BusinessDay 07 Aug 2020 by BusinessDay

Nigeria and the single-digit interest rate: Is this a new normal? …a key question for investment and business decisions

n fulfilment of monetary policy authority’s aspiration for a single digit interest rate environment, the sovereign yield curve continues to trend lower, with yields on Federal Government

Bonds hitting decade low. Across all tenors, including the 30-year maturity, yields on FGN Bonds are at single digit. This new interest rate environment reinforces the confidence of the Central Bank of Nigeria

FRONT PAGE EDITORIAL (CBN), under the leadership of Governor Godwin Emefiele, on the effectiveness of unorthodox measures in easing the cost of capital for businesses.

Quoting the CBN Governor, at his inaugural press briefing in June 2014, he emphasised, “we shall pursue a gradual reduction in interest rates. A comparison of selected macroeconomic aggregates from some emerg-

ing market countries including South Africa, Brazil, India, China, Turkey, and Malaysia indicate that Nigeria has one of the highest T-bill rates. Such high Continues on page 12

businessday market monitor

Biggest Gainer SEPLAT N321.00

Foreign Reserve $ 35.705bn Cross Rates GBP-$:1.32 YUANY - 54.72

Biggest Loser

BUACEMENT 9.03pc N40.20 -1.74pc 24,930.34

Everdon Bureau De Change

Bitcoin

NSE

Commodities Cocoa US$2,501.00

Gold $2,058.54

news you can trust I ** FRIDAY 07 AUGUST 2020 I vol. 19, no 623

SPECIAL SERIES

These 8 numbers capture Nigeria’s worsening socioeconomic crisis Favour Olarenwaju

ising inflation, a contracting economy, increasing poverty levels, plunging currency value and an ongoing Continues on page 31

N5,419,888.80 +1.84

N300

Market Buy

Sell

$-N 467.00 475.00 £-N 585.00 600.00 €-N 535.00 545.00

Crude Oil $ 45.55

FMDQ Close Foreign Exchange

www.

Spot ($/N)

I&E FX Window CBN Official Rate Currency Futures

($/N)

fgn bonds

Treasury bills

385.50 381.00

3M 0.00 1.20

12m NGUS jul 28 2021 421.79

0.00 1.70

-0.00

10 Y 0.00

30 Y -0.14

6.37

8.02

10.15

36m NGUS jul 26 2023

60m NGUS jul 30 2025

495.26

581.52

Nigeria’s delayed $1.5bn World Bank loan affects you in more ways LOLADE AKINMURELE

da Uche slumped into her chair after speaking with her bankers who had just told her they had no dollars yet for the

Here are the full implications

importer of educational children toys from China. Uche, 45, had been on a long queue for foreign exchange for

two months as Africa’s most populous nation grapples with dollar shortages caused by lower oil prices and declining

foreign portfolio inflows. Before her last attempt at Continues on page 29

Friday 07 August 2020

BUSINESS DAY

news PWR advocates gender diversity on Confusion trails PPPRA’s inability to release August Board seats in companies listed on NSE fuel price guide, spurring indiscriminate pricing ... as female board representation on Top 20 companies listed on NSE is just 20.9% Mercy Ayodele & Oluwafadekemi Areo

he Professional Women Roundtable (PWR) has a d vo cat e d f o r gender diversity on board seats as this will help many Nigerian companies maximise financial returns and meet with global standards. According to the IMF, gender parity has a significant impact on economic development in any society. At a corporate level, Mckinsey found that African companies with at least 25% female representation on their boards, had a 20% higher than industry average earnings before interest and taxes (EBIT) margin. The Professional Women Roundtable (PWR) is a female leadership/career development and gender diversity consulting firm operating across Africa. The PWR recently released a report on NSE Top 20 Gender Diversity Scorecard for 2020. The primary highlight of this scorecard centred on female representation on the board of the top 20 companies by market capitalisation on the

Nigerian Stock Exchange. The scorecard which was developed with the kind support of Avivah WittenberyCox, CEO of 20-First, UK sourced current data from company’s annual report, company’s website, as well as the NSE website. The report shows that out of the 230 board seats in total, only 48 seats are held by women (20.9 percent) and 182 seats are held by men (79.1 percent). The report also highlighted that out of the 20 boards; only three are chaired by women. These companies are Access Bank, Union Bank and Guaranteed Trust Bank. The five companies that ranked the highest in terms of percentage of board seats held by women are Access Bank (42.9 percent), Stanbic IBTC Holdings (40 percent), Larfarge Cement Wapco (36.4 percent), Union Bank of Nigeria (30.8 percent), Nigerian Breweries (30 percent) and FBN Holdings (30 percent). Five companies that ranked the least in terms of female representation are Dangote Cement (14.3 percent), Nestle Nigeria (14.3 percent), MTN Nigeria Com-

www.businessday.ng

munication (13.3 percent), Zenith Bank (7.7 percent) and Flour mills (7.7 percent). Notore Chemical Industries has no female board representation as shown by the report. The PWR report also show Female representation in board seats by sector, the financial services sector and the consumer goods sector has the highest female participation with respect to number of board seats held by women. The Financial service sector records 25.53 percent female representation while Consumer goods sector has 20 percent female representation. The least female board representations according to sector are in the industrial goods sector with15.38 percent representation, and the ICT and oil and gas sector which has 15.79 percent and 16.67 percent female representations respectively. 50 percent of the banks in the NSE Top 20 have least 30% female board representation and 37.5 percent of the boards in the financial service sectors are chaired by women as revealed by the report.

ISAAC ANYAOGU, HARRISON EDEH & DIPO OLADEHINDE

illing stations across major cities in Lagos, Abuja and Port Harcourt sold petrol between N148 and N150 per litre on Thursday following the inability of the government agency responsible for fixing fuel prices to announce the pricing template for August. The Petroleum Products Pricing Regulatory Agency (PPPRA) has not been able to adjust the price of Premium Motor Spirit (PMS), or petrol, because it is still working on the new template, according to an official of the organisation, but the delay could stem from unwillingness by any government agency to take responsibility for a fuel increase. The Petroleum Price Marketing Corporation (PPMC) had issued a memo on Wednesday to oil marketers instructing them that the landing cost of petrol at ex-coastal transfer point is N113.70 per litre, while exdepot price will be N138.62 per litre against the N109.78 per litre fixed for July. Relying on this, oil marketers who lifted petrol decided to adjust their prices to reflect the increased margins. Based on this, retail stations across the country began

https://www.facebook.com/businessdayng

adjusting their pump price. On the spot assessment by our correspondent in Abuja at Eterna and Mobil filling stations located along Kubwa Expressway, a satellite town at the Federal Capital Territory showed the retail outlets sold at N148, respectively. At NIPCO filling station along Lugbe Expressway in the outskirts of Abuja city centre, the filling station had commenced sales at N148 per litre of fuel. Filling stations monitored in Port Harcourt indicated many stations had since changed to N150 per litre as soon as the new price was announced. Findings show further price variation, as NIPCO in Bwari Area Council sold at N149 per litre, while Oando filling station in Bwari Area Council sold at N148 per litre. Similarly, several petrol retail outlets in Lagos sold petrol around N148 per litre. The Independent Petroleum Marketers Association of Nigeria (IPMAN) have told its members to continue selling petrol at the old rate of N143 per litre until there is a new directive from the Petroleum Products Pricing Regulatory Agency (PPPRA), but without one, they are simply adjusting their prices to reflect the ex-depot price. Responding to this development, Adetunji Oyebanji, president of Major Oil Mar-

@Businessdayng

keters Association of Nigeria (MOMAN), told BusinessDay that the marketers would be adjusting to ex-depot price, according to their various locations and market outlook. “First, if it is the marketers that determine the price, the reaction is not going to be the same in terms of price adjustments, unlike when there is an announcement on a fixed price by PPPRA. When the marketers determine the price, the prices vary according to their respective market conditions. “Everybody’s situation differs, in respect to what they have in their tanks, respective market outlook and dominance within a particular district among others. This is exactly what is happening,” Oyebanji said. Some marketers have not adjusted their prices as some could still be waiting for PPPRA to give them a price band and what price that must not be exceeded, he said. “Anybody who is still selling at N143, the ex-depot price now has gone up from N133 to N138. So, those people selling at that know they are losing N5 from every litre sold. “You will see more of marketers determining the price if there is no fixed price from PPPRA since the indicators are already there from the exdepot price by PPMC.

Friday 07 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

news

NOIPolls confirms significant drop in Buhari’s anti-corruption rating Cynthia Egboboh, Abuja

public opinion poll conducted by NOIPolls has revealed a decline in Nigerian government anti-corruption fight rating after strong gains in 2017, as most citizens fear retaliation or other negative consequences if they report incidents of corruption to the authorities. According to the survey, majority of Nigerians say the level of corruption in the country has increased and the government is doing a poor job of fighting it, causing a stark reversal from positive assessments three years ago. Key findings in the Afrobarometer NOIPolls survey on corruption in Nigeria show that a majority- (56 percent) of Nigerians say the level of corruption in the country increased “somewhat” or “a lot” during the past year. Six in 10 respondents- (61 percent) say “most” or “all” police officials are corrupt, although this reflects continued improvement since 2012 (78 percent). About four in 10 citizens see widespread corruption among elected officials and judges,

while traditional and religious leaders are least commonly seen as corrupt (by 26 percent and 30 percent, respectively). Among Nigerians who had contact with selected public services during the past year, substantial proportions say they had to pay a bribe to obtain the services they needed as the most frequent experience of paying a bribe was among citizens who sought assistance from the police. A large majority, about 76 percent say they had to bribe the police at least once to get help while 68 percent paid bribes to avoid a problem. Some 40 percent say they paid a bribe to obtain a government document, while 25 percent or fewer paid a bribe for school services (25 percent) or medical care (21 percent). Eight in 10 Nigerians (83 percent) say ordinary citizens risk retaliation or other negative consequences if they report incidents of corruption to the authorities, up from 77 percent in 2017. “About four in 10 citizens see widespread corruption among elected officials and judges, while traditional and religious leaders are least commonly seen as corrupt,” NOI-

Polls said in the report sent out on Thursday. In addition to negative reviews of the government’s anti-corruption efforts, a large majority of citizens say they do not feel safe reporting corrupt acts to the authorities. Afrobarometer is a panAfrican, non-partisan survey research network that provides reliable data on African experience and evaluations of democracy, governance and a quality of life. According to the report, the Afrobarometer team in Nigeria, led by NOIPolls, interviewed 1,599 adult citizens of Nigeria in January-February 2020. Since assuming office in May 2015, the administration of President Muhammadu Buhari has taken several measures to curb corruption, including the establishment of the Presidential Advisory Committee Against Corruption (PACAC), prosecution of high-profile corruption cases, suspension of top government officials alleged to be involved in corrupt practices, adoption of a whistle-blower protection policy, and enhanced capacity building programs for officers of anticorruption agencies.

Asaba airport ready for flight resumption - official Francis Sadhere, Warri

saba International Airport in Delta State is set to resume flight operations several months after shutdown by the Federal Government due to the coronavirus pandemic, which paralysed business and socioeconomic activities around the world. Secretary to Delta State government, Chiedu Ebie gave the indication on Thursday while inspecting the airport, noting that flight operations would commence in a few days, as the airport is fully ready. He was, however, not specific on date. Ebie said that the state government had put necessary protocols in place at the airport in compliance to Covid-19 protocols outlined by the Nigeria Centre for Disease Control (NCDC). He explained that the inspection was to ascertain the level of preparedness by the airport

management ahead of full resumption of flights. Ebie said he was impressed with the level of compliance to the guidelines by Nigeria Civil Aviation Authority (NCAA) and the NCDC against the spread of Covid-19. He further informed that personnel of the airport were currently undergoing training to enable them function optimally in line with the “new normal’’. The SSG said that when flight operations fully resume, no fewer than six airlines, including Ibom Air, Azman and Arik Air, would be on the Asaba route. He assured that the state government would work out modalities to ensure that physical distancing and wearing of face masks are strictly adhered to at the airport. Earlier, the special project director of the airport, Austin Ayemidejor said “steps have been taken to ensure that there is physical distancing, compulsory wearing of face masks, washing of hands at the point of entry and temperature check”.

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

news

Minister assures compliance among MDAs on purchase of made-in-Nigeria vehicles MIKE OCHONMA

inister of industries, trade and investment, Adeniyi Adebayo has given the assurance that there will be greater compliance among federal ministries, departments and agencies on the purchase of locally assembled vehicles in Nigeria. The minister gave this assurance during a virtual meeting with the Ibrahim Tanko Mohammed, managing director of Peugeot Automobile Nigeria Limited (PAN) to discuss various issues concerning Nigeria’s automotive industry. He also reiterated that his vision for the industry was for the automobile manufacturers to swiftly move to completely knocked down vehicles (CKD) production level by creating disincentives for semi-knocked

down (SKD) production. The minister added that, there would be greater compliance among federal ministries, departments, and agencies (MDAs) to patronise made-in-Nigeria vehicles. Topmost on the agenda during the virtual meeting was the topical issue of the status of the National Automotive Industry Development Plan (NAIDP) Bill, intervention funding for the automotive industry, and stimulating market demand for locally assembled vehicles. On the need for Nigerians to have greater access to vehicle acquisition funding, the minister stated that, the National Automotive Design and Development Council (NADDC) was putting in place a consumer finance scheme that would allow the public to easily access funds to purchase new locally assembled vehicles

and eventually expand the local pre-owned market. As a way of support, he promised to look into the need for an intervention fund for the automobile industry. The minister commended PAN Nigeria for initiating the meeting and its tenacity in following up on the NAIDP bill, assuring the management of the auto manufacturer that the Federal Government was doing everything to get the bill passed. Also speaking, Ibrahim Tanko Mohammed, managing director of PAN Nigeria Limited, called on the Federal Government to as a matter priority pay more attention on funding the country’s automotive industry. Mohammed agreed that, this initiative will serve as catalyst for the development of the automotive industry which is currently underperforming.

Oyo to recruit 7,000 teachers REMI FEYISIPO, Ibadan

yo State government says it is recruiting 7,000 teachers with the Teaching Service Commission (Oyo TES COM) ready to conduct computerbased test (CBT) for all candidates applying for the job. The CBT test is expected to begin from August 11, 2020. Chairman, Oyo TESCOM, Akinade Alamu stated this on a radio programme in Ibadan on Thursday while answering questions pertaining to developments on the state’s teaching appointment. Alamu had recently informed the public that all applicants for the teaching appointment would have to upload their credentials to

the state’s website to allow for equal participation and open process. He said that the examination would run through the week from 7am till 6pm except on Sunday. “The examination will be starting on Tuesday, August 11, 2020 and will run through the week till Saturday, they will be starting daily from 7am till 6pm and the results will be communicated to the applicants through the email they put in their registration and through SMS. “No applicant’s complaints will be attended to at the CBT centres. If anybody has complaints, let them come to the TESCOM office.” Alamu hailed the state government’s resolve to conduct computer-based examination for all candidates applying for teaching

appointment, as according to him, the move has portrayed the government as being open in all its governance processes. Reacting to the issue of private school owners demanding a quarter of school fees for periods students were at home due to the Covid-19 pandemic, the TESCOM chairman said the private schools ought to have consulted with parents and other stakeholders before deciding on such. He asked the private school owners concerned to see the effects of Covid-19 as that which affected them and parents as well, urging them to desist from charging the students without appreciating the consequence of the current situation on the financial strength of individuals.

Courteville declares N339.4m profit KELECHI EWUZIE

ourteville Business Solutions Plc, Nigeria’s foremost e-business solutions and advisory company has announced a 2019 profit before tax of N339.4 million as against N179.8 recorded in 2018. The company linked the profit to expansion of business activities and financial controls measures put in place during the year. Afam Edozie, chairman, Courteville Business Solutions Plc, at the 15th annual general meeting of the company in Lagos, said that on the count of the current economic realities, the board of directors would,

however, not recommend the payment of dividend to the shareholders. Edozie, who was represented by Olufemi Adekoya, announced that the company secured 3 new AutoReg Motor Vehicle Administration Documentation (MVAD) mandates while also renewing the contract with the Nigerian Insurance Association (NIA) for another year. The company, he said, would continue its business expansion drive especially for its flagship product, AutoReg, within the local boundaries and on the international scene, especially the African and Caribbean markets. “Our Company will be seeking to expand its product base www.businessday.ng

and to this end, emphasis will be placed on research and development. We will also be deepening our existing business relationships with the aim of growing our market share of the businesses and maximising total output”, he said. Adebola Akindele, group managing director of Courteville said the company had the foresight to prepare for the coronavirus lockdown by activating the work-from-home model and this helped in seamless flow into the lockdown period. Akindele said that the coronavirus induced lockdown affected the company negatively in terms of profitability initially, but it allowed the company to bounce back once the lockdown was lifted. https://www.facebook.com/businessdayng

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

news

Volume of dollar sales at investors’ FX window falls to $937.27m Hope Moses-AsHike

...FX turnover rises by 916.78%

a N0.67k appreciation when compared with N388.46k opened with on Wednesday at the I&E window, data from FMDQ showed. On the black market, the local currency was stable at N473 per dollar. However, naira weakened by N1.00k as dollar was sold at N474 on Thursday as against N474 sold on Wednesday at the retail Bureau. A report by FSDH research indicated that NT-bills market closed on a flat note on Thursday with average yield across the curve remaining unchanged at 1.70 percent. The OMO bills market closed on a positive note on the same day with average yield across the curve declining by 4 bps to close at 3.92 percent. The money market rates declined marginally, although system liquidity remained lower. Consequently, the Overnight (O/N) rate declined by 0.69 percent to close at 8.64 percent. The Open Buy Back (OBB) rate also declined by 0.50 percent to close at 8.00 percent. “We expect the money market rates to remain at current levels in the absence of any inflows tomorrow. We expect muted investor

he volume of dollars traded in the Investors and Exporters (I&E) FX window fell by 6 percent to $937.27 million in July from $992.12 million in June 2020. This is attributed to persistent dollar shortages resulting from low inflows from oil and remittances. The price of Brent crude has improved to $45.49 per barrel as of August 6, 2020 from as low as around $20 per barrel in March this year. Oil accounts for more than 60 percent of government revenue and about 90% of the country’s foreign exchange earnings. Naira appreciated by 0.96 percent as the dollar was quoted at N385.50 as compared to N389.25 on the previous day. Analysts at FSDH research said most participants maintained bids between N380.00 and N390.00 per dollar. The FX daily turnover rose by 916.78 percent to $106.66 million on Thursday from $10.49 million recorded on Wednesday. The foreign exchange market opened with an indicative rate of N387.79k, representing

www.businessday.ng

sentiment to persist in the NT-bills secondary market as investors’ participation remains moderate due to strained system liquidity,” the analysts said. The FGN bond market closed on a positive note on Thursday, as the average bond yield across the curve cleared lower by 53 bps to close at 4.07 percent. Recently, the attention of the Debt Management Office (DMO) has been drawn on the subject of loans obtained from China. As of March 31, 2020, the total borrowing from China stood at $3.121 billion, accounting for 3.94 percent of Nigeria’s total public debt of $79.303 billion. Moreover, loans from China accounted for 11.28 percent of the external debt stock of $27.67 billion. Hence China is not a major source of funding for Nigeria. The borrowings from China are concessional loans with interest rates of 2.50 percent, with the tenor of 20 years and a moratorium of 7 years. Furthermore, the borrowing cost also gets lowered due to the low-interest rate while the long tenor enables the repayment of the principal sum of the loans over a longer period of time.

https://www.facebook.com/businessdayng

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

comment The WTO’s role is more important than ever

comment is free

Send 800word comments to comment@businessday.ng

Pushback against globalisation has made a neutral referee even more valuable The editorial board

he next head of the World Trade Organization faces an uphill struggle. As candidates line up to replace Roberto Azevêdo, the multilateral trade body is confronting a fundamental difficulty: the impulse towards liberalisation has faded across much of the world. Concerns about globalisation, whether economic, environmental or security-based, have risen and countries are retreating from openness over trade. Mutual mistrust between China and the US, as well as the EU and China, means that any further liberalising of trade is likely to be between regional blocs and coalitions of the willing rather than all members.

Yet this context makes the WTO even more vital. In a time of heightened tensions the world needs rules to fall back on and a trusted referee to resolve disputes. Plurilateral and bilateral agreements affect those not party to their negotiations and the WTO provides protection. Individual governments and trading blocs are exploring how to regulate international trade in services and data, including agreeing rules with each other. However a consensus on minimum standards and fair treatment is reached, even if agreements are not made in Geneva where the WTO is based, it should be incorporated into the organisation’s rules. With so many challenges facing the international trading system it would be a mistake not to use the tools and bodies there to help solve them: an international forum on trade was hard-won and would be difficult to recreate. The coronavirus crisis demonstrates the value of common agreements on how to deal fairly with one another and prevent a race to the bottom: it also proves the benefits of coming to

similar agreements on intellectual property. The two leading candidates to head the organisation, Kenya’s Amina Mohamed and Nigeria’s Ngozi Okonjo-Iweala, have recognised there is merit to US criticisms over the behaviour of the appellate body, the WTO’s highest court — even if Washington’s aggressive actions are unhelpful. In December, President Donald Trump’s refusal to nominate any new judges to the seven-strong dispute resolution body hamstrung the court, freezing all future cases and removing the WTO’s ability to enforce its treaties. The move reflected longstanding US irritation at the body’s rulings and a feeling that it had stepped beyond its mandate. Even if Mr Trump does not prevail in November’s presidential election, the next US president is likely to retain some of Mr Trump’s scepticism about multilateralism and global trade. The EU, too, has become more sympathetic to criticisms that the court is making international law rather than just enforcing the treaties. Given

‘

Individual governments and trading blocs are exploring how to regulate international trade in services and data, including agreeing rules with each other

widening disagreements on trade policy between the WTO’s member states, the dispute panel cannot legitimately take on rulemaking power on their behalf. But a predictable international legal trading order is essential. Without some means of settling disagreements and clarifying ambiguities the treaties will be toothless: reform is the only way forward. The troubles over the appellate body are just one example of the difficulties facing an organisation that has simultaneously to be a forum for negotiation and an enforcer of the rules, so breeding disagreement. A successful director-general will need to be a broker who can form a trusted relationship with the EU, US and Chinese governments rather than an expert in the technical details of trade. Ultimately, progress on further trade liberalisation will depend more on the appetite of the member states than on the WTO — but the head of the organisation will still have a vital role trying to bring those members together. FT

Dealing with compound words in English

ompound words are lexical items that comprise two or more words. On that basis, there are primarily three categories of compound words; these are the hyphenated, the spaced and the singleword compounds. By reason of the foregoing justification, this treatise will cast the spotlight on oft-misused examples that reflect the three categories of compounds, as well as their appropriate structures. Lastly, I shall expatiate upon some pairs of compound words which are capable of generating different meanings when written together or separated. To begin with, the commonest of the misrepresented compound words in the category of those that should be separated is “a lot”. Many people write this as a single compound word, not least in informal writing. Following this, chances are you have noticed that another word in this category is “in fact”. This, like “in spite”, is often spelt incorrectly as a single word. Plausibly, this fallacy of deduction is born out of the similarity of the separated compound, “in spite”, and “despite”. Having borne this in mind, you should not be in the category of A LOT of people who, IN FACT, will continue to make mistakes in the spellings of these compound words, IN SPITE of the knowledge that this piece affords them. As a matter of fact, a diligent user of standard English must be willing to check the spelling of a new word every time. Do not gloss over the spelling of “every time”, which is another separated compound word often erroneously spelt as “everytime” — the similitude to prominent single-word compounds such as “everyone”, “everything” and “everywhere”. Conversely, it is essential to note that some compounds are single words, although, for the most part, they are incorrectly separated by many users of English. First up in this classification is the pandemic that has devastated the world and upended everyday life: the coronavirus. This contagion is a single-word compound and should not be spelt as “corona virus”. Three

other words in this class are townspeople, kinsfolk and clansmen. Observably, the plural forms of the first parts of the compounds usually mislead numerous people to write these words separately; thus, the erroneous spellings: “town people”, “clan people” and “kin folk”. All of these words, which are used to refer to people of common descent, are single-word compounds. Crucially, as well, it is noteworthy that the words “inasmuch” and “insofar” fall into the department of one-word compounds. On the same lines, these example sentences will suffice: “INASMUCH as (not in as much) you did not report your colleagues’ misconduct to the boss, you are complicit in the embezzlement of funds”. Furthermore, this is obtainable: “The three-day symposium was a resounding success, INSOFAR (not in so far) as it positively impacted no fewer than five hundred lives”. As a corollary to the aforementioned disclosures, it is absolutely vital to use some compound formations with hyphens, particularly those that are not in the category of regular compounds. Such hyphenated compounds are indicative of the fact that they encompass combined meanings. Instructively, these compound formations merge nouns and adjectives that qualify other nouns (accident-prone, sugarfree, carbon-neutral and whatnot), nouns and participles (computer-aided, power-driven, muddle-headed, heart-rending and problemsolving, among others), as well as adjectives and participles (good-looking, right-thinking, forward-looking, bad-tempered and so on). The hyphen should be infused into such compound words with clockwork accuracy. Last but not least, some compound words are capable of generating different meanings when separated or written together. First up in this category is “everyday” (a single-word adjective that is synonymous with “commonplace”, “habitual” or “normal”) and “every day” (a two-word adverb that means “daily” or “on a daily basis”). Given this distinction, we have: “I do not www.businessday.ng

wear my EVERYDAY (adjective) clothes to work EVERY DAY (adverb)”. In furtherance of that, it is imperative to know that the single word, “maybe” — the synonym of “perhaps” — is an adverb that should not be mistaken for the phrasal verb, “may be”, which should be separated. As a result, “MAYBE (perhaps) you MAY BE (to indicate likelihood) chosen as the next representative in the not too distant future”. More often than not, too, the indefinite pronouns “everyone” and “every one” are deployed arbitrarily by a thumping majority of people. To achieve clarification, “everyone” is used to collectively refer to the people in a group, while “every one” is applied in reference to each person in a group. On top of that, the latter pronoun can be succeeded by the preposition “of”, while the former cannot, as evidenced here: “I am much obliged to EVERYONE,” or “I am much obliged to EVERY ONE of you”. Next to this, the contracted negative verb, “cannot” (the formal variant of can’t), should not be confused with the separated phrase, “can not”. The latter is conclusively used when can is weaved into an expression that readily contains “not” (as in...NOT ONLY...BUT ALSO). Therefore, one could say: “This article CANNOT possibly include the entire examples that are related to the use of compound words”. On the other hand: “Samson CAN NOT only repair bicycles, but he can also fix automobiles”. The pair of “anymore” (the synonym of “any longer” or “nowadays”) and “any more” (an addition to something) is deserving of mention. To illustrate, “Since Stella does not take coffee ANYMORE, do you have ANY MORE tea for her?” Besides, the onus is on you to cease using “make-up” (a hyphenated compound noun) and “make up” (a phrasal verb) interchangeably. On that evidence, “Owing to the fact that consideration is part of Shina’s MAKE-UP (the qualities that he exemplifies), he will conduct another test to MAKE UP (to compensate) for your absence last Friday’. In this category, also,

https://www.facebook.com/businessdayng

The Gift of Gab

Ganiu Bamgbose is “over time” (during a long period) and “overtime” (the time spent in the workplace after the stipulated working duration), as instanced in the following statement: “OVER TIME, I have observed that members of staff have not been deprived of their OVERTIME earnings”. Another pair that readily comes to mind consists of “breakdown” and “break down”. Hence, “Whether we give a BREAKDOWN (noun) of our deeds, or we choose to BREAK DOWN (phrasal verb) all we have done, we shall leave this world to give accounts to our Maker SOMEDAY (or SOME DAY). Fascinatingly, “someday” and “some day” are examples of compounds that can be alternated. Likewise, when the adverbs “sometime” and “some time” denote an unspecified time in the past or future, they can be used arbitrarily. For instance, “SOMETIME/SOME TIME in 2019, I stumbled across Julius at the Ibadan University Zoo”. In all of this, your inclination to consult standard dictionaries, whenever you are unsure of the orthographic realisation of any given compound word, will prevent you from committing avoidable spelling gaffes. Dr Bamgbose (Dr GAB) has a PhD in English and lectures at the Pan-Atlantic University, Lagos. He is a social commentator who writes on different issues of national concern and the author of daily online English lessons titled “English for Today” with hundreds of lessons available on his website www.englishdietng.com.

