakistan’s longtime rival. “What Pakistan needed to do is deflate the general view of [the country] as an irresponsible state, and he

did that quite well,” said Ashley Tellis, a former senior US diplomat in India and now at the Carnegie Endowment for International Peace, a think-tank. “He recognised from the onset of the crisis that an escalation was not in Pakistan’s interest.” But Mr Khan still faces big challenges. Wrestling with a severe financial crisis and seeking a $12bn IMF bailout, Pakistan is under heavy international pressure to rein in the Islamist terror groups long used by its military as a proxy to target India in the disputed Kashmir province and beyond. What is unclear is how far Mr Khan is willing or able to confront the powerful military — which traditionally dictates Pakistani security policy and which the prime minister’s opponents believe tacitly backed his election — over the issue, or whether the generals are willing to abandon groups they are widely believed to see as valuable strategic assets. “At that highest level of abstraction, Imran realises these groups are not in Pakistan’s interest,” said Mr Tellis. “But the practical problem is that he doesn’t control the policy with respect to [them].” Mr Tellis added: “He has to do enough to show the international community that he is cognisant of their concerns, but he cannot make the army so irate by confronting their core national security policies.” Tensions ratcheted up quickly

after a February 14 suicide bomber killed more than 40 Indian paramilitary police in Kashmir. The attack was claimed by Jaish-e-Mohammad, the Pakistan-based militant group, with New Delhi accusing Islamabad of giving “full freedom” to JeM to operate and Indian prime minister Narendra Modi vowing to retaliate. Islamabad denied any role, with Mr Khan insisting he led a “new Pakistan” that understood harbouring terrorists was not in its interests. He promised to crack down on terror groups if India shared “actionable intelligence”. But Mr Khan also warned Islamabad would not hesitate to retaliate against India for any military aggression, a point reiterated by General Javed Bajwa, Pakistan’s army chief, on a visit to troops on the frontline in Kashmir. “We will not be intimidated or coerced,” Gen Bajwa warned. “Any aggression or misadventure will be paid back in the same coin.” Nonetheless, India carried out a “pre-emptive” missile strike on a JeM terror training camp on February 28, jolting Islamabad by targeting a site in Pakistani territory that was outside the disputed region of Kashmir. “An attack beyond Kashmir falls outside an unwritten understanding,” said a Pakistani cabinet minister, who was on Mr Khan’s crisis management team. “Outside Kashmir is a red line that means all-out war.”

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FT Why Ford is stalling in China while Toyota succeeds

Algerian protesters reject Bouteflika’s attempt to calm anger President’s suggestion he will serve limited term if elected fails to quell demonstrations

US car group suffered plummeting sales in 2018 as Japanese rival enjoyed bumper year TOM HANCOCK

HEBA SALEH

s Chinese workers returned to duty following a Lunar New Year break, the Changan Ford plant in the northeastern city of Harbin remained empty, with staff on an extended vacation until March. “It’s a much longer break than last year, which was about a week,” said a security guard at the joint-venture plant, which opened in 2017 after a $1.1bn investment and can produce up to 200,000 Focus models a year. Ford is one of several carmakers cutting production in China, the world’s largest car market where passenger vehicle sales fell 4 per cent to 23m last year, their first annual decline in almost three decades. China accounts for 30 per cent of global car sales, and foreign brands make up two-thirds of the market. That means multinationals’ joint ventures with Chinese carmakers are heavily exposed to the downturn. But not all have fared badly. Sales at Toyota’s joint venture with Guangzhou Automobile surged nearly 35 per cent last year, while BMW’s venture with Brilliance Auto saw a 20 per cent sales rise. Their differing fates show a range of factors — from investment in new models, competitive exposure to local brands, dealer relations, after sales service, and quality perceptions — can determine a brand’s success or failure in China. With Beijing unwilling to offer large subsidies to car buyers and analysts forecasting a further decline in the market this year, it is crucial for investors to pay attention to factors behind the success and failure of different brands in the downturn. Ford: slow to bring new models to market Ford had a late start in China, compared with rivals GM and Volkswagen. Slowed by years of corporate indecision and the impact of the 2008 financial crisis, it did not begin to make a mark on the market until 2012. Its two joint ventures saw strong demand among consumers for the Escort, Focus and Edge brands. Ford’s China sales in the four years to 2016 doubled to reach more than 1.2m. The Focus and Escort qualified for government subsidies on vehicles with engines of 1.6 litres or below introduced at the end of 2015. But sales began to decline at its main joint venture, Changan, in 2017 as the subsidies began to be reduced, and plunged 54 per cent last year after they were eliminated. Analysts said the company was slow to bring new models to the market. Two former workers told the Financial Times the tougher market conditions have led to hundreds of staff being laid off at the Changan Ford factory in Chongqing since December.

Tuesday 05 March 2019

P Margrethe Vestager argues that the current regime makes Europe companies better able to compete globally

Vestager warns against weakening merger rules Commissioner responds to Franco-German calls for overhaul of EU competition regime ROCHELLE TOPLENSKY

he EU’s competition commissioner Margrethe Vestager has warned national capitals to be “aware of the consequences” of watering down merger rules, saying such a move would amount to a “strategic choice” to change Europe’s economic model. “We have a lot of state intervention in our economy but basically it is a very strategic choice to have fair competition — and you can see that it bites,” said Ms Vestager in an interview with the Financial Times in Brussels. The Dane, who has built a reputation as a formidable competition enforcer by taking on Apple and Google, enraged the French and German governments this year by blocking a plan to merge the rail businesses of Siemens and Alstom. The deal was supposed to create a rail equivalent of Airbus to counter competition from China’s statebacked CRRC, the world’s biggest trainmaker. French finance minister Bruno Le Maire called Ms Vestager’s decision to veto the deal a mistake. Together with his German counterpart Peter Altmaier, he has proposed a potentially radical overhaul of the EU’s strict competition rules, including the option of giving politicians the power to override commission decisions and ensuring regulators systematically base

decisions on global rather than European or national market share. Ms Vestager, one of the star performers of the commission and deemed a potential future president, agreed the time was right to have “a more nuanced and more pragmatic approach” to competition policy. Data were becoming increasingly important to the global economy, she said. Meanwhile, with the rise of Chinese state capitalism and US protectionism, it was “more and more obvious” that the openness of European markets was “an asymmetrical thing”. However, she argued the current regime to foster fair competition “has served us well” by creating markets that made European companies more efficient, innovative and better able to compete globally. “I think it is important to discuss that very fundamental choice because if we want to change it [in Europe] we should be very well aware of the consequences,” she added. Europe’s competitors had adopted different economic models, she added. The Chinese “have made a different strategic choice” for a market led by state-owned monopolies while in the US they have chosen to have “more concentrated markets”. Ms Vestager defended her decision to block the Siemens-Alstom deal, saying had she allowed the merger go through it would have cut competition and increased prices for very high speed trains,

thereby pushing customers to look for a cheaper supplier — “de facto inviting” foreign competitors like CRRC into the market. Critics see the blocked railway merger as proof that the EU rules need to change in order to compete with state-backed rivals such as CRRC. However, Ms Vestager said the deal could have been cleared if the companies had done more to reduce their dominance in markets for very high-speed trains and mainline railway signalling systems. To level the playing field with Chinese and other state-backed rivals, Ms Vestager said Europe needs to make better use of its trade instruments, the bloc’s public procurement rules and new EU procedures for screening foreign direct investment. EU governments also needed to accelerate stalled talks over procurement measures “that will allow us to ask for reciprocity [in rivals’ markets]”. The commission urged EU capitals need to make better use of the programme to allow state aid for projects of common European interest. Established five years ago, the programme was first used in December to approve €1.75bn in government funding from France, Germany, Italy and the UK for a research and innovation project on sensors, chips and other so-called micro-electronics at the heart of household and industrial devices linked the internet.

