BusinessDay 08 Oct 2019

businessday market monitor

Biggest Loser

Biggest Gainer UACN N7.10 8.40pc

SEPLAT N517.00 -6.85pc 26,866.41

Foreign Reserve - $41.71bn Cross Rates - GBP-$:1.23 YUANY-N 50.64 Commodities Cocoa

US$2,422.00

Gold

N300

Buy

Market

Sell

$-N 357.00 360.00 £-N 448.00 455.00 €-N 389.00 398.00

+0.54pc

Crude Oil

I

Foreign Exchange

₦2,831,792.26

$1,491.90 $58.77

news you can trust I * * TUESDAY 08 OCTOBER 2019 I vol. 19, no 410

FMDQ Close

Everdon Bureau De Change

Bitcoin

NSE

g

I&E FX Window CBN Official Rate Currency Futures

($/N)

362.37 307.00

3M -0.17 13.08

NGUS DEC 24 2019 362.68

6M

0.03

10 Y 0.11

20 Y -0.02

14.28

14.44

14.62

5Y

-0.01 12.18

NGUS MAR 25 2020 363.53

NGUS OCT 28 2020 365.50

@

g

www.

fgn bonds

Treasury bills

Spot ($/N)

g

Finance ministry moves to rejig sluggish economy L-R: President Muhammadu Buhari; Asue Ighodalo, chairman, Sterling Bank/Nigerian Economic Summit Group (NESG), and Emmanuel Emefienim, executive director, Sterling Bank plc., at the opening ceremony of the 25th Nigerian Economic Summit Meeting in Abuja, yesterday.

…to reduce VAT, corporate tax filing requirement for MSMEs …incentivise investment in infrastructure to spur capital market

Time running out for reforms, T Dangote, Sanusi, others tell Buhari

OLUFIKAYO OWOEYE & SEGUN ADAMS he Ministry of Finance, Budget and National Planning has announced five areas of priority focus based on the Federal Government’s strategic plans to revamp

say Nigeria’s education needs overhaul

ODINAKA ANUDU, ONYINYE NWACHUKWU & HARRISON EDEH, Abuja

K

ey private sector players on Monday told President Muhammadu Buhari that time is running out for Nigeria to usher in economic reforms to cater for a bulging

population estimated to hit 410 million in 2050.

The private sector players at the ongoing 25th edition of the Nigerian Economic Summit (#NES 25) in Abuja said the country’s education system needs an overhaul as it is failing to meet the needs of employers.

“Clearly, we do not have the

luxury of time,” Asue Ighodalo, chairman, Nigerian Economic Summit Group (NESG), said. “Basically, our population is projected to grow by a little over 3 percent per annum, and if these projections are true, GDP must grow by that much year-on-year for us to just maintain our current GDP per capita, and this is without ac-

Continues on page 37

Inside

counting for inflation.”

Nigeria’s population is expected to hit 410 million by 2050.

Over 50 percent of this population will be under 18, with growing needs for food, shelter, security and education.

The government must, therefore, create competitive edge for industries to grow and initiate enabling policies mimicking the

Continues on page 37

Nigeria seeks global collaboration to gain from $950bn GDP in P. 2 Gulf of Guinea region Shared responsibility: Building and sustaining a strong economic future for Nigeria P. 38&39

P. 2

2

Tuesday 08 October 2019

BUSINESS DAY

news States look to areas of comparative advantage as revenues tank

L-R: President Muhammadu Buhari; Paul Gbededo, GMD, Flour Mills of Nigeria (FMN), and Sadiq Usman, deputy COO, agro-allied division, FMN, at the FMN exhibition stand, 25th NES 2019.

ODINAKA ANUDU & HARRISON EDEH, Abuja

G

Nigeria seeks global collaboration to gain from $950bn GDP in Gulf of Guinea region ...As FG promises to tackle piracy scourge in Nigerian waters ...Nigerian Navy intercepts 206 vessels in 4 years AMAKA ANAGOR-EWUZIE & STELLA ENENCHE, Abuja

W

ith mind set on maximising the opportunities in the $950 billion estimated Gross Domestic Product (GDP) available in the Gulf of Guinea region, President Muhammadu Buhari has solicited for regional and international collaboration that would help in tackling the scourge of piracy, sea robbery and other criminal activities on West African maritime domain.

The region, which controls about 70 percent of Africa’s oil production, estimated export value of $180.50 billion and $105.70 billion import value, was rated as hotspot for pirate attacks and sea robbery.

Speaking on Monday at the opening of the three-day Global Maritime Security

Conference holding in Abuja with the theme ‘Managing and Securing Our Waters’, the president said the Federal Government would not relent in efforts to rid Nigerian waters of the piracy scourge.

Buhari, who was represented by Zubairu Dada, minister of State for Foreign Affairs, reiterated the need for joint effort in securing the Gulf of Guinea, which is vital and central to global trade in view of the fact that many critical trade routes connecting African continent to the rest of the world run through the region.

“The Gulf of Guinea encompasses diverse geographical, geological and rich cultural heritage with many of its states endowed with vast oil and gas deposits critical in addressing global energy demands,” he said.

As the African continent forges ahead with phase II of the negotiations for the

creation of the African Continental Free Trade Area (AFCFTA), safety and security of sea transportation are critical to seamless trade and effective economic integration, Buhari said.

“Our approach, therefore, towards the realisation of maritime security in the region and other vital sea lanes is contingent on our collective effort and ability to put in place international, continental, regional and national frameworks and resources in cooperation with critical stakeholders,” he said.

He said the recently signed Suppression of Piracy and other Maritime Offences Act would provide the muchneeded legal and institutional framework for Nigeria to ensure safe and secure shipping in Nigerian waters.

Rotimi Amaechi, minister of Transportation, who was represented by Gbemisola Saraki, minister

of State for Transportation, said there is significant global concern on the rising spate of maritime insecurity and the perception that the Gulf of Guinea Region accounts for most of these cases.

“It is for this reason that Nigeria has decided to take the lead on behalf of the Gulf of Guinea states in convening this conference to examine the strategies and coordinated responses in place to address maritime insecurity,” he said.

Amaechi, who said there have been several endeavours to address the broad array of real and potential threats in the region over time, stated that the absence of legal frameworks within member states seems to be a significant challenge in the regional effort to stem the tide.

•Continues online at www.businessday.ng

Force majeure is power sector players’ bargaining chip against FG …Presidency engages GenCos after threat of downing tools to secure N600bn bailout ISAAC ANYAOGU

I

n the fictional world of television cartoon character Superman, kryptonite is an alien mineral that has the property of depriving Superman of his powers. In Nigeria’s floundering power sector, force majeure has emerged operators’ kryptonite to keep the Federal Government in line.

The term force majeure is used in contracts to absolve parties of their obligations based on unforeseeable, external and unavoidable situations. Power sector players use it as leverage to compel

the Federal Government to part with bailout funds or stop reforms.

Much like the Nigerian Labour Congress wields strikes as an advantage in negotiations with the Federal Government, electricity generation companies (GenCos) and electricity distribution companies (DisCos) through their trade association have weaponised force majeure to extract concessions from a Federal Government shoddy with reforms and too compromised to make bold decisions.

Last month, the Federal Executive Council, Nigeria’s highest decision-making orwww.businessday.ng

gan, approved N600bn intervention funding which, according to BusinessDay checks, puts power sector bailouts at $10.33 billion since 2014. The Central Bank of Nigeria (CBN), however, kicked against it, saying operators are yet to show results for previous bailouts.

Bowing to pressure, the CBN acquiesced but the Nigerian Bulk Electricity Trader (NBET), the body that buys power from GenCos and sells to DisCos, introduced a 0.74 percent administrative charge for gas supply transactions.

This was supposed to be a precondition for the GenCos

to draw from the N600 billion bailout.

In response, the GenCos through Joy Ogaji, executive secretary of the Association of Power Generation Companies (APGC), called a press conference and threatened force majeure, citing poor remittances on energy invoices by DisCos and the new administrative charge.

“The time may just be right for GenCos to declare force majeure and release themselves of all market obligations.

Surely, GenCos will remain blameless for taking such ac-

https://www.facebook.com/businessdayng

Continues on page 37

overnors are rethinking strategies to exploit their states’ areas of comparative advantages to raise revenue and create jobs.

States are constrained by their financials as they look to the Federal Government for bailouts. The Federal Government recently provided N614 billion to fund the wages of their workers and cater to infrastructure needs. The Central Bank of Nigeria has funded the Federal Government to the tune of N4.4 trillion as the country continues to face fiscal challenges.

“Imo State is the second largest in terms of cassava and number one in terms of melon cultivation,” said Emeka Ihedioha, Imo State governor, at a break-out session at the 25th edition of the Nigerian Economic Summit, tagged #NES 25.

“We are working on tapping into these. Our legislative process should be tailored towards encouraging us with laws that advance our competitiveness,” Ihedioha said.

He explained that when he came on board, Imo was 34th on the ease of doing business index, saying that he intends to change the situation to attract investors.

He said South-East governors are discussing to rejuvenate the infrastructure in the region.

“It does not appear the Federal Government is pro-

portionate in infrastructure allocation,” he said.

Abdulrahman Abdulrazak, Kwara State governor, said he is concentrating on Sustainable Development Goals.

He said the state is investing in education and creating an environment that will help it tap the African Continental Free Trade Area (AfCFTA) when it starts, stressing that the state has an advantage in agriculture and agro processing.

Abdulrazak said that BUA Group’s $350 million sugar investment and what Dangote Sugar is doing in the state can help Kwara supply Nigeria’s 1.7 million metric tonnes need.

He disclosed that the state has provided 50,000 hectares of land to Dangote and another 50,000 hectares to BUA. He pointed out that Olam’s cashew processing plant in the state, which is biggest in the country, and other investments, are there owing to relative security in the state.

Godwin Obaseki, Edo State governor, said Nigeria’s education today should focus on training the people to think critically and towards vocational and technical education. “The key question we must keep asking ourselves is, how are states organised in terms of data and records?

Absence of all these puts competition under threat,” he said.

Obaseki further urged alignment of states and Federal Government in competitiveness.

•Continues online at www.businessday.ng

FEC approves N10.72trn budget for presentation to National Assembly TONY AILEMEN, Abuja

A

ll is now set for the presentation of the 2020 budget to the National Assembly as the Federal Executive Council (FEC) on Monday approved the budgetary proposal of N10.72 trillion for presentation to the lawmakers.

The approval, BusinessDay gathered, was given at the extraordinary meeting of the council on Monday presided over by President Muhammadu Buhari.

Although there was no briefing at the end of the meeting, BusinessDay gathered that the meeting was called solely to “put finishing touches to the 2020 budget” to be presented to the National Assembly by 2pm today (Tuesday).

A source close to the meeting had informed BusinessDay that “FEC is in agreement with the position of the National Assembly on the benchmarks as contained in the MTEF approved by the legislature recently”.

@Businessdayng

The Senate had approved all the 16 recommendations contained in the report of the National Assembly Joint Committees on Finance and National Planning on the 2020-2022 Medium Term Expenditure Framework and Fiscal Strategy Paper.

The Senate increased the proposed 2020 budget from N10.002 trillion to N10.729 trillion, an increase of over N700 billion, as contained in the MTEF, paving the way for President Buhari to submit the fiscal document.

The National Assembly had insisted on early submission of the 2020 budget proposals to ease early passage and enable the country return to the January-December budget cycle as against the current May-June budget cycle.

The new move is expected to also help the oil-rich West African nation overcome distortions in economic planning, poor budget implementation as well as oversight responsibilities of the National Assembly in budget implementation.

Tuesday 08 October 2019

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

3

4

Tuesday 08 October 2019

BUSINESS DAY

news

Like Apapa, congestion threatens operation at Onne as overtime, abandoned containers litter port … over 1,500 cleared containers abandoned as NPA vows to auction them AMAKA ANAGOR-EWUZIE

B

usiness activities at the Onne Container Terminal, operated by West African Container Terminal (WACT),havecomeunderthreatas overtimeandabandonedcontainers continuetopileupattheterminal.

The terminal, which in the last 10 months has invested billions of dollars in acquisition of plants andequipmenttohandlegrowing volume of imports, is recording poor vessel turnaround and low efficiency in performance due to congestion.

Due to insufficient space to discharge vessels calling Onne Container Terminal, ships now stay more than 10 days before they could have access into Onne Port to discharge laden containers.

Worried by the growing number of such containers, the management of WACT recently wrote the management of the Nigerian PortsAuthority(NPA)tocomplain that agents have not been coming to pick their containers.

BusinessDay findings show that government is one of the greatest culprits in the ownership of overtime and abandoned cargoes. This is as over 80 percent of overtime cargoes at the nation’s ports are found to be owned by government agencies involved in various kind of projects like independent power project.

Speaking at the combined second and third quarters stake-

www.businessday.ng

https://www.facebook.com/businessdayng

holders meeting held in Port Harcourt and Onne Port, Al-Hassan Ismaila, port manager, Onne Port, said WACT also reported that to accommodate laden containers in Onne Container Terminal, they (terminal operator) had to convert part of their car parks and examinationbaytostackingareas.

He said presently, berth occupancy at WACT terminal stood at 90percent,showingthattherewas no space for vessels with laden containerstocomeanddischarge.

“WACT terminal in Onne presently has about 1,500 containers that have been examined but are yet to be taken out by the owners. There is a limit to which the terminal operator can be able to accommodate this overflow,” Ismaila said.

According to Ismaila, the terminal has overtime containers littering the stacking areas of the port, which occupies over 30 percent of the stacking space in the terminal.

He however called on the Nigeria Customs Service (NCS) and freight forwarders to come to terms on what should be done to address the issue of congestion caused by abandoned and overtime cargoes in Onne Port.

He noted that the situation in addition to stalling the 48-hour cargo clearance policy of the Federal Government had also impactedseriouslyonthevolume of cargoes that could be handled in Onne Port, if importers take delivery of their consignments as

@Businessdayng

and when due.

Reacting to this, Hadiza BalaUsman, managing director of the NPA, said the authority was in discussion with the Nigeria Customs to find out what need to be done to auction some of these cargoes.

“We have noted that a lot of containershavebeenabandoned by consignees and that WACT terminal is overflowing with overtime cargoes. People abandon their containers because they do not want their consignment to be subjected to 100 percent physical examination,” she said.

She said responsible consigneescannotabandontheircargoes attheport,sayingthedeclarations made by a lot of consignees were not correct that was why many of them were afraid of 100 percent examination by Customs and other government agencies.

According to Bala-Usman, the NPA is taking up these issues to ensure that Nigerian ports are competitive, by having the required turnaround time for vessels as well as the right infrastructure and machineries for cargo evacuation at ports.

“We will ensure that all these cargoes are auctioned if people do not come to pick them and pay governmentthenecessarycharges attributable to such type of cargo.

We also understand that overtime cargoes need to be moved to a particular location but we need Customstobeginon-the-stopauction because that is what we need to do at this time,” she said.

Tuesday 08 October 2019

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

5

6

Tuesday 08 October 2019

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 08 October 2019

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

7

8

Tuesday 08 October 2019

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 08 October 2019

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

9

10

Tuesday 08 October 2019

BUSINESS DAY

COMMENT

comment is free

Send 800word comments to comment@businessday.ng

Democracy, security and Nigeria’s future (2) STRATEGY & POLICY

MA JOHNSON

F

rom conceptual clarifications on security and conflict, it does not follow that when a country is secure, people are secure. The nexus between democracy and management of security relates to the whole dimension of human security and the provision of basic needs to the people. What then is information management?

There exists a welter of definitions on information management. Information management in the security realm entails the practice of collecting, monitoring and analysing security-related data. It describes controls that an organisation needs to implement in order to ensure that it is sensibly protecting the confidentiality, availability and integrity of assets such as citizens, data, borders, economy etcetera from threats and vulnerabilities.

Information management will require the use of technology-tangible and intangible, and human resources to identify, generate, process and store information for eventual retrieval and dissemination for use by individuals or groups who require such data for attaining their objectives. Information management will include profiling of perpetrators of crimes and criminalities on land, sea, and air. Crime against computers and information systems where the aim is to gain unauthorised access to a device or deny access to a legitimate user is called cybercrime.

Cybercrime is very common these

days which threatens a person, a nation’s security and financial health.

Internationally, both governmental and non-state actors engage in cybercrime.

Cybercrime crossing international borders and involving the actions of at least one nation state is sometimes referred to as cyberwarfare.

Brief analysis Security in Nigeria has reached a critical stage with insurgency in the north east spreading rapidly to other parts of northern Nigeria. Similarly, there are communal clashes in the Middle Belt, kidnapping in the South-West, cultists and thugs having a field day in the SouthSouth. In fact, the military has been over-stretched, with policing duties in 34 states of the country, and battle-fatigued after 10 years of armed conflict with Boko Haram in the north east.

Nigeria has been managing violence for several decades. Managing violence is very expensive. It is better to manage peace. What we are witnessing currently, is asymmetric warfare and the proliferation of small and light weapons is of concern. National security has been compromised by terrorist organisations operating within borders of countries in the Sahel region.

The security challenge has consumed the country’s lean resources to the extent that one of the daily newspapers reported that “FG’s declining military spending limits chances of defeating Boko Haram.”

But in response, the FG says that “the great difference between 2015 and today is that we are meeting these challenges with much greater support to the security forces in terms of money, equipment and local intelligence.”

The battlefield has fundamentally shifted to the society. The country cannot fight asymmetric warfare perpetually as it will have a negative impact on development. There are conspiracy theories that

some powerful people in the society are benefitting from the war on terror. If that was true, then there will be no end to the conflict.

The security situation appears to be pathological to an extent that a former Head of State, had to express his concern that “Nigeria is going through a period of trial amidst growing tension and resentment all over the country. There is anger in the land and voices of reason are drowning rapidly.” Some security experts say that there are wide variety of motivations for these threats ranging from economic to religious to conflict over resources.

Restoring peace in the country goes beyond using the military alone. The peace which we require as a country cannot be achieved by using the armed forces to compel the enemy to submit to our will as a nation. So, all components of national power, namely diplomacy, information and intelligence gathering, economic and military, must be brought to bear to end the war on terror.