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

comment

comment is free

Send 800word comments to comment@businessday.ng

The vindication of Akinwumi Adesina THE NEW WEALTH OF NATIONS

Obadiah Mailafia

ast week, the panel investigating African Development Bank President Akinwumi Adesina for alleged mismanagement and fraud finally submitted its report to the bureau of the Board of Governors. The Governors, comprising African Ministers of Finance and Economy, constitute the highest Authority of the bank. The Bureau is currently chaired by Niale Kabba, Ivorian minister for planning and economic development. My gentle readers would recall that, in January, Adesina had formally expressed his intention to stand for a second five-year term when his tenure expires August ending. He had been endorsed by our government and also by ECOWAS. He remains the sole candidate running for Africa’s topmost banking job. In February, several allegations erupted from a shadowy group of whistle-blowers and “concerned staff members”. They ranged from outright fraud to financial mismanagement, favouritism, nepotism, abuse of office, conflict of interest and breaching of the bank’s human resources rules. In June, the bank’s Ethics Committee cleared him of any wrongdoing. But U.S. Treasury Secretary Steven Mnuchin and other non-regionals insisted that they would only accept the findings of an independent external panel, arguing that “an independent review is fully consistent with a presumption of innocence”. Although the bank’s statutes have

no provision for a panel of that sort, the high Authority wisely decided that it was necessary to fulfil all righteousness. Chaired by Mary Robinson of Ireland, its mandate was to work, in the interest of the Bank Group, “to find a solution that would carry every Governor along in resolving the matter, as well as to preserve the integrity of the Bank Group and its governance mechanisms”. Whilst the panel was doing its work, the bank’s Vice President for Agriculture, Human and Social Development, Jennifer Blanke, announced her resignation with effect from July 4, 2020. Blanke, who had joined the bank in early 2017 and had overseen a number of the bank’s key programmes, announced that she was leaving for “family reasons”. The panel has absolved Akinwumi Adesina of any wrongdoing in respect of every single one of the 16 charges. I have read every line, sentence and syntax of the final report. It seems very evident that the committee took their task quite seriously and applied themselves with forensic assiduity. They not only rigorously reviewed the initial handling of the case by the bank’s Ethics Committee but also thoroughly reviewed all the documents and evidence submitted. In the interest of fairness and due process, they also gave the audience to Adesina to make his own case. The AfDB General Counsel served as counsel and secretary to the panel while the Auditor-General of the bank provided the relevant figures and data on financial operations. As far as the panel is concerned, the allegations of favouritism and breach of the bank’s rules remain unfounded. The allegation that Adesina used undue influence in providing a grant of $40 million to a named beneficiary, was dismissed by the panel. He was also absolved of involvement in the alleged wrongful employment and promotion of staff. The panel also took the view that the complainants could not prove that the 2017 the $250,000 World Food Prize awarded to Adesina in 2017 and

the Sunhak Peace Prize worth $500,000 that he received in 2019 were awarded to him in his capacity as President of the bank rather than in recognition of his own contributions to international service. The complainants also failed to produce evidence that both her and the staff that travelled with him went at the expense of the bank. In reaching their conclusion, the panel was careful to point out that “absence of evidence is not evidence of absence”. They also underlined the fact that it would be unfair to place undue burden on “a holder of high office in an international organization, to prove a negative, in the absence of sufficient grounds”. One of the lawyers working for Adesina was quoted as saying that a distinction needed to be drawn “between alleged institutional failure at the Bank and the conduct of the president”. I congratulate Mary Robinson and her team for doing a thorough and professional job. Nobody, in my humble opinion, can question the credentials or integrity of all three members of the panel. None is a push-over. Leonard McCarthy is a distinguished South African lawyer and public servant; a former Director of Public Prosecutions; a former Director for the Office of Serious Economic Offences; and a former Head of the Directorate of Special Operations of South Africa. He also served for almost a decade as World Bank Vice President for Integrity. Hassan Boubacar Jallow is Chief Justice of The Gambia and a former Attorney-General and Minister of Justice of his country; a jurist known for his integrity, fearlessness and impartiality. The chair, Mary Robinson, is a former President of the Republic of Ireland (1990-1997) and a former UN High Commissioner for Human Rights. She currently chairs the Elders forum set up by Nelson Mandela, a body of elder statesmen and women concerned with advancing global wellbeing. A legal prodigy in her youth, she was a Professor of Constitutional Law at the University of Dublin at age of twenty-

‘

In a land of 200 million, there will be 10 percent who are real devils and at least 10 percent who are on the side of the angels. I am persuaded that Adesina is on the side of the angels

Note: The rest of this article continues in the online edition of Business Day @https://businessday.ng Dr. Mailafia is a former Deputy Governor of the Central Bank of Nigeria, a development economist and public finance expert with a DPhil from Oxford obmailafia@gmail.com; 08036590990 (text messages only)

The boy child: Unseating his social validation as an endangered specie

here are conversations that are difficult for us to have because these conversations are seemingly not conventionally “correct” social narratives. Unfortunately, this public fear to engage in the right conversation, is what immediately creates the dichotomy of “us Vs them” blurring the aim for a meaningful social dialogue that can engender sincere change especially with respect to gender issues. One of such conversations is the now conscious or unconscious legitimisation of the status of the average Nigerian boy child, as an endangered social specie. This is loudly typified by the Igbo mistaken social scrutiny of the self, which many times is emblematic of a quickness to self-loathe and self destruct. It is no wonder why Daniel Jordan Smith, a professor of anthropology at Brown University, saw the Igbo as a profoundly fitting social specimen to mirrow the social concerns of shifting masculinity in Nigeria’s social culture. The university of Chicago press review of his book “To Be A Man is Not A One-Day Job” gives a more vivid description of Smith’s purpose: “…But while men talk constantly about money, underlying their economic worries are broader concerns about the shifting meanings of masculinity, amid changing expectations and practices of intimacy. Drawing on twentyfive years of experience in southeastern Nigeria, Smith takes readers through the principal phases and arenas of men’s lives: the transition to adulthood; searching for work and making

a living; courtship, marriage, and fatherhood; fraternal and political relationships; and finally, the attainment of elder status and death. He relates men’s struggles both to fulfill their own aspirations and to meet society’s expectations….Unraveling these connections, Smith argues, provides us with a deeper understanding of both masculinity and society in Nigeria.” The reason why most feminist talks in Nigeria’s media space are at best symphonies of meaninglessness, is because they aren’t speaking to the actual problem – the social system that define gender in Nigeria. Erroneously, the focus has been on men who are themselves victims of a system that has seen them through trenches of social horror. A point that Smith stated was a key premise for his work. According to Smith, “the focus has continued to be more or less exclusively on men’s lives, without examining masculinity “as gender”….while men were the assumed objects of study when trying to understand economics, politics, social organisation, and culture, masculinity itself was not really examined, problematised, and unpacked in and of itself. The idea that masculinity is socially constructed and performed, rather than simply given, is at the heart of new masculinity studies….by understanding masculinity and men’s lives, we can better understand wider aspects of social life and social change in contemporary Nigeria.” There, right there, is why we cannot but insist on the right social conversation.

www.businessday.ng

When foremost feminist Simone De Beauvoir declared that “one is not born but becomes a woman” making the point of how it is society that shapes and defines womanhood from birth, the mistake was to think that the male is immune from the same reality of how society shapes and defines masculinity for the boy child. Failure to realise this truth in the Nigerian society, is the reason why the average contemporary boy child in Nigeria, especially the Igbo boy child, is becoming a legitimately endangered human specie. In Nigeria’s history of poverty, economic, and infrastructural decay, the boy child is most likely to grow up in many poor homes as the sacrificial lamp not only to improve the economic fortunes of his family, but also to raise himself above the nadir of social perdition for his own progenies. So when he makes it out from the dilapidation that was his adolescent socialisation, he is literally shipped into Nigeria’s social hell-hole to ‘hustle’ where failure to achieve success draws opprobrium even from his opposite gender. Absolutely no one, not even the state, cares about the formation of the boy child. Instead he is literally thrown under the bus from childhood effectively telling him he is the ‘man’. So when families think the boy does not need an upkeep money like the female; when the state don’t think the boys too need good hostels like the females; when primitive religious practices target boys as alamajiri; when

https://www.facebook.com/businessdayng

four before rising to become President of her country. We hope this brings to closure the disruptive acrimonies of the recent past. Adesina, in my view, merits a second term. I spent some of the most formative years of my career as an economist at the African Development Bank. I was Chief Economist in the Planning and Budgeting Department. I drafted the bank’s first ever Strategic Plan 2003—2007. The AfDB is one of the most successful regional institutions in our glorious continent. It has preserved its Triple-A rating through vicissitudes and upheavals. Adesina has brought leadership and vision to the bank; enhancing its status as a knowledge institution. He has boosted its assets by $115 billion, to its current total capitalisation of $208 billion. He has anchored his development strategy on agriculture, agribusiness, power, infrastructures, technology and industrialisation. He has also brokered major investment deals while reaching out to China and other emerging economic powers. In so doing, he may have irked some of our so-called “development partners”. When he was minister for agriculture in Nigeria, I was not particularly impressed by his policies that seemingly favoured foreign agribusiness multinationals instead of the small peasant farmer. But I see in him an outstanding leader who is passionate about our continent and its future. A fluent French speaker, he is an urbane cosmopolitan who has the gift of bringing diverse peoples together.

CHIKE NWODO adolescent boys are thrown into Igba-boi apprentice system to better family fortunes; when society defines masculinity along economic lines, socially punishing the male for lack of it; when the ability to financially shoulder family responsibilities including for in-laws are definitions of masculinity; it is striking how we don’t see that these realities are what forms and shapes the Nigerian man as we see him. As a conservative society, no Nigerian with a good knowledge of the social culture of the different ethnic groups, can deny the truth that the Igbo girl child is the most liberated with better chances of social advancement than any other girl child across Nigeria’s ethnic cultures. Yet, how the same people target their brother gender for social opprobrium and ridicule defeats rational sense. Is the Igbo girl culturally worse than the Hausa/Fulani, Yoruba, Benin, Efik, Tiv, Idoma, Ibusa, or Gbaki girl? It is a common social narrative in Nigeria that if you want to know how wealthy an Igbo man is, you only need to look at his wife and kids. Because in most cases, the man looks like he doesn’t even feed. As societies evolve, imperative to that evolution is building the right sociopolitical structures on which the institutions that define social culture should sit. That should be the focus. Chike Nwodo is an academic and social analyst.

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

comment

comment is free

Send 800word comments to comment@businessday.ng

Anatomy of corruption in Nigeria HumanAngle

Femi olugbile

he subject of corruption occupies a prominent space in the attention of the Nigerian public. The ingredients of a perpetually doomed national project are there daily for everyone to see. In a nation with its values in tatters, corruption has been so “normalised” that it is part of everyday life. A prototype cartoon may show a clergyman casually reaching into the folds of his robe for money to respond to the veiled threat in the greeting by policemen at a checkpoint – “Your boys are hungry sir…”. On the Corruption Perception Index (CPI) Nigeria ranks 146 out of 180 countries. In 2019 almost half of all people who used public services admitted to having paid bribes somewhere in the course of accessing those services. The country’s corruption has become such a matter of international intellectual curiosity that books have been written and PhDs could soon be awarded on the subject in Ivy League Universities. In 2018, a scholar with the Carnegie Endowment for International Peace, Matthew Page wrote a paper titled “A New Taxonomy for Corruption in Nigeria”. In the paper, he attempts to customise the descriptive categorization

of Nigerian corruption, going beyond the generic descriptions in the World Bank’s “Helping Countries Combat Corruption”. Page’s classification of Nigerian corruption breaks it down into two dimensions – Where It Happens, and How It Happens. In the ‘Where’, the instrument takes Nigeria sector by sector, detailing the types of corrupt practices that are familiar on a day to day basis. In the ‘How’, there are tactics, techniques and behaviour by which corruption thrives in Nigeria. No sector is spared. There are political and institutional sectors – the press, where 78 percent of journalists in one year admitted to collecting “brown envelopes”, the judiciary, the power sector, the security sector, Education and Health. Even the organs of ‘Humanitarian’ services are not exempted. In the “How”, Page’s taxonomy identifies Bribery, Extortion, Auto-corruption – which includes Salaries and Pensions fraud, along with a subject much talked about lately – Re-looting. Contracting Fraud – a malfeasance involving government contracts, is identified as the most common and most lucrative form of corruption in the country. It includes staples such as Unnecessary Procurement, Unqualified or Untrustworthy Contractors, Single Source Procurement, Bid Manipulation, Conflict of interest, weak oversight and contractor underperformance. And so – there it is, at last. Contract Fraud is the big elephant in the Nigerian room. Is it being tamed? The uniform answer of the knowledgeable observers is “No”. What is the problem with the “War on Corruption”? The prevailing tactic, so far as it can be discerned, is to put “strongmen” in crucial positions with a mandate to

beat the organisation into shape. Occasionally, there are “forensic audits” ordered in troubled agencies. The problem, according to Page’s taxonomy, is that all agencies in all sectors, across the board, are “troubled”. A recent spate of summaries of Auditor-General’s queries circulated by SERAP reveals the true situation of things. An agency which is so rich it could have transformed the Niger Delta to Dubai if it’s work were farmed out to an international management company, awards and “mobilises” thousands of contracts, only for the contractors to disappear into thin air, though, in reality, they live in the neighbourhood. Another agency paid N28 million for production of three hundred copies of a Procurement Manual that was available free on the internet. It goes on and on. It would seem that the solution is not unsmiling strong men wielding the big stick, or even “forensic audit” ordered with fanfare, mentioning humongous sums of money. In truth the Procurement Act 2007 is of international standard in its prescriptions. But till today, friends of an incoming governor can become billionaires within a few weeks of “His Excellency’s” ascendancy. Unnecessary Procurement. Unqualified or untrustworthy contractor. Single source procurement. Conflict of interest. Weak oversight. Contractor NonPerformance. Virtually every instance of looting of large amounts of public funds falls under one or more of those umbrellas. The rules are all there in the Act. Nobody is following them, and nobody is suffering real-time visible consequences for disobeying them. Instead the public is treated to periodic showcase accusations, petitions, denials, and long-winding erratic legal procedures. Auditing three years after the act does little except provide fodder for such

‘

The solution, if one indeed could be found, must lie in building structures. The best minds in the nation could be put to work to devise, implement and monitor a hands-on “due process” at every level of public life, in addition to a strictly disciplined, no-exemption enforcement of TSA

Olugbile is a writer and psychiatrist. synthesiz@gmail.com

Leadership truth and power

ften, I am bewildered whenever I hear some leaders say they want the people in their organisations to give them honest feedback by telling them what they need to know, and not what they want to hear. The reality is that speaking truth to power is easier said than done; it is a considerable risk that is likely to cost people their careers or means of livelihood. However, the people who have mastered the game earn respect from their managers and help their careers. In my leadership journey, I have related with many leaders who value having a supportive, loyal, and non-judgmental workplace to experiment with new ideas and obtain honest feedback on their leadership styles. But then the same leaders tell me that what they want most is a safe, respectful, and constructive challenge from the people around them. They believe that constructive challenge pushes their thinking and emotions to drive decisive action and growth. This scenario applies to leaders in senior management roles, especially where the organisational culture is more hierarchical and relationship-focused. The truth is that leaders who operate in hierarchical cultures are not open to receive upward feedback; most times, they receive far less honest feedback than leaders who work in an egalitarian and task-focused culture. In the workplace, speaking truth to power usually means telling your boss or another leader how you believe their actions are wrong or how they can act differently. It involves demanding a moral response to an

organisational problem rather than an expedient, natural, or selfish response. According to James O’Toole, a candor culture in which people are encouraged to speak out to a leadership that is willing to listen is fundamental to sustainable corporate success yet being candid with someone in power is historically riddled with danger as well. The reality is that speaking truth to power can put people at high personal risk. The phrase carries a connotation of bravery or risking the status quo, reputation or livelihood, or face victimisation from the person one is confronting. Most corporate scandals and the recognition that great innovative ideas can come from a lower level and frontline employees are two critical reasons that the most successful organisation are those in which people are not afraid to speak up without any fear of unintended consequences irrespective of their level in the organisation. It is pertinent to note that speaking truth to power is always unsettling, but that is how influential leaders emerge. Most leaders understand they must encourage open and transparent cultures, keep their eyes open, and take any wrongdoing suggestions. The irony is that there is a huge gulf between knowing and doing, and not all leaders can translate fine words into action. The truth is that most leaders’ actions and body language do not earn them the trust and confidence of the people who follow them. The contradictions are so apparent to everyone that the leaders are too blind to see themselves. The question then arises;

www.businessday.ng

sensational stories, and every incoming administration has an abundance of stories to tell about the misdeeds of its predecessors. Relying on petitions authored with dubious motives to drive the investigation of corruption renders it whimsical and a possible weapon for political vendetta. The solution, if one indeed could be found, must lie in building structures. The best minds in the nation could be put to work to devise, implement and monitor a hands-on “due process” at every level of public life, in addition to a strictly disciplined, no-exemption enforcement of TSA. Such a process is routinely practised in all internal procurements by the oil majors and some international organisations. It is not a pipe dream, or rocket science. In those organisations, “The System” cannot be breached for or by anyone, from Chairman to CEO to Director of Finance. It raises a red flag at the first sign of infraction and shuts down instantly. Consequences follow swiftly. In a country where even legislative oversight is a major source of problem in its own right, punishment for every red flag must be swift and severe, for the Minister as for Messenger. It is a gargantuan assignment for any government to set itself. But anything short of such a deliberate, strategic approach would make any “War on Corruption” mere hot air for party propaganda, or a cynical charade for the delectation of the uninformed. The bigger fight to mobilise all persuasive and coercive resources in the land, including Education and Religion, for the arduous journey of revamping the values and morality of the general society may then begin, drawing energy from the credible efforts of government to sanitise itself.

The leadership factory with

how many leaders are genuinely prepared to listen to people from every level in the organisation? How open are they to criticisms of the leadership and broader organisational practices? How many people have a voice in the workplace? What are the channels for open communication? What are the opportunities for interaction? And what is the assurance that nothing changes as a result of speaking up? Socio-cognitive research has demonstrated that power affects how people feel, think, and act. The rejection of rigid command and control leadership to more empowering and collaborative approaches may seem to address speaking up. It is ironic the justification given to “oppression,” and it is more puzzling how oppression is perpetrated through a mutual process between the “oppressor” and the “oppressed.” We must admit that the powerless in society can be frightened of freedom and that freedom is acquired by conquest, not by gift. Freedom must be sort consistently and responsibly as it is not an idea that becomes a myth. It is an indispensable condition for the quest for human completion. Reasons abound on why people might be reluctant to “speak up” – fear of authority is just one of the—ingrained, in many cultures, especially in African, where there is profound deference to authority figures. The African culture requires that people respect and obey their parents, their elders, their teachers, and other authority figures without questioning them. This accounts for why we have a lot of “Yes” men everywhere. A healthy ‘speak up’ culture breaks down

https://www.facebook.com/businessdayng

Toye Sobande

the barriers that can often exist between the workforce and the leadership. A vital ingredient of a healthy culture is a willingness for the leadership to listen to their people. Also, a culture of engagement and feedback is required for employees to voice their ideas and concerns. Hence, leaders must ensure that they don’t turn a blind eye to practices or complaints that could seriously damage their organisation’s operations or reputation. Thus, speaking truth to power is more than truth-telling; it is not that simple; instead, it requires clarity of intent that benefits something more significant than the individual interest. We must discern what is right and ethical before we get our leaders to consider our ideas and suggestions. Again, it is nobler that we understand how truth and power operate in the workplace environment as it requires a moral reflection by figuring out why we may want to speak our truth to power. Sobande is a Lawyer and Leadership Consultant. He is a Doctoral Candidate at Regent University, Virginia Beach, USA, for a Ph.D. in Strategic Leadership. He can be contacted by Email: contactme@toyesobande.com

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

Editorial Publisher/Editor-in-chief

Frank Aigbogun editor Patrick Atuanya

Nigeria and the single-digit interest rate: Is this a new normal? Continued from front page

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

Bashir Ibrahim Hassan

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

rates create a perverse incentive for commercial banks to simply buy virtually risk-free government bonds rather than lend to the real sector”. Economists and policy analysts globally are encouraging governments and corporates to take advantage of low interest rate environment to finance infrastructure and real sector expansion, particularly in developing markets, where sustainable growth will be dependent on the concerted ability of government and private sector to bridge the huge infrastructure gaps. The CBN has over the past year reiterated this perception and responded with a number of administrative policy measures, including the prescription of a minimum loan-to-deposit ratio of 60 percent (subsequently increased to 65 percent) for banks, with continuous implementation of its strict penalty for non-compliance, in the form of extra-ordinary cash reserve requirement. In reinforcing its support to the CBN and renewed accommodative and pro-growth stance, the monetary policy committee (MPC) lowered the benchmark rate by 100 basis points to 12.5 percent at its meeting held in May 2020, citing the need to stimulate credit, crate jobs and reflate the economy against the risks occasioned by the COVID-19 pandemic. Interestingly, the federal government, which has been the single

largest borrower in the country with about N15 trillion debt obligation in the domestic market, is perhaps the biggest beneficiary of the current low interest rate environment. Notably, the lower interest rate affords the government the opportunity to fund the 2020 budget deficit, which is some 49.7 percent of projected expenditure and 3.7 percent of GDP, at a relatively lower cost. Importantly, the government would be able to refinance maturing and perhaps existing debt obligations at lower interest rate, thereby reducing the debt service burden and mitigate the lingering concern of fiscal cliff. With a debt service burden, defined as debt service cost to actual revenue estimated at 99 percent in the first quarter of the year, the lower interest rate may improve the fiscal position of the federal government, particularly as COVID-19 pandemic, lower oil price and latent macro challenges may undermine Nigeria’s revenue generation prospect over the near term. As the sovereign yield curve declines, lending rates are easing, as reflected in the steady ease of the prime lending rate to 14.7 percent in May 2020. More so, yields on corporate bonds have come off the peak levels, as investors seek higher yield alternative debt notes to the single-digit FGN Bonds and treasury bills. Investment grade rated corporate bonds are trading at a tight premium to FGN benchmarks. For instance, the Infra-Credit backed GEL Utility Bond, rated “Aaa”

by Agusto, with approximately 14year term-to-maturity trades at 9.58 percent, a significant 557 basis points yield tightening when compared to the yield of 15.15 percent at issue in August 2019. Will rising inflation rate be the showstopper? Orthodox economics, founded mainly in monetary theories such as the Mundell-Fleming model or “impossible trinity”, established a strong nexus amongst three core macroeconomic variables; inflation, exchange rate and interest rate, with each being a prominent tool for taming or managing the others. Implicitly referencing the causeeffect relationship amongst the three variables, Governor Emefiele in reviewing the Nigerian macros at its inaugural presentation on assuming office in June 2014 noted, “owing to the tight monetary policy of the Bank coupled with improved food harvest, inflation moderated to a sixyear low of 7.9 percent at end-April 2014. Debt-to-GDP ratio fell to 11 percent, while foreign exchange reserves stood at $37.15 billion as at 27th May 2014”. This assertion succinctly describes how monetary policy tightening, manifested through high interest rate can help rein-in inflationary pressures and attract foreign capital, which is requisite for shoring up external reserves and ultimately stabilising the local currency, Naira. As the era of high yield fades, fund managers may have to explore alternative assets in corporate debt and private equities by working with

reputable intermediaries, capable of de-risking otherwise non- investable assets. This is particularly important, as the current dynamics where pension funds, the largest institutional asset manager, with over N10.8 trillion funds under management, depend mainly on government paper is unsustainable. Notably, the pension fund industry currently has over two third exposure to FGN securities, thus creating a monopoly market for the federal government, another major factor why it may be justifiably easier for the government to sustain the negative real rate environment. Therefore, fund managers may have to seek new investable assets in the real sector, particularly in critical sectors like agriculture, telecommunications, power, industrials, utility and energy, where the higher multiplier effect of private sector investments on the economy may help stimulate inclusive growth, sustainable job creation, mitigation of social vices and ultimately increase per capita income, pension remittance and broader fund flow in the Nigerian economy. It has been well established, globally and indeed Nigeria, that the velocity of every Naira spent in the private sector is multiples of that of government spending, thereby reinforcing the case for increased private sector investment in the economy.

Note: The rest of this article continues in the online edition of Business Day @https://businessday.ng

EDITORIAL ADVISORY BOARD Imo Itsueli Mohammed Hayatudeen Afolabi Oladele Vincent Maduka Opeyemi Agbaje Amina Oyagbola Bolanle Onagoruwa Fola Laoye Chuka Mordi Mezuo Nwuneli Charles Anudu Tunji Adegbesan Eyo Ekpo Wiebe Boer Paul Arinze Boye Olusanya Ayo Gbeleyi Haruna Jalo-Waziri Clement Isong

Enquiries NEWS ROOM 08169609331 08116759816 08033160837

} Lagos Abuja

ADVERTISING 01-2799110 08033225506 SUBSCRIPTIONS 01-2799101 07032496069 07054563299 DIGITAL SERVICES 08026011296 www.businessday.ng The Brook, 6 Point Road, GRA, Apapa, Lagos, Nigeria. 01-2799100 Legal Advisers The Law Union

OUR Core Values

Mission Statement To be a diversified provider of superior business, financial and management intelligence across platforms accessible to our customers anywhere in the world.