AT&T reshuffles entertainment assets after WarnerMedia takeover HBO to be folded into one business unit with other television channels ANNA NICOLAOU

T&T unveiled plans to restructure its Hollywood assets, in a reorganisation that saw two influential media chiefs exit, while giving more power to CNN’s Jeff Zucker and Kevin Tsujihara, the head of the Warner Bros film studio. The announcement came after a tumultuous week as Richard Plepler, chief executive of HBO and a singular force in Hollywood, last Thursday said he was leaving the company — days after AT&T cleared its final legal hurdle to take over WarnerMedia. David Levy, chief executive of Turner Entertainment, also resigned. AT&T will fold HBO into one business unit with other television channels TNT, TBS, and truTV. The

company has brought in Robert Greenblatt, the former chairman of NBC Entertainment behind hits like “This Is Us”, to manage the business. News and sports will be combined into another division, with CNN chief Mr Zucker now presiding over CNN, Turner’s sports network, AT&T regional sports channels and the Bleacher Report, the website. The Warner Bros film studio, under chief executive Kevin Tsujihara, will add a “global kids and young adults” business, aiming to capitalise on tie-ins for animation, licensed toys and gaming. The changes came after John Stankey, the AT&T veteran who is now running WarnerMedia, spent the past several months planning what to do with the phone giant’s newly acquired Hollywood assets.

Mr Stankey said in a statement that this was “the right management team to strategically position our leading portfolio of brands, world-class talent and rich library of intellectual property for future growth”. While HBO and other Time Warner television networks had operated with a high degree of autonomy under previous ownership, AT&T wants to combine them to achieve a “more co-ordinated approach to the company’s original programming”, according to a statement. This plan did not sit well with Mr Plepler, who had enjoyed his independence in running HBO, leading to his resignation, according to people close to the situation. AT&T shares were down 1 per cent in early morning trading.

rotesters have rejected an offer by Algeria’s president to serve a truncated term in office if re-elected next month, taking to the streets overnight to amplify their calls for him to leave office. In an effort to calm public anger after more than a week of demonstrations, Abdelaziz Bouteflika said in a written message late on Sunday that if he was elected to a fifth term, he would call a national conference to set a date for another poll in which he would not be a candidate. But thousands of demonstrators denounced the proposal as they gathered overnight in the centre of the capital Algiers and in other cities. Zahira, a student who joined the protests, said she was not taken in by Mr Bouteflika’s offer. “He’s trying to pull the wool over our eyes. Bouteflika is not the man to lead a democratic transition. These promises are just a way to gain time. I’m sure if he is elected, he’ll stay for the entire term,” she said. Mahmoud Kerral, a teacher, pointed out that Algeria’s authorities had a long record of promising to liberalise the system before clamping down. “Algeria is not a democratic country and it won’t become one under Bouteflika and his clique,” he said. The protests, which began 10 days ago in the capital Algiers, have turned into an unprecedented expression of anger against the effort to extend Mr Bouteflika’s rule. The president, who turned 82 on Saturday, has been paralysed since he suffered a stroke in 2013. He has rarely been seen in public since then and has not been heard speaking by his people in six years. The offer to shorten the next presidential term, which was coupled with an ambiguous allusion to constitutional reform, was dismissed by many Algerians as a ploy to prolong the life of the secretive regime. Makhlouf Mehenni, a commentator on the TSA Algerie news website, described the reference to a national conference as vague, writing that “concession is too big a word for Mr Bouteflika’s proposal”. “To see in it yet another manoeuvre is neither an exaggeration nor is it paranoid,” he added. “The message from the president lacks a very important detail: the date of the envisioned [early] election.” Mr Bouteflika’s campaign manager presented the president’s formal nomination papers late on Sunday, but there was no sign of the elderly leader who is reported to be in a hospital in Geneva undergoing medical checks. “I have heard the pleas of protesters and especially thousands of young people who asked about our nation’s future,” he wrote in his message. Many Algerians consider Mr Bouteflika’s candidacy an insult and suspect that real decisionmaking lies in the hands of an opaque clique of power brokers around him, including military leaders and his brother Said Bouteflika.

Tuesday 05 March 2019

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UK charities face scrutiny over ethics of investment policies Trustees seek ruling on whether they must divest from fossil fuels, junk food and payday loans ANDREW JACK AND LESLIE HOOK

harities which invest in assets at odds with their purpose face fresh scrutiny following a request for a legal judgment on what trustees can do with the billions of pounds they oversee. A coalition of 20 charities has asked the attorney-general and the Charity Commission for England and Wales to seek a ruling on whether the public benefit of charities means they should be required to align their investment policies with their own objectives and commitments to wider society. The move is the latest example of a growing focus on ethical investment and whether charities should maximise returns to donate to their chosen causes, or divest from activities which undermine those objectives such as global warning, payday loans or marketing foods high in sugar to children. Last year Ireland decided to completely divest its sovereign wealth fund from fossil fuels, as did the Church of England and Edinburgh university. Globally, more than 1,000 institutions with $8tn have made commitments, according to 350.org, an environmental campaign group. But some of the UK’s most highprofile institutions have stopped short of fully divesting, including Oxford and Cambridge universities and the National Trust. The coalition behind the latest request includes three Sainsbury family trusts, the National Council for Voluntary Organisations — which has 14,000 member organisations — the Quakers, the Royal Society for the Protection of Birds and the Joseph Rowntree Charitable Trust. They want a ruling from the First-tier Tribunal, which was created in 2006 to examine charity issues. The request says existing guidance is outdated, vague and potentially misleading because it pre-dates both rising concern over climate change and subsequent legislation governing trustees and

charities. “We’re calling for the law to be revisited,” said Sian Ferguson, who represents the Sainsbury trusts, which have shifted their £100m portfolio out of fossil fuels. “The trustees were frustrated that the advice they were given was they didn’t need to think where their investments were, and they should concentrate on giving. That just didn’t make sense because some of their investments were causing the problems they were trying to solve.” Bates Wells Braithwaite, lawyers for the coalition, said the rising concern about issues including climate change required fresh legal scrutiny since the most recent ruling on charitable investments was in 1992. It was the result of an application to the High Court by the bishop of Oxford against the Church of England Commissioners. The Charity Commission’s legal adviser said in 2014 that since the judgment — which did not restrict the Church’s investments — “what may well have changed is the public perception of charities and what they should be doing.” Advice from the Charity Commission, issued in 2016 and currently under review, allows trustees to make ethical investments even if they provide a lower financial return than alternatives, but does not constrain them. The OSCR, the Scottish charity regulator, recently issued guidance for trustees to “make sure that investments are not inconsistent with the charity’s purposes”. Nicholas Stern, chair of the Grantham Research Institute on Climate Change and the Environment, said in a statement: “Charities exist for the public benefit and it is entirely logical that their investment decisions should also promote the public benefit . . . Charities can and should lead by example, and need stronger and clearer guidance on their investment decisions.” There is no timeline for when the attorney-general and the Charity Commission might respond.