Our policy makers must put more efforts to addressing refugee issues and funding of education in the north east to improve the welfare of children in the region. The growing and boundless threat in the north east requires better deterrent capabilities and far more developed defences.

Above all, good governance to our citizens is vital to lasting peace and security. We need to apply care and caution so that the nation is not left with a disaster of monumental dimension capable of rendering the West African sub-region unstable. The governments- states and federal-must not break laws in order to uphold it. Democracy can work better if there is adherence to the rule of law.

While citizens must be law abiding and not take laws into their hands.

There are views in certain quarters that security challenges are further

‘

Cybercrime is very common these days which threatens a person, a nation’s security and financial health.

Internationally, both governmental and non-state actors engage in cybercrime.

Cybercrime crossing international borders and involving the actions of at least one nation state is sometimes referred to as cyberwarfare

compounded by information gap which can only be addressed if the country continues unabated to fund intelligence organisations effectively. That is the price the country has to pay for insecurity. The intelligence community must engage experienced and seasoned experts to develop, and conduct detailed risk assessments, provide technical and procedural countermeasures and adequate force protection measures.

In conclusion, a democratic Nigeria is only an aspiration. An economically prosperous and democratising Nigeria are unquestionably the country’s hope of attaining security. Democracy is the only known means of checking the political nuisance embedded in the nature of our politics. If we are able to sustain democracy despite its flaws and weaknesses, then the very conditions responsible for the exclusion and marginalisation of large segments of the society will hopefully disappear with time.

Elder statesmen should not shy away from dialoguing in order to resolve the anger that seems to have permeated the country. The government’s conflict management decisions should be based on quality risk assessments and vulnerability assessments of events.

Finally, permit me to paraphrase a quote by saying that in moments of despair, in our search for solutions to the security challenges, the answer is not likely to come from logical thinking. Rather for salvation and rescue of our country, we have no choice but to resort to lateral thinking. Thank You. (Concluded) The original paper is slightly modified for this column. References are contained in the original paper presented at one of the breakout sessions of the 2019 Annual National Management Conference, Abuja.

Johnson is an author and a retired naval engineer who has passion for African development and good governance

Re: Why do Nigerians still study law?

O

n the 18th of last month, David Hundeyin, wrote a nice piece titled “Why do Nigerians still study law? In the article, Hundeyin, compared the law degree to an investment that has turned out to be a bubble, due to the fact that many lawyers after spending lots of time and money in earning a law degree sometimes garnishing it with an LLM end up ,in his words, “unemployed, underemployed and ridiculously underpaid”.

Continuing he added, “in the job market of today, a 19-year-old with an SSCE certificate, an online nano-degree in Python and six months of remote experience as a developer will be significantly more employable and better remunerated than a 31-year-old with an LLB and an LLM”.

Despite this sorry state lawyers allegedly find themselves, Hundeyin is still surprised why, in his words, “naïve teenagers and pushy parents all over the country are still putting down “law” on JAMB forms”. In concluding, he suggested it was ripe to “short the bubble and try something new”.

He advised that “when making the most important investment decision of a young adult’s life – post-secondary education – students and their parents must first of all analyse the job market to make an informed decision about what to fill in on that JAMB form….it also means that Nigerians must focus now on practical skills over high-sounding degree certificates”.

Within a short time from publication, in my opinion, this article became viral on Law blogs, different WhatsApp group for lawyers etc. On WhatsApp, it was shared on many platforms by even non-lawyers. Personally, friends and relatives sent it to me. I had no option than to read the article. When I read the article, I quickly appreciated the literally wit of Hundeyin, indeed, his degree in Creative Writing and Media, Culture & Society was a good investment. At first, I agreed with everything he said, but when I re-read it, I

gradually began to highlight some hasty generalisations and wrong premises.

Another source of worry for me, was that in all the groups where this article was shared, no lawyer objected or had a contrary view, infact, many applauded the article as being the gospel truth.

Indeed, this quick acceptance of the article and the inability of many lawyers to see its flaws, acknowledges the fact, that the article struck a chord with many lawyers, which is, the inadequate welfare packages.

Even though Hundeyin’s article is titled, “Why do Nigerians still study law?” I doubt he really undertook a rigorous, historical and holistic search into finding out the “Why”, because if he did, his article would have come out differently by finding out other reasons apart from the “investment’ reason, this imbalance is actually the Achilles heel of his beautifully written article.

Hundeyin’s submissions in his article, will be absolutely right, if the only or major reason people undertook legal education was for pecuniary reasons. Indeed, the article makes it seem as if the “poor welfare” is a new phenomenon or a detail that was hidden from the public. It wasn’t.

From time immemorial the role of an advocate hasn’t been solely or majorly for material wellbeing, law has been synonymous to service, the black robe lawyers wear even signifies this.

Behind the robe, there is a piece of triangular cloth attached to the left shoulder, often described as violin shaped. The cloth was a sack where clients and well-wishers could put ex-gratia payment, after a lawyer’s advocacy in court.

This was the way a lawyer could “earn” his fees since clients were not paying. Similar story applies in Nigeria where many older lawyers will narrate how they were paid professional fees in form of cash crops etc, most times not being sufficient or adequate to be professional fee. Even in recent times, we lawyers are forced out of newww.businessday.ng

cessity to provide numerous pro-bono services.

More than monetary “investment”, many teenagers and parents – who aren’t naïve and pushy as Hundeyin may have us think – look at other investment such as investment in service, relevance, trust, prestige, respect, honour etc.

If it was purely monetary investment, why do professionals with 3 or 4 degrees yearn to have a law degree? In fact, just some years ago, we had an 80-year-old man who was called to the Bar. Speaking from a personal example, if I and my parents were looking at the pecuniary benefits that would have come out from investing in my legal education, I would not have been a lawyer, as the family friends who were lawyers or my parent’s lawyers were not well off financially than my parents. If they wanted “investments”, my parents and many other parents would have sent us to Alaba International Market, or Ladipo which have produced many billionaires. They had more in mind.

Also, Hundeyin seems to overlook the fact that many lawyers are not the first lawyers in their families, many have parents, siblings and relatives who are lawyers who are obviously aware of the “bubble” in investing in the law degree, why aren’t they discouraging their love ones from undergoing a path that will allegedly lead them to despair? Cleary, there’s more to this than meets the eye’ As highlighted above, Hundeyin failed to consider other reasons, why a law degree is sought. I will do him the honour of providing some.

Firstly, a law degree unlike other profession is like a big fishing net, it provides wider opportunities for lawyers, it makes it easier for a lawyer to work comfortably even in non-legal professions as a human resource, journalism, compliance, public relation, writer, international relations etc. So, when a parent advises his/her child in the art class to have a law degree and not necessarily specialize in the other Art, it’s a

https://www.facebook.com/businessdayng

J.B NWACHUKWU decision made out of goodwill to give the child more opportunities.

Also, a law degree comes with high selfesteem and respect, many people not only in Nigeria but around the world respect lawyers even if the lawyers account is red. The legal profession comes with a certain nobility and class which most people want to partake in. Moreso, even those that don’t practice law or earn their livelihood from law, still want to identity that they are lawyers.

In relevance, a lawyer shares many things in common with other professionals who serve, such as doctors and teachers, these professionals are of more relevance and impact and are needed more. For example, I have no doubt that an IT guy with no university degree will earn far more than me, I know this from first-hand experience in reviewing numerous labour agreement for them.

That’s exactly my point, while they need me directly to review their contracts and provide legal advice on other issues like Intellectual Property (IP) etc, I literally don’t need them for anything, apart from my professional fees, same goes for teachers and doctors. Society needs the services of lawyers, doctors, Religious leaders and teachers, more than they need society.

Moreso, the legal education of a lawyer is rich and vast, lawyers when well-groomed are skilled in oratory, literary prowess, history, analytical and logical reasoning, eye for details etc. These are “skills” many parents desire their kids to acquire.

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

@Businessdayng

BUSINESS DAY

Tuesday 08 October 2019

COMMENT

11

comment is free

Send 800word comments to comment@businessday.ng

Insights & views on culture (1): Acemoglu & Robinson’s ‘The Narrow Corridor’

RAFIQ RAJI

T

“

he Narrow Corridor: States, Societies and the Fate of Liberty”, the latest book by Daron Acemoglu, a professor of economics at MIT, and James Robinson, a professor at the Harris School for public policy at the University of Chicago, is a goldmine of insights.

What is state capacity? It is the ability of a state to achieve its objectives.

That simple. Such simplicity is the recurring theme of the book. The suggestion is not that the authors avoid the complexities of the subject they explore, but rather that they have sufficient mastery of it to put their ideas forward in the most straightforward manner.

Their main idea is that for liberty to thrive, there must be a balance between the state and society. And they impressively show how a lot of the governance problems around the world stem from an imbalance between the two. The objectives of a state include law enforcement, conflict resolution, economic regulation,

provision of infrastructure and public services. A state has capacity when it is able to achieve these objectives. When a state lacks capacity, however, society dominates. The dominance of either the state or society stifles liberty, which is the condition that underpins innovation and prosperity.

Society is culture; that is, “customs, traditions, rituals and patterns of acceptable and expected behaviour that have evolved over generations.” When culture dominates the governance of people’s lives, the influential custodians tend to get a better deal than the rest of society. And not until there is a state with capacity to balance the scales, culture becomes a cage that the elite beneficiaries use to stifle the progress of the rest.

‘Red Queen’ Thus, as society predates the state, “it is (the) state that creates liberty.” To sustain liberty, however, the state and society need to continually compete with each other, with “neither getting the upper hand.” The authors call this continued balanced competition between the state and society a “Red Queen” effect. And this is true in reality, isn’t it? Countries with state capacity and strong civil societies are the ones Africans are willing to brave the dangers of the seas to reach.

“Societal mobilisation” or “the involvement of society at large (in

particular non-elites) in politics” take the forms of “revolts, protests, petitions, and general pressure on elites via associations or the media”.

It could also be via participation in elections to elect or be elected. A society’s power rests on its ability to “impose (its) wishes on major social and political decisions” through these means. When the state is too powerful and society is not able to exercise its power, liberty is similarly stifled.

The edge Since state-building is essentially a countervailing force to cultural hegemony, “would-be state builders are more likely to succeed and emasculate the norms meant to restrain them if they have an ‘edge’.” That is, “something special, making it possible for them to overcome the barriers in their way.” This “edge” could be religious, organisational, technological or personality-related.

An African example of one such state-builder, whose edge was organisational, is King Shaka of Zululand in what is today’s KwaZulu-Natal province of South Africa. The Zulu’s dominance in today’s South Africa is a testimony to Shaka’s state-building legacy. But for Shaka to succeed, he “had to break parts of the cage of norms” in Zululand, especially “kin relations and supernatural beliefs, in order to weaken sources of compet-

‘

When culture dominates the governance of people’s lives, the influential custodians tend to get a better deal than the rest of society.

And not until there is a state with capacity to balance the scales, culture becomes a cage that the elite beneficiaries use to stifle the progress of the rest

ing power.”

“Restrictions based on norms, traditions and customs dull economic incentives and opportunities, and need to be loosened for economic growth to flourish.” This is because “innovation needs creativity and creativity needs liberty.” That is, individuals should be able to act and go about their affairs without fear and experiment with ideas, whether they are pleasant to others or not. Put another way, “prosperity and economic growth originate” from “incentives for people to invest, experiment, and innovate.”

A state is required to bring all these about. In the absence of one, norms or culture prop up their influential custodians at the expense of the rest.

Because like the authors put it, “you need opportunities to be widely and fairly distributed in society, so that whoever has a good idea for an innovation or valuable investment gets a chance to carry it out.” Thus, “liberty in the economic domain necessitates the levelling of the playing field and the lifting of these restrictions.” Social mobility and prosperity for all would be elusive otherwise.

“Dr Raji is chief economist at Macroafricaintel.

He was previously an Africa Economist at Standard Chartered Bank, London, UK. (Twitter: @ DrRafiqRaji)”

Industry, innovation and infrastructure: Towards a more sustainable path

E

conomies globally have witnessed inclusive growth through the Micro Small and Medium Enterprises (MSME). So, it apropos that MSME’s are the engine for economic growth. In African countries such as South Africa, Kenya, and our neighbours Ghana, small businesses contribute immensely to their respective economies in the form of innovations, job creation, tax remittance to the government, increase to the gross domestic product (GDP) and so on.

Industry, innovation and infrastructure serves as the basis for this article and it is no coincidence that it is also sustainable development goal 9 of the United Nations Development Program. At the Development Bank of Nigeria, providing access to credit is the primary objective because the financing constraints faced by the MSME segment have stifled inclusive growth in the country.

Collectively, this segment remains the largest employer of labour and based on SMEDAN’s report, there are over 41 million MSMEs contributing to over 50 percentage of Nigeria’s GDP. In the same breath, less than 5 percentage of these businesses have adequate access to credit through the financial system. Perhaps more importantly is the operating environment that businesses in this segment are faced with daily.

Ease of doing business and economic development In my humble opinion, SDG 9 is perhaps at the heart of the MSME segment of the economy. It is my view that once Nigeria as a country can appropriately provide and deliberately follow/implement a blueprint in the context of providing the anecdote for safe guarding some industries from external competition i.e. textile and manufacturing as well as spurring innovation in other industries such as financial services, mining and quarrying, education and healthcare and certainly the much needed infrastructure

development that will reduce the cost of business internally as well as aid in reducing key economic indices such as unemployment.

I sincerely believe other aspects that are wanting in the economy will automatically begin to take shape.

The nexus between ease of doing business and economic development can be explained in six main strands in entrepreneurship literature.

Exports Asongu & Odhiambo (2018) opined an export-focused economic development strategy is based on market-oriented economic policies that provide enabling conditions for entrepreneurship and conducting business domestically. As such, the domestic business environment should also be competitive by means of cutting-edge technologies and participation in foreign markets.

Foreign reserves that are generated from export surplus are essentially used in stabilising the economy in times of both monetary and fiscal crises. Such stabilisation is necessary in order to attract future investments as well as prevent domestic entrepreneurs and foreign investors already operating in a country on the continent to leave. The economic environment in Nigeria has been predominantly driven by oil exports. Although the government has made some strides in its attempt to diversify away from crude with the Africa Growth an Opportunity Act (AGOA) strategy by primarily focusing on non-oil exports, such as agricultural products, we have witnessed some of the challenges that permit the countries response is hinged on improving innovation and infrastructure deficit.

Living standards To be sure, doing business in Nigeria can contribute towards the improvement of living standards because entrepreneurs in any business environment pioneer and tailor innovations that enhance the overall living quality for employees, customers and

www.businessday.ng

other stakeholders in the community. Such innovations pertain to goods and services that are environmentally friendly as well as the development of smart cities. The underlying view of positive externalities of doing business and economic development is in accordance with literature on the importance of doing business in the delivery of public goods and reduction of poverty.

GDP and GDP per capita Although axiomatic, doing business provides enabling conditions for increased GDP growth and GDP per capita. To be sure, doing business improves aggregate investments, consumption and exports which are constituents of the GDP. More importantly, the process of doing business employs factors of production such as; labour, land and capital that contribute to value-added goods and services which augment national income, national product and by extension, GDP per capita, especially when the national product is equitably distributed across the population. These associated positive economic externalities from doing business are consistent with a knowledge economy but more importantly with building the operating environment of the country.

Balanced development Policies of setting-up businesses can be tailored to address concerns of unbalanced regional development in the perspective that entrepreneurs can be provided with incentives to locate and develop their businesses in localities and regions that are less developed.

I firmly believe the corresponding positive development externalities associated with the establishment of new businesses which can contribute towards balanced regional economic development include: amelioration of transport infrastructure (e.g. roads, rail linkages and airports), employment avenues, and enhancement of private and public services such as stable electricity, schools, water supply and hospitals.

https://www.facebook.com/businessdayng

JOSEPH NNANNA

This cannot be overemphasised given the destabilisation of the north-eastern part of the country. One doesn’t need to imagine the lack of basic amenities residents of these communities are faced with daily because so many Nigerians face these challenges without the added misery of violent insurgency.

So, in the spirit of building industries, innovating existing ones and finally improving on infrastructure, it is fitting that a balanced and more systematic approach should be taken.

Wealth sharing and creation Providing credit that enables business continuity contributes to the creation and sharing of wealth in an economy. This is essentially because, in the establishment of a business, capital is attracted from a plethora of shareholders (i.e. banks, the public and investors) by entrepreneurs. Moreover, the process of creating a business does not exclusively mobilise wealth from the public, but also permits participating investors to share benefits from the transformation of new ideas into production processes with a pool of new capital. Ultimately, the process of business development leads to wealth creation and distribution among shareholders and stakeholders.

Note: the rest of this article continues in the online edition of Business Day @https://businessday.ng Prof. Nnanna is the chief economist at Development Bank of Nigeria

@Businessdayng

12

Tuesday 08 October 2019

BUSINESS DAY

EDITORIAL PUBLISHER/CEO

Frank Aigbogun EDITOR Patrick Atuanya DEPUTY EDITOR John Osadolor, Abuja NEWS EDITOR Chuks Oluigbo EXECUTIVE DIRECTOR, OPERATIONS Fabian Akagha EXECUTIVE DIRECTOR, STRATEGY, INNOVATION & PARTNERSHIPS Oghenevwoke Ighure ADVERT MANAGER Ijeoma Ude FINANCE MANAGER Emeka Ifeanyi 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

The rule of law is national interest

C

iting national interest as reason for disobeying court orders and trampling on the rule of law is disingenuous. In a democracy, the rule of law, and not what the administration thinks, is the national interest. Prosperous and sustainable societies are built around respect for the rule of law and on strong institutions. Disobedience of court orders, disregard for the rule of law and destruction of institutions are the sources and greatest acts of corruption in a democracy and negates the possibility of building a prosperous and democratic society.

Early in the life of this administration, when the Attorney General of the federation and minister of Justice said the illegally detained former National Security Adviser would not be allowed to enjoy the bails granted him by several courts in the land in the interest of the ‘public good’, we thought he was overreaching himself and was not

speaking for the government.

How wrong we were.

But even the president was to repeat the same line of thought at the 59th annual conference of the Nigerian Bar Association in Abuja. He was quoted as saying: “Our apex court has had cause to adopt a position on this issue in this regard and it is now a matter of judicial recognition that where national security and public interest are threatened the individual rights of those allegedly responsible must take second place in favour of the greater good of society.”