BusinessDay avidly thrives on the mainstay of our core values of being The Fourth Estate, Credible, Independent, Entrepreneurial and Purpose-Driven. • The Fourth Estate: We take pride in being guarantors of liberal economic thought • Credible: We believe in the principle of being objective, fair and fact-based • Independent: Our quest for liberal economic thought means that we are independent of private and public interests. • Entrepreneurial: We constantly search for new opportunities, maintaining the highest ethical standards in all we do • Purpose-Driven: We are committed to assembling a team of highly talented and motivated people that share our vision, while treating them with respect and fairness. www.businessday.ng

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

COMPANIES&MARKETS Consumer Goods

Unilever To Separate Tea Business, Completes Horlicks & Boost Acqusition Segun Adams

nilever Nigeria on Wednesday announced that its parent company plans to spin off its tea business across the company’s markets except in India and Indonesia whilst maintaining partnership interests in the ready-to-drink tea joint ventures. The move will see a €2 billion tea business become an independent company distinct from Unilever. Unilever makes Lipton, Lipton Ice Tea ready-todrink tea (partnership with

PepsiCo), Brooke Bond, and PG Tips. “The balance of Unilever’s tea brands and geographies and all tea estates have an exciting future, and this potential can best be achieved as a separate entity,” said Unilever Global. “A process will now begin to implement the separation, which is expected to conclude by the end of 2021.” Unilever had announced a strategic review of the global tea business in January. Analysts say tea has been losing grounds to coffee and herbal tea in many of the locations affected by the tea business spinoff.

The company will also unify the Group legal structure under a single parent company, it said. During the second quarter, the acquisitions of the health food drinks portfolio of GlaxoSmithKline in India, Bangladesh and 20 other predominantly Asian markets was completed. The acquistion of Horlicks and Boost gives Unilever a boost in the healthy nutrition market, the company said. In the first half of the year characterized the by Covid-19 pandemic, Unilever sales slowed by 1.9% in emerging market while

revenue from developed markets grew 2.4%. Food service declined by nearly 40% and out-of-home ice cream declined by nearly 30%. Shoppers moved from offline to online channels, driving ecommerce growth of 49%. Home consumption of ice cream and tea increased while consumers indoors saw personal care decline except for hygiene products. “Our focus for the rest of 2020 will continue to be volume led competitive growth, absolute profit and cash delivery, as this is the best way to maximise shareholder value,” said Unilever.

L-R: Olusesan Ogunyooye, Head Marketing & Corporate Communications, Alpha Mead Group; Morenike Azeez, Executive Secretary, Lagos State Vocational & Technical Education Board (LASVEB); and Olumide Orojimi, Head Corporate Communications, The Nigerian Stock Exchange (NSE) during the presentation of Face Masks donated by Alpha Mead Group to LASVEB, under the ‘Masks for All Nigerians’ initiative of the NSE in Lagos.

LafargeHolcim, IBM in partnership to develop road design optimization solution CHUKA UROKO

major boost is on the way for road design in Nigeria as LafargeHolcim, the global leader in building materials and solutions, seals pact with IBM Services to further develop ORIS, the first digital platform for road design optimization. Whereas LafargeHolcim, as a company, is active in four business segments including cement, aggregates, readymix concrete and solutions, and Products, IBM Services works at the intersection of strategy, creativity and technology to help clients digitally reinvent their businesses. As a design solution, ORIS comes with lots of benefits as it can reduce road project costs by up to one-third and carbon emissions by up to

half while tripling road durability and usage life-span. It allows decision-makers, road infrastructure authorities and project investors to improve road construction and sustainability and reduce inefficiencies through smart project design. This is especially timely as governments design stimulus packages to revive economic activity post-Covid-19 while also responding to the impact of climate change. An average of 700,000 kilometres (435,000 miles) of new roads are being built globally ever y year. Improving road quality and resilience will help reduce the massive amount of carbon emissions attributed to transportation. Because roads vary, depending on location, climate, vehicle types and traffic volumes, it is a complex challenge to define the

most sustainable and costeffective mix of building materials and technologies early in the design phase and this is where technology like ORIS calls. ORIS assesses road pavement designs from different perspectives and recommends efficient construction and maintenance patterns with local materials availability and capabilities. It is supporting public policies that conserve natural resources, enabling a more local and circular economy in road construction. “We are accelerating the digitalization of our solutions for sustainable a n d h i g h -p e r f o r m a n c e construction,” said Marcel Cobuz, Region Head of Europe, and a member of the executive committee with responsibility for innovation at LafargeHolcim on a global level.

www.businessday.ng

“With global solutions like ORIS, we are committed to leading the way in low-carbon and circular construction as well as responsible natural resource consumption for roads and beyond. We have already entered into pilots with different partners such as road authorities, international financing institutions and engineering firms to use ORIS in both developed and emerging markets,” he added. It is expected that LafargeHolcim will leverage IBM’s portfolio of digital platforms, hybrid clouds, digital design services, as well as IBM’s expertise in machine learning, artificial intelligence, industrial Internet-of-Things and data analytics to enhance further its materials knowledge in cement and ready-mix concrete products, as well as its solutions and products.

https://www.facebook.com/businessdayng

Improved use of robotics will spur economic growth – RoboGarden Gbemi Faminu

oboGarden, an artificial intelligence educational platform has urged stakeholders in the educational community to engage in increased use of robotics, artificial intelligence, digitalisation and advanced technology in order to aid the future generation on gaining skills especially for employability. Speaking during a webinar hosted by Ovana Elearning in collaboration with RoboGarden themed “rights and voices of youth: teach coding for the youth” held on Tuesday, Mohammed Elhabiby, president, RoboGarden said in line with global trends and advancement, it is necessary to equip youths and children with digital and technological skills in order to bridge the gap between education and employability. According to him, every country suffers different challenges including high unemployment rate which is aggravated by the lack of necessary employment skills, adding that advanced technology and digitalisation is key to economic growth. “Education has moved

from the traditional stage to skills blended with technology and digitalisation, across the world, there is a challenge of skills shortage and future jobs, research shows that in 2030, 85 percent of the jobs that will exist is yet to be invented which calls for the need to equip the next generation with necessary skills” Elhabiby said. Speaking on the role of RoboGarden, in promoting digital skills, Elhabiby said RoboGarden helps youths and children achieve goals in line with the United Nations sustainable goals by providing necessary skills to thrive after school through the application of future revolutionary education. “In the near future, there will be over 10 million more jobs for people with advanced digital skills – we must ensure inclusive and equitable opportunities for everyone to benefit” He added. He encouraged stakeholders in the education system to engage in transforming Nigeria’s economy by modifying its education system to include digital literacy and computational thinking, innovation, cognitive flexibility, emotional and social intelligence.

Emerging Markets see positive capital inflows in July despite slowdown Segun Adams

merging-market stocks and debt posted a second month of positive flows even though offshore capital dwindled in July, slowing to around $15.1 bn, lower than the $29.2 bn in June, according to estimates by the International Institute of Finance (IIF). “Investor appetite (was) underpinned by a falling dollar and an accommodative Federal Reserve,” said IIF. “The advance was limited by concern about a resurgence in virus cases and the dim global outlook for growth.” Debt flows continued their recovery, reaching $13.2 bn while equity inflows to emerging markets outside China were $2.3 bn. Less than half-a-billion flowed to China on the heels of increased tensions between Washington and Beijing. Regionally, EM Asia was the most benefited region, registering inflows of $9.9 bn, followed by EM Europe ($2.0 bn), IIF said. Since a historic capital outflow in March occasioned @Businessdayng

by the coronavirus pandemic and commodity price slump, interests in emerging markets have been focused on a period of stabilization and more twoway discussions on risks and opportunities in the EM space. Inflows into the region even though unsteady and below pre-COVID levels have been indicative of a recovery that is hoped will continue throughout the year in the absence of a second-wave of COVID-19 spread. IIF noted that sovereign issuers from most EM regions continue to leverage lower costs and favourable maturities because of deeply discounted valuations in many places. This has resulted in some of the more beaten down parts of the capital markets playing catch-up although the sustainability of the trend and broad-based nature of recovery across emerging markets remains a concern. IIF noted that at the moment, the recovery has been partially driven by broad dollar weakness, but expectations of growth differentials remain a concern.

Friday 07 August 2020

BUSINESS DAY

Market Insights

AgriBusinessInsight Analysis

Commentaries

Experts/Industry Views

Commodities watch

Policy Reviews

Send in Commentaries to caleb.ojewale@businessdayonline.com

Post COVID-19: Building Nigeria’s economy through agriculture FUNSO RICHARD & ABIODUN JEGEDE

here is no doubt the coronavirus pandemic has led to significant impacts on life as we knew it. Between January 2020, when the World Health Organization (WHO) declared COVID-19 as a global pandemic and today, every aspect of life has been transformed into a mixture of chaos, confusion, and uncertainty. Within months, nations have had to deal with an unprecedented number of mortalities ever recorded in recent times. A World Bank report projected a 2.1 percent decline in GDP growth for sub-Saharan Africa and a loss between US$37 billion and US$79 billion due to the pandemic. More alarming, according to the report, is that COVID-19 “has the potential to create a severe food security crisis in the region, with agricultural production contracting between 2.6 percent and 7 percent in the scenario with trade blockages.” Sub-Saharan Africa, especially Nigeria, should come out of this pandemic with two-fold lessons to face the realities post-COVID-19 era will bring. These are reevaluating dependence on fossil fuels and seeking alternative sources of revenue generation. COVID-19 crisis may wipe out demand for fossil fuel according to a report by the International Energy Agency (IEA), the world’s energy watchdog. The possibility of food scarcity has been forecast to be more dire than the direct impact of the COVID-19 pandemic. With an estimated 265 million people going hungry by the end of 2020, various governments need to focus on food production even as the race to manufacture a vaccine intensifies. A country like Nigeria, despite huge agricultural potentials, can still not provide cheap and affordable food for her growing population. With the COVID-19 pandemic, a bleaker outlook for food security in Nigeria has been predicted. Since Nigeria is not food sufficient, needless of being an agricultural products exporter, the country will be severely impacted by the lack of access to importation. Apart from the adverse impact on production across Africa, the supply chain has been impacted negatively as a result of restrictions on international movements. An investment in agriculture at this stage is not only going to avert the possibility of famine in Africa, it is a gateway to revitalizing several dying economies. The agriculture industry is highly diversified, leading to an abundance of opportunities to build the economy and enhance the standard of living of millions of Africans. In several ways, the COVID-19 pandemic presents a great opportunity for African nations, especially Nigeria, to approach industrialization differently and

explore its benefits through strategic investment in agriculture in a post COVID-19 era. After the pandemic nightmare is over, if the recommendations proffered in this article are adopted, Nigeria will have a golden opportunity to become truly independent and self-reliant. Nigeria must wean herself off the overdependence on crude oil and chart a new path to lay the foundation of economic reforms targeted at agriculture as the main catalyst, using innovation and local content development. Farming is a major aspect of agriculture, which includes crops, poultry, livestock and fisheries. However, there are other important aspects of agriculture that are often overlooked. A great example is the agro-allied industry that relies on agricultural products. The growing demand for processed or packaged food directly correlates with the availability of agricultural products. Besides manufacturing capabilities of agro-allied companies, supply chain, logistics, transportation, storage, marketing, crowdfarming, circular agriculture, biorefining (e.g waste-to-energy, waste-tochemicals) are some very essential income-generating opportunities that come with agriculture. There is an abundance of literature and conversations about the importance of agriculture in Africa. However, there has not been a comprehensive approach required to drive investment opportunities in Africa, especially Nigeria. For instance, in response to the impact of COVID-19, the Governor of the Central Bank of Nigeria, outlined how the government was going to support agriculture through the InfraCo PLC, a 15 trillion naira fund management infrastructure to drive investment in logistics and transportation of agricultural products. As laudable as this investment is, it addresses just one of the ways investment opportunities can build the Nigerian economy. The government www.businessday.ng

alone cannot provide the requisite investment needed to make agriculture a profitable venture and an economic-transformational force. Also, individual traditional farm ownership will not yield the right outcome if the scope of and approach to investments are not overhauled. This is crucial especially noting that while agriculture is the biggest employer in Africa, it is mostly populated by small farmers and the poor. Such a traditional approach to agriculture is not sustainable if food scarcity is to be adequately addressed within the next five years. To address the challenges facing the growth of agriculture in Nigeria, as well as Africa, a comprehensive agriculture investment approach will include the following: • Foreign Investment: It should not be surprising that foreign investment is the first recommendation we are making. Nigeria will benefit from foreign investment especially in the area of technology and large scale infrastructure. However, it is very crucial to emphasize that foreign investment must be bilaterally beneficial. The government must protect its human and natural resources from foreign exploitation, including the death of its local agriculture industry. For instance, the Chinese agricultural interests have been reported to exploit Nigerian local farmers in Ogun State and some states in the northern part of the country. Nigeria will only benefit from foreign investments if responsible public policies are in place. • Government Investment: It is understood that governments do not directly produce or manufacture products, however, such thinking needs to evolve. It is not enough for the government to provide funding and policies that govern agricultural operations, it is very important for governments at all levels to directly invest in agriculture. This may be done

https://www.facebook.com/businessdayng

through setting up public corporations or investing in joint ownerships with the private sector. This is different from a public-private sector initiative often touted as a buzz word for incentivising the private sector. This is running a business with government resources to generate income for the government and the governed. A great example is China, where its government-owned farms are becoming mega corporations which compete prominently on the global stage. Locally, the Oyo state government is making huge investments in transforming two farm settlements into commercial agricultural estates. This visionary investment redefines how governments should actively involve and invest in agriculture. The Nigerian federal government should convert some of its lands to agricultural hubs, paving the way for local governments to develop plans towards maximizing state and municipal lands for commercial agriculture. • Commununal Investment: Land is a sacred inheritance for many communities in Nigeria. While it is important to respect the attachment many have for their ancestral land, it is equally significant to translate such attachment for more productive ventures. Local communities have experiences with crops and other agricultural products that they can produce for commercial purposes. The challenge has been funding. While there is no lack of land resources, however, the need for labor, fertilizers, storage, transportation, and other important resources has been a major concern. These challenges can be solved if communities focus on creating communal corporations that address key areas of need. For instance, farm owners can decide to specialize in particular products and form a company around it. Members of the community who are into transportation can form a company that addresses

@Businessdayng

transportation needs. Another group can serve as a recruiting firm that employs locals who need jobs. Another group can form a purchasing company where they buy fertilizers and small-scale machineries that can make farming more profitable. Another group can form a marketing and logistics firm that is responsible for selling the products. This approach relies on mutual trust, since everyone knows everyone and local capabilities. The benefit of this investment strategy is that the collective efforts of the community provides leverage for bank loans, purchasing and marketing of their products, as well as reducing costs while creating opportunities for all involved. • Institutional Investment : Banks and other businesses invest in diversified stocks, including agriculture. Universities and other higher institutions of learning make considerable investments in income generating ventures. Some religious organizations make investments in healthcare and education. Since all these institutions are making income generating investments, it is logical to argue that they can equally make direct investments in agriculture. Banks should not only provide loan instruments to businesses, their unique insights of the economy should be enough incentive to establish agro-allied businesses, just like they run insurance operations. Nigerian universities can leverage their skills in research and development as well as familiarity with host communities to create agro-allied investment opportunities. With about ten learning institutions primarily focused on agriculture and many others with formidable faculty of agriculture, a nagging question is what have these institutions produced? The Nigerian academia occupies a unique position in promoting nationalist agendas through research and policies. They can also turn their curricula to be more relevant by creating opportunities for undergraduates and postgraduates to apply theories to actionable practicals. As part of their annual assessments, undergraduates of agriculture should be able to start an agribusiness venture. Religious organizations will make more economic impact on the lives of their congregants if a portion of their income is divested in agriculture. Unemployed members can be gainfully employed by the business arm of their organizations. This will not only reduce unemployment, it will reduce excessive demands on the congregants.

Continues online at www.businessday.ng Funso Richard is a US-based Business Risks Expert and Abiodun Jegede is a Postdoctoral Researcher at the University of Oxford, UK. They can be reached on jehopereze@gmail.com and jegedeabiodun@yahoo.com.

Friday 07 August 2020

News

BUSINESS DAY

Products Review

Technology Review

Personality Review

Company Review

FINTECH

Here is why Lagos LCDA is charging levy on POS operators FRANK ELEANYA

local government notice about a new N600 levy in the middle of July that came as a surprise to POS operators around Agbado, Lagos State, has raised fresh concerns about policy implementation for the digital economy. According to sources, POS operators within AgbadoOkeodo LCDA under Alimosho Local Government had received a circular a week before 25 July informing them of the N600 weekly levy. Almost immediately, a man who claimed he was the managing director of the company known as Messrs Trilling Volant Services contracted to collect the levy promptly created a WhatsApp group with the aim to ensure compliance. When the POS operators protested the levy, the supposed contractor collapsed the WhatsApp group. Olojo Tobi, chairman of Association of Mobile Money and Bank Agents in Nigeria (AMMBAN), the umbrella body in charge of POS operators, told BusinessDay later, that it was the first time its members were being asked by any state government to pay the levy. The so-called managing director arrived on the 25 of July with his “task force” to enforce the levy collection. “They even injured an innocent young salesgirl, despite the fact that our lawyer has written a letter to the local government,” said an agent who witnessed the incident. Tobi the chairman of AMMBAN said they met with the leadership of the local government who asked the

taskforce to suspend the collection until an agreement is reached with the association. In essence, the levy has come to stay. A memo from AMMBAN to members confirmed the association was invited for a meeting with Agbado Oke Odo LCDA authorities on Monday, July 27. The parties did not reach any conclusion during the meeting. “In view of this, I will urge all AMMBAN members to keep calm and continue with their usual business but shun any form of circular related to levy collection or tax by any contractor from Agbado OkeOdo LCDA till further notice,” the memo read. Azeez Olowo, chairman of AMMBAN Lagos chapter also confirmed the ongoing engagement with the LCDA to BusinessDay. However, the levy may not be such a big deal as long as it is in compliance with the stipulated levy expectations from agents by the government, according to Uche Uzoebo, Executive Head, Distribution,

and Engagement, SANEF who spoke to BusinessDay. SANEF is licenced by the CBN to coordinate the affairs of mobile money agents across the country. Nigeria has a tax compliance problem. According to the Joint Tax Board, there are ten million people (precisely 10,006,304) registered for personal income tax purposes in

all the states of the federation including the FCT. Out of this, about 4.6 million or 46 percent are registered with the Lagos State Internal Revenue Service (LIRS) indicating an average of 153,000 or 1.5 percent per state for others. The individual tax-paying population is estimated at about 19 million, whereas about 50.5 million employed Nigerians operate

outside the tax net. Small businesses’ tax compliance is not also impressive. According to the Federal Inland Revenue Service, Nigeria’s total tax collection in 2019 was N5.26 trillion ($13.5 billion). Assuming this amount relates to income tax from the 3.1 million registered businesses in Nigeria (CAC March 2019), this will bring average tax payments per business to N1,170 (less than $5). Uzoebo said agency businesses are not exempted from paying tax as long as it is the stipulated tax. Hence, the right question for the levy by the Agbado-Okeodo LCDA is whether it is stipulated, which makes it legal. It becomes an illegal levy if it is not stipulated in the tax document for agents. POS operators, also known as mobile money agents, are considered as a critical component of the drive to provide access to financial services for millions of Nigerians who are currently excluded. According to the Central Bank of Nigeria (CBN) in July, there are over 250,000 mobile money agents

across the country. Although Lagos may not have the largest number of POS operators being an urban centre - POS operators in rural communities are more, the transactions are significant. Agents usually charge an N200 fee. In return, they are expected to pay tax as a business. Agents are also subject to stamp duty and VAT charges. Also agents who own shops are also expected to pay taxes and levies depending on where they are located. The specific levy is also determined by the type of business the shop owner is doing. A small shop in an area categorised as rural pays between N2,500 to N500. “Ideally, every mobile money agent is supposed to have a business they run,” Uzoebo said. “They should also be registered with a licensed association. But what happens is that anybody just walks into the bank and they issue them a POS machine.” Nonetheless, leaders of AMMBAN insist there is a case to be made for multiple levies especially in a time when the COVID-19 has battered the income of many mobile money agents. The GSMA In its July Mobile Money Policy Responses found that many countries had chosen to waive fees as a strategy to encourage the adoption of mobile money services due to the severe impact of the COVID-19 pandemic. 15 out of 17 countries in sub-Saharan Africa leveraged fee waiver as a preferred instrument to effectively respond to COVID-19. According to the report, no Nigerian state took any measure to support mobile money operators.

and savings.” There are also reports that Google is planning to launch a branded debit card to be managed in the Google Pay app. “When we launched our new 5-year strategic plan in January, we said that two key pillars were to reach more customers with our digital offerings and use our expertise in finance, digital and inno-

vation to help them improve their financial health,” said Javier Rodríguez Soler, BBVA USA President and CEO. “This collaboration with Google is fully aligned with this effort – even more so in today’s world where the ability to conduct your financial life in a digital manner, from account opening to transacting to understanding financial health, is an imperative.”

Google Pay speed up US launch with 6 new partners FRANK ELEANYA

oogle’s plan to launch a digital banking service may be accelerating with the recruitment of six banking partners including BBVA USA, BMO Harris; Coastal Community Bank; First Independence Bank; and SEFCU in the United States.

The partners who will join existing partners like Citi and SFCU expected to manage the money that will be insured by FDIC, allowing Google to play the role of “front-end”. Google’s digital banking ambitions became public knowledge in 2019 by the Wall Street Journal. According to the report, Google was going to offer checking accounts service to users www.businessday.ng

with the banks handling all financial and compliance activities related to the accounts from early 2020. Google expects that its partnership with global banks, smaller credit unions with deep community ties, will have more opportunities to build products that address its consumers’ diverse needs. “We had confirmed earlier that we are exploring

how we can partner with banks and credit unions in the US to offer digital bank accounts through Google Pay, helping their customers benefit from useful insights and budgeting tools while keeping their money in an FDIC or NCUA-insured account,” said a Google spokesperson. “We are excited that six new banks have signed up to offer digital checking

https://www.facebook.com/businessdayng

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

INTERVIEW Persistent flood may trigger severe food crisis across Nigeria – Hydrological Services boss Most parts of the country are currently being ravaged by flood due to heavy rainfalls. In this interview with John Osadolor and Godsgift Onyedinefu, Clement Onyeaso Eze, Director General, Nigeria Hydrological Services Agency (NIHSA), speaks on the flood situation in the country and warns that all stakeholders should do the needful to avoid imminent catastrophes and possible famine in the land. Excerpt:

H AT D O E S THIS FLOODING MEAN FOR THE NIGERIAN AGRICULTURAL SECTOR? The type of flood we are already witnessing in Nigeria will have negative impact on agriculture. I was listening to a resident in Sunny Adewusi estate, Abuja, he was lamenting that apart from his vehicle that was already submerged, the crops he planted, have also been submerged. Every crop has certain level of water requirement for it to thrive, it doesn’t need excess, and it’s called duty of water, that is the amount of water a crop requites for maximum production. Then, once there is flood submerging agricultural land, it means that the farmer has lost his crops. He/She may be compelled to harvest earlier than necessary. In 2018, I was on the National Emergency Management Agency (NEMA) team to do assessment and my team covered Kogi State. Several of the Local Government Areas (LGAs) in Kogi State were submerged, in particular Ibaji LGA adjoining Ida was 100% under water. Even when we took a flying boat from Ida water front, it took us about two and half hours on flying boat, we didn’t know when we were on top of flood or on top of River Niger going to Ibaji. Their crops were submerged more than six feet above sea level, even houses were submerged. So, once there is heavy flood, the people should be prepared for famine and hunger. In fact there is an organisation we collaborate with known as Famine Early System Warning Network (FESWNET).They collaborate with United States Agency for International Development (USAID), they collate data on things that trigger famine in any country like in Nigeria. They monitor to know how government can assist or how foreign donors can assist. In a nutshell, once there is flooding, it will impact agriculture negatively. DO YOU SEE US HAVING A

the head bridge that it was submerged in 2012, and they lost over N5billion. So, once there is flood, it affects every sector, transportation is affected, like what happened in 2012 that people had to stay for days to cross from Lokoja going to any other parts of Nigeria. It affects economic activities across the country, once flooding like this keeps happening.