Countrywide fined in probe over anti-money laundering procedures FCA figures reveal how companies treat their customers is a major concern KATE BEIOLEY

roubled UK estate agent Countywide has been fined £215,000 as part of a week-long crackdown by the UK tax authority on money laundering in the property sector. HM Revenue & Customs said in a statement on Monday that Countrywide had failed to comply with money laundering prevention rules. HMRC said Countrywide had failed to conduct adequate due diligence and said it had breached rules concerning “proper record keeping”. The tax authority also handed down a £68,595 fine for collapsed online estate agency Tepilo, which went into administration in December last year. The fines are the culmination of a week-long HMRC probe of 50 estate agents across England, which were suspected of trading without being registered, as required under money laundering regulations. HMRC said it had been “the first such week of action involving intelligence-led, co-ordinated activity aimed

at estate agents trading without registering with HMRC as legally required”. It made unannounced visits to some 35 suspected companies in London, five in Leicester, four in South Bucks and Berkshire and three in Greater Manchester, among others. The tax authority will now be taking action against all estate agents who had failed to comply, including “fines, publication and criminal proceedings.” Ben Wallace, Minister for national security and economic crime, said: “Criminals who seek to use this country as a place to launder money should be in no doubt that they have nowhere to hide. “Estate agents are a crucial line of defence against them and that’s why they’re under a legal — and moral — obligation to file a report when they spot something amiss.” Monday’s update comes at a difficult time for Countrywide, which saw its profits halved last year following a string of profit warnings and emergency fundraising.

Cambridge university is one of several high-profile institutions in the UK that have stopped short of fully divesting from fossil fuels

CenturyLink finds internal controls ‘weakness’ in $34bn Level 3 deal US telecoms group delays filing annual report as it sees need for extra auditing NIC FILDES

enturyLink, the US telecoms company, has delayed the regulatory filing of its annual report, citing “material weaknesses in its internal controls” related to its acquisition of Level 3 Communications in 2016. The Louisiana-based telecoms company said that it does not expect to report any material changes to its published results for 2018 but that it needs to conduct additional auditing and testing of its controls regarding revenue recognition and how it values Level 3 assets and liabilities. “The principal reason for the

delay is that recently identified material weaknesses in internal controls over the company’s revenue recording processes and the procedures for measuring fair value of assets and liabilities assumed in connection with the Level 3 Communications acquisition have created the need to conduct additional review and testing with respect to those processes prior to finalising the assessment and the audits of the effectiveness of internal control over financial reporting as of December 31 2018 and of the company’s financial statements as of and for the year ended December 31 2018,” the telecoms group said in its state-

ment to the Securities and Exchange Commission. CenturyLink, traditionally a long-distance phone company, paid $34bn for Level 3, a dotcom boom darling. The deal made it one of the largest enterprise telephony providers in the US and transformed it into a global internet player as it took over Level 3’s international network. Its shares have more than halved since. In February, it said that revenue for the year fell to $23.4bn from $24.1bn while it recorded a net loss of $1.7bn compared with a $1.5bn net profit in the year before. It reduced its net debt to $35.4bn from $37.1bn.

Hundreds of millions of Chinese chat logs leak online Database of 364m records containing social media profiles was freely available YUAN YANG

undreds of millions of private chat logs from Chinese users have been left exposed on the internet, a researcher has found, in another worrying case of weak data protection in China. Victor Gevers, a security researcher at the cyber-security organisation GDI Foundation, said that he had found a database of 364m records, containing social media profiles and chat logs linked to names and identity card numbers. The database was freely accessible online to anyone who searched for its IP address, and user profiles were stored together with photographs, addresses and locations, said Mr Gevers. The main database was piping data to 17 other servers depending on which area the data came from, Mr Gevers said. “It’s worrisome that these things appear online so easily. There are privacy worries of course if data like this is being exposed,” said Mr Gevers. A large number of the records had the names and addresses of web cafés on them. Chinese cyber-security experts have long warned that web cafés

collect vast amounts of customer data. The databases were secured after Mr Gevers reported the problem, as per GDI Foundation’s policy of responsible disclosure. “Our biggest concern was to notify the owner as quickly as possible, and the internet service provider closed it down very quickly,” Mr Gevers added. Under Chinese law, all web cafés have to be approved by the local police station and the local branch of the ministry of culture. Several local governments have asked web cafés to install monitoring software on their computers, such as Jingwang Xianfeng (“Clean Web Vanguard”). Mr Gevers previously revealed a vast facial-recognition database in China’s heavily policed region of Xinjiang that was also freely accessible online. The records in the databases have labels referring to domestic social-media platforms WeChat and QQ, as well as records of WeChat payments and QQ account numbers, suggesting that the conversation logs might have been derived from services provided by China’s tech giant Tencent. The company did not immediately respond to a request for comment

and there is nothing to suggest Tencent was aware data were being derived from the services it provides. Although activists as well as businesspeople in China have reported having their private messages monitored by police, it is not clear how and whether the police are using the databases found by Mr Gevers. Many of the chat logs appeared to be of everyday conversations between Chinese millennials, revolving around money, love and relationships, and not obviously containing material that Beijing might consider illegal or politically sensitive. Following the Snowden revelations of US-orchestrated spying worldwide and fearing that Chinese citizens’ data might be easily exploited, Beijing made data protection and cyber security one of its legislative priorities. Despite decades of lax enforcement of privacy law online, Chinese regulators last year embarked on a wave of harsh rebukes and negotiations with domestic tech companies. The government accused the companies of failing to abide by data protection principles recently enshrined in the country’s first ever cyber-security law.

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Tuesday 05 March 2019

ANALYSIS China, India and the rise of the ‘civilisation state’ This illiberal idea is also appealing to some on the American right GIDEON RACHMAN

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Deutsche and Commerzbank: why Berlin is backing a merger Rumoured for a decade, the move to combine Germany’s two largest banks now has political backing STEPHEN MORRIS, DAVID CROW AND On an uncharacteristically bright early February day in London, German finance minister Olaf Scholz and his deputy Jörg Kukies spent the afternoon holed up in a series of discreet meetings at their embassy on the south-west corner of the city’s most exclusive square. Amid the chandeliers, Teutonic tapestries and silver service of the 19thcentury Belgrave Square townhouse, the duo quizzed a succession of investment bankers from the likes of Goldman Sachs and Bank of America on the issue consuming the German finance sector. Not the slowing economy. Not Brexit. But what can be done to revive Deutsche Bank? And could a merger with Commerzbank save them both? Since the financial crisis, the condition of the two 149-year-old Frankfurtbased lenders has become parlous. Both have seen their share prices plunge more than 90 per cent in the past 11 years as they churned through eight chief executives — including the two incumbents, flip-flopping on strategy while raising more than €30bn in new equity. Deutsche has become the symbol of pre-crisis hubris for European banks trying to mimic American-style “casino” finance. At one point it even ended up owning a $4.3bn Las Vegas casino by accident. Chart showing Deutsche Bank and Commerzbank versus peers On almost any measure of financial performance, Deutsche will be at or near the bottom of the list. It makes the lowest return on equity, has the worst cost-income ratio and pays the most to raise funds of its continental peers. Between 2011 and 2018 it made a cumulative net loss of €6bn and was fined $14.5bn for everything from mis-selling mortgage securities to its role in the Libor scandal. A combination with Commerzbank has long been floated as a way of reviving the fortunes of both banks, with rumours of a deal swirling around for more than a decade. But the match has never been consummated as both were busy removing toxic assets from their balance sheets, working through a series of post-crisis misconduct investigations and waiting for interest rates to rise again, to provide a boost to earnings. Their self-help strategies have not worked. Deutsche’s stock has plunged to a record low and analysts openly question the viability of its business model. And as Mr Scholz and Mr Kukies’ clandestine London meetings show, the idea is now gaining traction in Berlin. Policymakers and corporate bosses see a stable national banking champion as the backbone of their export-led industrial policy, vital if