Aside the fact that the president and his speechwriters were wrongly interpreting the decision of the court, two questions come to mind. The first is what is ‘public good/national interest and who determines the public good or national interest?

Despite the fact that no government, as yet, has been able to define the terms and there is no body of laws called public good or national interest, governments still cite it often as reason for abridging the rights of citizens. In effect, govern-

ments usually have the sole rights to determine what national interests or public goods are and they may be no more than regime or personal interests.

This has allowed governments to deny or abridge individuals’ rights while allowing them to get away with murder literally and metaphorically.

Secondly, the case being relied by the president and his attorney general was that between the federal government and Asari Dokubo. In that case - a treasonable felony one - it was the court that declined to grant the defendant bail based on the nature of the crime for which he was accused and not the government. Like we said the last time, “only under tyranny would the Presidency or the executive arm of the government act as the accuser, the law enforcer and the judge at the same time”.

Sadly, the same argument of national interest is being used to disregard court orders or the rule of law in dealing with government critics. Clearly, under the Buhari Presidency, the whims and caprices of the president and the sustenance of

his rule is more important than the rule of law. But it should be noted that those who ignore the rule of law today, will need the law to protect them in future.

What is more, this manner of reckless behaviour has consequences, which will deeply hurt the country and its corporate image among the comity of nations. First, no self-respecting country will do business with a country that doesn’t respect its laws. Second, no foreign investor will invest in a country that has no regard for its laws and where the courts are not independent or cannot be trusted to arbitrate on contract and trade disputes impartially and efficiently.

It is therefore very dangerous to the freedom of all citizens when the rule of law is ignored in the name of a ‘perceived’ public good or national interest as determined by the President and not by the courts. The President we see today, no matter how good intentioned, will not be there forever. Only the law, and quest for justice lasts forever and justice is what everyone seeks for and deserves.

HEAD, HUMAN RESOURCES Adeola Obisesan

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

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

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

OUR CORE VALUES

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

Tuesday 08 October 2019

BUSINESS DAY

COMMENT

13

comment is free

Send 800word comments to comment@businessday.ng

The economics of geopolitics: Why US senate targeted Philippines and other countries

T

he new senate bill targeting the Philippines and some other countries – Turkey, Egypt, Saudi Arabia – is fuelled by controversial political and economic agendas that have caused turmoil since the 1980s.

For some time, US senators Richard Durbin (Dem, Illinois) and Patrick Leahy (Dem, Vermont) had pushed for an amendment in the 2020 state and foreign operations appropriations bill by the US senate appropriations committee. Essentially, the amendment would deny entry of Philippine government officials involved in the detention of Philippine opposition, Senator Leila de Lima.

Last week, the US senate panel approved the amendment. Durbin considers De Lima’s detention a “politically motivated imprisonment.” According to Philippine government, De Lima was arrested and detained in 2017 for allegedly asking money from drug convicts to fund her senatorial campaign and for allowing the drug trade to continue in the national penitentiary while she was the justice secretary. Despite evidence, she claims the cases against her are “politically motivated.”

Reportedly, the senate amendment also called for the same action against officials of the Egyptian government for the “wrongful detention” of a US citizen and government officials of Turkey, Egypt, or Saudi Arabia.

In the Philippines, the provision can

be seen as part of the continuing political backlash following the 2016 Duterte election triumph, and the consequent meltdown of the Liberal Party (LP).

Usually heavy losses trigger reassessment, which can rejuvenate a political party and renew its leadership. Yet, that did not happen. As LP failed to attract voters in the Philippines, some of its leaders began pressure campaigns in the US and EU, to raise their diminished political capital at home.

In the past year, these campaigns have included frequent-flyer visits to Washington. In April, they resulted in the condemnation of human rights violations in the Philippines by senator Durbin, along with senators Edward Markey (Dem, Massachusetts), Marco Rubio (Rep, Florida), Marsha Blackburn (Rep, Tennessee) and Chris Coons (Dem, Delaware). The same resolution also called on the Philippine government to drop all charges against [CEO] Maria Ressa and (her online publication) Rappler.”

What’s behind the stated concerns for human rights and democracy?

Politics of campaign finance LP figures appeal to senators. Senators rely on campaign finance. The senators behind the Philippines amendment, in particular, get their political money mainly from lobbyists, defence contractors, finance, and especially large individual donors, according to congressional research.

In turn, the financial heavy-weights that drive US politics – Soros and his Open Society Foundations, Koch brothers, Adelsons, Mercers, Steyer, Singer and others – have their own economic agenda, which has geopolitical implications.

With an estimated net worth of $1.5 to $3 million, Richard Durbin is the influential senate democratic whip,

who has been haunted by allegations of conflicts of interest. Leahy is a senior senator, who was first elected already in 1974, while Ed Markey is a senior democratic senator, who has been challenged by Joe Kennedy III for the Senate seat. Both Leahy and Markey have a net worth of $2 to $4 million.

Former beauty pageant, Marsha Blackburn is a junior senator and ultraconservative Tea Party Republican, who vice-chaired Trump’s presidential transition team and nominated him for a Nobel peace prize for talks with North Korea. Democratic junior senator Chris Coons has a net worth of $8 to $12 million.

The ultra-conservative Marco Rubio has claimed that De Lima has been in prison on “bogus charges.”

Former Senator Trillanes, who began his political career with a failed coup d’état attempt in 2003, met with Rubio already in fall 2017. Having previously criticised President Duterte’s war on drugs, Rubio said the two also discussed corruption, human rights, and particularly the US-Philippine alliance.

After the failed 2016 campaign, Rubio has recently profiled himself as a conservative human rights defender and democracy promoter. He is for regime change in Venezuela, Hong Kong and China, Iran and Russia. His financial debacles are notorious. With net worth less than $500,000 but outsized political ambitions, critics claim he is dependent on and thus useful to ultra-rich donors, particularly his key funder – the notorious Paul Singer.

There are no free lunches. What kind of economic returns do these funders expect from their political investments?

Vulture capitalists With a net worth of $3.5 billion, Paul Singer sees himself as a philanthropist, who promotes the rule of law, democ-

‘

In the Philippines, the provision can be seen as part of the continuing political backlash following the 2016 Duterte election triumph, and the consequent meltdown of the Liberal Party (LP).

Usually heavy losses trigger reassessment, which can rejuvenate a political party and renew its leadership. Yet, that did not happen

Employment (offer) letter

S

o, I have been away for a few weeks attending to family matters. Actually, I became a grand mum again. I know I don’t look old enough to be a grand mum. Thanks for all the congratulations. So, why have I been off if I am the grand mum and not the mother? Well in my culture as the grand I’m literally dropping everything to be with the new mum. How do we integrate tradition, family culture and the work place? In the days when my father was a human resource director, they did not try to integrate but now the world is changing and dynamic companies are taking many things into consideration.

Today, in line with completing our recruitment journey we will be talking about the employment letter which is actually the offer letter. The fact that it is called an offer means it can be accepted or it can be turned down. For example, the candidate may choose to accept the job offer and return a signed letter as a formal acceptance of the position. The reverse or a counter offer may be the case if the offer doesn’t meet the candidate’s compensation package expectation The offer letter does not become an employment letter until it is accepted by the proposed employee and signed by him/her. Once it is accepted, it then becomes a contract, binding on both parties. To change it will mean a variation or even a termination of the original contract.

The contract must contain certain terms and conditions. A contract gives both you and your employee certain rights and obligations. The most common example is that the employee has the right to be paid for the work done while the employer has the right to give

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

Dan Steinbock is the founder of Difference Group and internationally recognised expert of the multipolar world economy. He has served at the India, China and America Institute (US), Shanghai Institute for International Studies (China) and the EU Center (Singapore). For more, see http://www.differencegroup.net/

OLAMIDE BALOGUN

reasonable instructions to employee to ensure the work is done.

What should be included in such a letter is usually almost fixed but you must be sure what the role is – permanent, contract, full time, part time or a commission-based employment.

The offer letter is necessary because it helps to show the basic terms and conditions under which the job can be down. I say basic terms because there are some more details that will most likely be in the company’s hand book or other documents.

There are many companies who don’t give out letters of employment and so their employees really have no clue what their employment is based on or what it contains. There are no terms and conditions. This means there is no consistency in work done and no consistency in quality expected and quality delivered. There will always be issues that come up from time to time and things that need to be explained and resolved as time goes on. A verbal job offer is usually not worth much because either or both parties may forget what they agreed or more importantly may not be able to enforce what was agreed.

In some countries, the labour laws govern terms and conditions of employment. However, in our environment because we don’t have robust labour laws it is always best to give offer letters. Those with unskilled daily paid workers I know don’t ever bother with documentation because of the very nature of employment. It is transient and unstable.

Like I said before consistency will be difficult and when there is no consistency even the customers are not satisfied.

www.businessday.ng

racy and LGBTQ rights. His hedge fund Elliott Management Corporation (EMC) specializes in distressed debt acquisitions. As a pioneer “vulture capitalist,” he buys up sovereign bonds on the cheap and then goes after countries for unpaid debts.

After the ‘70s energy crises, many fragile economies borrowed far more than they could repay. In the 1980s, that led some 50 economies to default or to restructure their debt. In Latin America, it caused a lost decade, but it also penalized Poland, South Africa and parts of Southeast Asia, such as Vietnam and the Philippines.

In vulture capitalists’ business, such crises are considered great opportunities, despite the great economic losses and human tragedies in the target countries.

In the mid-1990s, Singer purchased sovereign debt from nations in or near default, such as Peru and Argentina, and Congo-Brazzaville. Next the International Monetary Fund (IMF) rushed in to “help” imposing budget cuts and heavy austerity measures, forcing the governments to renegotiate what they owed.

In the past, Singer has targeted countries mainly in Latin America and sub-Saharan Africa. As prosperity levels are rising in Asia, Singer seems to be looking at targets in the East.

I remember once many years ago my pharmacist brother was explaining the need for formulas, weights and measurements and documentation. He wanted me to imagine what it would seem like if every time I opened a bottle of coke it was a different taste and I was not sure what it would taste like for sure. I would soon lose interest in the product.

Documentation also helps the company not to have reinvent the wheel every time somebody needs to be employed.

A good employment contract is beneficial to both the employee and the employer. It spells out the rights and obligations of each party, protects the job security of the employee and protects the employer from certain risks such as the release of confidential employer information after the term of employment ends.

The content of a letter of offer are the following at the very least.

What kind of position contract permanent or part time? job description, job title reporting structure, starting date of employment and length of probation, salary and benefits information and eligibility, acknowledgment of offer and confirmation of acceptance.

The job offer may be conditional, which means it’s contingent upon the proposed employee completing additional steps like passing a background check, reference check, or a preemployment drug test.

As much as you can it is always good to do background checks to ensure the information given is correct and, in some cases, to establish the integrity of the proposed employee. There was once we were the recruitment consultants to a university and we were helping them

https://www.facebook.com/businessdayng

recruit a bursar.

When we conducted a background check, we discovered that the candidate had been dismissed from one of his jobs which immediately threw up a red flag. We also then found out that he was building a few houses. This told us he somehow had much more money than his employment was giving him and we could not see where the excess money was coming from. Needless to say, he was never employed.

We will be talking about background checks in another article.

This offer is usually stated that it is for a certain time only just to ensure that the contract can be signed and completed within a reasonable time frame. This is to ensure the company is not held to ransom and made to leave the offer on the table indefinitely.

This offer letter once signed becomes one of the documents in the employee file.

The offer letter that becomes a contract upon signature of the two parties, the employer’s representative and the proposed employee. It is an extremely important document that both parties keep a copy of and each must keep safe because it forms the basis of their relationship.

As the year draws to a close, it is a time to ensure this year’s goals were met and next year’s goals are being set. In setting goals, it is important these days to think completely out of the box because the only companies making waves are those that are disrupting the industries, they are in. Doing things in absolutely different ways.

Have a great weekend.

@Businessdayng

14

Tuesday 08 October 2019

BUSINESS DAY

COMPANIES & MARKETS

COMPANY NEWS ANALYSIS INSIGHT

BANKING

Moody’s says adoption of e-payments by Nigerians is credit positive for banks … as electronic payment transactions hit N40.48trn in second-quarter OLUFIKAYO OWOEYE

C

redit rating agency, Moody’s, has described the rapid growth in electronic payments in Nigeria as credit positive for lenders.

Banking statistics released recently by the Nigerian Bureau of Statistics (NBS) show that a total of 711.29 million transactions valued at N40.48 trillion were recorded on electronic payment channels within the months of April to June representing the second quarter of the year.

The growth in electronic payments is at the expense of branch-based cheque and ATM transactions.

P e t e r Mu s h a n g w e, Banking analyst at Moody’s said for Nigerian lenders the increasing use of e-payments by customers is credit positive as it gives the banks a new channel for revenue generation and ability to cut costs.

“From a low base, the value of internet, mobile and point-of-sale transactions continue to grow substantially while cheque transaction fell 6.4percent in 2018,” he said.

Analysis of the figures show that NIBSS Instant Payments (NIP), an account-number based, online-real-time Inter-Bank payment solution was the preferred funds transfer platform within the period as it recorded the highest volume transaction at 271.34 million valued at N25.18 trillion as compared with N24.16trn inQ1 2019.

A breakdown shows that in the month of April, a total of 87.94 million transactions valued at N8.27 trillion were carried out using NIP. In May, a total of 95.98 million transactions valued at N9.03 trillion was carried out while in June, 87.42 million transactions valued at N7.86 trillion were carried out.

During the quarter under review, the volume of cheque transactions stood

at 1.94million valued at N1.18trn compared to N1.152trn in Q1 2019.

Volume of transactions via the Automated Teller Machine (ATM) stood at 221.65 million valued at N1.69 trillion, while total volume in April stood at 75.04 million valued at N575.86 billion. For the month of May, a total of 75.43 million transactions were carried out valued at

N580.86 billion and June had 71.18 million volume transactions valued at N542.43 billion.

Point-of-Sale terminals also recorded huge volume of transactions at 103.93 million valued at N749.81 billion. Volume transaction in April via the POS stood at 33.36 million valued at N246.09 billion, the volume increased in May to 35.46 million val-

ued at N257.73 billion, the volume, however, decreased marginally to 35.09 million valued at N254.99 billion.

The rapid mobile penetration has seen banks’ customers conduct their transactions using mobile payment applications.

Within the second quarter, the volume of transaction stood at 63.30 million valued at N1.15 trillion.

Volume of transaction via website platform stood at 27.59 million valued at N116.25 billion.

Volume of transactions through Remita, an electronic payment platform that helps individuals and organizations to easily receive and make payments across all banks, from anywhere and at any time stood at 11.04 million valued at N4.87 trillion.

DEALS

Kenyan E-Logistics firm expands to Nigeria DANIEL OBI

K

enyan e-Logistics company, Lori, has officially announced its expansion to Nigeria in a bid to cement its footprint across Africa.

The company, which is the largest eLogistics service provider in East Africa, launched in Kenya in 2016 to seamlessly connect cargo owners to transport in frontier markets.

Over the past 10 months, according to a statement, Lori has completed a successful pilot in Nigeria with some of the country’s top cargo companies including Olam,

Honeywell Flour Mills and Flour Mills Nigeria.

This expansion is said to present a massive opportunity for Lori, as the company seeks to facilitate and connect technology innovation, smart policy and government partnership, and seamless operations to continue to lower the cost of goods.

In July, Lori announced the appointment of new global leadership to drive the company’s expansion efforts across Africa. “Lori is at the forefront of revolutionizing cargo transport across Africa from the ground up,” said Uche Ogboi, Lori Chief Operating Officer in the statement.

L-R: Tinuade Awe, executive director, Nigerian Stock Exchange (NSE)/awardee; Tolulope Odebiyi, senator representing Ogun West district/ awardee; Kesingthon Adebutu, chairman, Premier Lotto Limited/awardee; Ituah Ighodalo, senior pastor, Trinity House; Allen Onyema, chairman/ CEO, Air Peace/awardee, and Seun Awobajo, awardee, at the 2019 Trinity House Honour Nigeria Awards in Lagos. Pic by Olawale Amoo

CONSUMER GOODS

Pepsico’s Q3 profit slumps 16% despite higher OLUFIKAYO OWOEYE

S

oft-dr ink giant, PepsiCo recorded a 16 percent decline in profit for the third quarter ended Sept.

7 to $2.1bn from $2.5bn a year earlier.

However, the makers of Pepsi’s net revenue surged 4.3percent to $17.19 billion in the third quarter, beating analysts’ estimates of $16.93 billion as increased spending on advert and other administrative expenses ensured more sales

growth for the company.

According to the company, it has increased investment in advertising and marketing by 12% year-to-date.

Meanwhile, on the rationale behind the acquisition of Pioneer Foods, the management said it is putting capital against a market opportunity that will deliver itself in the next 20 years adding that the investment is a good one.

“What Pioneer gives us is more scale in a con-

tinent where you’re successful not only because you have good products, but you need to have very good infrastructure, very good go-to-market, very g o o d ma nu f a c t u r i n g , clearly closer to the consumer and very good talent. I think from Pioneer, we get a very good set of brands across multiple categories, starting with basic food, but going all the way to more sophisticated breakfast solutions and juice solutions gives us great talent, great lo-

cal talent that understands how to operate in Africa,” The makers of Aquafina Water announced in July to acquire South-Africa based Pioneer Foods for $1.7bn.

The deal is not yet closed. Management noted that Pioneer’s product portfolio was complementary to its own and would help PepsiCo to expand in sub-Saharan Africa by adding manufacturing and distribution capabilities.

Editor: LOLADE AKINMURELE (lolade.akinmurele@businessdayonline.com) Graphics: Samuel Iduh

Tuesday 08 October 2019

COMPANIES&MARKETS

BUSINESS DAY

15

Business Event

INDUSTRIALS

Lafarge Africa relaunches ‘Elephant Supaset’ cement in Nigeria SEYI JOHN SALAU

A

s part of its commitment to continuously drive excellence and innovation in the manufacturing industry and built environment, Lafarge Africa Plc has relaunched the ‘Elephant Supaset’ cement brand to deepen market share and help deliver quality service for players in the built environment of the Nigerian market.