Clement Onyeaso Eze

PROBLEM WITH FOOD THIS YEAR OR THE COMING YEAR? In fact, what we are having now is pandemic within pandemic. When the Covid-19 pandemic started, it had farreaching negative impact on agriculture. People couldn’t go out to farm. This is even in addition to other levels of insecurity that farmers are grappling with going to their farm. Then the Covid-19 pandemic stepped in aggravating food insecurity. And now flood has stepped in. The natural conclusion is that there might be food crisis for 2020, if nothing is done immediately. Farmers that are harvesting their crops without full maturity period, you can be sure that the harvested crops will waste, some of them will not even be eaten or sold out at a giveaway price. So, there is that likelihood of hunger in the land occasioned by flooding, which is now joining the Coronavirus pandemic. WHAT DOES IT MEAN FOR THE CONSTRUCTION INDUSTRY, PARTICULARLY ONGOING CONSTRUCTION WORKS? Rains usually affect the construction industry. As a civil engineer, we know the period of the year when construction work is best done; highways, roads, bridges and even houses. If you are casting concrete on a building construction, you’ll www.businessday.ng

have to watch the weather, if it rains, it will negatively impact the structure. Then, on the road, it’s not easy to do construction especially in the southern part of Nigeria or generally during the rains. That’s why contractors complain that by the time they release money to them, we are already inside the rains, which means it will slow down the work. You can’t do proper road construction during the rains; it’s better during the dry season. So, with heavy rains now, you can be sure, that the construction industry especially in the southern part of Night, will be slowed down, bridges inclusive. WHAT DOES THE FLOODING MEAN FOR THE USAGE AND LIFE SPAN OF ROADS? If you watch the video clip on what happened at that bridge at Gwagwalada, Abuja, you’ll see that they might not have been able to consider the whole gamut of Hydrological issues during the design of that bridge. The amount of rainfall which you have to capture, will help you to determine the size, level, side drains of your bridge. Therefore, rains will affect road construction, it is also supposed to help you to do your design if you have collected adequate data ahead of time. I remember an industrial estate somewhere in Onitsha, it’s at

https://www.facebook.com/businessdayng

HOW DO YOU GIVE DATA ON FLOOD TO OTHER AGENCIES OTHER THAN THROUGH THE MEDIA? We have a lot of Hydrological data which has to do with surface and ground water data. Companies come to us, consulting firms come to us, and investors especially in hydro power come to us to look for Hydrological data to be able to determine or to do the feasibility studies on certain locations. In 2012, oil wells of oil companies in Niger Delta especially in Delta State were affected. Communities where they operate were submerged and it looked like they were irresponsible corporate bodies in those societies. Since then, they always call upon us for data to be able to know the level of water to safeguard their oil platforms and also to be prepared to attend to their communities, Corporate Social Responsibilities (CSR) for communities where they operate. We sell the data to those who use it for business, for consultancy and others. But for students doing research, we give them free and at the end of the day, they share their results with us. We collaborate with NEMA, they depend largely on NIHSA with regards to data on flood-related disaster. Yes, NiMET often goes on air earlier in the year, to talk about the amount of rainfall; the duration, onset date, cessation date and number of days of rainfall, which is a very good job they do. But, not all rainfalls translate to flooding which is our own work. It rained on Saturday heavily everywhere but here in Abuja municipal Area Council (AMAC), Abuja, there was no flood. But, that same amount of rainfall that didn’t cause harm @Businessdayng

in AMAC, will cause mayhem in Gwagwalada Area Council likewise in Niger state. So, these are the distinction between what NiMET does and NIHSA does. They predict the rainfall amount but we interpret it bearing in mind the geology of the environment, the topography of the area, the land use pattern, taking into account the river system and how they have been behaving over the decades, the geomorphology of the area and the terrain. So, these are the things and other parameters that we use to translate if the rainfall will amount to flooding. So, we collaborate with NEMA, we will inform NEMA the locations that may be flooded and then they escalate it from there, they prepare in terms of materials. They inform the governors, the SEMA, to make preparations in certain locations, in the event NIHSA’s prediction comes to pass, it may be in the area of evacuation. In 2018, going by what we had predicted, on the 7th of September, we notified NEMA that all the indices of 2012 flood incidents have manifested apart from the release of water from Lagdo Dam and based on that, NEMA had to invoke a section of their Act by seeking approval of Mr President that gave them the power to declare state of emergency in nine states of Nigeria. Once they declared state of emergency or national disaster, any equipment is at NEMA disposal, whether it belongs to the military, construction companies they will commandeer them. They are at this point in time empowered by law to utilize what’s available to them for rescue operations. And that’s what happened in 2018. On the 17th of September, the Director General of NEMA had to go to Lokoja with stakeholders and declared state of emergency in Kogi, Anambra, Delta, Niger, Adamawa, Kebbi, Rivers and Bayelsa states and they were able to mobilize resources anywhere they can get it. NIHSA notifies relevant bodies on what to do. We can’t enforce, we can’t demolish houses, we can’t charge anyone or institution to court, the states and FCT have the facilities to do so.

Friday 07 August 2020

BUSINESS DAY

FEATURE

South-South, East, fret as $4.8bn Chinese rail loan comes under threat at NASS Fate of Coastal rail project under threat too Ignatius Chukwu

s sentiment and fears seem to be whipped up against Chinese loans in the face of probes by the National Assembly (NASS), people in the South-South and South East seem to fret over the fate of rail projects earmarked in the zones by the Federal Government whereas most of those in other geopolitical zones seem to have gone far. The first in focus seems to be the $3.9Bn Abuja-Warri rail/seaport project which was expected to start in 2020. The project is to be handled by the China Railway Construction Corporation Limited (CRCC) mandated to build a major new railway linking the capital Abuja to the port city of Warri, a distance by air of approximately 440km, according to Global Construction Review (GCR). . The project is a public-private partnership, with Nigeria providing an equity stake of 15 per cent, CRCC an equity stake of 10 per cent, and the remaining 75 per cent to be borrowed from China’s Export-Import (Exim) Bank. The project includes the construction of a new port at Warri. CRCC will operate the railway and the port to recover its investment. The rail is to proceed from Abuja through the city of Baro and branch to Lokoja, the Kogi State capital. Another important railway project is to start in Port Harcourt and run through most South Eastern states to North East and end in Maiduguri, Borno State. This project is said to need a loan of about $900m from China. The mother of it all is said to be the Coastal Rail Project that may start in Lagos and end in Calabar, linking all the seaports in Nigeria. Some sources put all the loans at $17Bn, but Nigeria has since estimated its annual infrastructural development need at $50Bn per year. In this, the transport and power sectors are believed to be the neediest areas that may boost other sectors. Some groups led by Eze Chukwuemeka Eze, a consultant and media strategist told BusinessDay in Port Harcourt that high-tech politics being played at the National Assembly could torpedo all of the expected gains to the South-South, South East and North East. The Minister of Transportation, Rivers-born Chibuike Rotimi Amaechi, had cried out few days ago over same concern, saying Nigeria’s rail revolution could be disrupted by undue probes. He reminded Nigerians that most of the loans were sealed in the previous administration. The raging issue seems to be the alleged clause ostensibly ceding Nigeria’s sovereign status to china in the event of a default. The Minister had described the clause as mere

technicality in all loans but the NASS had raked up huge fears around it. Eze said: “Without any doubt every Nigerian is fully aware that the South-South is the oil region and main sustainer of the economy of Nigeria while the South East is the major purveyor and engine oil through which the economy is sustained as the hob of the commercial activities of this nation. The North East as the Food Basket of the nation. He went on: “So, with few members of a cabal plotting to deny these regions the required loan to facilitate the provision of modern rail system already provided for the South West and some parts of the North Central and North West is not only unpatriotic but wicked. Eze highlighted it will remain easier and cheaper to smuggle shoes from Aba to Cameroon than any part of the North East without the railway system in the East. The South East suffers all kinds of loss including robbery attacks, police extortion on the roads and customs in moving containers from Lagos to the East. He reiterated that the East remains the largest producers of palm oil in West Africa and to transport palm oil containers from East to other parts of Nigeria by road is a business killer plot. I therefore plead with the National Assembly not to fall into the hands of the enemies of the regions and support the Muhammadu Buhari’s administration in its efforts to fulfill his pledge to the Easterners by approving the loan required in this regard. Experts argue that coastal rail line would create a corridor of development. According to the United States Institute of Peace, railways create jobs and fast development. They quoted a Chinese philosophy of development anchored on roads and www.businessday.ng

railway lines, being central to poverty alleviation, peace and stability. It is a growth driver, the report stated, saying it is to catalyze structural transformation of a targeted area. On threat to Nigeria’s sovereignty, Eze insisted that Nigeria was not in any danger of loss of sovereignty, and rather vouched for the Minister’s experience in negotiating loans over the years. He reminds Nigerians that President Buhari only activated and implementation of the loan deals initiated by the Jonathan administration, but described those linking Amaechi to plots to sell Nigeria’s sovereignty as overly mischievous with political agenda. China began rail projects with loans as far back as 32 years ago in Zambia and went on up to Kenya and Ethiopia. China at the moment has a $60Bn loan package for Africa and Nigeria is said to have only captured $5Bn out of this. The Olu Obasanjo administration courted China with three oil blocks for a railway project but this was discontinued by his successor, Umoru Musa Yar’Adua. Jonathan revived but modified the loans from China and sealed a $5Bn package which Buhari inherited, pursued, and is expanding in leaps and bounds, according to the US Institute of Peace online report. Eze explained that the said clause generating the controversy is Article 8(1) of the agreement, which provides that “The borrower hereby irrevocably waives any immunity on the grounds of sovereign or otherwise for itself or its property in connection with any arbitration proceeding pursuant to Article 8(5), thereof with the enforcement of any arbitral award pursuant thereto, except for the military assets and diplomatic assets”. In a statement made available to media houses, Eze said Article

https://www.facebook.com/businessdayng

8(1) does not in any way suggest the leasing of Nigeria or her sovereignty to China. “Simply put, Sovereign immunity is a legal doctrine by which the government of a foreign country is immune from suit in the courts outside its jurisdiction. He said in common law jurisdiction, an independent sovereign state may not be sued in the courts against its will and without its consent. “This doctrine of state or sovereign immunity evolved from rules of international law and same has been internalised and made part of the common law of England which forms part of Nigeria’s body of laws. “Under the common law, exercise of court’s jurisdictions against the sovereign state is deemed incompatible with the superior authority of the sovereign state. The doctrine is founded upon the broad considerations of public policy, International law and comity rather than on any technical rules of law. “Flowing from the above and borrowing inference from the provisions of the very comprehensive and standard Foreign Sovereign Immunities Act (FSIA), a piece of legislation of the United States, a sovereign debtor, defending against a collection action may seek refuge in the FSIA. The Act was enacted to codify restrictive theory of sovereign immunity of states. “Although the FSIA serves as a jurisdictional bar to certain suits involving the official conducts of a foreign country, the Act provides several exceptions to that immunity. One of such is in the context of sovereign loan defaults; the sovereign may relinquish its immunity by express or implied waiver. Most sovereign bonds and loan agreements contain express waivers of sovereign immunity.” @Businessdayng

The media expert quoted the estimates of the Institute of International Finance (IIF), the Washington-based global association of the financial industry, as positing that the overall international borrowing rose to more than $246 trillion in the first trimester of 2019, nearly 320% of worldwide GDP. Simply put, the world borrows over three times more than it produces. It cannot be Nigeria alone. Eze stated that biggest economies of the world such as the US, UK, Germany, France, Japan, China, Italy, Canada, Netherlands etc are heavily involved in sovereign debts and rely on foreign loans for the financing of critical national projects. He maintained that no sovereign has achieved greatness without the support of other nations through loans. The stalwart described sovereign debt as the total capital that is owed to creditors outside of a country’s territory. He said Nigeria has maintained a very responsible level of external borrowing to save the country from distress which he said could affect the progress already recorded on the aggregate performance of the economy within the past few years. He called on the House Committee on Treaties to place national interest beyond self, cooperate and give necessary support to the Transportation Minister, Rt. Hon. Amaechi, for the speedy completion of more rail infrastructure to create jobs and improve the economy, assuring that the country is safe under the President Buhari-led federal government. He appealed to political activists who only understand politics to allow experts discuss and handle this matter. He said the House Committee can obtain other international loan deals to see if they have no single obligation clause upon the sovereign borrower. Assuring Nigerians of more results from the Transportation Ministry under Amaechi, Eze called for a temporary halt on the probe to allow for the commitment and implementation of the terms of the loan on the part of the Chinese in order to see to the completion of the specific loan projects for the use and enjoyment of Commuters. He expressed confidence in the competence and dexterity of Amaechi in negotiating bilateral agreement terms to the advantage of Nigeria. It is his advice that what should concern Nigerians is how those coming after this administration and could be the ones to managed the built railway system would move to maintain same credibility and capability in managing the rails and repaying the loans. He called on the NASS members to rather demand for strict enforcement of the terms of agreements especially the opening of Sinking Fund to deposit profits right now so that repayment would be easy from the fund.

Friday 07 August 2020

BUSINESS DAY

MoneyInsight ‘Businesses need to develop risk strategies that promote payment security’ Online transactions have increased in recent months as both consumers and businesses shift online in conforming to the new realities of limited human interaction. Kemi Okusanya, vice president, Visa West Africa in an emailed response to some interview questions, sheds some light on how the company plans to supports small businesses to weather the storm. Caleb Ojewale provides excerpts:

t appears there has been a focus on SMEs recently, is there a particular reason for

this? According to a study commissioned and published by PWC, SMEs contribute 48 percent of national GDP, account for 96 percent of businesses and 84 percent of employment in Nigeria. This means that SMEs are the backbone of our communities. Their significant value in the community positions them as an essential factor, contributing to the growth of the Nigerian economy. Unfortunately, SMEs were most affected by the COVID-19 pandemic, as the change in consumer behaviour took a toll on their revenue. As a result, providing extraordinary support to help small businesses navigate this extraordinary time became expedient for us at Visa. This is why we decided to support SMEs through our Where You Shop Matters initiative What does this

Okusanya

‘Where You Shop Matters Initiative’ really entail? The ‘Where You Shop Matters’ initiative enables entrepreneurs by providing them with the tools and information required to start, run, and grow small businesses online while encouraging consumers to support small businesses. At its core, the initiative

is a movement. A call for merchants to tap into the expertise of thought-leaders to shape their future. A call to the consumer to understand the power of spending and the importance of supporting the local economies. It is also a call to the industry and the ecosystem to do what we can to support these businesses.

This is about everyone coming together to support small business owners around the country. In what ways are you as an organisation helping to drive SME growth in Nigeria? We are focusing on promoting digital commerce and economic growth, with plans to continue to create products and services as the needs of entrepreneurs change over time. We are committed to empowering digitalfirst businesses. To see to the realization of this, we have built localized online resource centres, providing tools, partnership offers, and information on how to start, run and grow small digital-first businesses. Also, we are encouraging digital payments as well as advocating neighbourhood support for local businesses. We want customers to be conscious of the importance of shopping locally. With more online transactions, fraud cases may also increase. How is Visa ensuring

consumers’ security? We take security very seriously and we continue to provide and improve on solutions necessary to protect both our merchants and consumers. For nearly 20 years, we have been helping online merchants and issuers identify potentially fraudulent transactions. A s e - c o m m e rc e i n Nigeria is growing rapidly, consumers expect always-on connectivity with mobile devices and rely on retailers to provide payment experience, both secure and frictionless. As a result, we recently introduced Visa Secure (previously known as Verified by Visa), an updated program to help make online payments more secure. This solution provides rules and policies that merchants and issuing banks have to follow to authenticate e-commerce transactions and verify cardholders’ identity before a transaction can be authorized. Consumers can benefit from a smoother and consistent user experi-

ence across multiple payment channels, including mobile web, in-app and digital wallet payments, without any compromise in security. What are your key lessons from the impacts of the pandemic and how would you advice SMEs to position for economic recovery? As a result of the COVID-19 pandemic, we have witnessed an unprecedented acceleration of digital adoption throughout our industry and the broader society at large. While the near-term response has focused on maintaining business continuity, we think businesses should develop risk strategies that promote payment security and strengthen the trust foundation necessary for long-term recovery and growth. As more consumers have tilted towards the online method of shopping, we believe that there is a need for SMEs to embrace digital commerce. We have quality resources available for free on our website – visa.com.ng.

Plentywaka sets route for Abuja as it pockets $300,000 funding from investors FRANK ELEANYA

igeria’s transport startup, Plentywaka is heading to Abuja having raised $300,000 pre-seed investment led by EMFATO, Microtraction, and Niche Capital. Plentywaka plans to use the investment to continue to transform the transport system in Nigeria with improved mapping technology. The startup is kicking off with five routes in Abuja and passengers will enjoy a week of free travel. With

70 percent of people in Nigeria’s capital relying on public transport and in the absence of a robust transport system, Plentywaka has identified a significant gap for more reliable and efficient bus service in the city. Routes for the Plentywaka branded vehicles will include the busy Lugbe to Area 1. The e-hailing bus service is buoyed by a successful half-year reception by passengers in Lagos. Launched in September 2019, Plentywaka identified an opportunity in the commercial capital’s widely unstructured www.businessday.ng

transport system. Since then, the startup has built a platform of over 40,000 customers, reaching a milestone of 100,000 rides after just 6 months. As a direct response to the challenges of COVID-19, the startup has also launched solution-driven services such as Logistics by Plentywaka and its Staff Bus Solutions. The new company’s success is attributed to solving the issues of movement with a hassle-free alternative that is steered by technology. “Securing investment and expanding into Abuja

within our first year, in the midst of a pandemic speaks volumes of the demand for the service w e p r o v i d e ,” J o h n n y Enagwolor, Plentywaka’s Managing Director and Co-Founder, said. “We are excited to have investment partners on board that see and believe in our vision. An efficient transport system is fundamental to the prosperity of any city and we believe safe, convenient and comfortable travel should not just be for the few; but for everyone. Plentywaka in Abuja brings us closer to transforming transport

https://www.facebook.com/businessdayng

in Nigeria, one state at a time.” The easy-to-use Plentywaka app, available on Google Playstore and IOS App store, requires just a two-step process to schedule a journey and book a seat for convenient movement around the city. The new funding will build on its customer experience with developments to the app’s mapping technology to provide more precise tracking for journeys. As well as this, faster and simpler payment options will be introduced to pay for the various Plentywaka services aided by new @Businessdayng

partnerships with fintech platforms. “We are glad to be partnering with a very strong team that is passionate about providing convenience, safety, and comfort to everyday commuters. The distressful and uneasy experience by the majority of these commuters, especially in large cities is evident. We are backing the Plentywaka team to change that experience for commuters progressively by creating a transport system that is efficient,” Dayo Koleowo, Partner at Microtraction, says.

Friday 07 August 2020

BUSINESS DAY

Harvard Business Review

ManagementDigest

Restructure Your Organization to Actually Advance Racial Justice Evelyn R. Carter

he United States is at a turning point, and the entire world is watching. The murder of George Floyd — preceded by the murders of Breonna Taylor, Ahmaud Arbery, and many, many others — has sparked an outpouring of grief and activism that has catalyzed protests in all 50 states and around the world. For Black people, the injustice we feel around the murder of another unarmed Black person is not new — but the scale of recognition of systemic racism and the partnership we are feeling with others is. For diversity, equity and inclusion (DEI) practitioners like me, the influx of interest we’re seeing from organizations that want to both support their Black employees and advance the skills of their workforce with regards to racism, bias and inclusivity is unprecedented. Plus, all of this is happening in the middle of the coronavirus pandemic, which is also having an outsized impact on Black people in domains ranging from health to employment. Just a few weeks ago the constraints of the pandemic were even threatening corporate DEI efforts. Many organizations have made their donations. Sent their tweets. Hosted their town halls. DEI budgets that had disappeared are now back. What should come next? Companies can do a few virtual trainings and default back to the status quo — or they can recognize that the racial bias driving the injustices they and the majority of Americans now care about also plays out within their own companies. Organizations that choose the latter then must answer an important question: How will they restructure their workplaces to truly advance equity and inclusion for their Black employees? Organizations that are truly committed to racial equity — not only in the world around them, but also within their own workforces — should do three things: INVEST IN (THE RIGHT) EMPLOYEE EDUCATION The United States has a complicated history regarding the way we talk about slavery and how it contributes to disparate outcomes for Black people (including wealth accumulation, access to quality health

care and education and equity in policing) and the persistent homogeneity at the highest levels of corporate organizations. One consequence of avoiding this painful, yet foundational, aspect of American history is drastically different perceptions — particularly between white and Black Americans — about how much progress we have made toward racial equality. And yet, study after study shows that educating white Americans about history and about Black Americans’ current experiences increases awareness of bias and support for anti-racist policies. But far too often, the responsibility of doing this education falls to Black employees. White employees and others can take individual responsibility for their own education by tapping into the wealth of resources others have compiled. Organizations must also take seriously their role in educating employees about the realities and inequities of our society, increasing awareness and offering strategies for the individual accountability and structural changes needed to support inclusive workplaces. Here are some areas of focus companies can consider. First, training in “allyship” can motivate employees to be more effective at calling attention to bias, which can lead to a more inclusive environment for their Black colleagues. Next, leaders ask me every day how they can authentically discuss these iswww.businessday.ng

sues with their teams and how they can meaningfully show their support for Black Lives Matter internally and externally: For those executives, it’s important to discuss how to advance justice as a leader. Finally, while the protests have drawn attention to the systemic racism and injustices Black people face, we still have a lot of work to do to shed light on the insidious biases that undermine the everyday experiences of Black Americans in the workplace. Unconscious bias training is another tool to have in the organizational toolbox. BUILD CONNECTION AND COMMUNITY People do their best work when they feel a sense of belonging at work, and 39% of employees feel the greatest sense of belonging when their colleagues check in on them. But conversations about racerelated topics are notoriously anxiety-provoking: Non-Black employees may navigate these feelings by avoiding conversations about the protests and then miss out on ways they could show support to their Black colleagues. For Black employees who may have already felt like the “others” in organizations where those in power are primarily white and male, this failure to address and discuss the current moment and its implications may cause irreparable harm. To counteract this, organizations should prioritize authentic con-

https://www.facebook.com/businessdayng

nection across all levels: Leaders need to directly address the company and explicitly support racial justice. GOING BEYOND RECRUITING AND HIRING Education and creating community are immediate actions companies can take to create more inclusive environments, but for actual equity, those companies also need to evaluate and change their organizational processes to close gaps Black employees face relative to their counterparts. Recruiting and hiring are often the first places organizations start when thinking about racial equity. While figuring out how to get Black employees in the door of your organization is important, focusing on how to keep them there and move them into leadership roles is even more important. Organizations should be measuring the outcomes of all of their people practices — from recruiting and hiring to promotions, compensation and attrition — to evaluate where racial disparities exist. Two examples are particularly salient right now: assigning work and performance management. Even under normal circumstances, assigning work is fraught with racial bias: Employees of color are expected to repeatedly prove their capabilities while white employees are more likely to be evaluated based on their expected potential. Now, @Businessdayng

as many organizations look to give Black employees new flexibility and space to process trauma and take care of themselves, they need to be careful not to let those biases reemerge around who gets what assignment. Managers should not make unilateral decisions about which projects their Black employees should and should not do during this time Critically, organizations need to be sure not to penalize those choices when the time comes for performance reviews. The uncertainty caused by the shift to remote work had already caused a lot of unstructured changes to performance management processes, and it remains to be seen what further changes this social movement might bring. While some of these changes may seem incremental, educating employees on concepts like allyship and justice, embracing authentic communication and connection and redesigning systems and processes to reduce racial disparities are still radical changes for most organizations. And this is just the beginning of re-envisioning how to create a diverse, equitable and inclusive workplace that truly supports Black employees.

Evelyn R. Carter is a social psychologist who has conducted research on how to detect and discuss racial bias, and a director at Paradigm

Friday 07 August 2020

BUSINESS DAY

LEADINGWOMAN Adeya, Kenya’s top ICT expert joins World Wide Web Foundation Stories by Desmond Okon

enyan top tech researcher, Catherine Adeya, has been appointed the director of research at the World Wide Web Foundation. According to a statement on the Web Foundation’s website announcing her appointment, Adeya will lead and coordinate a research team dedicated to interrogating and understanding the most important barriers to achieving the foundation’s vision of a web that is safe and empowering for everyone. She will also sit on the leadership team, playing a critical role in shaping the future direction of the organisation, the statement said. The Web Foundation’s president and CEO Adrian Lovett said Adeya has demonstrated a deep understanding of the power of technology and the web to drive profound social change, rooted in robust and insightful research throughout her career. Adrian, while welcoming her to the team, said she knows

Adeya

first-hand that governments, companies, civil society and the academic world all have a part

to play to achieve the vision of the web as a public good for everyone.

“I’m thrilled to be welcoming Catherine to the Web Foundation leadership team,” he said. Adeya, an experienced leader, researcher and advocate with over 20 years working in technology and development, is not a neophyte to leading big organisations and driving their successes. Most recently, she led the development of the East Africa Centre for Internet Governance and Policy (CIGAP) at the renowned Strathmore University in Nairobi. She served as the Director of Business Process Outsourcing at the Ministry of ICT in Kenya; and in 2013, she was appointed by then Kenyan President, Mwai Kibaki, as founder CEO of the Konza Technopolis Development Authority. In addition, Adeya had previously overseen research work in Africa as a Research Fellow at the United Nations University’s Institute for New Technologies and the Research Manager at the African Technology Policy Studies Network. She was also the Chief Judge in the first Vision 2030 ICT innovation Awards in Kenya, and serves on the editorial board

of the Journal of Perspectives on Global Development and Technology. The tech guru, will start her role on August 17, based in Nairobi, taking over from Carlos Iglesias who has served as interim Research Director. The Foundation noted that Carlos will continue in his previous role as Senior Research Manager. “The push for the web’s power to be a force for good and the need for meaningful connectivity resonates with me,” Adeya said, commenting the appointment. She said the Web Foundation offers a thinking place that permits her to reflect more thoroughly on experiences; and make sense of what an ICT researcher working on frontier-breaking ideas would need in order to break through the powerful mindsets that are nervous about change they cannot control. “Today it is clear the web is a lifeline and we cannot afford to leave anyone behind. Reassurance will only come from evidence-based research; and I am privileged to contribute to this,” she stated.

Breastfeeding Day: WHO, UNICEF seek support for nursing mothers through counselling

lobal health regulator, World Health Organisation (WHO) and the United Nations Children’s Fund (UNICEF) are jointly calling on governments to protect and promote women’s access to skilled breastfeeding counselling, a critical component of breastfeeding support. Breastfeeding gives every child the best possible start in life, said WHO’s boss, Tedros Adhanom Ghebreyesus. It delivers health, nutritional and emotional benefits to both children and mothers, and it forms part of a sustainable food system. But while breastfeeding is a natural process, it is not always easy. Mothers need support – both to get started and to sustain breastfeeding. In line with this year’s World Breastfeeding Week theme, ‘Support breastfeeding for a healthier planet,’ the global organisations are rallying for support in breastfeeding through counselling services. In a statement, they said skilled counselling services can ensure that mothers and families receive support, along with the information, the advice, and the reassurance they need to nourish their babies optimally.

According to them, breastfeeding counselling can help mothers to build confidence while respecting their individual circumstances and choices. In addition, counselling can empower women to overcome challenges and prevent feed-

www.businessday.ng

ing and care practices that may interfere with optimal breastfeeding, such as the provision of unnecessary liquids, foods, and breast milk substitutes to infants and young children. “Improving access to skilled counselling for breastfeed-

https://www.facebook.com/businessdayng

ing can extend the duration of breastfeeding and promote exclusive breastfeeding, with benefits for babies, families and economies. Indeed, analysis indicates that increasing rates of exclusive breastfeeding could save the lives of 820, 000 children every year, generating $302 billion in additional income,” said Ghebreyesus. Co-signing the statement, both Henrietta Fore, executive director, UNICEF and Ghebreyesus said that skilled breastfeeding counselling can be provided by different actors including health care professionals, lactation counsellors and peer support providers, and in a variety of settings– in health facilities or clinics, through home visits or community programmes, in person or remotely. Tweeting from his Twitter account, Ghebreyesus said it is even more important to find innovative solutions to ensure that access to these essential services is not disrupted and that families continue to receive the breastfeeding counselling they need during the COVID-19 pandemic. In this regard, UNICEF and WHO, in line with the policy actions advocated by the UNICEFWHO-led Global Breastfeed@Businessdayng

ing Collective, are calling on governments to invest to make skilled breastfeeding counselling available to every woman noting that the availability of skilled breastfeeding counselling to every woman will require increased financing for breastfeeding programmes and improved monitoring and implementation of policies, programmes and services. Secondly, they called on governments to train health care workers, including midwives and nurses, to deliver skilled breastfeeding counselling to mothers and families, and protect health care workers from the influence of the baby food industry. “Ensure that counselling is made available as part of routine health and nutrition services that are easily accessible. Partner and collaborate with civil society and health professional associations, building strong collaborative systems for provision of appropriate counselling. “Together, through commitment, concerted action and collaboration, we can ensure that every mother has access to skilled breastfeeding counselling, empowering her to give her baby the best possible start in life,” they said.