the country is to weather the next downturn that many economists warn looms large. In turn, they hope a merger would help to re-establish Deutsche as a top-level capital markets player with the scale and reputation to hold back the encroachment of a revitalised Wall Street. Paul Achleitner, Deutsche’s chairman, has become the pivotal internal champion of a deal, according to people briefed on his thinking. “It is important that we in Europe remain strong and independent,” says Simone Menne, former chief financial officer of German airline Lufthansa and drugs maker Boehringer Ingelheim. “It may make sense to join forces and, when it comes to financial policy, to pursue a more European approach.” Yet, despite growing support for a merger in some business circles, there are many investors and executives arguing that combining the two banks would not remedy their problems. “We think a deal only happens in the near term if Deutsche’s plan A is clearly failing and the share price is under [even more] severe pressure,” says Stuart Graham, founder of Autonomous Research. “A deal [would be] born out of desperation and hatched by a government seeking to prevent contagion.” Politicians have been forced off the sidelines after a particularly turbulent 2018 that started with Mr Achleitner firing dour British chief executive John Cryan in favour of Deutsche “lifer” Christian Sewing, and ended with police raiding the bank’s headquarters in a money laundering investigation. Bank insiders suggest these raids added some urgency to Berlin’s merger discussions. Deutsche is also embroiled in a scandal at Danske Bank, the Danish lender. And the US Congress continues to investigate its longstanding business relationship with President Donald Trump. L eading the government’s Deutsche project is the softly-spoken, cerebral Mr Scholz, a businessfriendly Social Democrat who Angela Merkel named vice-chancellor last year. Mr Kukies is his emissary to the financial world. The Harvardeducated, ex-Goldman Sachs derivatives trader is the opposite of his boss: confident, brash, ebullient. The uber-bank they imagine would be the second-largest eurozone lender behind BNP Paribas, with about €2tn of assets. It would hold €845bn of deposits, almost the size of Citigroup, have more than 2,500 branches and employ 141,000 people — compared with Deutsche’s 92,000 today. As many as 20,000 of those jobs could be lost, analysts say. The outcome of this saga has im-

plications not only for the companies involved and Germany itself, but the continent’s banking industry as a whole. Few European banks generate double-digit returns, considered the bare minimum by investors. That explains why many have repeatedly called for consolidation among the region’s 6,000 banks. Speculation over any merger is being taken more seriously this time. Mr Scholz has adopted a far more activist stance than his predecessor, arguing that having strong and stable banks is a question of “national sovereignty”. He told a conference that the troubles of German banks had created problems for industrial policy because they “don’t have the scale and global footprint necessary to escort the corporate sector [overseas]”. A person close to the politicians says their desire for a national flagbearer stems from the 2008 crisis, when panicked banks restricted the supply of credit. “Foreign banks repatriate capital in times of distress,” he says. “One really has to be mindful of that.” Another of the ministry’s concerns is that Deutsche alone may be incapable of escaping from what James von Moltke, its chief financial officer, has called a “vicious cycle of declining revenue, sticky expenses, lowered ratings and rising funding costs”. Last year the bank generated a net profit of €341m — its first since 2014 — but it was forecast to be 20 per cent higher. The group made a return on tangible equity of only 0.5 per cent in 2018, a 20th of its target, and its struggling investment bank made a €303m loss last quarter as big institutional clients took their business elsewhere. The government is even worried about the viability of Deutsche’s bread-and-butter corporate lending business in light of its escalating funding costs and deteriorating credit rating. “Counterparties wanting to do a 10-year [interest rate] swap are starting to ask themselves how long the lender will be around,” says a senior European regulator, who asked not to be named. Chart showing Deutsche Bank and Commerzbank share prices rebased Mr Achleitner, who has overseen Deutsche for almost seven years, has become the key figure in the saga. He knows Mr Kukies well; both went to Harvard and ran Goldman Sachs’ operations in Germany and Austria earlier in their careers. The wily, gregarious 62-year-old Austrian, who started his career at Bain & Co, is one of the best-connected power brokers in German-speaking finance, also sitting on the boards of Daimler and drugs group Bayer.

he 19th-century popularised the idea of the “nation state”. The 21st could be the century of the “civilisation state”. A civilisation state is a country that claims to represent not just a historic territory or a particular language or ethnic-group, but a distinctive civilisation. It is an idea that is gaining ground in states as diverse as China, India, Russia, Turkey and, even, the US. The notion of the civilisation state has distinctly illiberal implications. It implies that attempts to define universal human rights or common democratic standards are wrong-headed, since each civilisation needs political institutions that reflect its own unique culture. The idea of a civilisation state is also exclusive. Minority groups and migrants may never fit in because they are not part of the core civilisation.

civilisation is the Hindu religion — a notion that implicitly relegates Indian Muslims to a second tier of citizenship. Jayant Sinha, a minister in Narendra Modi’s government, argues that modern India’s founding fathers, such as Jawaharlal Nehru, mistakenly embraced western ideas such as scientific socialism, believing them to have universal applicability. Instead they should have based India’s post-colonial governance system on its own unique culture. As a former McKinsey consultant with a Harvard MBA, Mr Sinha might look like the archetypal bearer of “globalist” values. But when I met him in Delhi last year, he was preaching cultural particularism, arguing that “in our view, heritage precedes the state . . . People feel their heritage is under siege. We have a faithbased view of the world versus the rational-scientific view.”

One reason that the idea of the civilisation state is likely to gain wider currency is the rise of China. In speeches to foreign audiences, President Xi Jinping likes to stress the unique history and civilisation of China. This idea has been promoted by pro-government intellectuals, such as Zhang Weiwei of Fudan university. In an influential book, The China Wave: Rise of a Civilisational State, Mr Zhang argues that modern China has succeeded because it has turned its back on western political ideas — and instead pursued a model rooted in its own Confucian culture and exambased meritocratic traditions. Mr Zhang was adapting an idea first elaborated by Martin Jacques, a western writer, in a bestselling book, When China Rules The World. “China’s history of being a nation state”, Mr Jacques argues, “dates back only 120-150 years: its civilisational history dates back thousands of years.” He believes that the distinct character of Chinese civilisation leads to social and political norms that are very different from those prevalent in the west, including “the idea that the state should be based on familial relations [and] a very different view of the relationship between the individual and society, with the latter regarded as much more important”. Like China, India has a population of well over 1bn people. Theorists for the ruling Bharatiya Janata party are attracted to the idea that India is more than a mere nation — and is, instead, a distinct civilisation. For the BJP, the single most distinctive feature of Indian