The newly branded Elephant Supaset cement, now in horizontal bags, is the first cement formulation specifically positioned for block making. According to manufacturer, Supaset is tailor-made to complement the efforts and promote the businesses of artisans, specifically block makers and other building construction workers.

Michel Puchercos, the CEO of Lafarge Africa Plc, said the introduction of this improved formulation of the Supaset is in line with the ‘Growth’ pillar of Lafarge Africa’s Strategy 2022, ‘Building for Growth’ which aims to drive profitable growth and accelerate performance in key areas.

According to Puchercos,

for 60 years, Lafarge Africa has continued to lead technological advancement in the Nigerian manufacturing sector. “Our global presence and Research Centre in Lyon, France provides a unique opportunity for us to deliver in line with best practices and create innovative products and solutions that deliver more value to our customers,” he said.

He opined that the newly branded Supaset is a solution to the long yearnings of its customers, especially block makers who have lost investments as a result of cement products that do not guarantee the needed strength for construction of buildings and other strong high concrete construction works.

Gbenga Onimowo, the commercial director of Lafarge Africa Plc said the rebranded Elephant Supaset cement is in response to customers’ needs and in line with global industry standards.

‘We launched Supaset because we have a unique understanding of the needs of our customers and our end users. With our access to global best practices, innovative solutions from the Lafarge Holcim group, we were able to identify and

introduce Supaset to take the lead and provide real solutions in construction.

We understand the huge losses that people have to deal with due to the lack of cement formulation that guarantees fast setting and superior quality,” he stated.

According to Onimowo, Supaset is a rapid-setting cement that enables blocks dry and set fast, while retaining its quality and ensuring no cracks and breakages. He opined that the desire to further secure and grow its market share within the cement segment influenced the introduction and rebranding of Elephant Supaset cement.

In addition to launching the new look bag and an improved product performance; Lafarge Africa has initiated a new Marketing Communications campaign across conventional and new media channels. Lafarge Elephant Supaset is now positioned as “The Chairman” for the construction of solid structures.

Onimowo stated further that as the first specialized cement for block making, precast moulds and concrete applications, Elephant Supaset reaffirms Lafarge’s commitment to innovation and customer satisfaction hinged on customer feedback.

L-R: Kolawole Fayemi, executive head of department, legal; Oluseyi Olanrewaju, finance director; Zakari Usman, executive head of department, business development group, and Solomon Ogufere, commercial director, all of Vodacom Business Africa Nigeria, pose with awards scooped by the pan-African corporate connectivity and telecommunications provider, at the 3rd Nigeria Tech Innovation and Telecom Awards in Lagos

L-R: Patrick Otoro, founder, Patrick Otoro Productions Limited; Boss Mustapha, secretary to the government of the federation; Abasi-Ekong Udobang, senior manager, program implementation, MTN Nigeria, and Anas Galadima, senior manager, public affairs, MTN Nigeria, at the MTN Foundation sponsored ‘Agbarho: The Musical’ stage play, in Abuja.

COMPANY RELEASE

Rensource Energy inducts new cohort of female engineers JOSEPHINE OKOJIE

R

ensource Distributed Energy Limited has appointed a new cohort of female Electrical and Electronics Engineers.

The new employees were the highest performers in a competency test administered by the company, from the pool of over 300 applications received.

This engagement of the engineers was preceded by a rigorous recruitment pro-

cess which saw them writing aptitude test, undergoing group interviews and oneon-one interviews with the recruiting manager.

Anu Adasolum, chief operating officer, Rensource Energy, while formally welcoming them the female engineers said that the decision of the company to specifically target female engineers in its latest recruitment exercise was part of the company’s policy to further entrench its belief of workplace diversity.

She noted that the era of some jobs being the exclusive preserve of men is gone, especially as women have proven they have same competence to function in similar capacity as their male counterparts when given the opportunity.

Speaking further, Adasolum advised that organisations need to take deliberate steps towards upturning the difficulties female engineers face in securing jobs that they are eminently qualified for.

L-R: Deise Smith, co-founder/creative director, Gemona West Interiors; Jennifer Chukwujekwe, founder, Jenniez School of African Interior Design, and Naomi Smith, co- founder/commercial director, Gemona west Interiors, at the Blueprint Conference 2019, in Lagos

FCMB celebrates customers, commits to excellent service delivery MICHAEL ANI

F

irst City Monument Bank (FCMB) has restated its commitment to attaining the highest level of customer advocacy by leveraging on its solid business models, bespoke solutions, excellent service delivery, highly professional staff, and technology to turn the aspirations of its customers to opportunities.

The Bank gave the assurance in a statement to celebrate this year’s international

Customer Service Week, holding from October 7 to 11, 2019, across its 206 branches in Nigeria. The theme of the celebration is, ‘’The Magic of Service’’. The theme recognizes that good service is magical, which can turn an unhappy customer into a satisfied longterm customer. It can also turn an occasional customer into a repeat customer as well as the biggest fan and advocate of an organization.

The highlight of the weeklong activities lined-up include a ‘’Special Thank

You’’ message to customers nationwide and a plan by the Managing Director, Mr. Adam Nuru to directly speak to as many FCMB customers as possible. In addition, the Executive Management of FCMB will visit children across all regions who have kiddies account with the Bank whose birthdays fall during the customer service week, to celebrate with them and present them gifts. Also, Staff that have gone the extra mile to provide magical service will be recognized and rewarded.

www.businessday.ng

L-R: Olamide Babayemi, pricing analyst and team lead, ajala.ng; Fola Akinboro, CEO, ajala.ng; Abiola Omosini, head, business travel, Nigeria, CWA, and Angola, Amadeus, and Ololade Akande, hotel and tours consultant, ajala.ng, at the unveiling of the new ajala.ng website in Lagos

https://www.facebook.com/businessdayng

@Businessdayng

16

Tuesday 08 October 2019

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 08 October 2019

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

17

18

Tuesday 08 October 2019

BUSINESS DAY

Media business Nigeria’s budding IMC industry is tormented by subsistence of a contracting economy - Jenkins Jenkins Alumona is the CEO of Strategic Outcomes Limited, an integrated marketing communication firm that has deep understanding of the Nigerian market. The consummated marketing communication professional, established Strategic Outcomes 15 years ago to approach the business differently but principally to achieve marketing objectives of clients. In this interview, he underscored ego as reason agencies and other companies are not embracing M&As to form stronger organisations in the face of contracting economy. He addressed other issues in the industry. Excerpts When you look at Nigeria’s integrated marketing communication industry, what picture do you see? see an industry that has great potential, has access to great talent but it is tormented by the slow growth of the economy. With a population as large as ours, we have access to a huge talent pool but the challenge is that we can’t do much if the other aspects of national development are not in place. If those guys in Aba, for instance have infrastructure such as electricity and make more shirts, distribute successfully and export, that means they will grow and have the need for expansion and also have the need for marketing communication activity. Everything is interlinked, if one thing is not working, others will not work.

step to establish the company to approach marketing communication in a different better way. The name of the company is in itself a statement that we desire to achieve outcomes that meet the strategic objectives of our clients. When I worked with Troyka and telecom firms, Econet and Glo, I saw a lot of things done with a poor attitude, especially where some people took a contracting attitude to delivering jobs to clients. I came to the conclusion that solutions could be better delivered to the benefit of both the client and the provider if the approach is more of a partnership. Our attitude in Strategic Outcomes is that the client is our partner. Achieving clients’ business objectives is important to us as it is to them.

I

The IMC industry is bleeding over elongation of payment period by clients, what is the way out of this logjam?

It is still about the strength of the economy. If the economy was strong enough it will not be like this. Presently, there could be companies that want to take advantage of the service provider and there are those elongating payment period because they are bleeding from cash flow challenges. The harsh economy is also forcing the media industry with no option than take the payment period offered. In this circumstance, clients and agencies should see themselves as partners and there should be sincerity of purpose between them on cash flow and payment period.

Companies are cutting marketing communication budgets, how is the industry coping with this?

You cannot control other peoples

Jenkins Alumona

spending but we must always continue to highlight the fact that in the most difficult times it is when clients need to seek the opportunities that marketing communications presents. The question is how are you able to find those opportunities. What marketing communication does is to help clients see and understand markets better and issues that they may not have considered and also help clients understand the consumer more.

Some brands have become successful in the Nigerian market through insight provided by marketing communication experts.

Some people allege that foreign marketing communication companies’ entry into Nigeria is a

threat to the local operators, do you agree?

I don’t think so; instead their coming is a boost to the business if they come in the proper way. Once a foreign company can fit into a particular country’s system, it is fine. This is a global market and we should live within it but they should follow the rules in our country.

Today, your firm, Strategic Outcomes Limited, is celebrating 15 years of doing business in Nigeria; could you tell us how the company came to be?

This company is a product of a desire to make a contribution to the marketing communication industry and also a desire to fulfill a lifetime goal of empowering others. I took a bold

Advertising body holds 14th edition of creative festival

T

he Association of Advertising Agencies of Nigeria (AAAN) has set out plans to hold its 14th edition of the Lagos Advertising and Ideas Festival (LAIF) awards.

In a statement, the AAAN Publicity Secretary, Jenkins Alumona said the award will be held in Lagos in December, this year. The LAIF Awards, which commenced in 2006, was instituted by the AAAN with the

aim of recognising, rewarding and fostering creative excellence in all areas of marketing communications.

The statement quoted Chairman, LAIF Management Board and AAAN Vice President, Steve Babaeko, as saying that this year’s awards will be centred on storytelling and the authenticity of the African story.

The organisers disclosed that the awards will have three major events, namely the LAIF Seminar/Exhibi-

tion, Young LAIFERS Competition and the LAIF Awards Dinner.

The LAIF Seminar/Exhibition is expected to attract practitioners and non-practitioners from the marketing community, who will have an opportunity to engage with local and international brand luminaries as they provide in-depth insight into key marketing and marketing communications challenges and proffer solutions to the posers identified.

Vodacom clinches awards at NTITA 2019

V

odacom Business Nigeria received multiple awards at the just concluded 3rd Nigeria Tech Innovation & Telecom Awards.

The awards, according to the organizers - Instinct Wave and the Association of Telecommunications Companies of Nigeria (ATCON), celebrate the strides of Vodacom Business Nigeria in providing affordable

communications and connectivity for economic growth in the country.

At the awards presentation, for the second consecutive year, Vodacom Business Nigeria won awards for Telecom Business of the Year and Enterprise Solutions Provider of the Year, Internet of Things Solutions Provider of the Year for the third consecutive year and for the first time the award for the Unified Comwww.businessday.ng

munications Provider of the Year.

Speaking on behalf of Vodacom Business Nigeria, Managing Director, Wale Odeyemi according to a statement said ‘as the leading pan-African total communications solutions provider, we will continue to sustain the quest to drive economic growth in Nigeria and Africa with our value-driven products and services.

https://www.facebook.com/businessdayng

Which other propellers are helping the company to weather the storm in the last 15 years?

The quality of people we engage in the business is an impetus. They are not necessarily employees but partners in the business. They understand the DNA of the company, where the company is coming from, where it is going and what it is all about.

When you were establishing this company, were you sure that things will go 100% as planned?

You can be as positive as you wish but there are other variables that affect the plan. You can go into anything believing that everything will go well, but you need to be in it with 99% positive mind. At the establishment of the company, my mind was to bring different positive approach to doing things. We are always interested in finding solution that will satisfy the objective than the payment for the job. We have

retained that core essence to partner with clients across sectors from manufacturing to service industry and the public sector and we continue to provide the best for them.

What would you consider as the most challenging in the last 15 years of your business operation?

From a broader perspective, if the economy does not grow and the number of businesses doing the same thing keeps increasing, we will get to a point when growth gets stunted. Though the economy has started growing now but not at the pace to satisfy players in the economy? Today, the business aspect is obviously not as good as it used to be and secondly, the SMEs are not transiting to medium and big companies. Thirdly, how many SMEs understand or have the need for advertising activity as their businesses are not growing. For Strategic Outcomes, the challenge we face is sometimes being pidgin-holed in to a particular area. The industry erroneously thought we are more of public sector but in the early stages of the life of this company, we did many jobs for non-public sector. We were at the heart of insurance sector consolidation working with quite a number of Insurance companies.

The other challenges are rising cost, keeping up with technology which we are coping with.

Where do you see Strategic Outcomes in the next five years?

We will continue to exist to provide solutions to firms who will also grow.

If the economy does not grow, the IMC sector will not grow. If we assist companies to grow, then we will have the opportunity to grow too. We want to help small brands grow and medium firms become bigger.

Sagay, Olorunyomi, Oyeyemi, others to speak as Akin Fadeyi Foundation launches FLAG’IT App

T

he Akin Fadeyi Foundation, Convener of the Corruption Not In My Country Project is set to launch a new mobile and web application device designed to empower Nigerians to report corruption. The launch is billed for October 10, 2019 at the ShehuYar’Adua Centre, Abuja.

The Report-Corruption-App, called FLAG’IT, a project initiated by the Akin Fadeyi Foundation is said to be funded by the John.D and Catharine. T. MacArthur Foundation to further promote anti-corruption fight in Nigeria by working with public institutions to open us their processes for transparency, accountability and excellent service delivery.

With FLAG’IT App, citizens shall be able to report and document their experiences around corruption and engage with government officials on issues bordering service delivery @Businessdayng

and corrupt practices across the country. The App also has a feature for documenting positive stories about credible and outstanding public Officers.

Chairman of the Presidential Advisory Committee Against Corruption, ItseSagay, will deliver the Keynote Address at the launch, while the Publisher of Premium Times, Dapo Olorunyomi; BoboyeOyeyemi Corp Marshal of Federal Roads Safety Corps;. Kole Shettima, Co-Director on Nigeria and Africa Director, MacAuthur Foundation; Oliver Stolpe, Country Representative, United Nations Office n Drugs and Crime and Simon Kolawole, Founder of The Cable Online Newspaper are also billed to speak at the event.

On the inherent benefits of institutional collaborations in fighting corruption, a panel of Discussants shall also rub minds in a technical session.

Tuesday 08 October 2019

BUSINESS DAY

19

Branding

How NBC supports government initiatives, impacts lives in Kano Globally, many business concerns are embracing CSR initiatives to not only empower communities but connect with communities for healthy, prosperous and sustainable business. They believe that it is only when communities are well-off that businesses can become strong and grow. This report looks at such CSR investments and community interlink.

I

CSR a global phenomenon n today’s socially conscious environment, organisations now place huge premium on corporate social responsibility (CSR) as a means of advancing both public good and corporate citizenship. As it is in other developed climes, Nigeria is not left out. In Nigeria alone, CSR has become an evolving business practice that incorporates sustainable development into a company’s business model. In view of this, the impact of CSR cannot therefore be over-emphasised especially considering investment allotted to it by many organisations.

Until recently, a handful of corporate organizations in Nigeria consider CSR as the last item on their agenda. However, it seems things appear to have changed with companies now paying huge attention to it while at the same time pursing profit in the overall interest of the business.

Till date, many organizations in Nigeria are singled out not because of the brand’s image created in the market space but rather as a result of the impact or value created by quality of investment in the area of CSR. Among organisations that are already toeing this path, it is Nigerian Bottling Company Limited given the new narrative created by its recent investments in CSR. NBC community initiatives Just recently, the desire to create a new narrative with CSR came into reality as Nigerian Bottling Company Limited, NBC; the nonalcoholic beverage giant inaugurated several education and water projects in Kano state. The project, according to the Memorandum of Understanding, is poised to impact no fewer than one million people in about 20 communities living within and around the area where the business operates.

The list of the projects that were inaugurated and presented to the people include a refurbished Kano State Water Board Laboratory in Panshekara, the provision of Ultra-modern Water Testing equipment for the laboratory, two Tube Wells drilled and connected to the Main Water Supply Network that directly provides water to about one million residents around the Madobi area, a block of Classrooms and furniture donated to Medile Primary School and the provision of Water Supply

Water project in Kano

to Challawa community.

In addition to this, the company also facilitated the training of senior managers from the Kano State Water Board on Performance Management and Team Maintenance. The company also laid 15 kilometers of new environmentally friendly High-Density Polyethylene (HDPE) water pipe lines and conducted a training for Kano State Water Board (KBSWB) technicians trained on maintenance of the special HDPE Pipes.

To the management of NBC, the provision of these facilities and projects come as a fitting reward for the tremendous goodwill and relentless support received from Kano state government as well as people of the state since it commenced operations in 1982.

Speaking at the official handover ceremony for all the projects, the representative of Managing Director of Kano State Water Board, who is the General Manager, Productions of the State Water Board, Ibraheem Saad who expressed gratitude to NBC for its unwavering commitment and support from the conceptualization of the projects to their successful execution, explained that the Water Board was happy to note that these investments would bringing lasting solution to the water challenges confronting parts of the state.

While presenting the water and education projects to the people of the state, the Managing Direcwww.businessday.ng

tor, NBC, George Polymenakos, expressed his profound appreciation to the Kano State Government for its invaluable support to the Coca-Cola system over the years stressing that the delivery of these community projects comes as a fulfilment of the company’s pledged contribution to the development of the state and the nation as a whole.

“We believe that our communities are the bedrock of our business. If our communities are healthy, prosperous and sustainable, only then can our business become strong and grow. This is why we invest in viable programs such as these to develop the productive capacity of the people and drive the sustainable development of our communities”, he said.

With regards to the education projects delivered by NBC, he said “Education is one of the most important investments a country can make in its people and its future. In line with this, we have constructed a block of classrooms with staff office and provided furniture for pupils of Medile Primary School, Kano. This, we hope, will support government’s efforts at bringing education to the doorstep of every child,” He revealed that the company spent over 4 million Euros on the various projects as a reflection of the confidence the company has in doing business in the state adding that this further demonstrates its commitment to the wellbeing

https://www.facebook.com/businessdayng

of the communities where it does business.

In his own remarks, the representative of the Emir of Kano, the Seriki Fulani Jaedanawa of Kano, Abubakar Gwadabe Buhari commended NBC for its show of concern and commitment in meeting some of the important needs of communities in the state.

“As a district head, I know the sufferings of our rural communities. I must say NBC has done well in alleviating their hardship. Let me quickly add that the Emir of Kano is indeed happy with these projects given the fact that it addresses two major challenges, education and water availability in these communities” he said.