BUSINESS DAY

Friday 07 August 2020

Health Business&Life These strategies can help fix Nigeria’s healthcare system – Experts Anthonia Obokoh

igerian healthcare professionals are increasingly bridging the gaps in the country’s healthcare system through innovation and investment. Nigeria’s health system faces challenges including inefficiencies, escalating costs, and variations in health care quality, access, and results. A wide agreement exists that the system needs transforming. A reformed system would deliver better care. These experts highlight strategic areas of strength and future proof in Nigeria’s healthcare systems that can be implemented to transform operations and improve collaboration and coordination of service delivery while improving the sector. They say data and Artificial Intelligence (AI) both play a crucial role as key healthcare delivery catalysts, noting that Nigeria needs to improve on its healthcare financing which will enable increasing healthcare sector attractiveness. One of such experts is Richardson Ajayi, executive vice-chairman, Bridge Clinic and chairman of LASUTH Board said healthcare providers should adopt innovative operating models to manage the balance sheet and cash flows, such as the ‘PropCo / OpCo model’(where the property assets are moved into a separate vehicle, to make

the operations asset-light) or the “focused factory model” (where the provider focuses on select healthcare services to optimize resources and ensure quality healthcare delivery). Ajayi said the government should focus on improving and implementing regulation that would encourage the return of skilled Nigerian medical doctors (up to c.40percent of registered doctors currently practice abroad), improve outcomes, and ultimately support healthcare sector growth. Also, a tier-based capital system can be considered, where minimum capital requirements are set for each cadre of healthcare providers; to support the provision of quality healthcare service delivery. He added that Hospitals should consider outsourcing the hospital management services to professionals who will be responsible for hospital administration activities, while doctors focus fully on healthcare delivery. “Public Private Partnership convergence is very important

- the government simply cannot do it all. Outsourcing the primary/secondary healthcare segments to the private sector, while the government focuses on the tertiary healthcare segment as well as regulation will go a long way in solving our problems,” he said. Similarly, Obinnia Abajue, chief executive officer, Hygeia HMO Limited said of some factors which are expected to increase sector attractiveness in the medium to long term is Mandatory healthcare insurance, Given that c.95percent of private healthcare spend is OOP, the implementation of mandatory health insurance (penetration is currently less than 5%) will significantly stimulate demand for healthcare services in Nigeria. “Retail health insurance coverage, from a demand perspective, is key to achieve the type of scale desired by health insurers today – especially in light of Nigeria’s informal economy,” he said. However, Nigeria’s healthcare improvement can be wit-

nessed with the strides and determination by these major stakeholders in the health industry that have taken actions to adopt and implement principles and approaches. They see data has driven several sectorled revolutions and investment can shape the sector better. Nevertheless, in the SubSaharan healthcare market, lack of data has negatively impacted healthcare information systems and processes – which are well behind par from a regional comparative standpoint. Technology has provided an opportunity for the convergence of traditional tech providers, academia and healthcare providers to form partnerships to deliver, manage and distribute advanced healthcare applications by utilizing AI algorithms – including auto diagnosis of certain medical conditions, data interpretation and the use of virtual technologies to remotely run hospital beds. “Data is the future – our ability to utilize data from a financing or clinical outcome perspective is key to bridging the existing healthcare infrastructure gaps across the region,” said Eyong Ebai Regional Lead, GE Healthcare. The healthcare sector requires long term capital, which is critical to project viability and sector development. The CBN recently launched the N100 billion health sector intervention funds for new and existing Nigerian healthcare businesses.

Exclusive breastfeeding can prevent 80,000 child deaths annually Godsgift Onyedinefu, Abuja

tleast 80,000 child deaths can be pre vente d annually when exclusive breastfeeding is optimally practiced, Osagie Ehanire, minister of health has said. The minister also said breastfeeding provides huge health benefits to both infants and mothers as it could prevent about 20,000 maternal deaths every year, postpartum bleeding, lower the risk of breast and ovarian cancers, and many more. Ehanire said this in his speech to mark the 2020 World Breastfeeding Week, with the theme “Support Breastfeeding For a Healthier Planet”

The minister stressed that the benefits of breastfeeding to both mother and baby cannot be over emphasized. He noted that early initiation of breastfeeding within one hour of birth, exclusive breastfeeding for the first six months of life, continued breastfeeding up to two years of age or beyond, with the introduction of appropriate complementary foods from six months, is the best practice. “Breastfed babies have stronger immunity, reduces the risk of infections and many childhood illnesses, and may also have longer-term health benefits including reduced risk of overweight and obesity in childhood and adolescence. “Studies have shown that obesity rates are 15-30 percent

lower in breastfed babies compared to formula-fed babies”, he explained. The minister however regrets that optimal breastfeeding is not optimally practiced in Nigeria. Quoting the National Demographic and Health Survey 2018, the minister said the early initiation rate of breastfeeding is 42 percent which clearly shows that not up to half Nigerian children are breastfed within one hour of birth. “Also, the exclusive breastfeeding rate in Nigeria is 29 percent indicating that only a mere percentage of infants aged 0-6 months are exclusively breastfed leaving a whopping 71 percent of infants not enjoying the benefits of breastmilk in their forma-

tive years. Only 9 percent of organizations have a workplace breastfeeding policy”, he said. “Looking at the data, it has been a great challenge in Nigeria as mothers and caregivers are neither fully aware of the importance of breastfeeding nor received adequate support from the environment to optimally breastfeed their babies. “This is why the celebration of week is to inform and educate mothers as well as galvanize more support from the Government/Legislation, Family and social network, health care system, workplace and employment, and Response to Crisis and Emergency on the benefits of breastfeeding”, the minister added.

COVID-19: Sambus Geospatial Ltd donates N5m worth software to government SIKIRAT SHEHU, Ilorin

s part of measures to combat COVID-19 spread through Geographical Information System (GIS) solutions, Sambus Geospatial Nigeria Limited has provided Five million naira worth of software and technical Support to the government. Akua Aboabea Aboah, Managing Director of the company, who disclosed this in an interview with journalists in Ilorin, explained that since the first case on February 27th, 2020, health organizations and individuals want to have quality information on the evolutions of the COVID19 spread. Scientifically, she says

such information requires geographical data and analysis to arrive at relevant facts and figures saying, “Therefore, geographic information system (GIS) technology is inevitably required in every location intelligence solution. “Consequent to this need, Sambus Geospatial Nigeria Limited has been offering support to government agencies, health departments, non-profit organizations, and industries monitoring COVID-19 by using complimentary software resources provided by ESRI (Environmental System Research Institute) to build dashboards which gives essential geographic data to monitoring COVID-19 in Nigeria. www.businessday.ng

“The Operations Dashboard created by Sambus Nigeria has been adopted by the Nigerian Centre for Disease Control (NCDC) representing COVID-19 data across Nigeria. “The Esri ArcGIS donation to the Nigeria Center for Disease Control is worth about Five Million Naira in software resources and technical support offered by Sambus Nigeria in setting up their reporting dashboard, application fixes and management. “Sambus Nigeria ensures that ESRI’s Disaster Response Programme (DRP) is well leveraged on in the country’s region by providing resource donations, training, and technical support to organizations as part of her Corporate Social

Responsibility (CSR).” This, according to her enables the maximization of location intelligence across the country using GIS applications to efficiently proffer solutions that facilitate decision making in response to the COVID-19 pandemic. Aboah, explained further that, the platform designed by Sambus Nigeria features data from NCDC, WHO, among other authorities which is quickly integrated and visualized in real-time with specific attributes of varying locations. “This is affected in a GIS application known as ArcGIS and represented in an Operations Dashboard that enables the public access to COVID-19 spatial data.

https://www.facebook.com/businessdayng

Asthma: A travel message - Is it a storm or fair weather? Executive Travel Health

Dr Ade Alakija Q-life Family Clinic

qlifeadvisory@outlook.com.

mportant Tips: Before booking your holidays, Discus with your Travel Health Advisor. Make sure your asthma is well controlled before Travel. Carry important Contact numbers on your person, including your doctors and the recommended doctor at your destination. If your asthma is normally well controlled, you should be able to go sightseeing, trekking, swimming and other leisure activities you wish, so enjoy yourself but do not Scuba Dive. Must Know: Your symptoms may vary greatly, from mild and infrequent to debilitating and severe. This may influence the type of trip and destination you choose. Know your triggers. (Many people with Asthma have allergies which can trigger asthma symptoms eg House dust mites, animal dander, molds, pollen and cockroach droppings. Tobacco smoke, air pollution, strong odours and fumes are irritants that often aggravates asthma. Please, if you are advised not to travel, do not travel. Some food items may help you stabilise your asthma and some others could trigger the symptoms. Consult your nutritionist. Before departure: A detailed history will be required of you including mode of transport and destination. Plan your diet: If you have food allergies, be certain that the food you will be eating does not contain substances to which you are allergic. Keep your allergy shot schedule: If you are taking a long trip, discuss with your allergist how to continue to take or receive your allergy shots. Health Insurance is essential. You will have to declare your asthma status and it should include repatriation. Make sure you have a self-management plan with details of medication and use, what to do in an emergency and contact numbers. Two inhalers must be taken in case of loss or theft (one in your hand luggage, and one with your responsible companion or checked in luggage). The same goes for stand by emergency suppositories. Wear an information bracelet or neck chains were possible (Get from Medic-Alert or SOS Talisman). Take a little more medication(all clearly labelled) than you think you need and carry a print out of allregularprescriptionsincaseyou lose your supplies and to prove the medicine is for your personal use. An adequate supply of all your medication should be in your carry bag. (Hand luggage) The usual immunisations for your destination should be taken along with annual influenza shots and pneumococcal vaccine. Plan for an emergency: @Businessdayng

Ask your doctor for an asthma action plan that will outline what to do in case of an asthma episode. After Departure:- On Route: Do not over-indulge in food and alcohol especially when on the move. Drink plenty of water and non-alcoholic drinks in flight. Sit well forward in non-smoking areas in aircraft (most flights are non-smoking these days). Avoid smoking areas in the Airport. Do not smoke. Irritability could be an early sign of reduced oxygen intake. Try to move about every hour, to exercise your legs to prevent blood clots. Give the note from your doctor (detailing Condition and Medication) to the ship’s doctor if you are going on a cruise. At Destination: Your condition may improve or deteriorate during your holiday due to climate change, absence of allergic triggers (fewer allergens at high altitude), stress or exercise/ exertion. Virtually all large cities in the developing world have significantly polluted air and the developed world in some major cities. Air pollution can be severe in cities where there are no controls over petrol and diesel exhausts. If possible avoid heavy traffic. Temperature changes, like sudden exposure to cold and dry air can bring on asthma symptoms, also aerosol metered dose inhalers may not function properly under freezing conditions and may need to be warmed in the hands before use. All beds and pillows harbour dust mites-unless they are treated with a microbial compound (for example, UltraFresh) which inhibits their growth. Be wary of hotels that look unclean. Takeallnecessaryprecautions as a regular traveller. You can do virtually all activities, but do not overexposeyourselftothesunand other extreme conditions. Be cautious if you have exercise-induced asthma, especially exertion of mountain climbing. Acclimatize properly. If you must dive, go snorkeling instead and not scuba diving. Increased asthma therapy prior to exercise will achieve better control but intensive exercise should be avoided as much as possible. Sports: If you are going to exercise a lot, especially activities that you are not used to, such as mountain climbing, hiking, etc., remember that exercise itself can trigger asthma symptoms. Any activity should start with a warm-up, and your quick-relief medication should be taken 15 to 20 minutes before you begin. All is Clear: If you have a clearly labelled Medication and Spacer (in your carry on bag), a responsible companion (if necessary). Your Asthma is stable. A letter with details of your condition and medication and information bracelet or neck chain. You are all clear to go. On return, you may need to inform your doctor of your experiences so he can plan better and safer trips for you and other asthmatics. Gather more information from the following websites and literature. www. fitfortravel.nhs.uk/General/Astma.html , www.asthma.org.uk (subscribe to Asthma Magazine), www.asthmacontrol.com (Gives you an idea of how well your asthma is controlled). Answer: With due consultation, it is not a storm, but fair weather. Have a Nice Journey.

Friday 07 August 2020

BUSINESS DAY

Hotels

Envoy Hotel still offers premium services Stories by Obinna Emelike

n March 2018, a new entrant debuted in the Nigerian hospitality market with a promise to make a difference, starting with its very exclusive location in the Central District Area of Abuja. Before the unveiling, the area, which hosts many country embassies including; United States of America and the United Kingdom, had no hotel outfit due to security concern. The promoters of the hotel saw the gap and decided to create a business environment that is closer to the diplomatic community and expatriates. That also informed the name, ‘Envoy’, which best describes the location and purpose of the property, as well as, recognising the hard work and journey travelled through the ages on the “Silk Road” in connecting the world. The setting speaks volume of the exclusivity of the facilities, services and even the guests, especially the diplomatsand high-profile personalities, who now take advantage of the hotel’s meeting facilities. It has also boosted accommodation offerings in Abuja with additional 59 rooms, which are stylish, modern, and exclusive. Furthermore, all rooms are equipped with state-of-the-art media and IPTV services along with modern, luxury living and bedding facilities fit for the VIP guest. The boutique hotel is unique for taking advantage of the five human senses; smell, touch, sound, taste and sight to ensure that guests’ satisfaction is at the centre of it

all. This implies that a culture of highly personalized service and attention to guests’ needs is in place and adhered to religiously by all hotel staff, including management. The smell senses are tingled from a guest’s very first step into the hotel’s grand reception. The bespoke scent, infused through its scentillators and air conditioning systems is obvious; while soothing sounds from Latin and African artistes play in the background of the hotel. Taste comes in a wide spectrum of continental flavours for all palettes, from arrival treats, o d’oeuvres to fine dining with a sophisticated wine list in the restaurant, lounges and bars. Relaxed touch is sustained with the throw pillows and the soft cuddly scatter cushions on the sofas and beds. The visuals come from the satisfying pieces of timeless luxury. From the hanging light fittings in the atrium, the litup global map accentuating the silk roads of old, and to the ancient story of the envoy aptly created on canvas in the lobby, the grandeur is obvious. Also, the chamberlain chairs in the lounge and waiting areas of the hotel all combined to tell the story of the upmarket, boutique,

luxury lifestyle and trendy Envoy Hotel. The uniqueness of the hotel is further heightened by its breathtaking furnishing and decor that speaks to the hotel’s natural exclusivity. Going by the splendor and the very indulging ambiance of the hotel, it is obvious, that The Envoy Hotel is set to create a lasting emotion long after guests have departed. A view from the exterior reveals a building that stands out during the day and radiates astonishingly at night. A unique feature of the hotel is its approach to hospitality technology. The hotel parades; hi-tech AV equipment that includes the use of iPads in the conference room, IPTV in rooms that allow for the communication of guests with the front desk, other key areas within the hotel and information about the local area, among others. Therefore, there is no need for the old-fashioned Guest Service Directory, as fast optic fibre wi-fi (first in Abuja hotels) is in place throughout the premises. Furthermore, The Envoy Hotel sets a new standard in safety and security for hotel guests, with multi-layer security concept specifically

designed for sophisticated travelers. Further to its infrastructure and installations, security is independently audited, a global security certification company was brought in at construction level and provided recommendations regarding security issues, that were taken into consideration when the hotel was constructed, thus resulting in the hotel being the first and only facility in Nigeria to be awarded a Level 2 Plus Global Lighthouse Certification in Security. With that, The Envoy Hotel can indeed be described as the most secure hotel in Abuja. Finally but not the least, Envoy Hotel is unique because of its managers who are known for exceptional service delivery across the many markets they operate. The hotel is part of the Mantis Collection and Mantis is happy to make its first foot print outside Lagos in creating an exclusive, conducive and secure environment for prestigious guests to meet and do business devoid of fear or risk of movement. Beyond delivering on services and facilities, Mantis is assuring that at The Envoy, guests are close to home, especially from March 2018 when it officially opens its doors to the public. With all these going for it, The Envoy Hotel has, in less than three years of its operation, set a new benchmark in Abuja with regards to hospitality standards, product quality and service fit for royalty. Well, ease of the lockdown, travel restrictions and resumption of domestic flights, the hotel awaits guests amid compliance to strict health and safety protocols.

Top BusinessDay Partner Hotels Four Points by Sheraton Hotel (Oniru Chiefatancy Estate,Lekki) Tel: +234 1 448 9444

Transcorp Hilton Abuja 1 Aguiyi Ironsi Street Maitama, Abuja Tel: +234-708-060-3000

The Wheatbaker #4 Onitolo(Lawrence Road), Ikoyi, Lagos. Tel: 01 277 3560

Hawthorn Suites by Wyndham Abuja 1 Uke St, Garki, Abuja. Tel: +234 9 4603900, +234 805 7522500

Lagos Continental Hotel Plot 52, Kofo Abayomi St, Lagos Tel: 01 236 6666

Radisson Blu Hotel Ikeja #38/40 Isaac John St, Ikeja GRA100271, Ikeja Tel: +234-908-780 5555

206 Exclusive Hotel Plot 206 Oladipo Diya Road Opposite Olympia Estate By Games Village Second Gate Durumi2 Abuja

Novotel Port Harcourt Address: 3 Stadium Road Rumuomasi, Port Harcourt Rivers State, Tel: 0809 713 5734

Continental Hotel shuts down operations

ontinental Hotel, formerly Intercontinental Lagos, has shutdown operations. The development was announced on the hotel’s website by the management, which disclosed that the closure was necessary for the refurbishment of the less than a decade old property. ‘’Please be informed that our hotel was closed for refurbishment effective July 31, 2020’’, the management said on the he website. ‘’The refurbishment commenced immediately and the time of re-opening will be communicated on a later date”. In the online statement,

the management further noted that, ’While our hotel remains the preferred choice for business travellers, families and leisure seekers, these extensive refurbishments will allow us to continuously provide first-class hospitality ex-

www.businessday.ng

perience to our valued clients’’. At its opening some yeas back, The Lagos Continental Hotel, then InterContinental, was a 5-star offering with all leisure trappings for guests. Set in Victoria Island, a

highbrow area of Lagos, the hotel is the tallest hospitality building in Nigeria. With its terraces, it offers splendid views of the Lagos city landscape including ocean view. However, hospitality industry observers are worried that the refreshment is coming in less than 10 years of operation as the hotel opened to guests in 2013. They are also concerned that it may take longer with laying off of most staff. It would be recalled that the hotel was formerly owned by Milan Group before it went into receivership because of the inability of Milan Group to settle debt it owed Skye Bank, a major financier of the hotel.

https://www.facebook.com/businessdayng

Radisson Lagos Ikeja #42-44 Isaac John Street, GRA Ikeja, Lagos

Southern Sun IkoyI Hotel Address: 47 Alfred Rewane Road, Ikoyi, Lagos Tel: +234 1 280 5200 / +234 1 280 0630 Email: ssikoyi.reservations@ tsogosun.com

Radisson Blu Anchorage Hotel 1A,Ozumba Mbadiwe,Victoria Island. @Businessdayng

Friday 07 August 2020

BUSINESS DAY

entertainment

‘The Nigerian market is ripe for animation movies, and our LBMM is the beginning’ In a few months time, the Nigerian movie industry will be witnessing the release of the country’s first feature length animation movie. In this interview, Blessing Amidu, the producer and executive producer of the 3D animation movie, tells Obinna Emelike why the animation genre is beginning to trend in Nigeria, the movie target, challenges and other related issues. Congratulations on the movie Lady Buckit and t h e Mo t l e y Mo p s t e r s (LBMM). Is the movie your first? es this is the first movie that I am producing/executive producing.

Why did you produce the movie in 3D animation, is animation begining to get good appeal and market in Nigeria? Although it is a niche market, Nigerians are starting to warm up to the animation genre. I guess we have the likes of Disney and Pixar to thank for that. Movies like Frozen and Moana turned out to be box office hits in Nigeria. We have also had stints from very creative minds within our shores. On the whole, I would say yes, the market is indeed ripe and this is just the beginning. Most animation movies feature city landscapes, why set in Oloibiri?

tend to be flexible, so they were quite open to taking on an unfamiliar genre. To ease them in, we decided to get them an animation voice coach. They actually deserve more credit than we generally tend to give.

The movie is a nod to Nigeria’s history and Oloibiri plays a key role within this context. What is Lady Buckit and the Motley Mopsters all about? Lady Buckit and the Motley Mopsters is a Nigerian feature length 3D animation movie set in Oloibiri, in today’s Bayelsa State. The movie protagonist is a self indulgent little girl who unexpectedly finds herself in the midst of very unusual company. Here, she must navigate the intricacies of unconventional friendships and personal growth. The movie is woven around themes of friendship, family, bullying and hygiene. It is quirky, it has something for everyone and is suitable for all ages.

demonstrating that they too can be heroes.

Why a female protagonist? We opted for a female protagonist as a means of empowering the African girl child. We wish to provide on screen representation for African girls, thereby

You have great cast whose voices made the animation thick, how did you get them to play in animation, a movie genre most of them are not used to and how rewarding is it

Animations are usually targeted at children, are they still the target for the movie? Yes. Children are our primary target but also there is a child in every adult. By and large, there is something in there for everyone, and so all ages will find the movie relatable.

Blessing Amidu

CNN’s African Voices features Nigeria’s leading talent studio

ne of Nigeria’s leading talent Studio company, Born Winners Empire (BWE) studios has been featured on CNN’s African Voices, an interesting programming strand that shines the spotlight on African talents and entrepreneurs. Industry watchers say it is an achievement for the BWE Studio, a talent studio with operations around audio recordings, live bands performances and animation. BWE Studios is a subsidiary of BWE Group, which was co-founded in 2011 in Russia by Ehigie Moses Ikeakhe and his brothers. The value proposition allows Nigerian fresh talents request for an artistic background to groom their musical careers, in Lagos where the studio is the early of its kind. In the long run, Ikeakhe foresights BWE Studios as changing the animation cul-

ture in Nigeria and creating an enabling environment for prospective animators with hopes to standardize the value of animation videos in the country and around the world. The Studio, which started barely seven years ago, is growing at a rapid pace. The BWE Studios has featured the live band performances and rehearsals of Nigerian music celebrities such as Burnaboy, Davido, Olamide, Timaya, DBanj, BankyW, Donjazzy, Kcee, Harrysong, Phyno, CDQ, Reekado Banks, Runtown, DJ Enimoney, Reminisce, Skales, Ice Prince, YCee, Adekunle Gold, Broda Shaggi, Victor AD, among others in its musical studio sessions over the years. Speaking on the significant of the studio, Ikeakhe said that the studio was the best to happen to Nigeria’s entertainment industry, while the demand for such www.businessday.ng

studio for production was increasing at alarming rate. According to him, “In Lagos the demand for such studio is catching on. And this is why we came up with a completely new model, an absolutely new idea to Nigeria, and yet we’re still striving hard to be on top of the game”. “We are one of the first talent management to see potential in comedians and have a reason to sign them and manage their professional career,” he added. BWE Studios focuses mainly on media and entertainment particularly in the zones of music, video and arts. The BWE Studio has lately elongated its activities to the animation industry and has had several successful 3D animation masterclass in Russia and Nigeria and some other partnership with lotusfly animation, among others.

for them? Honestly, it did not take much convincing to get them to play in Nigeria’s very first feature length animation movie. I think they were excited to be a part of something historical. There is also the fact that creatives generally

Judging by the reviews of those who have seen the movie teaser, what are their opinions about the movie? We have had quite amazing feedback- the most recurring being how impressive the visuals are. Many are glad to see Nigeria finally get more representation in the genre, and they can’t wait to see the movie.

What are the challenges in producing animation, is it more difficult and expensive than normal movies? Animation is exponentially more expensive than other movie genres. This has been the foremost challenge thus far. Another hurdle was finding a studio here in Nigeria, which had the right balance of skill and manpower required for the job. Thankfully, we have been able to tackle these issues. When are you releasing the movie and on which platforms considering that cinemas are still closed? The intended release date is just a few months away and we hope that by then, some normalcy would have been restored to the movie industry, enough to have a theatrical release. We are working to make the movie accessible to every Nigerian who wishes to see it. This means that we are targeting online streaming platforms as well.