Civilisational views of the state are also gaining ground in Russia. Some of the ideologues around Vladimir Putin now embrace the idea that Russia represents a distinct Eurasian civilisation, which should never have sought to integrate with the west. In a recent article Vladislav Surkov, a close adviser to the Russian president, argued that his country’s “repeated fruitless efforts to become a part of western civilisation are finally over”. Instead, Russia should embrace its identity as “a civilisation that has absorbed both east and west” with a “hybrid mentality, intercontinental territory and bipolar history. It is charismatic, talented, beautiful and lonely. Just as a half-breed should be.” In a global system moulded by the west, it is unsurprising that some intellectuals in countries such as China, India or Russia should want to stress the distinctiveness of their own civilisations. What is more surprising is that rightwing thinkers in the US are also retreating from the idea of “universal values” — in favour of emphasising the unique and allegedly endangered nature of western civilisation. Steve Bannon, who was briefly chief strategist in the Trump White House, has argued repeatedly that mass migration and the decline of traditional Christian values are undermining western civilisation. In an attempt to arrest this decline, Mr Bannon is helping to establish an “academy for the Judeo-Christian west” in Italy, designed to train a new generation of leaders.

Tuesday 05 March 2019

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UNDERSTANDING THE ECONOMY OF NIGERIA’S 36 STATES

he purpose of this series is to present evidence-based picture of Nigeria vis-a-vis the current presentations by politicians and various interest groups which are not backed by facts and figures. Such presumptuous speculations have driven the various national discourses or debates on the future of Nigeria, including such thorny issues as restructuring, whether fiscal, political, geographical or administrative. Facts are sacred, they say, and as such must be given priority in our search for national viability and survival.

‘Understanding the Economy of Nigeria’s 36 States’ series presents such an objective, dispassionate picture of the state of the economy and so viability and sustainability of the various component parts, sub-nationals or federating units of the country going forward. This series will serve to either buttress or discountenance some of the claims made on both sides of the restructuring argument. The series, written by Cambridge-trained economist, Dr. Ayo Teriba, looks at each state at a glance in the context of its geopoliti-

cal zone and as it compares to other states. The data present irrefutable facts about each region and its component states and raise the question: are they viable as constituted today and going forward? Each series examines a state’s realities from the perspectives of economy, resource endowment, state of wellbeing of its populace, and its budget (revenue and expenditure profile). Today’s edition covers an overview of Kano State and Katsina State, in the North-West region.

KANO • Economy

Kano State Summary

Kano State’s Gross State Product (GSP) was 3.7 percent of Nigeria’s GDP in 2017, the largest economy in the North-West, 2nd in the North and 4th in the country. Agriculture dominated 52 percent of the State’s GSP, Services was 42 percent while Non-Oil Industry was 6 percent.

• Endowments

Kano’s Land Area is 2.2 percent of total land mass in Nigeria, the least in the NorthWest, 18th in the North and 20th in the country. The State has neither a coastline nor a boarder but is surrounded by four States; Bauchi from the North-East and Kaduna, Katsina and Jigawa from its region.

• Wellbeing

North, and 8th in the country. Manufacturing and Construction jointly dominated 98 percent of the State’s non-oil leaving Utilities and Solid Minerals with 1 percent each. – The State’s N1.8 trillion Services was 2.8 percent of Nigeria’s Service sector, 2nd in the North-West and the North, 4th in Nigeria. Inter-State Comparisons With a Gross State Product (GSP) of N4.26 trillion or 3.7 percent of the gross outputs produced in the country was the largest economy in the North-West, 2nd in the North and 4th among the 36 States and the FCT. The State’s 13.4million Population is 6.7 percent of national population, the most populated among the States in the North-West, the North and in Nigeria. 20,300/km2 Land Area in the State is 2.2 percent of Nigeria’s land mass, the least in the North-West, 18th in the North and 20th in the country. N93.8billion Government Revenue in the State was 3.1 percent of all States’ total revenue, the highest in the North-West and the North, the 5th in Nigeria.

Total population in Kano is 6.7 percent of national population, the most populated State in the North-West, the North and in Nigeria. Kano is the 7th most densely populated in Nigeria, 29th in literacy and 21st life in expectancy with a Per Capita GSP that is 5th in the North-West, 10th in the North and 16th among the States and the FCT.

• Budget

Kano retained 3.1 percent of States’ revenue in 2017, 5th in the country; spent 4.5 percent of States’ outlays, 4th in the country, incurred an overall deficit and held 2.4 percent of total debt, 15th among the States and FCT.

Economy

Structure Kano State’s 2017 estimated Gross State Product (GSP) was N4.26 trillion or 3.7 percent of Nigeria’s GDP, the largest in the North-West, 2nd in the North and 4th in the country. Agriculture contributed 52 percent of this, Services, 42 percent, Non-Oil Industry, 6 percent.

• Endowments Kano State was originally created in 1967 but was subdivided into two, Kano and Jigawa States, in 1991. The State has no boarder or a coastline and is bounded by four states, Katsina to the northwest, Kaduna to the southwest, and Jigawa to the northeast, and Bauchi to the southeast. Kano State’s land area of 20,300/km2 is 2.2 percent of total land mass in Nigeria, the least in the North-West, 18th in the North and 20th in the country. Major towns and cities are; Kano, Tarauni, Tofa, Minijibir, Bichi, Shanono, Kabo, Gwale, Ungogo, Bagwai, Gezawa, Makoda, Kunchi, Gwarzo, Karaye, Kibiya, Rano, Rimin Gado, Gabasawa.

– N2.2 trillion Agricultural output in the State was 9.3 percent of agricultural produce in the country, the 3rd in the North-West, 5th in the North and in Nigeria. • N2.01 trillion in crops was 90 percent of the State’s agricultural output, • N218.2 billion in livestock was 10 percent, and • N0.8 billion in fishery was negligible, • Forestry was Nil. – Kano’s N200 billion 2017 Non-Oil Industrial output was 1.5 percent of the gross Non-Oil Industrial output in Nigeria, the largest in the North-West, 3rd in the

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Tuesday 05 March 2019

UNDERSTANDING THE ECONOMY OF NIGERIA’S 36 STATES

Wellbeing

Kano State’s Population of 13.4 million people is 6.7 percent of national population, the most populated State in the North-West, the North and in Nigeria. With a land area of 20,300 per km2, density in the State is 659 people per km2 compared to the country average of 219 people/km2, the 7th most densely populated in the NorthWest, the North and among the 36 States and the FCT. Kano’s literacy is the 3rd in the North-West, 12th in the North, and 29th in the country. Life expectancy of 49 years is 4th in the North-West, 7th in the North and 21st in Nigeria. Female life expectancy of 50 years retains 4th in the North-West, 13th in the North and 28th in the country. Male life expectancy of 47 years is 3rd in the North-West, 6th in the North and 20th in the country. The State’s Per Capita GSP of N318 thousand is 5th in the North-West, 10th in the North and 16th among the States and FCT.