On his part, Group Quality, Safety & Environment Director, Coca-Cola Hellenic Bottling Company (CCHBC), Zoltan Syposs who was part of the conceptualization of the idea that birthed the projects commended the Kano State Government alongside NBC team on the successful completion saying that the projects form part of CocaCola Hellenic 2025 commitment that is focused on making the environment sustainable.

In his remarks, Water Resources & Technologies Manager, CocaCola Hellenic Bottling Company (CCHBC), Nils Deeke who flew in from Switzerland for the inauguration said the investment in Kano state is in line with the commitment to give back to the society @Businessdayng

while also playing a crucial role in the economic development of the state.

“It is not just enough to sell our products, we want to make positive impact in the lives of people as well as the communities around us. As we speak, over 20 communities have been provided with water supplies. We will also build capabilities that would ensure that the facilities provided are well maintained”, he explained.

In 2015 alone, the company renovated 4 blocks of 13 classes and 2 staff rooms, made provision for chairs or tables for over 1200 Pupils’ Teachers in LEA Zwaciki, clean-up of Challawa tannery waste dumpsite. Aside that, the company took it ‘Back to School Initiative’ to Kano, donating 1,500 School back to Schools pack to Gidan Makama Primary School.

Until now, access to portable and drinking water was a rarity to residents of these communities in Kano state. Now with the provision of these facilities, it is hoped that this challenge will become a thing of the past.

Abdullahi Gimba, a resident of one of the benefitting communities described the construction of water facilities as a great privilege to the community. According to him, this facility would contribute a great deal to save families a lot of stress in their daily search to get water.

“We are so happy to have this project in this community. This is the first time we will have pipeborne water in this community”, Gimba said.

For companies such as NBC that have chosen to tread the path of PPP, the ongoing support of the government in essential to create an enabling business environment, to allow the private institutions deliver on their business goals as they support the government to do even more for its people.

Speaking on NBC’s plans for Kano, Polymenakos said, “having secured water availability for our operations, we are committed to scaling up our business in Kano by intentionally investing in the injection of new production lines in our Challawa Plant to create employment for the youth while meeting the needs of our consumers in State.” He further promised that the company would continue with an annual scholarship program for the top 10 pupils graduating from Medile Primary School.

20

Tuesday 08 October 2019

BUSINESS DAY

property&lifestyle How building green makes economic sense, saves environment

Venture into manufacturing … as IFC commits about $300bn in green building investments to create wealth provides green building adviCHUKA UROKO and jobs, SON tells sory and fundraising services, explains that this has beimporters s the devastating come necessary because, as a

A

impact of climate change spreads with differing degrees according to climatic regions, building green does not only make economic sense, but also saves the environment, experts have said, noting however that responses to climatic conditions also differ from one region to another.

In the Western world, both the incidence and impact of climate change are grave unlike developing countries including Nigeria where the impact is relatively minimal. This, perhaps, explains why the Western countries are more proactive in their response.

Experts advise that countries like Nigeria that have not been heavily impacted should come out of their comfort zone and go for preventive measures, insisting that building green is a must-take approach.

“Given the economic, social and environmental impacts of climate change which manifests through rising temperatures, altered hydrological (water) cycles and extreme weather events, with corresponding risks to the integrity of energy, food and water systems, the common saying that prevention is better than cure needs to prevail,” advises Shaninomi Eribo, Founder of GreenSquareMetre.

Eribo, whose company

country, Nigeria lacks capacity to respond to challenges such as the California fires of late 2018 and Hurricane Dorian that practically levelled the Bahamas recently.

For reasons of this inadequacy, the next best thing for the country is to go for preventive action that can limit C02 emissions which drive climate change by making slight changes in the existing building and construction practices, leading to the adoption of ‘green building’.

The International Finance Corporation (IFC) defines green building as incorporating design techniques, technologies, and materials that reduce dependence on fossil fuels and negative environmental impact.

Besides the investment opportunities expected to come with green building, its adoption has become increasingly necessary given the discovery from the Paris Climate Conference of 2015 that the built environment accounts for about 40 percent of energy consumption and over a third of anthropogenic emissions globally.

The sector was identified as having the greatest potential of contributing to the achievement of the agreed limits of a global rise in temperature of no more than two degrees centigrade above pre-industrial levels.

It has also contributed sig-

CHUKA UROKO

T Nestoil Tower: One of Nigeria’s few green buildings

nificant financial resources in the form of Green Bonds and Green Mortgages which have been committed to undertaking climate friendly investments such as green building projects.

According to the Climate Bonds Initiative, green bond issuance grew steadily at 4 percent year-on-year to $162 billion in 2018. Green Mortgages which offer finance to both developers and potential homeowners at about 0.5 to 2 percent less than the conventional rates have been used in countries such as Mexico to move the construction market towards a more sustainable future.

IFC’s analysis of 21 emerging markets in its Climate Investment Opportunities in Emerging Markets report found that there is a $24.7 trillion investment potential for

green buildings between now and 2030, representing a whopping 84 percent of total global climate smart investments.

With specific regard to Sub-Saharan Africa, the report estimates the commercial investment potential in the construction of lowcarbon buildings at nearly $153 billion, with Nigeria’s climate smart investment potential at over $104 billion from 2016–2030 in selected sectors. Over the same period, IFC has committed about $300 billion in green building investments.

IFC posits that the value of green buildings is particularly important in emerging markets such as Nigeria, where utility bills can consume up to 20 percent of a moderate-income family’s disposable income, and resources such as clean energy

and water are scarce.

To address these issues, the IFC created the Green Building Market Transformation Programme which addresses the gap in the market by introducing a clear green building standard and low-cost rating system called EDGE which outlines the benefits to developers, owners and banks, in order to unlock the potential for an era of green construction and development.

Nigeria should do well by adopting this new practice.

But, unfortunately, one of the main inhibiting factors to the full scale adoption of green building practices in Nigeria is the ‘perception’ by developers that they cost considerably more to design and build. This could not be further from the reality, particularly given falling technology costs.

Low confidence in real estate drives banks’ credit to 4-year low ENDURANCE OKAFOR

…loan to sector slips 21%

N

provide credit to the real estate sector reflects low confidence in the sector, and people’s disposable incomes remains stifled,” Rotimi Olu-Steven, a broker at International Real Estate Partners, said.

Of the N15.48 trillion combined credit given out to 17 sectors by the Nigerian deposit money banks, real estate got N582.96 in the second quarter to June 2019, 2.25 percent lower than N596.39 received in the preceding quarter.

According to industry sources, commercial banks

igerian commercial banks intensified their risk-averse attitude and cautious stance in the property industry as credit to the sector dropped to a four-year low in the second quarter of 2019.

Sectoral credit allocation to real estate shed N13.43 billion quarter-on-quarter and N161.6 billion year-onyear, the half-year data by the National Bureau of Statistics (NBS) has shown.

“Banks’ unwillingness to

are not ideal or suitable medium for financing real estate projects because whereas commercial bank deposits are short-term in nature, real estate is for long term which is usually vulnerable to the vagaries in the economy such as changes interest rates, exchange rates, and the rate of inflation.

“Nigeria is still a viable market. Capital is a challenge,” Andrei Ugarov, partner at PwC said, adding that “deals are however happening. Players in the industry are making use of other financing options to fund real estate development projects.”

More than 90 percent of new homes that are built in the country utilise funds from personal savings, a statement by the Association of Housing Corporation of Nigeria (AHCN), an umbrella organization for all federal and state housing agencies read.

An analysis of the H1 2019 data by the state-funded

www.businessday.ng

Bureau revealed that bank lending to Nigeria’s property industry in the review period is the lowest since the N548.21 billion credited to the industry in the second quarter of 2015.

With a deficit of more than 17 million units, Nigerian property industry contributed 6.44 percent to real GDP in Q2 2019, higher than the 5.57 percent it recorded in the preceding quarter but lower than the quarter before.

After exiting recession in Q1 2019, the first growth from its negative mode, the real estate sector in the second quarter of this year turned back to contraction to post -3.84 percent growth in Q2’19.

“There is no liquidity in the market; no one is releasing the money,” Tosin Ajose, Lead Advisor at DealHQ Partners said. She added that “it will take two to three years for the sector to fully recover.”

A key culprit of the housing industry is the low level of mortgage penetration in

https://www.facebook.com/businessdayng

Nigeria, industry sources have said.

“Banks run away from mortgage industry now but players in the space understand that it is a sleeping giant; by the time the right antidote is given to the sleeping giant, you will see the potential unleashed,” Banjo Obaleye, CEO, Infinity Trust Mortgage Bank, said.

With single-digit interest rates in some other countries, mortgage industry contributes significantly to economic growth and development.

This is, however, not the case in Nigeria as the roaring inflation rate and the attendant high mortgage rate have not only dampened housing demand but has blunted developers’ investment appetite.

Nigeria has one of the world’s lowest mortgageto-Gross Domestic Product (GDP) rate at 0.6 percent. This lags Ghana’s 2 percent, South Africa’s 30 percent and crawls after the U.S and UK rates of 60 percent and 70 percent respectively. @Businessdayng

he Standards Organisation of Nigeria (SON) has charged Nigerian importers to venture into manufacturing not only to generate wealth, but also to create jobs for the teeming unemployed youth in the country.

The import regulatory agency of government explained to the importers that establishing manufacturing outfits would go a long way to save the country’s foreign exchange since some of the things that were imported into the country could be manufactured locally.

Osita Aboloma, Director General SON, gave the charge at a one-day sensitisation programme with importers and dealers of electronics in Alaba International Market, Ojo, Lagos, advising the importers to get the required standards to make their products competitive.

The director general who was represented at the event

by Obiora Manafa, director, Inspectorate and Compliance Directorate, noted that with the African Continental Free Trade Agreement (AfCFTA) accented to by President Muhammadu Buhari, Nigerian manufacturers must up their game to avoid being overwhelmed by foreign goods.

“Adhering to standards was the surest way to bring back the glory days of Alaba International Market,” he said, assuring that SON was ready to work with local manufacturers to make their goods exportable in a bid to earn foreign exchange for the Nigerian economy.

“Instead of faking established brands, build your own brands and make money from it. We are also advising that you go into manufacturing; we cannot continue to depend on import; many big importers have gone into manufacturing. Nigerian cables are the best, why should we import,” he wondered.

He noted that the machinery to produce cables are not too expensive, assuring further that they were open anytime to help the importers to select the materials and the equipment to enable them to start producing. “This is better for you and for the economy at large,” he stressed.

According to him, the fight against substandard products was a big one, saying that a lot of people were in detention for dealing in substandard products to serve as deterrent to importers who had intentions to indulge in the nefarious act.

Tuesday 08 October 2019

BUSINESS DAY

21

property&lifestyle ‘We are one-stop company providing real estate solutions in fast-growing cities’ OBINNA AZONOBI is the MD/CEO, Realtypros Investment Global Limited. The setting up of Realtypros, has been attributed to his experience in real estate and career and today the young firm is one of the fastest-growing real estate development companies in Nigeria. In this interview, he speaks on his foray into real estate, the motivation and the journey so far. He speaks with CHUKA UROKO, Property Editor

B

eyond being the chief executive of Realtypros, what else can you tell people about yourself?

My name is Obinna Azonobi. I was born in October 1985. I had my primary and secondary school education in Surulere, Lagos and studied Mechanical Engineering at Federal University of Technology, Owerri, Imo state. I began my career as a salesman in the retail industry. From there, I moved up to become a sales manager, general manager and now CEO after traversing four industries.

Over the years you have traversed four companies.

Tell us a bit of your professional experiences My experience cuts across retail, logistics, manufacturing, information technology and real estate industries. I have a professional certification in Advanced Supply Chain Management from London Academy Business School, UK. I have consulted for multiple real estate companies, helping them to build their sales structures and processes, most especially in the area of network marketing.

You trained as a mechanical engineer. Instead of dealing with machines repair and fabrication, you chose to work with real estate clients. What informed that choice?

I chose real estate because it is one of the easiest means of becoming successful legally. By easiest I mean without any startup capital. By selling

and closing one big deal in real estate, one can fetch a huge commission to cover the cost of starting his own real estate agency. All that is required is keeping oneself informed and understanding the operational basics of buying and selling real estate.

In my study of wealth creation, I found out that there is no wealth without property and since I wanted to become wealthy, I knew I couldn’t do without real estate. I used to ask myself a rhetorical question: How does one set up a company without so much financial investment? Real estate was the answer. So, I equipped myself, went for a professional degree, built my repertoire and afterward set up my company. As ‘annewbie’ in the industry, I started from the lowest level as a freelance marketer and rose to the top as a CEO. When people like you aspire, they usually learn from other people as mentors. Who were your mentors the journey to where you are now?

Of course, I have mentors. Debo Adejana, the MD/ CEO of RealtyPoint Property Limited, has been my mentor and coach since 2013. Others I consider as leaders and motivational speakers that impacted positively on me through inspiring and motivational books are Brian Tracy, T.D Jakes and Bill Gates. I read most of the books written by these writers. Spiritually, I am inspired by Kenneth Copland and Kenneth Hogan.

Tell us about your com-

Obinna Azonobi pany and how you run it. Is it in line with your vision?

Realtypros is a one-stop real estate solution company with the vision of providing real estate solution in all fast-growing cities of the world. We have extended our borders to Cairo, Egypt, London, America and Canada with representatives and partners in these locations working remotely with the hope to set up offices in the future. Our core services range from land, building,

and construction. We also have an Academy where people are trained on several skills like leadership, real estate marketing, network marketing, etc. Our head office is located at Sangotedo, Ibeju Lekki with branches at Festac Town, Abuja, Port Harcourt, and Owerri.

As a company, what defines your culture, competitive advantage, marketing strategy, and branding?

We are guided by our core

NMRC, Kaduna in N3bn pact to create new, affordable mortgage scheme Stories by CHUKA UROKO

I

t is good news for home buyers as the Kaduna State government (KDSG), Nigeria Mortgage Refinance Company Plc (NMRC) and Federal Housing Author-

ity (FHA) Mortgage Bank have signed an agreement to create a novel mortgage blended initiative with an initial investment of N3 billion.

The tripartite deal is part of ongoing drive to create an enabling environment for af-

Ogundimu and El Rufai, after the signing event www.businessday.ng

fordable housing development and mortgage creation in Nigeria at single digit interest rate Nasir El-Rufai, the Kaduna State governor, commended the participating institutions for agreeing to work with KDSG in establishing the blended rate programme, disclosing that the state had enacted a Landlord and Tenant law that encourages, empowers and protects property owners and investors.

He disclosed further tat the state had created a Mortgage and Foreclosure Authority as well as passed into law the Mortgage and Foreclosure Law (MMFL) in the state.

According to the Senior Special Adviser and Counselor to the governor, Jimi Lawal, the creation of the initiative was premised on state’s successful strides in driving institutional

and policy reforms to enable investment in housing finance.

Kehinde Ogundimu, NMRC’s managing director, commended the governor, noting that Kaduna State was at the forefront of housing finance transformation and is also becoming a model state in terms of ease of doing business and mortgage friendliness.

“The creation of the blended financing initiative represents NMRC’s value proposition under the World Bank sponsored housing finance strategy aimed at removing barriers to housing finance and promoting the creation of an enabling environment for housing development and mortgage creation across states in Nigeria through the adoption and passage of NMRC’s proposed model mortgage and foreclosure law (MMFL).

https://www.facebook.com/businessdayng

value which is REAL and it means Reliability, Excellent, Accountability, and Loyalty. We presently have 24 staff working in the various departments and our competitive advantage over other companies is that we provide in-house training to all our staff whereby everyone starts to reason like an entrepreneur. Our marketing strategy runs from network marketing which are the freelancers who work remotely and earn commission once a deal is closed. Our clients constitute the middles class, high-income earners, working-class and low-income earners who buy into our estate. We are also into facility management and we sell luxury properties to specific clients How have you leveraged technology in building a successful real estate development company?

We use various digital medium to reach out to all our customers, consultants and clients. We also have an online management portal that allows us interact and keep track of databases and reports of over 20,000 real estate consultants nationwide. Our business model is technology-driven and we are adopting new technology every day in optimizing our business processes.

What have been your biggest challenge in running your business?

One of our biggest challenges is in the recruitment of experienced and capable hands to work with us. Most graduates are unemployable

because they are simply unwilling to start from the low level which helps them gain experience on the job but want to begin at the top without any form of understanding as to how to succeed on that level or even sustain their position.

They have absolutely nothing to offer but want to be paid heavily for doing nothing.

How have you been able to sustain your business in terms of financing?

Our model which allows freelancers work remotely takes away the huge salary payment of staff working from the office. The cost of running fuels on cars and generators at the offices cut down on our cash flow and our affordable scheme also allows customers to buy our properties and there is constant revenue generated through this model.

In the course of your business venture, are there decisions you would have made differently.

I would say that wrong decisions have been made while running my company but interestingly it has been a learning process that has taught me to make decisions differently.

How do you give back to the society?

We give back by making donations to orphanages, sponsor specific foundation, empower unemployed women and partnered with Visible Voice Foundation.

We have tackled diversity on all levels by employing passionate talents from different ethnic groups in Nigeria. .Tell us about your business interest apart from what you are doing presently.

I am interested in venturing into the agricultural sector and owning the biggest farm in Lagos that will cater for fishing, poultry, etc.

Through the hectares of land we have, we are looking to set up a recruiting agency and empowering a vocational centre where youths will be trained and become skillful in their area of specialty.

Expectations as El Rufai speaks on real estate sector challenges at RICS confab

A

ll eyes will be on Nasir El Rufai, the governor of Kaduna State , who will be speaking on the challenges of real estate sector in Nigeria at a conference in Lagos. It is expected that, as a built environment professional, the governor will offer value along with useful insights.

The conference being hosted by the Royal Institution of Chartered Surveyors (RICS) Nigeria Group has as theme, ‘Unravelling the Real Estate Sector Challenges in Nigeria: Regulation, Funding and Development’.

Besides Governor El Rufai—a fellow of the Nigerian Institute of Quantity Surveyors and also of Royal Institu@Businessdayng

tion of Chartered Surveyors (FNIQS, FRICS)—who will be coming as keynote speaker, Jennifer Welch, RICD Director for Africa, will also be speaking and updating members on RICS in Africa.