BBNaija Lockdown: Ozo enjoys Head of House title

arly this week, Ozo, one of the contenders in the Big Brother Naija reality Tv show, emerged winner of the Head of House (HoH) game and consequently becomes the first male HoH and the first housemate to complete the game. Ozo and Dorothy, who he chose as his deputy, are now living in the luxurious Head of House lounge and enjoy immunity from the coming evictions this Sunday, while the other housemates scramble for votes. The now anticipated Monday night game followed the same pattern, the only difference this time was the introduction of some new obstacles such as a ring toss and having to draw a portrait of oneself. After receiving a gentle reprimand to take the games more seriously from Ebuka, and after witnessing a double eviction during the Sunday live show, the housemates faced the game with the determination to win. The game gives every housemate an equal opportunity to win so

https://www.facebook.com/businessdayng

they put in their best hoping to be lucky. As expected, Lucy did not qualify to partake in the game since she won the title last week. As the game progressed, Nengi and Tochi led the group with 23 and 24 respectively, however Ozo trumped their record with a perfect ‘30’ score when he reached the very last square on the mat. Big Brother gave the other housemates a chance to beat Ozo’s score, but no one came close, so Ozo was officially announced as the Head of House for the week. Perhaps the only thing more difficult than the actual game for Ozo was choosing a deputy. During his Diary Room session with Biggie, he unsurprisingly chose Dorathy, which she accepted with all her ‘Full Chest’. Voting for the upcoming Sunday eviction opened again on Monday at 10pm WAT and closed on Thursday, August 6, at 10 pm WAT. Fans can now vote for their favorite housemate to stay in the Big Brother Naija on the website and mobile site – africamagic.tv/bigbrother. @Businessdayng

Also, via SMS by texting VOTE and the name of the housemate to 32052. (SMS costs N30 for Nigeria only and available on the participating networks – Airtel, MTN and 9Mobile). This season, the tiered voting system will give DStv and GOtv viewers more votes via the MyDStv and MyGOtv apps to keep their favourite BBNaija housemates in the house. DStv Premium customers will get 2,500 votes; Compact Plus will have 1,500 votes; Compact customers will get 750 votes while Confam and Yanga customers will get 500 and 200 votes respectively. For GOtv customers on Max, they get 350 votes and GOtv Jolli customers get 200 votes. Voting on the MyDStv and MyGOtv apps is open only to subscribers in Nigeria with eligible packages and an active subscription. Big Brother Naija season 5 airs 24/7 on DStv channel 198 and GOtv Max and Jolli on channel 29. Sign up to DStv today via www.dstvafrica.com or get GOtv Max or Jolli on www.gotvafrica.com

Friday 07 August 2020

BUSINESS DAY

Garden City Business Digest 2019: Rivers Microfinance Agency’s year of prosperous turnaround • And the CEO’s twist of fate Ignatius Chukwu

he year, 2019, was declared the year of prosperous turnaround for the 11-year-old Rivers Microfinance Agency (RIMA) which was set up in 2008 to progress those at the bottom of the economic pyramid upward through soft loans to transform the economically active poor. The irony however is that the man who performed this feat, Ipalibo Watson Sogules (PhD), was soon deposed, (June 15, 2020) arrested and even thrown before a magistrate’s court for prosecution over alleged N13m fraud. His twist of fate however continued when soon after, the state pleaded with the magistrate to discontinue trial for lack of incriminating evidence in the fraud he was said to have perpetuated with three other management staff of the agency: the Head of SMEs, Nimi Harry, the Head of Finance and Account, Ukela Okorji; and the Internal Auditor, Sofiri Koko. This raised concerns over the seeming humiliation of a seasoned banker such as Sogules who is regarded as a devoted supporter of Gov Nyesom Wike. RIMA watchers however hint that such twist of fate seems to be the destiny of any CEO in RIMA. The first CEO felt he was doing great only to

Ipalibo Sogules (PhD)

be thrown off by the former governor who said the man rather frittered away N500m out of the N2.5Bn seed capital by awarding amounts as loans to party loyalists contrary to laid down expectations of a purely commercial lending institution. His successor, Innocent Harry, thought he uplifted RIMA with the remaining N2Bn, acquired permanent headquarters, established a Micro-Finance Bank, and claimed to have made N1Bn profit but also suffered the same fate and was removed by a new Governor in 2015. The year 2019, RIMA made very significant progress as it achieved its milestones and

reached out to the poor to lift them up and SMEs to increase their bottom lines. It posted profit that significantly positioned the agency for the upward trend in achieving its core mandate. Sogules through dint of hard work, his ingenuity and experience in the industry, is said to have brought back RIMA from losses to profitability and proficiency. The losses and dismal performance were contained in an audited report in 2015 which stated that RIMA’s entire capital had been eroded by 2015 and that the place operated in huge losses of N972.92m in five years. “The rascality of the previous management is epitomized by the

losses incurred throughout the duration of the administration between 2010 and 2015”, the statement had said. Sogules thus set about rebuilding RIMA with strong emphasis on credit management and marketing of its products. By end of 2019, he reported at a retreat that the Agency broke even and made some profit (about N3m) and that they were going to consolidate on this and increase profitability. “This is the first time a government agency is giving profit. “ He also attributed the significant progress to a well motivated staff as the Agency in 2019 for the first time promoted staff and rewarded outstanding ones for hard work. On the MFI, the CEO said: “Yes, the RIMA Growth Pathway MFB Limited is doing very well and we are also pursuing their own recapitalisation and the CBN has given a deadline for recapitalising all MFBs. But if you look at the bank, 90 per cent of our transactions are done through it. It is being recapitalized and about to open another branch. It is profitable right now. We have instituted ATM system and we have Interswitch; meaning they can transfer funds. These are signs of doing well.” Sogules pleaded for recapitalization of at least N1Bn to now begin to fly from January 2020 into higher financial grounds. This was not what

he saw as his tenure was terminated abruptly. According to a budget analyst, Kie Obomanu, RIMA was a success story from 2015 to 2019. “It’s has been profits all the way in the last four years. For 2019, it’s a giant leap as against the losses before 2015. RIMA has adhered strictly to its rules of engagement which stipulate: providing access to financial services as well as opportunities to build capacity and self sufficiency for the people of Rivers State. This is by lowering the criteria for borrowing money with no expensive collateral normally required to secure such loan. “The efforts of the Rivers State Government under the leadership of Gov Wike must be commended for always ensuring that it stands in the gap for CBN loans to get to those SMEs and the poor in Rivers State irrespective of party affiliation or state of origin. “The Agency’s flagship product - “Market Traders Loan” will bring about a total turn around. RIMA’s other product, “Market Traders Loan” has proved overtime to be very successful as it is now a household name by customers. RIMA has disbursed a cumulative of N4.7 billion as at November 2019. A total of 2,812 entrepreneurs have been reached and this is clearly exemplified by the increase in the bottom line of these SMEs as recorded in the Data Base

System. It has also instituted a robust Risk Management System in line with standard best practices obtainable internationally. This means, it has an aggressive loan recovery system in active collaboration with the Judiciary with penalties properly spelt out for defaulters. This has activated a genuine recovery trajectory. “2019 Financial Report clearly shows RIMA breaking even. This means cost of operations was subsumed by the turn over. With the profits posted through the guide of Performance Management System, RIMA hopes to consolidate on its achievements to make 2020 a year of outstanding success.” What the MD rather got seemed to be the rude shock of a dismissal that June 15 evening. The Magistrate, A.O. Amadi-Nna, however struck out the matter following an application filed by the state Attorney General, Zacheaus Adangor, to discontinue the matter. The state AttorneyGeneral cited section 108, subsection 2 of the Rivers State Criminal and Administration Justice Law in court and pleaded with the court to set the defendants free. Most business analysts in Port Harcourt wonder what next for Sogules in his twist of fate now that the same government has retracted their word on ground that he was not implicated.

The Leesi Gabriel Gborogbosi formula for marginal field bid Port Harcourt by Boat

IGNATIUS CHUKWU

he return of marginal oil field bid many years after seems to throw up some positives especially the unveiling of top brains and experts in the rare sector such as Rivers-born Dr Leesi Gabrial Gborogbosi. Nigeria last opened bids for marginal oil rounds over 18 years ago, and whatever expertise that had accrued seems to have since evaporated. Thus, the opening of the 2020 bid rounds which attracted 600 bids has been making a lot of waves. Gborogbosi has about three decades of leadership experience in the oil and gas industry. His doctoral dissertation focuses on strategy implementation, collaboration, the role of middle managers, and the dynamics of social movements. He leverages his professional experience as a Certified Management Consultant (CMC); Fellow, Institute of Chartered Accoun-

tants of Nigeria; and The Institute of Management Consultants, to render strategic insight into marginal oil bid processes and incidentals. Gborogbosi is the Founder/CEO of Gabriel Domale Consulting (a management consulting firm), set up after many years with a top IOC. In Domale Consulting, he is responsible for all aspects of the firm’s strategy, business development, leadership, governance, competitiveness, teams, and operations across all network of client offices. Over the course of about three decades working in a global oil and gas company prior to founding Gabriel Domale Consulting, he has served in a variety of leadership and managerial roles, including most recently as finance manager of a portfolio of complex gas capital projects. It is significant to note that he was a member of the corporate strategy, planning, budget, and reporting team. He has collaboratively led finance transformation and knowledge management sessions, quarterly projects performance reviews, investment appraisal, and business planning with a focus on capital efficiency, cost and milestones deliveries for a portfolio of seven projects for a culturally diverse global audience. So, when Gborogbosi spoke last week in an exclusive interview with BusinessDay (which was run in BD Sunday), most industry watchers stirred in their corners because he is believed to have touched sensitive insights needed by marginal field bidders and their consultants.

www.businessday.ng

The expert gave cost ideas, advising investors who would be successful at the pre-qualification stage to treat the costs up to the point of winning the bid as search costs. “In the 2020 marginal field bid round, the total search cost is N47m (approx. US$130,235) excluding signature bonus. He said the cost include costs for registration, application and bidding per field: N5,500,000 (approx. US$15,235) as registration fee - N500,000; application fee - N2,000,000 and bid processing fee - N3,000,000) and [B] – costs for data prying, data leasing, Competent Person’s Report and Filed Specific Report : US$115,000 (approx. N41,515,000) as data prying - US$15,000; data leasing - US$25,000;

Leesi Gborogbosi

https://www.facebook.com/businessdayng

Competent Person’s Report - US$50,000 and Filed Specific Report – US$25,000. “Signature bonuses will be paid as per the applicant’s winning bid. The signature bonus should be estimated to be included in the investment proposal. The US Dollars to Naira equivalent is derived using the Central Bank of Nigeria (CBN) current exchange rate of the US Dollars to Naira of N361/$1.” From his wealth of industry experience and his nativeness rooted in the oil region, he gave what he considered an investment approach. He ended with his chosen best templates for bidders which any discerning bidder would want to look at twice. On the best templates to be used, Gborogbosi advised winners to consider what he called front-end planning right from the onset; plus the right financials and dataset that could sustain the operation of the marginal field lifecycle. “I will recommend that the investment plan for the marginal field should contain 10 key sections namely: executive summary that should provide summary information on the content of the investment proposal. “This section is key as it enables decision-makers to have an overview of the investment decision points.” Dr Gborogbosi could be one of the evidence of the emergence of a new crop of Niger Delta brains that form a human capital reserve base expected to stand up and take over the oil industry and rescue the oil region. This is because many insist that nobody from the moon will come to rescue the region and their resources.

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

Sports

All to play for as Man City battle Real Madrid at Etihad Stories by Anthony Nlebem

he Uefa Champions League returns after five months of lockdown due to the outbreak of coronavirus, with the second leg of Manchester City’s tie with Real Madrid taking place on Friday night, August 7. Newly crowned Spanish champions, Real Madrid, will be attempting to overturn a 2-1 deficit at the Etihad Stadium against a Pep Guardiola tutored Manchester City side. Guardiola’s men put in a very convincing performance back in February to come away from the Bernabeu with a narrow advantage, but a lot has changed since then. Real Madrid came back from the lockdown in scintillating form wrestling the LaLiga crown away from Barcelona and finishing the campaign with ten wins from their last 11 matches. After a disappointing Premier League performance this season, Man City have a lot riding on their Champions League run, but they will need to get past a red hot Real Madrid side if they are to stand any chance of winning the tournament.. City have struggled on the continent’s biggest stage in recent years, and will be without star striker Sergio Aguero, but will be banking on the Champions League to salvage a disappointing season. Here is a look at key talking points heading into the crucial cracker. Defence Real Madrid may have

scored 16 goals less than Barcelona during the 2019/20 LaLiga campaign, but their success was founded on the back of a resolute defence. Real conceded fewer goals than their fierce neighbours Atletico Madrid - who are renowned for their defensive abilities under Diego Simeone. Sergio Ramos marshalled his men to an impressive 19 clean sheets, letting in just 25 goals in 38 games. If Man City want to stop Real Madrid adding to their record-breaking collection of European titles, then they will have to find a way past one of Europe’s meanest defences. City’s biggest weakness

is their defence. No matter how strong the side have been in England, they can’t get over the proverbial wall in their Champions League exploits. A treble-winning side last year, City fell to Tottenham Hotspur in the quarter-finals. In fact, for all the money that’s been spent constructing the backline, the Cityzens have never made it past the quarter finals stage of the competition. Attack Zinedine Zidane may have the luxury of having several attackers to call upon, the reality is rather different. When your centre-back is your second top scorer, you

know something isn’t quite working in the attack. Although Sergio Ramos is Madrid’s penalty taker and netted an impressive 11 goals, the likes of Eden Hazard, Gareth Bale and Vinicius Junior should be doing far more to aid Karim Benzema up front. The attacking trio of Hazard, Bale and Vinicius along with Rodrygo only managed eight league goals between them. If Man City can find a way of stopping Benzema that will go a long way to stopping Madrid. Man City’s strengths have always been their immense squad depth. It’s part and parcel with the huge amount of

money they have spent over recent years, but it’s still quite unbelievable just how much depth Guardiola’s side have, particularly in the attack. With only Sergio Aguero out with injury, City have the opportunity to field a number of different rotations up front, with any one of them good enough to beat just about anybody Star player to watch Man City’s star man heading into the Champions League return is Kevin De Bruyne. The Belgian tied Thierry Henry’s Premier League assists record and he’ll be vital to how City perform in the tournament.

Widely regarded as one of the best midfielders in the world today, there’s not many out there who can control a game the way De Bruyne can and City will look to him to ensure they move past Zinedine Zidane’s Real Madrid. Los Blancos have an abundance of big names, especially in the attacking areas, but the form of frontman Karim Benzema is by far the best of the lot. The Frenchman has flourished this season bagging 26 goals and 11 assists in all competitions and finishing behind Lionel Messi in the LaLiga scoring charts. With Eden Hazard struggling to hit the ground running following his summer move from Chelsea and Gareth Bale becoming ever more isolated in the Spanish capital, Madrid have begun to rely on Benzema. Verdicts Upsets from Champions League matches makes it more difficult to predict than ever given the unusual circumstances that it is being played in. It wouldn’t be a surprise for Madrid to go all the way and claim their 14th European crown, it is hard to predict them getting past their next opponents. Manchester City and Guardiola outclassed Madrid and Zidane two months ago, and although Aguero will be a big miss for the Citizens, the Argentine actually played no part in the first leg either. Madrid’s form and fortunes have improved dramatically since then but attempting to overturn a 2-1 deficit away from home may be a big task.

NFF sets up caretaker committee for Anambra State FA

he Nigeria Football Federation (NFF) on Monday constituted a 6-man caretaker committee to steer the affairs of Anambra State Football Association for the next three months in the first instance. This came less than 24-hours after the Jude Anyadufu led electoral committee set up late May concluded its task on Aug. 2 with a virtual election which returned Sen. Ifeanyi Ubah, the incumbent chairman for the second term. In a statement issued on Monday, the NFF said the caretaker committee became inevitable following the expiration of the Ubah led board

on July 28 and the inability of the electoral committee to conduct the elections. It would be recalled that the board and local football council elections were scheduled to hold on July 27 and July 28 before the Anambra government ordered the suspension of the exercise on July 25 citing breach of COVID-19 safety protocols. The NFF said the caretaker committee led by Emmanuel Okeke had the mandate to conduct elections into the board and the LFCs between Aug. 4 when their appointment became effective and Nov. 2 when it would elapse. The interim committee www.businessday.ng

would be inaugurated on Aug. 5. “Recall that the tenure of the Board of Anambra State Football Association and the Anambra State Local Football Councils elapsed by effluxion of time on April 30 and May 2 respectively. “Arising from the novel coronavirus pandemic (COVID-19) and the general lockdown, including football activities, the ASFA Congress was convened on April 28 leading to the extension of tenure of the Board and the LFCs, for another three months, which again expired on August 2. “The Electoral Committee was unable to conduct elec-

tions into the Board of ASFA and LCF on July 27 in view of the Anambra State Government’s letter to the Electoral Committee complaining of the violation of the COVID-19 protocols of the State.

https://www.facebook.com/businessdayng

“Art. 85 of the NFF Statutes 2010 provides that ‘the Executive Committee shall have the final decision on any matter not provided for in the Statutes or in cases of force majeure.

@Businessdayng

“Consequently, the Executive Committee of the NFF in its wisdom, and in order not to create a vacuum do hereby constitute a Caretaker Committee for ASFA as follows: Emmanuel Okeke, Chairman and Victor Nwangwu, Vice Chairman. “Others are Nonso Philip, Member; Charity Okonkwo, Member; Onyeabo Chimezie, Member and Onyedika Chijioke Secretary. “The Caretaker Committee is to administer the activities of the Anambra State Football Association and also conduct elections into the Board of ASFA and LFCs within three months, effective from Aug. 4 to Nov. 2.

Friday 07 August 2020

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

News DMO resumes FGN savings bond auctions as economic activities pick up Onyinye Nwachukwu, Abuja

he Debt Management Office (DMO) on Thursday announced that it had resumed monthly auctions for the Federal Government Savings Bond (FGN Savings Bond) effective August 2020, as economic activities pick up after tight Covid-19 restrictions. The DMO had suspended the monthly offers in April 2020 as government placed restrictions on activities and movement to curtail the spread of COVID-19 pandemic. “The first Offer for subscription for the bonds after four months of suspension will open on Monday, August 10, 2020 and close on Friday, August 14, 2020,” the federal debt office said in a mailed note on Thursday, as

it urged the general public to “look out for the advert of the Offer for Subscriptions in various newspapers and its website.” The DMO also encouraged investors to continue saving through the FGN Savings Bond, as they attract good incomes and are secure, being a Sovereign instrument, while also, contributing to national development. Recall that the debt office had assured at the time that the suspension of the April 2020 Offer will not affect Coupon Payments due to investors for already issued FGN Securities. It said government had made arrangements to ensure that all Coupon Payments for and redemptions of FGN Securities were made as and when due to investors’ designated accounts.

Only 1.2% Nigerians enjoyed government’s COVID-19 palliatives – SBM research BUNMI BAILEY

he Federal G overnment’s effort to cushion the impact of economic and health crisis brought about by the COVID-19 pandemic through provision of palliatives may have been a far shot as just a tiny fraction of the citizenry benefitted from those relief measures, according to a recent survey conducted by Lagos-based research firm, SBM Intelligence. The survey, which covered 18 Nigerian states across the six-geopolitical zones, reveals that only 1.2 percent of respondents received some form of support from the government while 98.8 percent of respondents claimed not to have received any form of support or palliatives. “The 1.2 percent of respondents said that they received some form of support through one of the following channels: TraderMoni, MarketMoni, FarmerMoni, FGN-funded loans issued by the banking industry, food distribution from the local government collection points or through other proxies,” the report stated. A large portion of the group that received government support indicated that the support received was insufficient, according to SBM, while noting that absence of a comprehensive national database is a setback for a broad-based distribution of palliatives. “Without a unified database to go by, the distribution of palliatives was bound to be abysmal,” SBM said. During the lockdown which ran for five weeks from

March 31-May 4, 2020, the Federal Government rolled out palliative measures for targeted groups, in a bid to alleviate the effects of the COVID-induced lockdown. The social investment programme, which entails food distribution, cash transfers, and loans repayment waivers, increased from 2.6 million households to 3.6 million households, according to government figures. Sadiya Umar Farouq, Minister of Humanitarian Affairs and Disaster Management, had said every Nigerian citizen enjoyed the COVID-19 relief stimulus and that the stimulus was evenly distributed across Nigeria. “There is hardly anyone in Nigeria who didn’t receive the Federal Government palliatives care in this trial COVID-19 pandemic. All the tribes in Nigeria received the palliative, in fact it was evenly distributed,” Farouq had said. However, findings from the survey contradict these claims. This is even as lamentations have trailed the distribution of government palliatives, with citizens alleging the process of distribution of the palliatives had been politicised. A further analysis of the SBM survey showed that 100 percent of respondents from the North Central states (Nasarawa, Benue, and Abuja), 100 percent from North-East states (Adamawa and Yobe), 100 percent from South-East states (Abia, Enugu, Anambra) and 100 percent from SouthSouth states (Edo, Rivers and Cross River) noted that they had not received any form of support from the government. www.businessday.ng

L-R: Anthony Chiejina, chief corporate communication officer, Dangote Industries Limited; Zouera Youssoufou, managing director/CEO, Aliko Dangote Foundation, CACOVID Administration; Osayi Alile, CEO, ACT Foundation, and Ameachi Okobi, group head corporate communication, Access Bank, at the Coalition Against Covid-19 (CACOVID) media briefing on the Food Palliative Distribution, yesterday, in Lagos.

Nigeria’s delayed $1.5bn World Bank loan ... Continued from page 1

getting $10,000 from her bank she had heard from a friend within the bank that she was not deemed as an essential importer and that was the reason for the prolonged delay, and that even essential commodities impor ters had to wait on a long queue to get dollars.

This friend however told Uche that things could change after the World Bank disburses a $1.5 billion loan to Nigeria. The money was supposed to boost dollar liquidity, a boon for several SMEs struggling with no access to foreign exchange for critical inputs. The World Bank loan, which is by no means a lasting solution to Nigeria’s dollar shortages but could have helped pave way for autonomous foreign inflows due to the confidence boost it gives investors, has however suffered a fresh setback. That is after the longawaited meeting of the board of the World Bank to consider the support package for Nigeria will no longer hold at the August 7 date, as the global lender has yet to be convinced that the government and Central Bank of Nigeria are serious about commitments to put in place credible mechanisms to enhance efficiency in allocation and use of public finance. With the board set to go on recess from August 10 to 25, the earliest another meeting can hold is in October. Uche and other SMEs will have to wait another painful month to see if Nigeria can get its act together in boosting dollar inflows, and can get the dollars they need for their businesses to continue running. They could wait even longer if the government does not move on the reforms required to access the loan. That wait could force painful decisions to accelerate cull-

ing of badly-needed jobs of Nigerians. The development is also bad news for manufacturers who need dollars for key inputs and have pending dollar requests sitting with their banks. Foreign portfolio investors whose funds are trapped in the country will now also have to wait longer. Nigeria’s foreign reserves are under $36 billion but there is probably a FX demand backlog of around $5 billion plus the estimated value of swaps of around $7 billion. “It means the FX liquidity crisis will worsen,” Muda Yusuf, director-general of business advocacy group, Lagos Chamber of Commerce and Industry (LCCI), said in reaction to the delayed World Bank loan. “A lot of manufacturers, retail businesses and service producers cannot get FX at the moment, not even in the NAFEX window and all of that struggle is partly due to the distortion in pricing,” Yusuf, whose LCCI draws membership from over 2,000 small businesses in the commercial capital of Lagos, said. “A lot of demand is now flowing to parallel market as a result, but the huge premium at that market is causing untold hardship for many,” Yusuf said, saying, “It is disappointing that the government is dragging on reforms that would help alleviate some of the pain people are facing.” The delayed funding is also likely to put pressure on the naira. The naira fell to a new low of N474/$ on Thursday at the black market, according to abokifx, which collates data from traders. That takes the spread between the I&E window rate and black market to N86/$. The black market, which is easily the most liquid of Nigeria’s FX markets, is where many businesses have had to

https://www.facebook.com/businessdayng

increasingly go to for dollars. “There is going to be continued pressure on FX as external reserves are fast depleting,” said Kayode Tinuoye, head of portfolio management at investment bank, United Capital. “Multilateral funding was supposed to be one of the key ways to augment FX reserves, so if the World Bank loan does not go through we will see more pressure on the naira,” Tinuoye said. The delay in the $1.5 billion loan means the scarcity of dollars in the official markets will persist longer and more businesses will run to the black market, which could lead to a further decline in the exchange rate and rising inflation. That is bad news for firms already struggling to manage costs and for cash-strapped households whose purchasing power will further reduce. Why World Bank loan is stalling Before now, the World Bank and the Nigerian government have had series of meetings to discuss the loan, but those meetings have not been fruitful, according to sources familiar with the discussions. The World Bank wants the government to move quicker on some key reforms including unification of the country’s inefficient exchange rates, enthrone service reflective electricity tariffs and completely halt the wasteful regime of petrol subsidy. In addition, there are also recommendations for improving tax revenues in a country where tax-to-GDP ratios are at about the lowest in the world. These reforms were among promises made by the government to the IMF before securing a $3.4 billion loan in April. While some moves have been made, Nigeria remains far away from completing the reforms. Seeing how Nigeria has failed to keep its promises to the IMF, the World Bank is @Businessdayng

now holding out until concrete moves are made by the government. The decision to cancel the meeting of the board, which is rare at a time of this pandemic, sends a bad signal about Nigeria’s leadership. “It is important that Nigeria moves quicker on reforms to pave way not only for the World Bank loan and autonomous foreign inflows,” said Taiwo Oyedele, a partner and head of tax and regulatory services at consultancy Price Waterhouse Coopers (PWC). The removal of a costly petrol subsidy, that gulped nearly N2 trillion last year, is gathering pace with the government now allowing flexible pricing even though it is not yet a full deregulation, given that the PPPRA still determines the price on a monthly basis. Nigeria however backtracked on the electricity reforms it promised the IMF and World Bank after the electricity distribution companies (Discos) bizarrely blocked plans to implement a costreflective tariff that they had championed for so long. The finance ministry says the said COVID-19 support from the World Bank is not conditional upon enthroning a marketreflective electricity tariff. Moves towards a unified exchange rate, which had seemed to be gathering momentum after the CBN devalued the official rate to N360/$ from the N306/$ rate it has been for three years, have also slowed. The CBN assured the market that it would move the official rate even further until it was collapsed at the I&E window rate, where the naira is weaker at N388/$. However, investors and analysts got a rude awakening that a full unification of all the rates could take longer than expected after the government pegged the exchange rate at N360/$ in its Medium Term Expenditure Framework to run for the next three years.