Budget

N166.8 billion total expenditure in the State was 4.5 percent of actual total spending by all States, the highest in the North-West and the North, 4th in the country. The spending components in 2017 were: Recurrent Spending of N157 billion was 5.9 percent of the recurrent outlays of all the States and the FCT, the largest in the North-West and the North, the 2nd in the country. Capital Spending of N9.8 billion in the State was 0.94 percent of States and FCT’s total capital outlays, the 5th in the North-West region, 16th in the North, 31st in Nigeria. Deficits Kano State is one of the 25 States and the FCT that had deficits in 2017. The State made an overall deficit of N73 billion, the 2nd among the 6 States in the North-West that had deficits, among the 17 States in the North that had deficits and 3rd among the States that had deficits in the country. Debt Total outstanding debt of N112.5 billion in the State was 2.4 percent of the States and FCT’s total debts, the 2nd in the North-West, 4th in the North and 15th in the country. Domestic Debt of N90.3 billion in December 2017 was 2.8 percent of States and FCT’s domestic debts, the highest in the North-West, 4th in the North and 14th in the country. Foreign Debt of N20.29 billion in December 2017 was 1.6 percent of the total foreign debts of the States and FCT, 3rd in the North-West, 5th in the North 16th in the country. 2013-2017 Trends Total Revenue: Kano’s Total Revenue declined from N117.7 billion in 2014 to N93.8 billion in 2017. The slump in revenue came from gross statutory allocations (GSA) and internally generated revenue while value added tax increased slightly.

Kano’s Total Spending: Kano’s total spending increased from N144.8 billion in 2014 to N166.8 billion in 2017; Recurrent spending grew from N61.1 billion in 2014 to N157 billion in 2017, while capital spending declined from N83.7 billion in 2014 to N9.8 billion in 2017.

4.1. Fiscal Realities of Kano State 4.1.1 2018 Aspirations Kano State’s N246 billion 2018 budgets is 2.6 percent of all States’ and FCT’s 2018 budget, the largest in the North-West and in Northern Nigeria, 9th among the 36 States and FCT. 4.1.2 2017 Realities

Revenue Kano State’s 2017 Actual total revenue of N93.8 billion was 3.1 percent of all States’ actual total revenue, the highest in the North-West and the North, 5th in the country. The revenue components in 2017 were: Statutory Allocations of N45.0 billion was 3.08 percent of the total allocations to all States and the FCT, the highest in the North-West and the North, 5th among the 36 States and FCT. Internally Generated Revenue of N22.2 billion was 2.9 percent of total, still retained the highest in the North-West and the North, 5th among the 36 States and FCT. Value Added Tax of N40.7 billion was 4.37 percent of States’ total, the largest in the North-West and the North, the 2nd in the country. Spending

Revenue Use: Kano maintained a current surplus that was as large as its recurrent spending in 2014, adding some borrowings to the current surplus to keep capital outlays above recurrent spending; a similar level of current surplus in 2015 however ended in overall surplus rather than in capital spending as capital spending dropped to zero that year. The surplus of 2015 gave way to larger current and overall deficits that mostly ended up on recurrent spending since 2016. Financing: Revenue financing: overall deficits of 23.7 percent of total revenue in 2014 gave way to an overall surplus of 57.9 percent of total revenue in 2015 which in turn gave way an overall deficit of 77.8 percent by 2017. Spending finance: overall deficit of 19.2 percent of total spending in 2014 gave way to an overall surplus of 137.8 percent of total spending in 2015 but a deficit of 43.7 percent in 2017. Capital budget finance: overall deficits of 33.2 percent of capital budget in 2014 gave way to an overall surplus of 56,100 percent of capital spending in 2015, and a deficit of 744.9 percent of capital spending in 2017. Kano’s Debt Domestic debt stock grew from N32.2 billion in 2013, to N92.3 billion in 2017 from 22.3 percent of revenue in 2013 to 98.5 percent in 2017. Foreign debt stock grew threefold from N10 billion in 2013 to N20.3 billion in 2017; from 6.9 percent of revenue in 2013 to 21.6 percent in 2017. Total debt stock rose from 29.3 percent of revenue in 2013 to 120.0 percent in 2017.

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BUSINESS DAY

UNDERSTANDING THE ECONOMY OF NIGERIA’S 36 STATES

KATSINA • Economy

Katsina State Summary

Katsina’s Gross State Product (GSP) was 2.8 percent of Nigeria’s GDP in 2017, 2nd in the North-West, 5th in the North and 9th in the country. Agriculture was 76 percent of the State’s GSP, Services were 22 percent and Non-Oil Industry was 2 percent.

• Endowments

Katsina’s Land Area is 2.59 percent of total land mass in Nigeria, the 5th in the North-West, 16th in the North and 17th in the country. The State has no coastline, shares a boarder with Benin Republic and is surrounded by four States, Jigawa, Kaduna, Kano, and Zamfara, all from its region.

• Wellbeing

North, and 23rd in the country. Manufacturing (mainly Food, Beverage and Tobacco, and Textile, Apparel and Footwear) and Construction were 98 percent of the State’s non-oil output. – Katsina’s N0.7 trillion Service output was 1.1 percent of Nigeria’s Service output, the 3rd in the North-West, 4th in the North and 13th in Nigeria. Inter-State Comparisons With a Gross State Product (GSP) of N3.2 trillion or 2.8 percent of the gross outputs produced in the country was the 2nd in the North-West, 5th in the North and 9th among the 36 States and FCT. 8.3million Population of the State is 4.1 percent of national population, 3rd in the North-West and the North, 4th most populated in Nigeria. The State’s Land Area of 23,600/km2 is 2.59 percent of Nigeria’s land mass, the 5th in the North-West, 16th in the North and 17th in the country. Katsina’s N58.2billion Revenue is1.9 percent of all States’ total revenue, the 4th in the NorthWest, 9th in the North, and 20th among 36 States and FCT.

Population of Katsina is 4.1 percent of national population, 3rd most populated State in the North-West and the North, the 4th in Nigeria. The State is the 12th most densely populated, 31st in literacy and has the 15th life expectancy in the country, with a Per Capita GSP that is 3rd in the North-West, 7th in the North and 12th in the country.

• Budget

Katsina retained 1.9 percent of States’ revenue in 2017, 20th in the country; expended 1.7 percent of States’ outlays, 22nd in the country, incurred a deficit, and held 1.1 percent of total debt, 33rd in the country.

Economy

Structure Katsina State’s estimated Gross State Product (GSP) in 2017 was N3.2 trillion or 2.8 percent of Nigeria’s GDP, 2nd in the North-West, 5th in the North and 9th in the country. Agriculture was 76 percent of the State’s GSP, Services, 22 percent, and Non-Oil Industry, 2 percent. – N2.4 trillion Agricultural output in Katsina State 10.2 percent of all agricultural produce in the country, the largest in the North-West, 3rd in the North and in Nigeria. • N2.25 trillion in crops was 92 percent of the State’s agricultural output, • N198.5 billion in livestock was 8 percent, and • N1.0 billion in fishery was 0 percent/negligible. – The State’s N0.1 trillion 2017 Non-Oil Industrial output was 0.4 percent of the gross Non-Oil Industrial output in Nigeria, the 5th in the North-West, 10th in the

Endowments

Katsina State was carved from the old Kaduna State in 1987. The State has no coastline, shares a boarder with Niger Republic to the north and shares boundaries with four States, Zamfara to the West, Kaduna to the South, Jigawa and Kano to the East. Katsina State’s 23,600/km2 land area is 2.59 percent of total land mass in Nigeria, the 5th in the North-West, 16th in the North and 17th in the country. Major towns and cities are; Bakori, Batagarawa, Dutsi, Funtua, Baure, Faskari, Charanchi, Dandume, Daura, Dan Musa, Ingawa, Danja, Batsari, Bindawa, Dutsin-Ma, Katsina, Mashi, Kaita, Malumfashi, Musawa, Sandamu, Kankara, Kusada.