RICS is a global professional body and, according to Gbenga Ismail, the president of the Nigeria Group, the body promotes and enforces the highest international standards in the valuation, management and development of land, real estate, construction and infrastructure.

“As at 2018, there were RICS-qualified professionals in nearly 150 countries of the world. RICS accredits 125,000 qualified and trainee-professionals worldwide,”

22

Tuesday 08 October 2019

BUSINESS DAY

Investments

ENERGY INTELLIGENCE OIL

GAS

PETROCHEMICALS

Market Insight Companies Commodity Tracker Policy

POWER

Aje field to increase production by 300% on completion of technical work STEPHEN ONYEKWELU

T

he Aje oil field located on oil mining lease (OML) 113 on completion of technical work by London listed ADM Energy and partners is set to increase production by threefold.

Aje is currently producing about 3000 barrels of oil per day via two producers: Aje-4 in Cenomanianage sands and Aje-5 in Turonian sands, linked to the Front Puffin floating production, storage and offloading (FPSO) vessel. But on completion of technical work and some new injection of investments, the field is set to produce a gross output of up to 12,000 barrels per day, a 300 percent increase in production capacity.

The field’s proven reserves are 82.4 million barrels of oil equivalent, while proven, probable and possible reserves are estimated to be 220.8 million barrels of oil equivalent (boe).

In addition, the partners are developing plans to begin producing gas from condensate reservoirs in Aje’sTuronian sands.

OML 113 contains the Aje oil and gas field which is situated 24 kilometres offshore adjacent to the border with Benin Republic.

Aje is unusual for a Nigerian field because it lies in the Benin Embayment on the eastern edge of the West Africa Transform Margin, rather than the Niger Delta.

The water depth over the Aje field varies significantly. The continental shelf where the water depth is less than 100 metres gives way to a steep continental slope with water depths reaching up to 1,000 metres “Discussions are taking place with potential off-takers and investors,” said ADM. YinkaFolawiyo has a 41.9 per-

cent stake in Aje. ADM holds 5 percent while the other partners are New Age on 24.1 percent, Energy Equity Resources on 16.9 percent and Panoro Energy on 12.2 percent.

ADM, meanwhile, said it will become cash-positive in 2020, paving the way to launch “a portfolio of projects”.

It will target projects with “at-

tractive risk-reward profiles across the oil services, power and energy sectors and in technology related to these industries, in order to build a portfolio of undervalued projects

by originating deals for appraisal, development and producing assets.”

ADM aims to “option” assets where oil and gas has already been discovered and then make a debt or equity contribution to access upside for shareholders.

“The benefit of this approach is that ADM may only raise equity after the asset has in principle been secured, allowing the company to gear up its equity pre-commitment,” it said.

ADM may also consider buying producing assets in collaboration with bidding syndicates.

The company has alliances with debt providers in Africa who support natural resource deals.

“These relationships are mature and long standing and can potentially provide funding that preserves equity for later deployment at higher, less dilutive valuations,” it said.

ADM is also developing a relationship with UK companyZark Capital “to seek alternative funding for investment opportunities as they arise.”

The Government of Nigeria approved the Aje Field Development Plan (“FDP”) in March 2014 and by October 2014; the Final Investment Decision (‘FID’) for the project was agreed. The FDP involves a three phase development programme.

Phase 1 will focus on the AjeCenomanian oil reservoir and include the tie-back of two existing subsea wells and a leased Floating Production Storage and Offloading vessel (“FPSO”). Phase 1 production commenced in May 2016. The planning for Phase 2 is now underway and will see additional wells drilled in order to increase total Cenomanian oil production. Phase 3 will target the development of the Turonian gas condensate reservoir.

Nigeria to lose $3.3m daily over new OPEC’s production cut DIPO OLADEHINDE

T

he news about Organisation of Petroleum Exporting Countries (OPEC) capping Nigerian crude oil output at 1.77 million barrels per day (mbpd) following the new agreements reached by its members is expected to cost Africa’s biggest oil producing country about 57,000barrels per day worth $3.3 million daily.

Nigeria has been one of the largest overproducers and noncompliant OPEC members in the production cut deal this year at a time when the oil market continues to be oversupplied with rising U.S. production and faltering oil demand growth.

In a chat with Bloomberg TV, new Nigerian Minister of State for Petroleum Resources, Timipre Sylva said Nigeria is ready to make deeper oil cuts if necessary and would now adopt new quota of 1.774 million barrels a day after admitting the country overproduced in August.

With Oil price trading at $58, strict adherence to this new OPEC Quota means Nigeria oil is expected to lose about 57,000 barrels per day worth $3.3 million daily.

“Everybody agrees in OPEC that we need to stabilise the market. We cannot allow prices just to plummet,” Sylva stated.

The 2019 budget was signed by President Muhammadu Buhari in May, was based on oil production of 2.3 million bpd (including conwww.businessday.ng

densates) with an oil benchmark price of $60 per barrel although Bloomberg shipment tracking data said Nigeria bumped around 2.2 mbpd in August.

“We will cut across the assets.

The OPEC quota is on crude production only, not on condensate, so it doesn’t affect the condensate,” Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mele Kyari told reporters at a conference in Fujairah in the United Arab Emirates.

Iraq and Nigeria, two rogue members of OPEC that haven’t been complying with their share of the production cuts in recent months—pledged last month to fall within their respective caps while the cartel and its allies are

https://www.facebook.com/businessdayng

trying to rebalance the oil market.

In August, Nigeria pumped 1.866 million bpd, up by 86,000 bpd from July, according to OPEC’s secondary sources that the cartel uses to calculate official production and compliance rates while Iraq has been pumping 4.8 million bpd in recent months instead of its target of 4.512 million bpd.

“I have had a series of meetings with the leadership of Nigeria and Iraq and they have assured me they will be faithful to their obligation,” Mohammed Barkindo, Secretary-General of OPEC, told Bloomberg TV. “There is no unilateral action that will be taken by both Nigeria and Iraq; I have been in contact with the countries.”

Nigeria’s government is struggling to generate more revenue to @Businessdayng

finance its growing budget amid unreliable oil revenue. The country’s debt has grown more than 160 percent to N24 trillion in the last five years. Tax to GDP remains low at 6 percent, one of the lowest globally.

Despite averaging more than 7percent in the first 14 years of this century, annual growth in Nigeria’s economy, which vies with South Africa as the continent’s largest, hasn’t managed to top 3percent for the past four years.

President Muhammadu Buhari, who was re-elected in February, pledged to diversify his country’s economy, which depends on oil for 90percent of its foreign exchange, making it vulnerable to global price movements.

Tuesday 08 October 2019

BUSINESS DAY

23

ENERGY INTELLIGENCE

Nigeria’s oil rigs stagnate as OPEC records decline DIPO OLADEHINDE

L

atest data from Organisation of Petroleum Exporting Countries (OPEC) reveals Nigeria rig count remains static at a time the 14-member cartel recorded a decline of 13 rig counts while globally rig count increase by 32.

Oil and gas rig counts are frequently used throughout the oil and gas industry as a metric of consumer confidence; it indicates willingness for oil and gas companies to continue investing while also signifying the actual activity within the current market.

Data obtained from Baker Hughes Incorporated and the Organization of Petroleum Exporting Countries (OPEC) showed since the beginning of 2019 Nigeria’s oil rig, which is a reflection of the level of exploration, development and productive activities occurring in the oil and gas space remained static in the month of August at 15 rig counts and still a sharp decline from a three-year high of 35 rigs count recorded in February 2018.

Abayomi Fawehinmi, an energy analyst in a Lagos based oil

firm said oil rigs are indications of drilling activities going on in a country’s oil sector however it can be very dodgy at times.

“Some rigs are like beasts and drill faster, cheaper and better than the others while some other rigs can also be docile,” Fawehinmi said.

Fawehinmi noted that global fall in rig counts indicated investors have a low amount of faith in the oil and gas industry.

As at August 2018, Iran had the highest rig drilling activities of 157 rig count; followed by Saudi Arabia with 114 rig counts; while Iraq, United Arab Emirates (UAE) and Algeria all had 77 rig counts, 63rig counts and 44 rigs counts respectively to make up the top five countries with the highest rig counts among OPEC members countries.

Also, Kuwait recorded 47 rig counts; Venezuela recorded 25 rig counts; Libya recorded 16 rigs counts; while Nigeria, Ecuador, Gabon, Angola, Congo, Equatorial Guinea had 15, 8,6,4,3 and 1 respectively to make up OPEC countries with the lowest number of rig count.

The 14 OPEC members recorded a total of 580 rig counts in August as against 580 recorded the previous month with Algeria recording the highest marginal increase of 3 rig counts.

Non-OPEC members had a decrease of increase of 22 rigs, from 1, 804 rig counts recorded in July 2019 to 1,782 rig counts recorded in August. World rig count also recorded a decrease of 32rig counts, from 2,394 rig counts in previous month to 2,362rig counts in August.

OIL & GAS

Carlyle Group launches Boru Energy targets oil & gas acquisition in Africa OLUFIKAYO OWOEYE

A

fter an investment gone bad in now-defunct Diamond Bank, global investment

firm, Carlyle Group seems to have moved on as it announced the establishment of a new platform, Boru Energy, which would target acquisitions of up to $1 billion, focussing on oil and gas opportunities across Sub-Saharan Africa.

According to Caryle, Boru Energy’s investment goal will be to assemble a portfolio of primarily non-operated interests in oil & gas production assets. The potential portfolio will be spread across several Sub-Saharan Africa countries and will consist of assets with significant commercialisation potential and where the operator

is a high quality national, international or independent oil and gas company It also agreed to partner with Aidan Heavey and Tom Hickey who are well-regarded as industry veterans with extensive investment experience investing in African oil & gas assets.

Aidan Heavey is the founder and former Chairman and CEO of Tullow Oil PLC, an Africa-focused exploration and production company listed on the London Stock Exchange.

Under Heavey’s leadership, Tullow grew into a FTSE 100 company with production of over 80,000 barrels of oil equivalent per day.

Tom Hickey was CFO of Tullow Oil between 2000 and 2008, where he worked closely with Heavey, and has since held various management positions in the oil & gas www.businessday.ng

industry.

Funding for potential invest-

marketing in Europe, Africa, Latin

the strong experience and indus-

America and Asia.

try expertise Carlyle has in this region and globally.

ments will come from Carlyle

CIEP first invested in Africa in

International Energy Partners,

2017, when Carlyle-backed Assala

This investment is led by man-

L.P. (CIEP), a fund that focuses on

Energy acquired Shell’s onshore

aging director and head of CIEP

oil and gas exploration & produc-

assets in Gabon.

Marcel van Poecke and managing

tion, midstream, and refining and

https://www.facebook.com/businessdayng

Boru Energy will benefit from @Businessdayng

Director Bob Maguire.

24

Tuesday 08 October 2019

BUSINESS DAY

OFFGRID BUSINESS

This US agency has funds for off-grid energy projects in Nigeria ISAAC ANYAOGU

T

he United States Trade and Development Agency (USTDA) is providing funding for three projects that will help to electrify many rural communities and deliver critical gas resources to support economic activity and job growth while helping US companies export goods and services.

The organisation said it has committed funding for a feasibility study to help Xenergi Nigeria Ltd. expand and construct a natural gas gathering and processing plant that will substantially increase access to customers in the Niger Delta region.

USTDA also committed funding to help the Abuja Electricity Distribution Company provide electricity to underserved communities through the implementation of up to 1,370 solarpowered minigrids with energy storage systems. USTDA Colorado’s Rocky Mountain Institute will carry out the study.

USTDA is further providing funding for a study to assist Havenhill Synergy Limited to develop off-grid solar and storage minigrid sites in up to 110 Nigerian communities.

That study will be completed by Colorado-based Odyssey Energy Solutions, Inc. “While this is a validation to the quality of the work we do in Nigeria, most importantly, it helps us to develop a portfolio of 110 solar mini-grids projects that will be finance ready at the end of this feasibility study and will impact over 300,000 off-grid population,” said Olusegun Odunaiya, CEO Havenhill Synergy Limited.

Havenhill says it wants to carry out development activities in 110

communities across Nigeria that will potentially host its portfolio of off-grid smart solar mini-grids which will serve as the first access to clean electricity by the inhabitants of the community.

According to Havenhill, this study will be done in collaboration with Odyssey Energy Solutions Inc. who will provide the technical support required for the development of the project.

US firms will also have the opportunity to help Xenergi in conducting the study.

Though the organisations did not disclose how much funding is involved, findings show the USTDA receives over $50million yearly in funding. In 2017, it requested for of $80.7 million and got 25 percent more according to the US-based Center for strategic & International Studies.

While the USTDA has been targeted for elimination, “The agency boasts an export multiplier of $85 for every $1 spent on programs,” says the Center for Strategic & International Studies.

USTDA says these activities all support Power Africa, a U.S. government-led initiative to increase electricity access across the continent, and Prosper Africa, a U.S. government initiative to substantially increase two-way trade and investment between the United States and Africa.

“Nigeria is a dynamic market with many opportunities for cooperation between our private sectors,” said USTDA Acting Director Thomas R. Hardy. “USTDA’s support for these energy projects will strengthen important business ties between our countries and deliver important results for the Nigerian people.”

USTDA has now funded more than 70 projects in Nigeria focused on energy, telecommunications, transportation, healthcare, and agribusiness over the past 27 years.

The U.S. Trade and Development Agency helps companies create U.S. jobs through the export of U.S. goods and services for priority development projects in emerging economies.

USTDA links U.S. businesses to export opportunities by funding project planning activities, pilot projects, and reverse trade missions while creating sustainable infrastructure and economic growth in partner countries.

Nigeria’s offgrid needs big projects to attract big investment - InfraCredit DIPO OLADEHINDE

N

igeria has the biggest and most attractive off-grid opportunity in Africa, and one of the best locations in the world for minigrids and solar home systems, however in order to attract big investments there is need for more collaborative effort for bigger projects.

Speaking at a panel section at the annual BusinessDay Future of Power Conference which held in Lagos Daniel Mueller, head, origination and structuring at InfraCredit Guarantee Company, Nigeria Offgrid sector needs bigger projects that will attract huge funding or government agencies to facilitate larger projects just the same way Nigeria Liguified Natural Gas (NLNG) project is attracting $10 billion.

Mueller noted that Nigeria needs to prioritize what it takes to bring in investment because people are investing in smaller projects since regulators are making difficult for people to bring in

bigger investment into the sector.

“Offgrid sector is always doing smaller projects and can’t attract funds like the N9.3 trillion Pension funds looking for bigger size projects,” Mueller said.

Mueller said the market is now ripe for relatively larger capacities of between 20MW and 100MW in different cities as there is now willingness and ability of the Nigerian customer to pay for power but a lack of currency stability could discourage investors from taking

long-term financing decisions.

“The regulator said you need a license or permit if you’re generating above one megawatts, however, these licensees are not easily available or forthcoming,” said Mueller at InfraCredit, a specialised infrastructure credit guarantee company, established to enhance local currency debt instruments, mainly bonds, to finance eligible infrastructure projects in Nigeria.

Nigeria’s off-grid electricity

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

market is steadily becoming the darling of funders and investors, and this is despite its market entry challenges – FX instability, country’s insecurity, and customs levies.

“Uganda is trying to learn from Nigeria’s off-grid; even though our offgrid is huge and quite dynamic it’s also quite young at the same time. No matter how bad things are you really can’t shut down down Nigeria,” Dolapo Kukoyi, partner at Details Commercial Solicitors said at the conference.

Nigerians spend an estimated $14 billion annually on smallscale diesel generators to offset poor or non-existent grid supply.

Over 80 percent of Nigerian businesses cite electrification challenges as the most significant obstacle to doing business with erratic power supply resulting in more than $25 billion in annual losses to the economy, more than 6percent of GDP, according to Nigeria’s Power Sector Recovery Programme.

According to Rural Electrification Agency (REA), developing offgrid alternatives to complement the grid creates a $9.2 billion a year market opportunity for minigrids and solar home systems that will save $4.4 billion for Nigerian homes and businesses.

While it is not clear if investors in the market enjoy any form of tax holidays as they come in, it is however certain that a lot has changed as highlighted by All On’s chief executive, Wiebe Boer, to enable these funders push through improved energy access to millions of Nigerians.

Feedback: 07037817378, 08137433034, 08135447789

email: isaac.anyaogu@businessday.ng, stephen.onyekwelu@businessdayonline.com, oladehinde.oladipo@businessdayonline.com

Tuesday 08 October 2019

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

25

26

Tuesday 08 October 2019

BUSINESS DAY

EDUCATION

Weekly insight on current and future trends in education

Primary/Secondary

Higher

Human Capital

Stakeholders canvass support for Nigerian teachers KELECHI EWUZIE

S

ince the launch o f U N ’s Wo r l d Te a c h e r s D a y 25 years ago to galvanise global effort to help teachers, millions of teachers are still without the support and training they need to succeed. Consequently, more than half of all young people in the world have not attained the basic reading and maths skills needed to build prosperous futures for themselves and their communities.

In several Sub-Saharan Africa countries the average teacher does not perform much better on reading tests than the highest-performing grade 6 or 12 years old pupils.

In six of such countries 40 percent of primary school teachers are not as knowledgeable as their pupils should be.

According to the World Bank, teachers in low and middle income countries often lack the skills or motivation to teach effectively.

This lack of quality teaching is linked to poor outcomes, school drop-outs and long term out-of-school children.

It is against the backdrop

L-R: Oladapo Olarinmoye, managing director, Bridge International Academies; Rotimi Eyitayo, CEO, Team Master Global and Ibukun Igbinosa, director, People, Bridge International Academies, during the launch of the #TeachersTransformLives campaign on World Teachers Day at Bridge Office, Yaba, Lagos.

of these challenges that Bridge has launched the #TeachersTransformLives campaign to raise awareness of how teachers can be well supported and developed to help children even in the most challenging places.

The campaign highlights teachers from various communities whose experience of teaching has been transformed due to a programme of training and support.

They demonstrate first hand that teachers on the front line of this silent teaching crisis can change lives and improve outcomes if supported effectively.

O ladapo O larinmoye, managing director at Bridge Nigeria, said, “Teachers play a significant role in shaping young people’s lives and the future of their countries so it’s the most important job in the world.