Friday 07 August 2020

BUSINESS DAY

EXPERT PROGNOSIS OF NIGERIA’s ECONOMY

IMF, Citibank’s diagnostics on Nigeria: Snapshot of current economic situation and outlook

Transcription of Virtual Luncheon by The American Business Council Nigeria in partnership with Citibank Nigeria Limited in honour of Jesmin Rahamn, IMF Mission Chief and Senior Representative in Nigeria, to share the fund’s diagnostics on Nigeria Jesmin Rahman, IMF Mission Chief and Senior Representative in Nigeria igeria entered this crisis in a weak position. If we look at average real GDP growth in the last three years prior to the crisis, it was at 2%, roughly half the growth in peer countries and firmly below population growth. Inflation at 12% was roughly three times the average in peer countries. So in other words, average Nigerians were experiencing both falling real per capita income as well as facing a higher cost of living prior to the crisis. Let’s look at a couple of key macro balances; I have here consolidated fiscal deficit and current account deficit. When we compare these levels to how they were in 2014 which was the last time before Nigeria experienced a commodity shock, these balances were much worse last year. And what is more worrisome is how these deficits were financed. For example, the fiscal deficit was to a great degree financed through monetization or central bank borrowing, while the current account deficit was financed was significantly financed through short term portfolio flows. In other words, Nigeria entered this crisis with low policy space as well as risky financing structure. So not surprisingly, Nigeria has been hit hard. For sub-Saharan Africa in general, the impact of COVID-19 has been through three channels; lower global demand, sharp drop in commodity prices and difficult financing conditions. For Nigeria specifically, the external impact was felt through two channels; a precipitous drop in oil prices. So, Bonny light prices went from a peak of $72 to something like around $20 and even at that price we read reports that there were unsold cargos. It was a huge drop in oil prices. On the capital account front, Nigeria was already experiencing capital outflows since Mid-2019 because of policy uncertainties. When COVID-19 came, this was accelerated. In the chart on display, you have the total foreign holdings which include fixed income securities, equities and OMO bills, it dropped close to 14 billion since 2019 or roughly 40%. Again, you have a huge shock there. The pandemic is expected to have a very heavy toll on the economy. Let’s look at growth first; Real GDP is expected to

Jesmin Rahamn

contract by almost 5.5% this year, impacted by both productions cut, so last year oil production was 2 billion barrels and our current projection for this year is 1.67 billion barrels. There’s production cut but more importantly, the non-oil, nonagricultural economy is also being hit. Because oil prices are low, there’s spillover impact from the oil sector to the nonoil economy but also because of the COVID-19 close down and contractions in domestic activities. When we look at Q2, Nigeria doesn’t have a lot of highfrequency indicators but if we look at Google mobility index, PMI etc. things that are available, we see a sharp contraction across domestic activities. From this aspect of impact, 2020 GDP contraction is large. On the right of the slide, I have a chart of how 2020 is looking now versus how it did before the COVID-19 crisis, and you can see significant downturn revision not just in growth but across various states. So revenues are much lower while the fiscal deficit is now projected to be 7.3% of GDP. Of course, the current account has taken a big hit despite import contraction, we are going to see current account deficit stay quite elevated at 3.9% of GDP, and because capital inflows have dried up a part of financing need will have to be made through a drawdown of reserves so you will see a drop in international reserves as well. Recovery So let’s look at recovery, we are projecting GDP to slowly come back to its pre-crisis level. So it’s actually going to take three years in our baseline projection for real GDP to come back to the 2019 level and this is in line with what happened www.businessday.ng

David Cowan

during the last crisis, it took about three years for real GDP level to come back to the precrisis level. If you look at the full five-year horizon, cumulatively, real GDP is growing only by 5%, so 1% per year, so in others words, we are going to see the pace of decline in real per capita income even pick up in the next five years, so it’s quite a dismal projection. And as dismal as these are, there are still downside risks and large uncertainties because pandemic cases are still on the rise in Nigeria itself, there’s low testing, even compared to SSA countries, so nobody really knows how the pandemic will play out in Africa and Nigeria. After that global uncertainties we don’t know if there will be a second wave, we don’t know if the vaccines will be out. There could be upside risks too in the sense that maybe COVID-19 disappears but it is more likely that we are going to be surprised on the downside and if that happens then the recovery that we expect to start in 2021 will not take place, 2021 will see a zero growth. Nigerian Government’s Interventions Let’s look at what the government is doing starting with fiscal policy. So the budget was revised in important ways in response to this crisis. On the revenue side, oil prices and production were revised down in the light of developments in Q2. On the spending side, the government has removed fuel subsidies and introduced an automated fuel price formula. Capital spending has also been prioritized to address the impact of the pandemic, the budget contains a COVID-19 intervention fund of about N500 billion to support health care facilities, provide relief

for taxpayers, and incentivize employers to retain and recruit staff during the downturn. Government has also increased social register; people on social assistance by about a million households to 3.6 million. So the intervention was timely and as much as the limited fiscal space in Nigeria would allow but of course not as high as in other countries due to the limited fiscal space. CBN’s Moves Moving on to intervention of the monetary front. Several things are happening here, on a macro level, the central bank recently cut monetary policy rate, this is happening everywhere across SSA as well as other parts of the world to support the economy. The MPR is the case if Nigeria is directly related to the savings rate so that’s helping banks’ interest rate margin. There has also been a huge release in liquidity in the domestic debt market. So late last year, CBN introduced a policy prohibiting non-bank domestic actors from holding OMOs as these holdings are maturing and these non-banks institutions are offloading their positions, the liquidity is finding its way into government papers keeping the government’s cost of borrowing in the domestic market very low. The CBN has also adjusted the official exchange rate as you know in March took 360 from 307. On a sectoral level, CBN plans to inject liquidity of N3.6 trillion through various credit facilities to support medium and small enterprises and affected households, pharmaceuticals sectors as well as domestic manufacturers, also interest rate on all applicable interventions has been cut from 9% to 5%. The CBN has also introduced regulatory

https://www.facebook.com/businessdayng

forbearance in the form of deferred debt service payment for COVID-19 affected businesses. So there is a lot happening on the policy front both from CBN and the government. Beyond COVID-19 So let’s now move beyond COVID-19 since we have started to talk about fiscal policies beyond COVID-19. Nigeria has always been to me, a fascinating country with huge potential, there’s nothing it doesn’t have. Nigeria has a huge population, natural resources and yet this is a country when you compare to its peers on social indicators and living standards, it is not where it should be. Per capita income used to be $7,000 in the mid-1980s since then, it has gyrated in sync with oil prices. There are quite a few challenges Nigeria needs to tackle if this course is to be altered. At the current population growth rate of 2.6%, Nigeria’s population is projected at 400 million by 2050. The labour force is growing very rapidly much of which is getting absorbed in either the informal sector or not employed at all. In the informal sector, wages are very low. Basic literacy among the young population is very low. Six of out ten out of school children is Nigerian so these are very sobering statistics. When you look at poverty rate, it is around 40% and given the population projection, by 2030 World Bank estimates a fifth of the world poorest people will be housed in Nigeria. When you add regional dimension, the situation is even scarier because you will the concentration of all of these low statistics in one part of the country. To turn Nigeria’s population into human capital so the economy grows, Nigeria @Businessdayng

needs strong job growth and investment in social indicators; education, health and some of the very basic services. My colleagues in the IMF did a basic estimate of how much it would cost the country to reach the SDGs and they came up with 18% of GDP which would come largely from the government even though donor community would help. This reemphasises the importance of growth because without stronger growth to raise revenues, and without those revenues, it would be hard to provide for these very basic and much-needed amenities. The second challenge is to reduce the dependence on oil, in some ways the Nigerian economy has achieved diversification. Oil only counts for 10% of GDP and 1% of employment so you can say that’s a kind of diversification but the non-oil economy depends heavily on the oil prices through direct and indirect linkages and oil also accounts for 50% fiscal revenues and over 80% of exports and oil is also important for FX inflows even though remittances help. Because of this, to have any form of meaningful diversification, Nigeria needs to move on these fronts as well; diversify fiscal revenues, exports, in addition, to diversify GDP base because relative to this is the risk perception. Nigeria’s DNA is oil and unless diversification is seen on both fiscal and external fronts, this perception is unlikely to change and this perception needs to change if we are to avoid the big cycles. Nigeria also has to safeguard oil resources, it is important to diversify but it is also important to safeguard what you have. Fiscal revenue from oil production is dropping over time meaning the share of the pie going to the government has been declining which is not good. There are two problems with that, one is that the government has less money to spend on the very basic and important needs I spoke about before. The second thing is that it sends a very negative signal because oil is a national wealth and belongs to everyone. If people have a feeling that it is not being appropriated properly, it dents their confidence and incentive to pay taxes. So it is really important to preserve oil fiscal revenues. Oil fiscal wealth from the Sovereign Wealth Fund (SWF) is not looking good. Nigeria has about five years if oil savings but when you look at the size of the SWF it’s really small by itself and tiny compared to 2020 budget or per capita. It

Friday 07 August 2020

BUSINESS DAY

EXPERT PROGNOSIS OF NIGERIA’s ECONOMY These 8 numbers capture Nigeria’s worsening socio-economic crisis Continued from front page

pandemic amid a faulty health system can summarise the pains of people in Africa’s most populous nation. But these numbers go further and reveal cracks that must be mended as socioeconomic indices worsen in Nigeria. 1.87% Given that Nigeria’s GDP averaged 2% from 2017-2019 with economic growth for Q1 2020 at 1.87% compared to 2.28% of Q3 2019, the social status of Nigerians seems to be dwindling substantially. According to Jesmin Rahman, IMF Mission chief and senior representative in Nigeria, “Nigeria entered this crisis in a weak position.” This prior weak position of Nigeria when entering into the Covid-19 pandemic has contributed to higher economic risks that might be worse than the 2008/2009 global financial crisis. To put in context, Nigeria’s real GDP is currently about half of emerging markets and developing economies (EMDEs). To make matters worse, the International Monetary Fund (IMF) staff and Nigerian authorities estimate that Nigeria is expected to contract by 5.5% this 2020. 3.8% & 38% As noted by Rahman, total

revenues and grants that were 8.5% of GDP in the pre-COVID era had now declined to 4.7% of GDP as at July 2020. This yields 3.8% decline in the country’s revenue during this Covid-19 era. Nigeria’s revenue of 8% of GDP with almost 5% attributed to the non-oil sector signals just a little bit of diversification. Nonetheless, this is rather low compared to the minimum threshold that is required for accelerated growth, for which other regions of subSaharan Africa (SSA) nations, oil exporters, Angola and Saudi Arabia surpass. Likewise, the gross international reserve has dropped from $36 billion to $22.3 billion, amounting to about 38% decline within the same period. What is worse is Nigeria’s rising debt levels. Nigeria’s public debt rose to an all-time high of N28.6 trillion as at March 2020, and external debt skyrocketed to 35% of aggregate from 15% in December 2014. 2.6% At the current population growth rate of 2.6% Nigeria’s population is projected at 400 million by 2050. Currently, Nigeria’s population has been rising steadily to slightly above 206 million people. Of this, most Nigerians are either in the informal sector, underemployed or unemployed with low wages.

Moreover, the Northern region is the most populated region in Nigeria, which has been highly tormented by the terror group called Boko Haram. World Bank even estimates that by 2030, about a 5th (20%) of the world population will reside in Nigeria. 12.6% An increase from 12.4% in May to 12.56% in June 2020 was recorded by the National Bureau of Statistics (NBS). This represents a 1.21% increase in June from May’s 1.17% increase, which is the greatest hike since June 2018 and was mostly triggered by rising food prices asides other sectoral increases. The rising cost of goods and services not only reflects erosion of purchasing power to consumers but also poses a problem for savers in the country where banks offer very low single-digit interest rate for savings accounts. 40% Four out of 10 Nigerians spend less than $1 on daily feeding. NBS reported that Nigerians consume 2,251 average calories per day, amounting to the food poverty line of N81,767 per year for each individual. To put this in context, this means that Nigerians spend about N6,814 per month and N227 daily on feeding. This is clearly less than a dollar per day.

When the cost of non-food needs is included, the lower and upper national poverty line rises to N124,948 and N137,430 per individual in a year. So, 4 out of 10 (that is, over 82.9 million) Nigerians, have real per capita expenditures that are below N137,430 ($359.76 based on the current exchange rate of N382) yearly excluding Borno state due to extreme Boko Haram insurgencies. World Bank further estimates that the poverty rate will increase to 42.5% in 2020, thereby pushing 5 more million Nigerians into poverty this year. 47 million Nigeria Employers’ Consultative Association (NECA) fears that the unemployment rate might hike from 23.1% in 2019 to 33.5% in 2020. This represents over 47 million unemployed Nigerians. Experts strongly advocate that investing in human capital is the way forward to national recovery and inclusive growth. 25% Deteriorating Health Conditions means 25% of Nigerians lack access to safe water. Moreover, health risks appear to be the worst since the Spanish flu of 1918. Rahman noted that the proportion of additional health expenditure to GDP stands at 0.3% (N186bn

extra allocation) in Nigeria. This is rather low in contrast with 0.47% for low-income countries (LICs) and Sub-Saharan Africa (SSA), 0.46% for emerging markets (EM) and 0.49% for G-20 economies. Furthermore, two-thirds of Nigerian population lack adequate sanitation and a quarter of Nigerians are lacking access to safe water. Due to falling out of both the health and economic impact of the pandemic, the Nigerian economy is expected to contract by as much as 5 per cent in 2020, and not until 2023 would the economy begin to see a rebound, Rahman added. 9.5 million There are about 9.5 million Nigerian school drop-out children as at January 2020 according to a report by the National Social Safety Nets Coordinating Office (NASSCO) gotten from 2.25 million poor and vulnerable households in the agency’s National Social Register. Net attendance amounts to just 53% in Northern Nigeria. Lagging Education Standards means 1 in 6 global out-of-school children is Nigerian, according to United Nations Children’s Fund (UNICEF). Furthermore, according to NBS, in terms of education levels, an average of 50.5% of Nigerians either have no formal education or

less than primary education with males dominating at 66.17% compared to 34.72% females. Primary education averages 34.1% comprising 41.3% males and 26.9% females, while secondary and post-secondary education is much lower at 19.5% and 11.9%, respectively. Quite dismal is the low illiteracy rate in the country with barely 50% of literate females. What is the likely way forward? It is projected that for Nigeria to fully recover from this crisis in line with Sustainable Development Goals (SDGs), some degree of additional spending is necessary by 2030. Education, health, electricity, roads, water & sanitation need to increase by about 8%, 4%, 1%, 2% and 3% respectively, approximately a total rise of 18% in GDP for Nigeria’s expenditure. While these are very hopeful predictions, there are still a plethora of uncertainties about the economic and social environment of Nigeria. This is because of the high risks involved, not just nationally but globally. Also, these recovery projections are contingent on the anticipation that all things go well in Nigeria’s smooth completion of the eased lockdown phase and there is no occurrence of the second wave of coronavirus.

saw in 2015-16. To the point is that this time we know that the Central Bank has an institutional memory of how to deal with oil price shock. Remember the last time part of the problem that we had was that policy response was extra-ordinary delayed. The NAFEX market did not take off until mid-2017 and so I think that is quite important to bear in mind. Moreover not only is the Central Bank got institutionalized memory of the oil price shock but it’s got more pressure on it. The point you should take from Jesmin’s presentation is there was an agreement with the Central Bank that there would be more exchange rate flexibility and unification of the rates. In addition, I still believe looking and reading around Nigeria that there is more domestic pressure and sometimes remember that Nigeria does not always respond to international pressure but it responds to domestic pressure. so the economic advisory council and the office of the vice president are all pushing for this exchange rate reform. So I think I would be fundamentally depressed if it took us to mid-2022 to fix the exchange rate problems that

we are facing now. So I think we’ll see a speedy response to it which I hope would speed up the recovery and I still expect to see some sort of exchange rate adjustment or in the NAFEX in the final quarter of this year. We hosted the governor of the Central Bank and I know what he is hoping is that the distribution of money from the IMF and the World Bank would allow him to shore up reserves and recovering oil prices means they can minimise any adjustments to naira but I suspect that it would still have to be vaguely large not as large as we have seen in some places. Just to give you a worst-case scenario, the Angolan kwanza in 2015 was pretty much in the same place as in Nigerian naira around 160 to a dollar, but it is now trading at around 562 to $1 and the parallel market is trading at 770 Kwanza to the dollar, but we are not going through this depressing Kwanza scenario. But there has to be some sort of adjustment of the naira to get things going again. We need to hope that that policy serious form comes out in the final quarter and then we can start to move forward in terms of the recovery.

IMF, Citibank’s diagnostics on Nigeria ... also nowhere near what some commodity exporters have. The government started to reform the Petroleum Industry Bill, Petroleum Industry Governance Bill, it would be very important to finalize those and to introduce transparency and have a clear regime there so new investments can flow in and fiscal revenues can increase and Nigeria gets all it is supposed to from oil. David Cowan, CitiBank Chief Economist for Africa Jesmin referred to the longterm growth potential for Nigeria and that was confirmed yesterday, anyone who watched the news recently would be aware of reports of how Nigeria’s population could become potentially one of the largest economies in the world but that demographic transition obviously requires a lot of management and it could easily become a demographic time bomb as it could be a demographic dividend. The long-term promise is still there and Nigeria should keep focusing on that in especially going through this crisis because crisis comes and go. And that’s why I had a little bit long-term thoughts on this. This

is the third crisis I’m facing in Africa now, the first one was in the mid-90s when we had the HIV pandemic that had started to sweep across Africa and then gloomy forecasts came out on Africa at that time and people predicted large declines in GDP going forward. Those things did not materialize as people changed their social behaviour particularly in East and southern Africa and I think they are some parallels now with this (corona) virus spreading across the continent that we don’t fully understand and we don’t know how it is going to play out. Then again when you look at crisis they all have their own unique elements to them and I think that’s another important thing to stress. I think one of the most important things that we don’t really know yet is how the lockdowns will impact on the GDP growth numbers and I think that’s important from a number of ways and you could begin to see some of that complexity emerging now. The first thing is historically when we run through crisis, Africa has shown a great deal of resilience and one of the reasons is because of the informal sector because people can keep working especially in fast-moving www.businessday.ng

consumer goods companies because they got kicked out of the formal sector into the informal sector. One of the problems we are having this time is because of the nature of this virus which led to a lockdown and we don’t really know the extent of its impact. But when you think about it in terms of GDP growth, what we do know at this point is that if you look across Africa, GDP in the first quarter, excluding South Africa, from around the 2% recorded in Nigeria - there was a lower number in some countries like Morocco - but we saw 2% in Nigeria up to around 5% in Kenya and Ghana, which was kind of logical since January and February were normal months and lockdowns came in March. But what it tells you is that we do not know how negative the numbers will be in March. I guess for Nigeria’s secondquarter, most of us think it will be somewhere between negative 4% to negative 5% but we don’t know, but if you go back and think about it, one of the things that we have seen is that part of the reason why Nigeria became one of the fastest-growing economies

in Africa was because part of the activities in the informal sector was incorporated into the formal of GDP numbers. Now how that will play out will become apparent when we see the GDP numbers for the second quarter. Quarter three will be better than that, the question to ask in quarter four is whether we have moved from a return to the business to what I recall a return to leisure. I want to stress is that there are some similarities and differences between the oil price crashes that we have seen previously and this one. So one of the things that interest you is that when we went into the last oil price crash in late 2014 early 2015, remember that Nigeria had been like an economy on steroids. The $100 oil price in prior four years meant that Nigeria was like a MercedesBenz rolling down the Lekki Expressway at 100 kilometres per hour. This time Nigeria limped into the oil price shock GDP growth managed to get to 2.5% in the last quarter of 2019. The economy wasn’t on a super FX-fuel and point I will stress to people is that although the impact is not good, it’s not the same sort of abrupt collapse we

https://www.facebook.com/businessdayng

@Businessdayng

Friday 07 August 2020

BUSINESS DAY

news

INEC introduces election result viewing portal James Kwen, Abuja

he coast seems to be getting clearer for Nigeria to attain the much talked about electronic voting which many believe would improve the credibility of the country’s electoral process. This is as the Independent National Electoral Commission (INEC) has introduced a dedicated public portal, the INEC RESULT VIEWING (IReV) that will enable Nigerians to view polling unit results real-time as the voting ends on election day. According to the commission, this move is to further strengthen transparency in the election result management system which has remained a major source of mistrust in Nigeria’s electoral process. The commission, however, emphasised that the IReV does not constitute electronic collation of results as the collation of

election results shall remain as provided for by law; a manual process of completion of relevant result sheets and their upwards collation until the final results are determined. Festus Okoye, INEC national commissioner and chairman of information and voter education committee, disclosed this in a statement at the end of the commission’s meeting in Abuja on Thursday. Okoye said the innovation would commence from the Nasarawa Central State constituency bye-election scheduled for Saturday August 8, 2020, after which it will be extended to the Edo and Ondo governorship elections as well as all subsequent elections. He expressed the hope that the innovation would improve the transparency in election result management and further consolidate public confidence in the electoral process.

International flights: Travellers to arrive 3 hours before boarding IFEOMA OKEKE

he Presidential Task Force (PTF) on Covid-19 has said that passengers would arrive three hours before flights when the country’s airspace finally opens for international operations. The PTF has asked the aviation authorities and airline operators to begin the process for the restart of international flights. Travellers have had high hopes for the resumption of international flights with the reopening of domestic airports for domestic flights in July after almost four months of closure due to the coronavirus pandemic. The PTF national coordinator, Sani Aliyu, during a briefing

he Federal Capital Territory Administration (FCTA) on Thursday threatened to shut down any school violating the Covid-19 guidelines aimed at ensuring the safety of exiting students who recently resumed preparatory to the West African Senior School Certificate Examination (WASSCE) and Basic Education Certificate Examination (BECE). Chairman, FCT ministerial task force on Covid-19 enforcement, Ikharo Attah who led the team to inspect some schools in the nation’s capital, told journalists that the administration could not afford to expose the students to the danger of contracting the kill virus; hence all schools must stick to the guidelines for reopening of schools. Attah said the FCT min-

JOSHUA BASSEY

igeria’s Private Sector led Coalition Against COVID-19 (CACOVID) on Thursday announced the flag-off of a nationwide distribution of multibillion naira food palliative and other relief items to mitigate the adverse effects of the novel coronavirus pandemic on vulnerable Nigerians. The food relief materials for which the private sector operators are spending about N23 billion, will cover 1.7 families amounting to about 10 million people across the 774 local governments in the country, including the federal capital territory (FCT). CACOVID administrator and CEO of Aliko Dangote Foundation (ADF), Zouera Youssoufou told newsmen in Lagos that the food distribution was the next phase in the line of actions mapped out by the coalition to partner government in the fight against the coronavirus pandemic and

on Thursday in Abuja, said the Nigeria Civil Aviation Authority (NCAA) and other agencies, as well as airlines, should commence the process for the restart of international flights. According to Aliyu, passengers would arrive three hours before flights when the country’s airspace finally opens for international operations. He said: “Specific to air transportation, as you are aware, domestic flights have already resumed, the railway sector has also restarted. For international travel, we have made recommendation to the aviation industry to commence the process for opening international airport provided all existing international and local Covid-19 protocol are in place.”

FCTA threatens to shut schools violating COVID-19 guidelines James Kwen, Abuja

CACOVID launches N23bn food palliative for 1.7m households

ister, Muhammad Bello has warned heads of schools within the territory that the government would not risk the lives of students and teachers. He warned that any school found to be violating the protocols would be shut down and its students transferred to other serious schools, while the management of such schools would be given the appropriate sanctions. “Any school that fails to comply, we will do everything within our power to safeguard the students. And such schools will be shut down through legal processes and the students will have to go and write exams somewhere else, pending when the school complies with the safety guidelines and those responsible for the school mismanagement will be brought to book. www.businessday.ng

relief the vulnerable people of the burden posed by the outbreak of the disease. Zouera disclosed that with the announcement in Lagos, the coalition has divided the nation into the six geo-political zones and the distribution was being flagged-off simultaneously in states such as Adamawa, Yobe, Ekiti Ogun, delta, Edo, Kano, Sokoto, Kaduna, Plateau, and Nasarawa. The food palliatives are coming in addition to donations by CACOVID, of medical equipment to state governments to strengthen their response capacity, and construction of isolation facilities in about 38 centres across the country for which the coalition had spent about N15 billion, to help ease off the pressure on the states and Federal Government in their responses to the pandemic. CACOVID has also helped to reinforce the testing capacity of the (Nigeria Centre for Disease Control (NCDC) with the donation of over 300,000 test kits and personal protec-

tive equipment (PPEs) just as the coalition is primed to commence the third and final phase of its Covid-19 response plan. Youssoufou told journalists that each of the targeted 1.7m households would receive in various quantities, rice, pasta, garri, maize, semovita, noodles, salt, and sugar. She explained the rationale behind the involvement of private sector operators in the fight against Covid-19, saying the minimum the private sector could do as partners in nation-building was to collaborate with the government at all levels to help fight the pandemic and reduce the hardship it has brought upon the nation and her people. “CACOVID has since the onset of the coronavirus pandemic been committed to providing relief packages to the most vulnerable. The coalition’s primary focus was to aid the Federal Government in the fight against Covid-19”. “Having done this successfully, we are turning our attention to offering a reprieve to

households who have been adversely affected by the scourge of the virus. Through this food relief programme, we will be reducing the risk of a second viral wave by encouraging people to remain indoors rather than expose themselves when seeking to provide food for themselves and their families, Zouera stated. The Aliko Dangote Foundation CEO reiterated that the coalition would be working with state governments through the Nigerian Governors’ Forum (NGF) to ensure all targeted families are reached and that it is done transparently. She said that the state governors and FCT minister, through the state implementation committee, would appoint a coordinator to diligently record and send an accurate and complete copy of the inventory tracker and goods delivery notes to the CACOVID operations centre daily through the state CACOVID representative to ensure timely and efficient delivery and proper transparency and accountability.

L-R; Adebola Adetayo , MD ; Emmanuel Ijiwere, director; Taiwo Oluwadahushola, CEO, and Kuku Quareeb, financial consultant, all of Green Eagles Agribusiness Solutions Limited, at a press conference on the Green Wealth Project in Lagos. Pic by Pius Okeosisi

NELMCO saves N92bn from PHCN liabilities-MD HARRISON EDEH, Abuja

he Nigerian Electricity Liabilities Management Company (NELMCO) on Thursday said it has saved the Federal Government the sum of N92 billion through discount solicitation and renegotiation of the Power Holding Company (PHCN) liabilities. Discount solicitation is the downward renegotiation of value of PHCN liabilities, which NELMCO explained it did, to the tune of 30 percent in order to save money for the government. Managing director of NELMCO, Adebayo Fagbemi, stated this during the presentation of SelfAssessment Tool (SAT) by the Bureau of Public Service

Reforms, a policy initiative that enables agencies of government understand their strengths and weakness while using the outcomes for continuous improvement. The discount verification strategy, he noted, was meant to be a downward renegotiation of the preprivatisation liabilities in the power sector, which would give comfort to the operations of the distribution and generation companies postprivatisation. “Our adoption of discount solicitation window helped us a lot. For instance, for every five million, we solicit from Nigerians a discount of 30 percent instead of paying 100 percent because of paucity of funds; we pay 70 percent on the liabilities.

https://www.facebook.com/businessdayng

“These steps saved N91 billion for Nigeria from N914 billion worth of liabilities. What we have as outstanding now is about N400 billion,” he explained. The MD expressed optimism that the agency would be able to offset the outstanding liabilities to the last kobo by 2022. NELMCO is set up by the Federal Government to manage all power sector related debts pre privatisation, which is expected to give comfort to the distribution and generation companies in performing their roles. The director-general of BPSR reforms, D.I Arabi in his remarks said the assessment of NELMCO would give them opportunities for self-assessment in addressing possible weakness. @Businessdayng

He noted that the BPSR would guide the agency with resource persons to help them implement key recommendations that will enable them to be efficient in their mandate. Arabi further noted that the agency was extending its assessment to over 100 agencies of the government in line with the open government partnership of the Federal Government, which is in accordance with the global watchdog for anticorruption. Permanent secretary in the federal ministry of power, Didi Walson-Jack said NELMCO could be called to take up addition assignment in the ministry on the back of the commitment shown in the management of pre-privatisation liability concerns.