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Tuesday 05 March 2019

UNDERSTANDING THE ECONOMY OF NIGERIA’S 36 STATES 3.

Wellbeing

• Statutory Allocations of N34.9 billion was 2.39 percent of the total allocations to all States and the FCT, 3rd in the North-West, 5th in the North and 11th in the country. • Internally Generated Revenue of N5.9 billion was 0.77 percent of total, the 4th in the North-West, 12th in the North and 27th among the 36 States and FCT. • Value Added Tax of N12.6 billion was 2.66 percent of States’ total, 3rd in the NorthWest and the North, the 6th in the country. 4.1.2.2 Spending Total expenditure of N64.3 billion in the State was 1.7 percent of actual total spending by all States, 5th in the North-West, 12th in the North and 22nd in the country. The spending components in 2017 were: • Recurrent Spending of N41.4 billion was1.56 percent of the recurrent outlays of all the States and the FCT, 6th in the North-West, 17th the North, 29th in the country. • Capital Spending of N22.9 billion in the State was 2.2 percent of States and FCT’s total capital outlays, 3rd in the North-West, 5th in the North, 11th in Nigeria. 4.1.2.3 Deficits Katsina State is one of the 25 States and FCT that had deficits in 2017. The State made an overall deficit of N6.2 billion, 4th among the 6 States in the North-West that had deficits, 14th among the 17 States in the North that had deficits, and 21st among the States that had deficits in the country. 4.1.2.4 Debt Total outstanding debt of N51.8 billion in the State was 1.1 percent of the States and FCT’s total debts, the 5th in the North-West, 17th in the North and 33rd in the country. • Domestic Debt of N31.1 billion in December 2017 was 0.9 percent of States and FCT’s domestic debts, the 6th in the North-West, 18th in the North and 34th in the country. • Foreign Debt of N20.6 billion in December 2017 was 1.6 percent of the total foreign debts of the States and FCT, 2nd in the North-West, 4th in the North and 14th in the country.

Katsina State’s Population of 8.3million people is 4.1 percent of national population, 3rd most populated State in the North-West and the North, the 4th in Nigeria. With a land area of 23,600/km2, the State has a density of 350 people per km2 compared to the country average of 219 people/km2, 2nd most densely populated in the NorthWest and the North, 12th in the country. Katsina’s literacy is the 4th among the North-Western States, 14th in the North, and 31st in the country. Life expectancy of 50 years in the State is 2nd to Kebbi in the North-West, the 4th in Northern Nigeria, and 15th in Nigeria. Female life expectancy of 52 years is the highest in the NorthWest, 4th in the North and 15th in the country. Male life expectancy of 47 years is the 4th in the North-West, 7th in the North, 21st among the States and CT. The State’s Per Capita GSP of N390 thousand is 3rd in the North-West, 7th in the North and 12th in the country.

Budget

4.1.3 2013-2017 Trends Katsina’s Total Revenue: Total Revenue declined by about 10 percent from N65.1 billion in 2014 to N58.2 billion in 2017. The decline in revenue came from gross statutory allocations (GSA) while both internally generated revenue and value added tax grew to partially compensate for the loss of GSA.

Katsina’s Total Spending: Total spending grew by about 5 percent from N61.3 billion in 2014 to N64.3 billion in 2017. Recurrent spending declined slightly from N44.1 billion in 2014 to N41.4 billion in 2017 and capital spending increased from N17.2 billion in 2014 to N22.9 billion in 2017.

4.1. Fiscal Realities of Katsina State 4.1.1. 2018 Aspirations Katsina’s N213.6 billion 2018 budget is 2.3 percent of all States’ and FCT’s 2018 budget, 4th in the North-West and in Northern Nigeria, 12th among the 36 States and FCT. 4.1.2. 2017 Realities

Revenue Use: Katsina consistently maintained current surpluses to which it has tended to borrow a bit more since 2015 to fund growing capital outlays. Financing: • Revenue financing: overall surplus of 5.9 percent of total revenue in 2014 gave way to an overall deficit of 45.2 percent of total revenue in 2015, and 10.6 percent in 2017. • Spending finance: overall surplus of 6.3 percent of total spending in 2014 gave way to an overall deficit of 31.1 percent of total spending in 2015, and 9.6 percent in 2017. • Capital budget: overall surplus of 22.6 percent of capital budget in 2014, gave way to an overall deficit of 79.9 percent of capital budget in 2015, and 27 percent in 2017. Katsina’s Debt Domestic debt stock grew from N0.3 billion in 2013 to N31.1 billion in 2017; from 0.3 percent of revenue in 2013 to 53.5 percent in 2017. Foreign debt stock by the State has doubled from N11.5 billion in 2013 to N20.7 billion in 2017; from 14.9 percent of revenue in 2013 to 35.6 percent in 2017. Total debt stock rose from 15.2 percent of revenue in 2013 to 89.1 percent in 2017.

4.1.2.1. Revenue N58.2 billion 2017 actual total revenue in the State was 1.9 percent of all States’ actual total revenue, 4th in the North-West, 9th in the North 20th among the 36 • States and FCT. The revenue components in 2017 were: For enquiries, please call Teliat 08098710024, Chuks 08116759816 or teliat.sule@businessday.ng

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INSIGHT/INNOVATION

2019 elections and the irrelevance of poverty

OGHO OKITI

n every cycle of elections in Nigeria, none fails to deliver some sort of narrative and provide an enduring image. Yes, in Nigeria, we are a very forgetful lot. Our attention span is usually very short. This is not ideal for a nation that wants to grow, because growth and development often arise from the pain and annoyance of previous experiences. Still, some images refuse to go away. So, last week, a video went round of a trailer, fully loaded with bags of rice being distributed at the Alausa secretariat in Lagos. What’s very poignant about this video is that the bags of rice were actually being thrown at civil servants of the State. So, one thing is very clear, this group of people are actually employed. They have jobs, but all the same, they are poor, desperate, impoverished, beggarly, indigent, and deprived. The video shows about 10 men on the top of a trailer throwing bags of rice. Conservatively, those fighting, struggling, and desperate to get a fraction of the bags of rice could be as

many as 3000. Obviously, it depicts survival of the fittest. The distribution is not even, nor systematic. It certainly was not based on some sort of criterion. From the clip I saw, I have no way of determining the number of successful people, but it’s hard to justify the indignity suffered for the sake of a bag of rice. From the video, there are many dimensions to understanding the precarious situation we have found ourselves in. One of those dimensions is certainly in relation to the interplay between power and poverty. Indeed, the video depicts the relationship between power and poverty in the worst form. Worse, these affected Nigerians are not street urchins but civil servants of the State. But they reinforce the argument I have made before. The majority of Nigeria’s civil servants, both in the States, and in the federal government, are largely a form of social service. It was not intended so, but it has become so. Majority of those employed in the civil service are employed for the purpose of receiving some sort of salaries, and not for an exchange of services towards the State. In essence, there is an unwritten contract that the State pays whatever it can afford, while they do the barest minimum necessary. There is no accountability, matched with responsibility. They are poor, but most of them also know they are not competitive outside of the civil service. Most of this group of civil servants are found in the very lower cadres. They have no hope, nor