Every teacher needs ad-

Anthos House advocates inclusive education for special need children KELECHI EWUZIE

A

nthos house handlers have called on both private and public sectors in Nigeria to invest in infrastructure to provide inclusive education for children with special needs.

They argued that children with special if given the appropriate environment to flourish can be very valuable to society.

Lai Koiki, the executive director, Greensprings School says it is important to allow special needs children to have some form of inclusive education, adding that there is no reason for families with special needs children to be ashamed.

Koiki while speaking at the one year anniversary of Anthos House, a subsidiary of Greensprings School in Lagos said the one-year journey of Anthos House has

been amazing.

“I must say that the special needs journey is almost as old as the journey of Greensprings School. This is because we believe we are all special in one way or the other”, Koiki said.

She further said that over 30 years ago, the management started a special needs unit in Greensprings known as learning support ; this initiative was born out of the necessity for children to have the opportunity to socialise.

According to Koiki, “Anthos House has now grown out of the vision, we had about 35 years ago, and it is positioned to provide older children with a pathway for independence, self-management and the high possibility of experiencing work and life”.

Kimberley Scollard, Head of School at Anthos House pointed out that in the past one year; the school has continued to facilitate its students www.businessday.ng

to be more independent.

Scollard opines that besides academic, the utmost aim of the school is to ensure that students gain necessary life skills such as cooking, shopping, and the ability to take care of themselves.

Anthos House as a special needs school in Lagos accommodates students aged from 10 to 17 years with Autism, Down syndrome, Cerebral Palsy, ADHD and other learning difficulties.

A parent at the event, Angela Emuwa, expressed her happiness about how things are going in the school.

She said, “I am very excited about the progress Anthos House has made within a short period of one year.

When we joined, the school was still under construction. But today, I am happy with what I am seeing, most especially with the school’s focus on improving the life and entrepreneur skills of the students.”

equate support and professional development and many teachers are not getting that. The stakes for not doing this right could not be higher. That is why we are launching a new campaign to highlight the important work of teachers and how appropriate training and support can enable them to improve learning outcomes even in the most difficult environments.”

Rotimi Eyitayo, CE O,

Team Master Global, stated that when teachers have the right training and motivation, their potential becomes performance, adding the substance of the teacher is what makes the teacher great.

On his part Simon Ibitoye, a teacher from Magbon, Badagry in Lagos while sharing stories of success and growth said that despite being a teacher with over 15 years’ experience, it was after his extensive training on-the-job that he has been able to inspire his pupils to their full potential.

According to Ibitoye, “The teacher training that I have received has made me acknowledge the limits of my previous teaching methods.

Previously, I would simply relay a set of information to my pupils and expect them to instantly understand what I had said without really engaging them. But now I have people around me to coach me, I have many resources that are just right for me and for the children, and I have regular feedback on my pedagogy. All this has made me a star teacher.”

Ibitoye “There’s no greater feeling in the world than knowing that you have had a positive impact on the academic and social progression of your pupils.”

Teachers who are working on the front line of the global learning crisis explain how they are becoming stronger teachers and how training and support is making them agents of positive change in their communities. Their stories shine a light of teachers in challenging communities who are making a huge impact on children because of a reinvigorated approach to training and support. Watch their stories, in their own words, here.

Rhoda Odigboh, Academics director at Bridge Nigeria, said, “Teachers can be more effective if they are equipped with the resources, techniques and support designed to improve learning outcomes.

We know how to deliver better teacher training and support leading to more effective classrooms. Unless governments and others take urgent action the UN Goal of quality education for all by 2030 looks very unlikely to be reached.”

“There remains a global shortage of over 68 million teachers, making the learning crisis both a quantity and quality issue for communities, governments and every sector helping to address the challenge” Odigboh.

Group urge Oyo governor to save LAUTECH from impending crisis REMI FEYISIPO, Ibadan

O

yo Kajola Group ( O KG ) , a n O yo State-based sociopolitical organisation, has weighed in on the controversy between Oyo and Osun States over the Ladoke Akintola University of Technology (LAUTECH), Ogbomoso, saying that the needless drama being orchestrated by the government of Osun State was unhelpful and condemnable.

The group said that reports coming out of Osun State in recent weeks on the LAUTECH issue show that Osun was bent on running down the school for no just cause.

The OKG, in a statement by its media coordinator, Adebayo Ayandele, said “We are appalled by the unhelpful and condemnable statistics that have been reeled out about LAUTECH by the government of Osun State of late. The target of such unfounded statistics is to bring the school to its knees and bring the future of thousands of its students into

https://www.facebook.com/businessdayng

jeopardy, a situation akin to the Biblical story of two women fighting over a child.

“Of course, the real mother of the child would not allow harm come the way of the child, though the impostor won’t mind if the child got killed to prove a point. In this case, Oyo State, being the real mother of the baby (LAUTECH), should take firm decisions to save the school from impending crisis.

“In recent weeks, we have heard all manners of half-truths and unfounded stories about payments made to LAUTECH by the co-owners. Osun State, in particular, had released statements to the effect that it has been paying far more than Oyo State in recent years.

“Our findings, however, indicate that Osun State mixed facts with fiction in the statement it released recently. We have since confirmed that the two owner states of LAUTECH have since separately taken ownership of the two Teaching Hospitals. While Oyo had taken control of the Teaching Hospital in Ogbomoso, Osun had taken @Businessdayng

ownership of the Teaching Hospital in Osogbo.

“In effect, whatever Osun State spends on LAUTECH Teaching Hospital, Osogbo is its responsibility and should not be mentioned as part of expenses meant for LAUTECH as an institution.

“We also read with surprise a claim by Osun State to the effect that LAUTECH should by now be self-financing, since according to that statement, the Osun State University established well after LAUTECH has allegedly become financially independent.

“Let us place on record here that no university around the world can be self-financing as such. The Secretary to the Osun State whom the statement was credited to must have spoken tongue in cheek just in search of excuses to justify the contempt Osun has for LAUTECH. We are aware that top universities across the globe survived on huge grants from public-spirited individuals, governments and families to attain the status they now parade.

Tuesday 08 October 2019

BUSINESS DAY

27

EDUCATION Students display entrepreneurial skills to emerge winners of JA Nigeria competition KELECHI EWUZIE

E

vans Adeluka Owodunni; Amusan Iyanuoluwa; Olawumi Temilade and Opebiyi Abdul-Azeem all students of Taidob College, Abeokuta, Ogun State and founders of T.C Achievers Company, have emerged winners of the 2019 Junior Achievement National Company of the Year (NCOY) Competition in Lagos.

Their project a gas leakage detector device used to detect any leakage in liquefied petroleum gas in homes, schools and industries was adjudged the best among 11 other presentations.

T.C Achievers Company by emerging winners will represent Nigeria against fellow JA Africa companies for the title of 2019 JA Africa Company of the Year set to hold in Ghana.

Simi Nwogugu, executive director, Junior Achievement

Evans Adeluka Owodunni; Amusan Iyanuoluwa; Olawumi Temilade and Opebiyi Abdul-Azeem all students of Taidob College, Abeokuta, Ogun State and founders of T.C Achievers Company, pose with their teacher after emerging winners of the 2019 Junior Achievement National Company of the Year (NCOY) Competition in Lagos.

Nigeria while speaking at the event said the competition represents an opportunity to showcase the depth of potential that lies within these young minds and Junior Achievement Nigeria’s role in grooming the next generation

of leading entrepreneurs.

This annual celebration of success allows young people to demonstrate their business acumen and spirit of entrepreneurship in a competitive environment, which will engage business, education

and policy leaders as well as the media.

Nwogugu further said that this is a call-to-action for corporate, stakeholders, teachers, youths, entrepreneurs and all who support the cause of empowering youths to be-

University don advocates inclusion of sign language in Nigeria’s education curriculum MIKE ABANG, Calabar

E

xperts in Sign language in the University of Calabar have advocated for the inclusion of sign language in Nigeria’s education curriculum from primary to tertiary level to guarantee inclusive education at all levels in the country.

They made this known at the Chinua Achebe Arts Theatre in the University of Calabar during an event to mark this year’s International Week of the Deaf.

The event which was tagged: Public Awareness of Ability in Disability is the inaugural edition of the Annual Disability Awareness Programme and organized by the UNICAL Chapter of the Nigerian Universities Deaf Students Association and National Association of Special Education Students.

The event also is the commemorating the second anniversary of the International Day of Sign Language with the core aim of raising awareness of the importance of sign languages and strengthen its status worldwide.

Speaking during the event, the Head, Department of Special Education in the University, Josephine Nanjwan, said sign language is a language like any other and its inclusion in the na-

tion’s education curriculum will guarantee inclusiveness and ensure that those who have hearing challenges are not left behind.

“Sign language is a language like any other language and those who have hearing impairment that can result in not hearing what another person is saying have their own language and these people are also important in the society.

“We should make sign language part of the curriculum right from primary school so that these people will not be left behind and can function effectively in the society. So based on this sign language should be put in every curriculum starting from the primary, secondary and higher institutions.

“When we are talking about inclusive education that has to do with education of those that have one challenge and those that don’t have challenges so as to create an inclusive society. Also when we are talking about togetherness, those that don’t understand sign language cannot communicate with those who have difficulties in hearing because communication is their problem that is the reason that we believe that sign language should be included in all our curriculum”, Nanjwan said.

She said communication is what makes human bewww.businessday.ng

ings what they are and it is very critical that people are not excluded from the educational system as well as other aspects of the society because they have hearing impairment.

Also speaking, Godwin Irokaba, a senior lecturer in the university President Buhari for assenting to the disability bill and called on the Federal Ministry of Education to make sign language a national language as is the case in other nations.

He said that discriminating against deaf people is tantamount to disabling them and we cannot have a just and egalitarian society of a segment of the population is discriminated against.

“While I will like to commend the leadership of President Mohammadu Buhari for signing the Disability Bill into law in Nigeria, I will like to call upon the Federal Ministry of Education to make sign language a national language as is the case in other countries.

“Sign Language should be included in the national curriculum and studied as an elective course in Junior Secondary Schools. Also Departments of Linguistics and Modern Language should offer elective courses in sign languages.

“This way, the doctrine of inclusion – educational and social will be attained and we will have a society who

coming not just leaders, but conscientious leaders leading a vibrant economy.

Olufunke Smith, group head, retail banking, Lagos Island branch of First Bank while expressing her delight on the company support and participation in the activities of Junior Achievement Nigeria, especially its National Company of the Year (NCOY) said First bank is pleased to identify with JA Nigeria.

Smith observes that with innovation and invention being essential at promoting opportunities for growth and development in the fast-changing world, the NCOY remains a platform to strengthen the intellectual development of young people in the society.

Seasoned judges who assessed the students for evidence of innovation in all aspects of a company’s operations at the National Company of the Year (NCOY) include Awuneba Ajumogobia, NonExecutive Director, UACN

Property Development Company; Eloho Gihan-Mbelu, CEO Endeavour Nigeria, Kehinde Olateru, CEO, Crenet TechLabs; lbukun Akinola, Co-founder, Piggyvest and Israel Nnnana, manager, Business Process Solutions, Deloitte.

Aside from winning the first position at the competition, T C Achievers, ProjectGas Leakage Detector, also won Best CSR (Corporate Social Responsibility prize.

Code-Net, a student company from Janet N John College, Lagos emerged second.

The students designed a software application-The Skools App which is used to bridge the communication gap between parents, teachers and students.

Orion Company, Rhemaville Christian Academy Jos, Plateau State emerged third.

The students developed an educational software application to guide students in selecting careers of their choice.

ALTS holds ENAA education fair in Abuja, Lagos sees deaf and other disabled people as an integral part of the system.

“Give deaf people equal rights and opportunities and they will excel. Discriminate against them and you will be disabling them. Legally, discrimination is a crime against humanity and should be resisted. We cannot have a just and egalitarian society if a segment of the population is discriminated against”, Irokaba said.

In an address, Okoroafor Gideon, the President of Nigerian University Deaf Students Association (NUDSA), Unical Chapter said the disability awareness programme was poised at educating the general public about the potentials inherent in persons with disabilities.

He said with the current trend of inclusive education, all schools should be made inclusive wherever possible and the environment should be made disability friendly.

He added that “there is a clarion call for the Nigerian society to embrace sign language in all aspects to ensure adequate and appropriate inclusion of persons with disabilities in general and persons with hearing impairment in particular”.

The event was equally organised with the core aim of raising awareness of the importance of sign languages and strengthen its status.

https://www.facebook.com/businessdayng

Josephine Okojie

A

LT S E d u c a t i o n Ad v i s o r y Ni g e ria is set to hold its October 2019 Europe, North America, Africa (ENAA) Boarding School Fair in Abuja and Lagos respectively.

The fair with the theme ‘Playing to the Strengths a n d Ta l e nt s o f Ni g e r i a Students’ will provide the right guidance and advice to students and parents seeking admission into foreign boarding schools.

“Many Nigerians choose to go to study abroad. Without the right guidance and advice, the benefits sought may be lost,” said Anthonia Sawyerr, managing partner, ALTS in a statement made available to BusinessDay. “So, we are organising our October fair to provide guidance to parents who have already decided i n d e p e n d e nt l y t o s e n d their children to school abroad.”

“The fair will provide parents the needed information about such an impor tant de cision, by giving them the opportunity for direct discussion with representatives from schools from abroad,” she further said.

She stated that the vis@Businessdayng

iting schools will be run seminars for teachers and students to provide the opportunity to connect with Nigerian schools and share best practices in education.

She added that the e ve nt w i l l b e atte n d e d by diplomats and school proprietors as well as educators and families.

“Some of the world’s finest boarding schools will be present at the ENNA fair and Nigerian families attending will get the opportunity to talk with prospective next school abroad,” Sawyer said.

She urged parents to attend to ensure that investments made on their children’s schooling aboard is based on fact and not hearsay.

“The school and country that be the right fit for the child must play to the strengths of the parents,” she added.

The fair is scheduled to hold at Transcorp Hilton in Abuja on the 9th of October and at Radisson Blu in Lagos on the 12th of October, 2019.

Representatives from various boarding schools in the United Kingdom, Canada, the United States of America and Switzerland w ill be present at the fair.

28

Tuesday 08 October 2019

BUSINESS DAY

Why work is not the right place to seek intimacy

T

he bitter truth, and one that many people struggle to accept, is that work will never love you back.

This can be a harsh blow for those who persistently attempt to meet their emotional needs in the workplace, which I have found to be a recurring theme in my consulting room over the years.

The fantasy that you are “special” to your boss because he or she smiles at you or shows appreciation can disguise the reality that work is predominantly a transactional affair.

Once an illusion sets in that the boss cares more for you than he or she actually does, the obsession to retain his/her attention can overtake one’s capacity to think creatively and make sound decisions.

This confusion normally results from people attempting to recreate at work what they experienced from their parents in early life.

Kenneth Eisold, a New Yorkbased psychoanalyst and organisational consultant, says people’s deep longings and fears often surface when faced with authority.

Where parents have provided an inadequate sense of security, their offspring may settle into work patterns where they attempt to recreate an alternative relationship that provides, if not actual security, then at least the fleeting

feeling of it.

Children need to believe they have good parents to feel safe.

They are unlikely to tolerate the truth that their parents are failing them in this regard.

“Whatever you’ve done as a child to hold on to the belief that your parents love you gets transferred to other relationships,” he explains.

“This often arouses very profound infantile motivations that are still alive. It means you don’t see certain things [about your boss] or you elicit their responsiveness in order to gain the kind of attention and care that you’re craving.”

Focusing on work relationships to the neglect of personal ones may also hamper intimacy with family and friends. As one former patient said to me: “The risk is that family life disintegrates around you while your professional life heads gracefully forward until you reach a point where it’s too late to recognise what you’ve lost.”

For another ex-patient of mine who worked in education, the obsession to elicit interest and admiration from her headteacher meant that she made herself available 24/7, to the cost of her family.

Amid her hard work and dedication, she misconstrued that she was the centre of her boss’s world. “She had me believe [that] I’m amazingly intelligent and that www.businessday.ng

everyone wants to be with me,” she says.

“I had to work so bloody hard to be the golden girl. I even made a separate ringtone so that I would know if she was calling — even at the expense of ruining my children’s bedtime routine because I would leave them with the television when she needed me.”

This patient’s mother had been a single parent whose narcissistic tendencies meant she was often absent, and she gave her boyfriends precedence over her two daughters.

When she was home she was often stressed and aggressive. My patient learned from her mother that the way to connect to a parental figure was to focus on their needs to the exclusion of her own needs, and by extension, those of her children.

To sustain this, she had to ignore the fact that her “special place” was contingent on a certain type of behaviour.

When the reality became more apparent in therapy, she reduced her more extreme pleasing behaviour — only for her boss to react aggressively and eventually make her job redundant.

“The end was a disaster because I started to have strong opinions and to see that she wasn’t as great as I thought she was,” my patient says.

For dependent personalities

https://www.facebook.com/businessdayng

such as this, a demotion or dismissal can feel deeply personal and reignite wounds from the past, making recovery even more difficult.

As her illusions came crashing down she faced the harsh truths of who her boss actually was, and how she herself had colluded in a relationship that harmed her career development and family life.

Narcissistic authority figures can exacerbate this problem. Mr Eisold says: “With a narcissistic person you can always have some success because, by trying to please them, you capture their attention fleetingly.

But that inconsistent responsiveness often establishes the most profound patterns because you keep thinking: ‘If I figure out more accurately what she wants, then she’ll love me.’”

People also turn to colleagues for closeness because they find work an easier emotional terrain to navigate than relationships at home.

Work offers prescribed rules and norms about how to behave, and its stream of people, meetings and tasks all limit how close people can be.

The emotional intelligence you have learnt in the office, however, may fail you when having to deal with disputes at home.

Ultimately work has an “end to the day”, whereas in contrast there @Businessdayng

is little respite from family life.

Another patient of mine craved emotional security because his mother was often unresponsive and rejecting.

He pushed aside thoughts that his chief executive used him for his own gain. As can be the case, a needy boss may wrongly attribute the subordinate’s hard work as evidence of genuine affection.

“Unconsciously I think we had an unholy pact,” he explains.