Friday 07 August 2020

BUSINESS DAY

Live @ The Exchanges Market Statistics as at Tuesday 06 August 2020

Top Gainers/Losers as at Thursday 06 August 2020 LOSERS

GAINERS Company

Opening

Closing

Change

SEPLAT

N321

N350

STANBIC

N31.5

N33

1.5

UBN

N5.4

MTNN

N118

N118.5

0.5

FLOURMILL

N19.4

GUINNESS

N13

N13.5

0.5

MAYBAKER

N2.9

NASCON

N9.6

N10

0.4

LEARNAFRCA

N1.01

Company

ASI (Points)

Opening

Closing

Change

N40.2

N39.5

-0.7

DEALS (Numbers)

-0.4

N19.2

-0.2

VOLUME (Numbers)

N2.8

-0.1

VALUE (N billion)

N0.94

-0.07

BUACEMENT

MARKET CAP (N Trn)

24,930.34 3,646.00 173,748,425.00 2.132 13.005

Bargain hunting puts over N120bn in Nigeria stock investors pockets ... increasing interest in SEPLAT signposts investors confidence in new CEO Storiees by Iheanyi Nwachukwu

ithin just four trading days into this week, Nigeria’s stock investors have pocketed about N123billion as capital appreciation due majorly to increased activities on the buy side of the local Bourse. We had earlier this week advised that the outcome of more half-year (H1) 2020 earnings results will continue to spur market reactions. More investors are seen taking position in companies due to their attractive H1 and full year earnings and proposed corporate action (dividend). For value counters like SEPLAT, increasing interests in its shares seen lately no doubt signposts investors confidence in its new CEO, Roger Brown who resumed on August 1. Brown leads SEPLAT into the next phase of the company’s growth aspirations and expected to work towards reinforcing the company’s leading position in the Energy sector. He joined SEPLAT in 2013 as the CFO and played a key role in the successful dual listing of the Company in 2014 on both the Lon-

don and Nigerian Stock Exchanges. For the second time this week, SEPLAT stock led the gainers tabled. Its share price moved from Wednesday’s low of N321 to N350 on Thursday, adding N29 or 9.03 percent. Stanbic IBTC Holdings moved from N31.5 to N33, up N1.5 or 4.76 percent. Similarly, since joining SEPLAT, the new CEO has played significant roles in various asset acquisitions by the Company as well as implementing the company’s financial business model. He also played critical roles in the company’s success-

ful landmark deals, Initial Public Offering (IPO) and financial structure of debt and acquisitions, as well as increased returns to shareholders. The Nigerian Stock Exchange (NSE) All Share Index (ASI) increased further on Thursday August 6 by 0.19 percent to 24,930.34 points, from preceding day low of 24,882.04 points. Other gainers on Thursday include Guinness Nigeria which went up from N13 to N13.5, adding 50kobo or 3.85 percent. MTNN went up from N118 to N118.5, up by 50kobo or 0.42 percent; while NASCON advanced from N9.6 to N10,

up 40kobo or 4.17percent. Also, the value of listed stocks increased from N12.979trillion to N13,005trillion. The week opened with ASI of 24,693.73 points and market capitalisation of N12.882 trillion. The stock market’s negative return year-todate (YtD) printed lower at -7.13 percent. In 3,646 deals, investors exchanged 173,748,425 units valued at N2.132billion. FBN Holdings, GTBank, Custodian Investment, Transcorp and Lafarge Africa were actively traded stocks on the Nigerian Stock Exchange on Thursday August 6.

Tosin Finnih, Partner, Human Capital Business, Stanbic IBTC Holdings PLC presenting food items and provisions to Little Saints Orphanage, Abule Egba, Lagos during the Stanbic IBTC Blue Women Network Giving Back Initiative recently in Lagos

Global market indicators FTSE 100 Index 6,026.94GBP -77.78-1.27%

Nikkei 225 22,418.15JPY -96.70-0.43%

S&P 500 Index 3,322.95USD -4.82-0.14%

Deutsche Boerse AG German Stock Index DAX 12,591.68EUR -68.57-0.54%

Generic 1st ‘DM’ Future 27,115.00USD +60.00+0.22%

Shanghai Stock Exchange Composite Index 3,386.46CNY +8.90+0.26%

Agusto upgrades FCMB Asset Management’s Legacy Money Market Fund rating to A(f)

egacy Money Market Fund, a mutual fund managed by FCMB Asset Management Limited (FCMBAM), has received a rating upgrade. The Fund’s rating has been upgraded from A-(f) to A(f) by Agusto & Co, a foremost pan-African rating agency. FCMBAM is the asset management arm of FCMB Group Plc, one of Nigeria’s leading financial institutions. According to Agusto & Co., “the higher rating of A(f) reflects Legacy Money Market Fund’s conservative credit and liquidity profile. Since the launch of the Fund in February 2019, it has maintained good credit quality of underlying investments, with assets held in securities with well rated entities”. The Legacy Money Market Fund is a low risk, openended, Nigerian Naira-denominated mutual fund that invests in Money Market Instruments. It is registered with the Securities and Exchange Commission. Itsprimary objective is to preserve capital, and its secondary objective is to generate stable income for investors. The Fund’s performance benchmark is the average yield on the 90-day Nigerian Treasury bill. The Fund is targeted at individual and institutional investors. The minimum initial subscription in the Fund is N1,000, while the minimum holding period is 1 month. Investors in the Legacy Money Market Fund or any of FCMBAM’s other mutual funds can access

their investment accounts 24/7/365, through FCMBAM’s Customer Portal. Login details are sent to the investor’s registered email address, once the investor has registered at https:// fcam.fcmb.com. Speaking on the upgrade of the Fund’s credit rating from A-(f) to A(f) by Agusto & Co, the Chief Executive Officer of FCMBAM, James Ilori, said, “given the lowrisk nature of the Legacy Money Market Fund, capital preservation is given utmost attention, in our investment decisions. Also, the relatively high level of liquidity of investments ensures that investors receive regular income throughout the year. We expect to maintain and improve on our achievements by continuing to apply our deep understanding of portfolio risk management for the benefit of investors”. FCMB Asset Management Limited also manages three other mutual funds – Legacy Debt Fund, Legacy Equity Fund and Legacy USD Bond Fund. In addition to the four collective investment schemes, FCMB Asset Management offers clients discretionary and non-discretionary portfolio services, as well as execution-only mandates. FCMB Asset Management Limited has consistently focused on delivering international standard investment management services, aimed at meeting investors’ investment goals, in terms of capital preservation, income-generation, and capital appreciation.

Stanbic IBTC’s Blue Women Network reaches out to less privileged

tanbic IBTC Blue Women Network (BWN), a network of female employees of the Stanbic IBTC Group, donated food items and provisions to orphanage homes in locations across Nigeria through its Blue Women Giving Back Initiative. The BWN, inaugurated five years ago, has consistently taken steps towards helping the society at large.

Part of the body’s mandate is to provide support to the disadvantaged, hence, the creation of its Giving Back Initiative. BWN members made voluntary cash donations which were used in purchasing food items and essential provisions for various motherless babies’ homes. The items were distributed in four orphanages in Lagos, Port-Harcourt, and www.businessday.ng

the Federal Capital Territory, Abuja. The orphanages that benefited were the Port-Harcourt Children’s Home; Karu Home Orphanage in Abuja, as well as the Motherless Babies Home (Lekki) and Little Saints Orphanage, both located in Lagos. Nike Bajomo, Chairperson of BWN and Executive Director, Business Development, Stanbic IBTC Pen-

sion Managers, said: “The COVID-19 pandemic affected virtually every aspect of the lives of the citizenry. The Blue Women’s Network decided to reach out to orphanages who were also negatively impacted knowing that donations to them may have dwindled in view of the pandemic and restricted movement in the early weeks of the pandemic. Our concern for them

https://www.facebook.com/businessdayng

necessitated this outreach to show our support to them”. Expressing her appreciation to all female employees of Stanbic IBTC Holdings PLC for their contribution, Bajomo said: “I am incredibly proud of all the members of BWN for their willingness and sacrifice they made through the generous donations. They have put smiles on the faces of these angels through their financial commitment.” @Businessdayng

The BWN is a network of female employees of the Stanbic IBTC Group with an objective to strengthen the growth and development of its members. It serves as an opportunity for female staff of Stanbic IBTC to engage and share knowledge which will enhance their professional skills. Its Giving Back Initiative emphasises the need to help the less privileged in the society.

Friday 07 August 2020

BUSINESS DAY

FINANCIAL TIMES

World Business Newspaper

Beirut explosion: France’s Macron warns Lebanon on need for reform

International donors pledge aid in wake of explosion that devastated Beirut Chloe Cornish in Beirut, Victor Malle t in Paris and Andrew England in London

rench president Emmanuel Macron has warned Lebanon that the country will continue to sink if the government does not push ahead with much-needed reforms as mounting public anger over a blast that killed more than 130 people raged across Beirut. “The priority is unconditional aid and support for the population,” Mr Macron said in the Lebanese capital. “We will be there for you and won’t give up on you.” However, he added that he wanted to have a real dialogue with politicians about economic and political reforms that Paris had been demanding for years to fight corruption and stabilise the country. “If reforms are not carried out, Lebanon will continue to sink,” he said. He called for “strong political initiatives to fight against corruption” and a “transparent audit of the central bank and the banking system”. Many Lebanese blame the ruling elite for the economic malaise and a dysfunctional state, which is seen as a root cause of the explosion of 2,750 tonnes of ammonium nitrate, a fertiliser that can also be used in bombs, at Beirut port on Tuesday. Lebanon was a French mandate in the years after the first world war. As Mr Macron visited the bat-

tered east Beirut neighbourhood of Gemmayze, dozens of volunteers undertaking the clean-up shouted “the people want the fall of the regime” — a slogan used during mass protests last year that forced the resignation of the previous government. Protesters also denounced the Lebanese president, chanting “terrorist, terrorist, Michel Aoun is a terrorist”. The anger was palpable across Beirut. A decent government “would not have left this bomb in the middle of the country”, said Maria, a 65-year-old shop owner wearing a Lebanese flag bandanna around her head.

Mr Macron told crowds that French aid would not go to “corrupt hands”, while adding that he would seek a new deal with Lebanon’s political leaders. “I will talk to all political forces to ask them for a new pact. I am here today to propose a new political pact to them,” he said. The roots of Lebanon’s political turmoil date back to the end of its 15-year civil war in 1990 and the decision to share power through sectarian quotas. Critics say that this system has created an entrenched political class of warlords or “chiefs”, who divide power and influence between themselves along sectar-

ian lines. Donors have been holding back financial assistance as Lebanon’s economic crisis has deepened because of longstanding frustrations over politicians’ failure to enact reforms as well as concerns about graft and the prominent role of Hizbollah, the militant movement that is part of the coalition government. “The Lebanese political system plays a huge role in why the country is in the economic state it is in today, and with Lebanon not able to meet the costs of reconstruction or stand on its feet economically, now there’s a chance to send aid

that would support its economy but also act as a vehicle for implementing necessary reform,” said Lina Khatib, head of the Middle East programme at Chatham House. “With popular anger in Lebanon mounting . . . the Lebanese powers have to recognise if they are going to at least retain a degree of power, they have to engage in some measure of reform,” she added. Beirut was already in talks with the IMF in the hope of receiving a bailout after it defaulted on its $90bn debt pile in March, but those negotiations had ground to a halt because of political infighting in Lebanon. Kristalina Georgieva, the IMF’s managing director, on Wednesday said the fund was “exploring all possible ways to support the people of Lebanon”. “It is essential to overcome the impasse in the discussions on critical reforms and put in place a meaningful programme to turn around the economy and build accountability and trust in the future of the country,” she said. “It is also a time for the international community and the friends of Lebanon to step up to help the country in this moment of urgent need.” In an economic recovery plan finalised in April, the government banked on receiving $10bn in international support. The Lebanese pound has collapsed and the inflation rate has risen to about 56 per cent, while the IMF forecasts that the economy will contract 12 per cent this year.

Microsoft expands TikTok takeover ambitions to entire global business US group explores whether it can add regions including India and Europe to deal for video app’s US arm Miles Kruppa in San Francisco, A r a s h Ma s s o u d i i n Lo n d o n, Stephanie Findlay in New Delhi and Primrose Riordan in Hong Kong

icrosoft is chasing a deal to buy all of TikTok’s global business, including the viral video app’s operations in India and Europe, according to five people with knowledge of the talks. The US software company said on Sunday it was in negotiations with ByteDance, the Chinese owner of TikTok, to explore “a purchase of the TikTok service in the United States, Canada, Australia, and New Zealand”. But Microsoft has since also pursued a plan that would include all countries where TikTok operates. TikTok does not operate in China, and such a deal would not extend to its China-facing sister app Douyin. Meanwhile, Microsoft executives have sought to assuage the Chinese government as it seeks

to avoid being caught in cross fire between Beijing and Washington, two of the people said. One person close to Microsoft pushed back on the suggestion that the US tech group was discussing asset swaps in China as part of a deal. The shift from Sunday underscores how preliminary the talks between the two sides remain as they race to meet a mid-September www.businessday.ng

deadline to reach a deal and prevent TikTok from being banned in the US. One person close to ByteDance’s Asia-Pacific operations suggested that Microsoft had been attracted to the idea of buying all of TikTok’s global business by the difficulty of separating back-office functions such as HR and to ensure that TikTok users in one country

https://www.facebook.com/businessdayng

could still use the app if they travelled to another. On Monday Donald Trump, US president, said it was “probably easier to buy the whole thing than to buy 30 per cent of it”. He also said that whoever bought TikTok would have to pay a “substantial” fee to the US Treasury. Any eventual deal may take a variety of forms, the people who spoke to the Financial Times said. They highlighted a long list of obstacles that stand in the way of a transaction, including price. One person involved said the discussions were like “multi-dimensional chess” given the number of stakeholders in the process, including governments and minority shareholders in ByteDance. Even adding the entire business to any deal does not resolve the enormous challenge of untangling TikTok’s technology from ByteDance. ByteDance had previously been working on separating the data and algorithms between China and the rest of the world before the talks began, employees said. @Businessdayng

Microsoft has discussed adding an agreement whereby it would have one year to separate TikTok from its Chinese parent and address US government concerns over the security of the data generated by the app. Two people following the talks closely said that the timeframe would be difficult to meet, with one of them going so far as to say it could take between five and eight years to fully separate the software. Daily newsletter #techFT brings you news, comment and analysis on the big companies, technologies and issues shaping this fastest moving of sectors from specialists based around the world. Click here to get #techFT in your inbox. India is TikTok’s biggest market, with more than 650m downloads according to Sensor Tower data. But it has been banned in India since the end of June, when the government put it on a blacklist of 59 Chinese mobile apps that it accused of threatening national security.

Friday 07 August 2020

BUSINESS DAY

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

Toyota defies coronavirus pandemic with quarterly profit Recovery in China and cost cuts help cushion blow of health crisis at Japanese group Kana Inagaki in Tokyo

oyota has become one of the few carmakers worldwide to eke out a quarterly profit, even as the coronavirus pandemic prompted a collapse in sales and plant closures. Shares in the world’s secondlargest carmaker briefly rose nearly 3 per cent in Tokyo on Thursday following the release of the results, which were backed by a faster than expected recovery in sales in China and years of stringent cost-cuts under chief executive Akio Toyoda. Toyota maintained its fullyear guidance for operating profits and revenue, but cautioned of “the possibility that the business environment will change significantly depending on . . . the future spread of Covid-19 and the state of its containment”. The company recently lost its crown as the world’s most valuable carmaker to US electric vehicle group Tesla. For the April to June quarter, Toyota reported a 74 per cent year-on-year drop in net

profit to ¥158.8bn ($1.5bn). While its operating profits were nearly wiped out, the Japanese group outperformed rivals including Volkswagen, General Motors and Nissan, which all suffered losses during the period. Toyota delivered profits even as group vehicle sales dropped 32 per cent from a year earlier to 1.8m units due to the pandemic.

Losses in the US and Europe were offset by profits in the company’s financial services arm. The results also showed an unexpected boost from Covid-19 in terms of costs, which fell due to shorter working hours and reduced business travel. Meanwhile, it upgraded its annual vehicle sales forecast to 7.2m vehicles from the 7m projected in May as the pace of

recovery in most regions, led by China, has been faster than expected. During the first quarter, sales in China rose 14 per cent to 482,000 vehicles. In disclosing its net profit guidance for the first time, the company said it expected a 64 per cent year-on-year drop to ¥730bn for the fiscal year through March 2021. “The result is reassuring and

there is a strong indication of an upward revision [in operating profit] during the fiscal first half,” said Koji Endo, head of equity research at SBI Securities. Toyota’s performance stands out compared with domestic rivals such as Nissan, which has an alliance with France’s Renault. The company anticipates its biggest ever operating loss this year. On Wednesday, Honda reported its largest quarterly loss since 2009 and warned of a 64 per cent drop in annual profits as car sales fell in almost all of its main markets. Honda has historically managed to offset downturns in car sales with its more profitable motorcycle business. But the pandemic also sparked a 62 per cent fall in first-quarter motorcycle sales led by declines in India and Indonesia. Seiji Kuraishi, Honda’s executive vice-president, said the company aimed to return to profitability for the full year, pointing to a strong recovery of car sales in China and demand for motorcycles in Vietnam and Thailand.

Freshly served pub bonds dip as sector fears another lockdown Slug & Lettuce owner took ‘window of opportunity’ to sell debt, one investor says Nikou Asgari in London

orries that pubs and bars in the UK will close to allow the reopening of schools have pushed down the price of bonds sold just two weeks ago by pub group Stonegate. Stonegate, which runs the Slug & Lettuce and Yates chains, seized on the post-lockdown reopening of the leisure sector to sell £1.2bn of bonds, financing its acquisition of the UK’s largest pubs operator, Ei Group. The deal, which was the largest sterling-denominated high-yield bond sale since 2013, consisted of five-year sterling and euro tranches worth £950m and €279m respectively. The bonds priced at 100 pence on the pound and 93 cents on the euro, according to deal documents, but slipped as low as 93 pence and 87 cents this week as speculation grew that pubs would

be the first to shut if further local and national coronavirus lockdowns were imposed. The bond price movements are a sign that companies hardest hit by the pandemic such as bars, restaurants and travel companies are not out of the woods yet, ahead of an expected resurgence of the virus in winter. The Children’s Commissioner www.businessday.ng

for England said on Wednesday that if more local lockdowns are required across the country, schools should be kept open at the expense of pubs, restaurants and non-essential shops, a view backed by scientists. This followed warnings by Professor Chris Whitty, England’s chief medical officer, that the UK was near the limit of what it could

https://www.facebook.com/businessdayng

do to relax restrictions, and Professor Graham Medley, chairman of the Scientific Advisory Group for Emergencies, who said a “trade-off” will be required. Investors voiced concerns that the pubs’ revenues will dry up again if shutdowns are reintroduced. Together, Stonegate and Ei have more than 4,000 venues across the UK. Stonegate declined to comment. “There’s a greater likelihood that lockdown of some sort could happen,” said one fund manager who bought Stonegate’s bonds. The investor added that the future closure of pubs and potential for heavier social distancing restrictions has likely encouraged some bondholders to sell. “[Stonegate has] a very good coupon so as long as the company can afford to pay the coupon, that works for me,” the investor added. The pub group pays investors interest rates of 8.25 per cent for @Businessdayng

the sterling bond and Euribor plus 5.75 per cent for the euro tranche — relatively high borrowing costs compared to similarly rated issuers, reflecting wariness about the sector. An ICE BofA index of European companies yields 4.1 per cent. “[Stonegate] took the small window of opportunity,” said one European fund manager, adding that if the group had come to market in August, it would have been unlikely to sell the bonds. The debt was underwritten by a group of banks that had been stuck holding the so-called bridge loans on their balance sheets, unable to move them until appetite returned for riskier debt. In the week ending July 19, Stonegate’s sale volumes of beer, cider and ale from a sample of 1,130 pubs amounted to 91 per cent of that sold in the same period last year, according to the documents.

Women in Business

AFFIONG WILLIAMS

Friday 07 August 2020 www.businessday.ng

By Kemi Ajumobi

Constance Iloh

Founder/CEO, ReelFruit

BUSINESS DAY

First black Professor in the School of Education at UC Irvine

ffiong Williams is the CEO/ Founder of ReelFruit, a topmost fruit processing, packaging and marketing company in Nigeria. The company, founded in 2012, retails a range of dried fruit and nut snacks through a variety of channels including over 450 Supermarkets, Airlines, Schools, Hotels, and concluding export sales through Amazon.com. ReelFruit is an award-winning brand, winning international Women In Business Competition in the Netherlands. Affiong is passionate about agribusiness and looking at innovative, market-driven solutions to add value to local produce given Nigeria’s unique agricultural landscape. She established a complex supply chain in 4 countries (Ghana, Gambia, Ivory Coast and Nigeria) to achieve year-round availability of products, a key competitive advantage. ReelFruit is a registered and active member of the Nigeria Export Promotion Council. Affiong has managed several mid-sized export sales to Belgium, Switzerland, and the US and Canada, and also intra-Africa trade to Gambia and Senegal. She leads a large team of staff members, as well as 4 external consultants, even as she managed a pilot farm project training 45 women in Mango Farming in Kaduna. As part of a business model, Affiong has gained and has had experiences with several horticultural and commodity mapping studies that have both been backed by donors such as IDH and USAID NEXXT, as well as company-funded research studies. She has also advised the Lagos State Government on their approach to investing in SMEs in order to achieve maximum job creation. Through her entrepreneurial journey, she has been invited to countless fora on agribusiness, investment and trade. “I’m very internally motivated, so I’m quite a driven person. It’s in my nature to finish the things I start, and it’s in my nature to do hard things. So I think I’ve drawn from my inner strength to keep going and say ‘I can finish what I started’. and see it through. But,

to be honest, when all that fails, because obviously, it’s a finite resource, I look at people’s lives I’ve changed.” She said. Affiong Williams obtained a post graduate diploma in Business Administration from Wits Business School, Johannesburg, South Africa. In 2018, she also participated in the Stanford SEED Transformation ProgramStanford Institute for Innovation in Developing Economies. She worked for 4 years for Endeavor Global, a global non-profit which catalyzes economic development by supporting small to medium enterprises in developing markets. Affiong is passionate in unearthing the job and wealth creation potential of agribusiness and global trade. After four years of working at Endeavor, she started to pursue the idea of starting a business. She knew that she wanted to come back to Nigeria to do that. Affiong looked at a couple of criteria to decide which industry she wanted to enter. “Job creation was my number one criteria, so I really wanted to build a business in an industry that had huge job creation potential. So, I picked agriculture and agribusiness.” Williams narrated. Affiong is passionate about entrepreneurship, agriculture and politics and is an avid runner, completing over 15 marathons, raising funds for charity in the process. She believes that before you get into any industry, you must carry out research on that industry. She says “If possible, I would advise every aspiring entrepreneur to volunteer for a while in the particular industry he/she is interested in before venturing into the business. The amount of learning would be priceless.” She said. On financing, she admits that, that will always be an issue, as she doubts any entrepreneur always has all the money needed at a particular time. “I think money follows good businesses and good ideas. One should always start with what they have, show progress, and people will be attracted. No one will appreciate the excuse that money has stopped you from starting at all. Resourcefulness is a trait every entrepreneur must have” Williams advised.

escribed as a “higher education powerhouse” by Diverse: Issues in Higher Education, Professor Iloh is an anthropologist of education whose program of research explores educational inequities and opportunity; institutional and organisational culture; college access and choice; social context; and student experiences. Iloh is especially known for her work that investigates the college-going narratives and realities of underserved students in higher education as well as work that examines forprofit colleges and community colleges. Professor Iloh received a Ph.D in Urban Education Policy from the University of Southern California where she became the first from the Rossier School of Education to receive the PhD Achievement Award, the highest honor given to any PhD holder at the university. Constance earned a Bachelor’s degree from the University of Maryland, College Park and a Master’s degree in Business Management from Wake Forest University. One of Iloh’s most notable scholarly contributions is the Iloh Model of College-going Decisions and Trajectories, a new and innovative three-component ecological model that illuminates contemporary college decisions and educational narratives, while also problematising the notion of college “choice.” Her research and expertise has been cited in multiple spaces, including the Harvard Law Review and featured in Forbes, Politico, The Chronicle of Higher Education, Black Girl Nerds, Education Dive, Inside Higher Ed, For Harriet, Diverse Issues in Higher Education, and National Public Radio (NPR). In 2017, NPR named Iloh a national expert while highlighting her as their Source of the Week. Constance has been invited to share her work with the White House Initiative on Educational Excellence for African Americans, the Hammer Museum, the Institute for Higher Education, Telemundo, NBC Universal, and Michelle Obama’s Reach Higher Campaign. Iloh is a 2018-2019 recipient of the prestigious UC Hellman Fellowship, a highly com-

petitive research fellowship bestowed upon assistant professors showing great distinction in their field. Constance made history as the first Black professor in the School of Education at UC Irvine. In 2016, Iloh became one of the few academics ever named to the change-agents and break-out stars of the Forbes “30 under 30” list. “I am openly walking by faith and living my dreams in colour. I try not to define myself by conventional ideas of success because purpose is bigger than that.” She said. For Iloh, you must never be afraid to let your light shine. She emphasises that this is especially important for women and people of colour, because so many spheres of life aim to limit and minimize women when they are destined to be greater than any box they could be put in. She also believes that there is also the tendency to overlook the importance of the unique identities and approaches of women in spaces like the academy. “By researching the most underserved students and understudied sectors in postsecondary education, I am bringing into focus the realities of 21st century education. Rather than shy away from what makes you different, embrace how God made you different.” She said, adding that “So many people reach out to me regarding how the little things about my identity or research mean so much in shifting the common image of an intellectual.” Said Constance. Iloh also believes that sometimes, people see the recognition but they don’t know the story, the support and sacrifices of her people. “They don’t know the nights I was in my high school library writing Gates Millennium Scholarship essays for college until the custodian had to close up, while my mom waited in the car after a long day of work. They don’t see the years, months, days, hours, and minutes of work you have put in to grow, excel, and stretch yourself as a scholar and what it’s really like to be you in the academy.” Iloh stated. She is however grateful for purpose “because it keeps me moving and motivated”.

For sponsorship and advert placement contact: kemi@businessdayonline.com Published by BusinessDAY Media Ltd., The Brook, 6 Point Road, GRA, Apapa, Lagos. Advert Hotline: 08033225506. Subscriptions 01-2950687, 07045792677. Newsroom: 08169609331 Editor: Patrick Atuanya. All correspondence to BusinessDAY Media Ltd., Box 1002, Festac Lagos. ISSN 1595 - 8590.