ambition of rising to the top. But the other group, and you will not find this group in the video, are destined to or are at the top of the civil service cadre, and they decide the future of the State or appropriately, share the proceeds left by political office holders. At the root of this are ignorance, injustice and poverty. Essentially, the video is symptomatic of the dynamic interplay between power and poverty in Nigeria. It is fuelled by ignorance, but sustained by injustice and poverty. It played out also in the recent presidential elections. President Muhammadu Buhari clung to power after expanding poverty and ignorance. And I wonder, what is the essence of power if not for the purpose of eradicating ignorance and poverty? Rational expectations would be that those that expand ignorance and poverty will not have the opportunity to do so again. But Nigeria is not in an ideal situation, except that I expect that every leader should transcend beyond the shallow thinking of the generality of their followers. But those leaders are also not ideal here in Nigeria. The ones here expand poverty and ignorance, and use the same for the purpose of wining elections or usurping positions. They realised, more than many of us, that when you are too poor, you are also not able to think about how you became poor. So, in relation to poverty, three explanations can be made regarding the presidential elections. Except in the South West, there was no clear pattern that poverty (economy) was

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And I wonder, what is the essence of power if not for the purpose of eradicating ignorance and poverty?

the number one priority for Nigerians. In the South East and South South, that distinction was not clear because they have always voted the People’s Democratic Party (PDP), so it’s not clear whether poverty was a concrete issue this time. In the core North, they have always voted President Muhammadu Buhari. Though his main challenger was a Fulani Muslim like the President, there is no concrete evidence that poverty consideration was strong. My take therefore is that only the South West provided evidence that the weakness in the economy was a strong factor. So, as poverty expanded considerably in the last four years, no matter the extent of the poverty, many clung to him. I had thought poverty does not recognise Igbo, Yoruba, and Hausa, but every time, we are proved wrong that the main problem is ignorance and not poverty. It just so happens that most people that are ignorant are also poor. It is thus in the interest of our politicians to keep majority ignorant, and poor in order for us to continue to have the nature of results we had last week. So, while I think poverty should matter, and the dignity of Nigerians should matter in our elections, I believe I am in the minority. The others see relationship between power and ethnicity, and religion, underpinned by ignorance. I thank you. Dr. Okiti is the president, Time Economics Ltd @ Dr_Okiti 081.7153.0058

Seven side effects of the presidential election PROPHYLAXIS

AYULI JEMIDE

.S. president Abraham Lincoln (1809-1865) defined democracy as: «Government of the people, by the people, for the people». The term democracy comes from the Greek language and means “rule by the people”. Does this definition hold true with the elections of 23rd February 2019? If we go by mere fact that voter turn-out was 35.6% (29.3 Million) of the 82 million registered voters then the outcome cannot be classified as a “rule by the people”. It is clear that the poor voter turnout was a result of several factors: voter suppression, voter apathy, or violence. Whatever the reason, it is symptomatic of both a system failure and a citizen’s mistrust of the system. For many voters the system failure was that they were not enamored with a system that threw up two major presidential candidates who they simply could not be bothered to vote for. I met so many people who felt that both the APC and PDP Presidential candidates were not good choices and since they were the front runners it was better if they abstained. So, absenteeism must have been at it’s all time high on the 23rd of February 2019.

The first side effect of the presidential elections is a dent in the psyche of many Nigerians, voters and non-voters alike. Let’s not pretend about this, the fact is that many Nigerians are traumatized by the brazen impunity of politicians and the seeming lukewarm attitude or outright connivance of our law enforcement agents at all levels. For many of those who abstained from voting, their resolve not to vote in subsequent elections has become even stronger. Post elections, many responsible voters have joined the abstainers because a lot of voters feel their votes did not count or where manipulated. It is not relevant whether they are right or wrong, what is important is how they feel and the consequences of that apathy. The second side effect was that the capital market lost N84 billion within days of the elections. The statistics also shows that a lot of investors converted their investment from equity to fixed income instruments. This shows an aversion for risk and lack of confidence in the macro-economic environment post elections. The third side effect is that the voltage of tribalism has increased by many notches. This stems from the fact that the politicians turned on the volume in playing the tribal sentiments card during the 2019 elections. Some of the things that were said to pitch voters of one tribe against the other or to intimidate voters of a given tribe are unprintable. The adverse effect of this still lingers on with pockets of post-election skirmishes in the supposed Igbo enclaves in Lagos for example. We have had a lot of venting and counter venting on social media between Yorubas and Igbos. This is not

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The fact that Nigeria has indeed become the poverty capital of the world was clear in the undignified manner politicians threw bags of rice and other victuals at people

a healthy side effect of an election. It must stop! The fourth side effect of the elections is the glorification of poverty. The fact that Nigeria has indeed become the poverty capital of the world was clear in the undignified manner politicians threw bags of rice and other victuals at people. In one case civil servants in a state were gathered to hustle for bags of rice thrown at them by their ‘’benevolent’’ benefactors. I simply cannot think of a better way to reinforce poverty in the minds of our “poor” citizens. Such events sadly epitomize the decay in our electoral process because this should clearly be characterized as vote buying. The fifth side effect of the elections is that the US dollar has dropped against the Naira from about 360/1 the USD now trades for about 355. What is responsible for this? I have always maintained that the rate of the Naira headed south post elections in 2015 majorly because the demand side suffered attrition. The fact is that during the Presidential elections there was a lot of cash dollar in circulation. Let’s not be ostriches, it is an open secret that a lot of election bribes given to INEC officials, policemen, military men and a lot of the under the table expenditure are denominated in USD and mostly cash. So, the BDC’s and FX hawkers “Mallams” were awash with supply of USD and once supply exceeds demand in enough proportion the price drops. The sixth side effect of the presidential election is the expected emigration of millions of Nigerians for different reasons ranging from fear of economic downturn, to fear of reprisals for supporting a candidate and more. The seventh and perhaps the most

damning side effect is that many Nigerian institutions seem to have lost their independence in the eyes of Nigerians. If you follow the commentaries on social media and other avenues this comes through very strongly. After the elections Nigerians have lost faith in the military, the police and much worse, INEC. INEC is the only institution in the electoral system that does not have a commander in Chief and has the word “Independent” as part of its name but Nigerians, irrespective of political leanings, no longer think they are independent. INEC is fingered for not raising an alarm when its staff were held at gunpoint, raped, killed and intimidated. What kind of organization behaves like that? INEC’s cancellation of elections in several places because of violence instead of setting a new date for elections has set a new precedence of rewarding the violent. Very bizarre is the fact that INEC seeks to conduct elections in certain places after having announced the results. Many commentators also believe that if INEC had simply approved electronic transmission of results from all polling units into INEC’s situation room (which INEC currently has the facilities for) the process would have been less violent and more credible. It is obvious from these side effects that the electoral system needs urgent reforms. If these reforms are not carried out we should expect voter apathy to increase exponentially come the next elections in 2023. Ayuli Jemide is Founder and Lead Partner of Detail Commercial Solicitors. An entrepreneur, public speaker and writer. Email: AJ@ayulijemide.org Twitter: @JemideAyuli

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