“I know [now] that the reason I wasn’t getting a promotion was that he had me where he needed me to be, and I wasn’t willing to force a difficult conversation and risk the security of knowing that I was not likely to be rejected at work.”

Facing the truth would not have allowed him to sustain the level of hard work his CEO required.

Only by separating in his mind his relationship with his mother from that with his boss, as well as learning to rely more on his partner for security, did he have the strength to leave his job after many years and then build his own successful business.

While work can offer satisfaction and rewards, real love and security is best sought from family and close friends. Once you stop seeking these from work relationships, however, you may be left with the bigger challenge of examining your personal life.

Tuesday 08 October 2019

BUSINESS DAY

BDTECH

29

In association with

E-mail: jumoke.akiyode@businessdayonline.com

The challenges of software development in Nigeria JUMOKE AKIYODE-LAWANSON

I

neffective monitoring, support and patronage of locally developed software is stunting the prospects in that sector, in which experts say Nigeria has considerable comparative advantage and the local and international markets are vast and lucrative.

The experts further say that the biggest challenge of the industry is that while local expertise abounds, governments and corporates in Nigeria still purchase their software solutions abroad, despite over a decade of promising to fully implement the local content policy.

“If Nigerians, including government, begin to buy from Nigerian software providers, we would have an industry that would internally generate over $2 billion annually and that alone would spiral into other African countries, then to other countries all over the world, says Abiodun Atobatele,CEO, ATB Techsoft, an indigenous software development company.

“We have the National Office for Technology Acquisition and Promotion (NOTAP), whose role is to regulate importation of technical skills, such as software but is NOTAP aware of what is going on internally? Are they aware that most of these products that they are approving for companies to go and buy abroad are available in Nigeria?

“The regulators, including the National Information Technology Development Agency (NITDA) need to look inwards themselves. They need to organise quarterly workshops and conferences where people and companies can come and showcase technology that has been developed inter-

nally and keep records, so that when companies go to the regulators to ask for permission to purchase specific solutions from America, NOTAP can tell them that 10 companies already have that software in Nigeria,” Atobatele told BusinessDay. BusinessDay finds that Nigeria’s emerging software industry is still a long shot from being the ideal ecosystem for tech-driven entrepreneurship to perform optimally.

According to a report from the Institute of Software Practitioners of Nigeria (ISPON), software developed by local companies can serve the diverse needs of over 25,000 ministries, departments and agencies [MDAs] across the three tiers of government. However, less than 20 percent of software used by government agencies is locally developed and those that are in use are priced at ridiculously low rates, simply because they are not foreign.

Pius Okigbo, past President of ISPON told BusinessDay that “There is nothing Nigerian developers cannot write in software programmes but nobody is ready to trust us and pay us huge amounts of

money so as to make us bigger players in Nigeria and this is a big tragedy.”

Okigbo added that, “We have developed some good solutions that foreign solutions cannot match. Foreign software became the humongous behemoths they have become because of huge patronage. They all have their humble beginnings”.

According to him, the foreign software companies achieved rapid growth with encouragement from their home governments. That was how the likes of SAP, Microsoft and Oracle have become local and global household names.

“Nigerian software companies need similar support from the government and the private sector players. I still maintain today that there is no foreign Human Resources (HR) software system that is better than the locally-developed HR package.”

In 2014, the Federal Government revealed that plans were being made to ensure that Nigeria, Africa’s largest economy by GDP, produces 250 indigenous and sustainable software companies by 2017. However, two years after the set target, stakeholders still complain of the

widespread scepticism by organisations and government about the competence and talent of local software developers.

Paul Uzoechina, the Administrative Secretary at ISPON told BusinessDay that ISPON currently has over 100 registered corporate members of the association with a special category for software startups and individual members.

“To become a member, corporate organisations must have software as their primary source of income, be duly registered in Nigeria CAC, must be seen paying its taxes, must have practicing software developers on its management team and board and must be able to provide proof of software that it has developed. For individuals, as long as you can code and you make a living from coding, you can become a member,” Uzoechina said.

The most popular locally developed software, according to him are, Remita authored by Systemspecs Ltd, which is used to facilitate the Treasury Single Account (TSA) as mandated by the Federal Government to remit funds from the accounts of all MDAs to a central account, dController Enterprise System authored

by BSSL Technologies, used by many government department and quasi government departments and is currently hosted in the cloud running in all states of the country, e-Government Operation Solution (eGOS) authored by Connect Technologies ltd, a platform designed to integrate people, processes and Technology and extends the reach of Government, Orbit-R Banking System authored

by Neptune Software Ltd, a Core banking application for micro finance banks covering diverse operations and iX-Trac authored by Infosoft Nigeria Ltd, a Capital Market solution which has been in operation in the Nigerian Capital market for the past 19 years.

John Obaro, CEO Systemspecs ,

says,“a good number of youngsters are showing interest in software developing.

We just need to encourage innovation and create an atmosphere for people to blossom and I believe we can play the world from software. We need to encourage as many people as possible to go on inventing apps for instance. Some may fail but we just need a few successes to do well first in Nigeria and then hit the global market.”

Obaro further observes that many local developers are making massive investments in international training, certifications and partnerships, in an attempt to put their solutions in pole position to compete with their counterparts in other parts of the world.

“We have Nigerians from the best schools around the world, so we have the skills, competence, creativity and the drive but we also have challenges with the enabling environment and challenges with business ethics but we need to realise that these are not unsolvable problems and we need to remain determined and continue to move forward.

“First, we need to optimise in the local market and then the external market too. A lot of Nigerians did not appreciate software development and so it was a popular declaration that people developing software were making money for doing nothing. Intellectual work is not as appreciated as physical work and that was why there was a controversy with Remita, the indigenous software developed for the single treasury account (TSA),” Obaro said.

Large scale buyers of foreign software include companies in most of Nigeria’s major industries, including banks and financial services, manufacturing, oil and gas, telecommunications, ministries and the ICT industry itself, which relies almost entirely on foreign operating systems.

Verve reiterates commitment to improving payment solutions

V

erve, Interswitch Group’s innovative card scheme has promised to continually improve financial inclusion and significantly enhance digital payment solutions by making its platform even more seamless and efficient for payment services across the world.

Mitchell Elegbe, founder/GMD, Interswitch Group made this promise during a media parley held in Lagos to mark the 10th year anniversary of Verve.

During the event which had in attendance, members of the media, partner banks, other trade partners and

representative of the Central Bank of Nigeria (CBN), Elegbe cited penetration as a major challenge for payment solutions providers in the country.

“With all the payment companies we have in Nigeria today, penetration is still less than 10 percent. The real enemy is cash which takes 90 percent as the preferred payment method. You have to be extremely lazy as a payment company not to do well in a market where cash is still 90 percent,” he said.

According to him, collaboration and partnerships would be very crucial to changing these statistics and providing

www.businessday.ng

better solutions to customers and the company remains committed to that cause.

Recounting the company’s experiences over the years, Mike Ogbalu III, chief executive officer, Verve, said that the journey so far had not been easy but the company has understood that they had to do things differently in order to solve existing problems in the Nigerian market.

The company was the first to come up with the first instant issuance technology as customers could now get their cards issued on first time request.

“Prior to this time, for you to issue a card to a customer, the customer has

https://www.facebook.com/businessdayng

to go into a bank branch, apply for the card and probably come back after two weeks. But then, we felt that failure to issue a card to a customer and him not being able to activate it right there on the first visit, reduces activity rate by at least 20 percent.”

Ogbalu stated that the company’s deep knowledge of the Nigerian market had given them an edge over competitors.

“We have once again placed a bet that payments would continue to evolve. Today we have also invested in innovations, we have our products both

@Businessdayng

physical and virtual and today we issue these cards here in Nigeria and in 12 countries across Africa.”

With a product launch in New York recently, the Verve card which is currently accepted in about 22 African countries is now accepted in over 185 countries globally and across 9 channels and about 42 million cardholders so far.

Verve was launched in 2009 and is currently the only African card scheme that is a member of EMVCo, the global body responsible for setting and regulating payment card standards.

30

Tuesday 08 October 2019

BUSINESS DAY

BDTECH

E-mail: jumoke.akiyode@businessdayonline.com

e-Government confab to address low revenue generation, unemployment and challenges of telecoms JUMOKE AKIYODE-LAWANSON

G

iven the low internally generated revenue (IGR) by the state and federal governments, huge ICT infrastructure deficiency and massive youth unemployment rate in Nigeria, which increased to 23.1 percent in the third quarter of 2018 from 22.7 percent in the second quarter of 2018, DigiServe Network Services Limited in partnership with the federal ministry of communication technology, Federal Inland Revenue Service (FIRS), Nigeria Communication Commission (NCC), National Information Technology Development Agency (NITDA), Association of Telecoms companies of Nigeria (ATCON) and Nigeria Internet Registration Association (NIRA) will be holding a one day conference to discuss how technology adoption in government can boost government IGR, enhance Government service delivery and reduce unemployment in the country.

With industry stakeholders and government agency representatives discussing the theme; ‘eGovernment: Powering Governance

From L-R: Gavin Hubbard; technical sales PFU Limited, Adrian Cafferkey; regional manager, Fujitsu Africa and Amechi Richard Ani; CEO, IQ Distribution (NIG) Limited at the Fujitsu forum and product launch held in Lagos on Thursday, 3rd October, 2019.

with ICT’, the conference provides an opportunity for the stakeholders to discuss the recently approved national eGovernment plan and parley on how to remove the barriers militating against the growth of the Nigerian telecoms and ICT sector.

According to Lanre Ajayi, the

executive chairman of DigiServe Network Services Limited, “Nigeria is said to be the poverty capital of the world, having the highest number of people living below the poverty line. The combined IGR for all the states in Nigeria in the year 2018 is said to be a mere N1.6 trillion, which is just about the

Fujitsu promotes digitalisation of paper with new tech scanners …harps on future of document imaging for large organisations and governments JUMOKE AKIYODE-LAWANSON

J

apanese technology company, Fujitsu, has embarked on an intense strategy to create awareness and promote the digitalisation of paper documents by converting hard copy into softcopy data sets with its line-up of state-of the art scanning solutions.

Fujitsu is an established brand in the document imaging market, featuring new technology driven scanning solutions in the workgroup, departmental, and production-level scanner categories.

With 37 distribution partners globally, making $300 million in annual revenues, Fujitsu plans to entrench its value added scanning solutions in Nigeria and Africa, and has partnered with popular the IQ distributions, authorised distributor for Fujitsu scanners, batteries, components and IoT’s in Nigeria and sub Saharan Africa.

Speaking at the Fujitsu forum and product launch in Lagos recently, Amechi Richard Ani CEO, IQ Distribution Nigeria Limited said that although the brand is not yet very popular in Nigeria, Fujitsu is positioned rightly to lead the market because of the quality, durability, reliability and affordability when it comes to digital imaging solutions.

“Already, banks in Nigeria understand the need to digitize data. Before now, there were bottle necks between distribution of Fujitsu items in Nigeria especially because of the challenges of sourcing foreign exchange but now,

with IQ distributions, a wholly Nigerian company as authorised distributors of these products, we are able to accept Naira payments with fast delivery because we are going to be stocking the products in Nigeria in our various warehouses and service centres in Lagos, Abuja, Port-Harcourt, Enugu, and we are planning to site in Kano to cover the north. We also offer after sales services such as installation, integration, repairs and returns,” Ani said.

During his presentation, Adrain Cafferkey, regional manager, Fujitsu Africa, disclosed that 17 banks across Africa currently use Fujitsu products in their move towards digitalisation.

The company which develops document imaging applications is targeting banks, insurance companies, government agencies, health organisations, oil & gas, and corporate retail markets.

According to Cafferkey, “It is all about the digitalisation of paper and we provide scanners that allows us to digitalise paper.”

“Fujitsu has the number one market share globally, with a 44 percent market share – so out of every two scanners sold in the world, one is a Fujitsu. The unique features are certainly the image quality and the robustness of our products. We have end users such as some banks that have used ur products for 10-11 years with very little or no problem, so it is an extremely robust product that you can integrate with a lot of document management solutions and our imwww.businessday.ng

age quality is second to none,” he told BusinessDay. Speaking on the company’s strategy to deepen its bran in Nigeria, Cafferkey said the company hosts several technical workshops to train local expertise in country, which is extremely important.

“We develop local expertise that have the capacity to support, maintain and repair our products. We also organise events to create awareness on the whole digitalisation journey and why people would require document scanners,” he said.

To curb counterfeiting of its products, the company has taken steps to standardise its products by the Standards Organisation of Nigeria (SON) and develop relationships with law enforcement agencies to make sure that counterfeited products are confiscated and the due cause of the law takes place.

“We also have an excellent relationship with our sister company, Fujitsu America which is called FCPA. They inform us if any product is attempted to be brought into Nigeria.

One thing that we like to emphasise is that products not bought in the country would not have warranty, so should a situation arise, the end user, at their own cost, has to send that product back to wherever it was bought. Also, it deprives the Nigerian economy because you can only grow your economy by buying local, investing and supporting local businesses,” Cafferkey said.

https://www.facebook.com/businessdayng

revenue of just one telecoms company operating in Nigeria. One of the ways of reversing this gloomy picture is to mainstream technology in governance.”

Ajayi further explained that the Nigeria eGovernment Conference would provide a platform where government officials and experts in various specializations in ICT can interact, share perspective and develop roadmap to mainstreaming ICT in various departments of government. He assured Nigerians that the conference would not just be another talk shop, but an avenue to proffer practical solutions to real-life problem.

“We are assembling top notch experts and world-class ICT service providers to come and share their expertise on how to deepen ICT in governance. The resolutions at the conference will be printed in book format and delivered to relevant government agencies and other stakeholders, with a view to ensuring implementation of the resolutions” Ajayi said.

The conference, which is scheduled to hold on October 24 in Lagos, has attracted top

government officials and major players in the private sector. Babajide Sanwo-Olu, governor of Lagos State, is expected to deliver the opening speech as the host governor, while Ernest Ndukwe, the chairman, board of directors, MTN Nigeria will present the keynote address.

Other confirmed keynote presenters include Jim Ovia, the chairman, board of directors, Zenith Bank, Babatunde Fowler, executive chairman, Federal Inland Revenue Service (FIRS) and chairman Joint Tax Board (JTB) and Ali Isa Ibrahim Pantami, the minister for communications technology.

Kayode Fayemi, the governor of Ekiti state and chairman of the governor’s forum is expected to chair the panel made up of other governors, other panel chairs include; Funke Opeke, the CEO of MainOne, Segun Ogunsanya, CEO of Airtel, Juliet EhimuanChiazor, country manager, Google Nigeria and Sehinde Oladapo, managing director, GMT Energy.

Panel sessions will be held with top professionals in the telecommunications and technology industry and government agencies.

MainOne lands submarine cable in Cote D’Ivoire

C

onnectivity company, MainOne has finally landed its submarine cable in Grand Bassam, Cote D’Iviore, which is the final leg of the ongoing expansion to reach Senegal and Cote D’Ivoire. The Grand Bassam landing which follows the recent completion of the landing in Dakar Senegal will extend the reach of the cable into Cote D’Ivoire and neighboring countries. The deployment is also notable because it is the first commercial cable in service to deploy spectrum sharing capabilities guaranteed to deepen infrastructure sharing and lower the cost of delivering broadband services to West Africa.

Following the landing at the Grand Bassam beach in Abidjan, the cable will be connected to an existing branching unit on the MainOne cable trunk already strategically located offshore. The upgrade of the electronics on the cable and the implementation of spectrum sharing functionality will now enable multiple operators share optical spectrum on the submarine pair with up to 10 Terabits of capacity. The availability of such increments in capacity is expected to further accelerate the deployment of 4G services in addition to fixed broadband across the region.

The submarine cable will also be connected to the newly constructed MainOne data centre in Abidjan, purposely built alongside the cable landing station to house infrastructure to facilitate the growth of the digital economy in Cote D’Ivoire. The facility built to Tier III standards will address the needs of Internet Service Providers (ISPs), Telecom Operators and Mobile Network Operators (MNOs), Global Content providers @Businessdayng

and Enterprises in Cote D’Ivoire seeking world class infrastructure at competitive costs for locally resident data. The highly efficient and reliable facility will offer rack spaces for these businesses to collocate their IT infrastructure including servers and other equipment with ease while gaining access to fully redundant power, cooling, carrier-grade security, and fire – prevention. The carrier-neutral facility will also bring direct access to the MainOne Cable system as well as interconnection with major network operators in Cote D’Ivoire.

Speaking on the development, Funke Opeke, CEO, MainOne said; “We recognise the role that broadband infrastructure plays in driving the growth of the digital economy and economic development in the 21st Century and are excited that we can enable these investments in Cote D’Ivoire. We look forward to energizing the digital ecosystem, not just in Cote D’Ivoire, but also in neighbouring countries as we bring the new submarine cable connection and Grand Bassam data centre into service.”

MainOne’s submarine cable was the first private subsea cable to deliver open-access, broadband capacity to West Africa in 2010, heralding the explosion in Internet access witnessed in the region. The MainOne system traverses the coast of West Africa with fully operational landing stations from Seixal in Portugal through Accra in Ghana to Lagos in Nigeria, the addition of new branches in Dakar, Senegal and Grand Bassam, Cote D’Ivoire and additional branching units in Morocco and Tenerife yet to be connected.

Tuesday 08 October 2019

BUSINESS DAY

31

INSIGHT

Oil: The footprint of criminality …as Nigeria’s oil economy comes under attack …crude oil theft, illegal refining reach industrial scale to be ready if the cash call is made. The first $180m has not been exhausted, they said. Remember that spending $180m is not same thing as doing work worth $180m. Shell says it’s always ready but will have to wait for cash call.

IGNATIUS CHUKWU, Port Harcourt

I

ndustry experts think Nigeria is facing something equivalent to a war, but this war is against its economy. The war is seen in the size of crude oil theft and illegal refining volumes that are going on. If oil is Nigeria’s mainstay, then losing about $1.32 billion in six months or 22m barrels in such period could truly destabilize its economy.

Put another way, an industry source said where a 24-inch pipeline is losing crude through an 8-inch pipe to a faraway vessel means that the oil industry through such pipeline is losing one third of its crude to thieves.

This why a briefing note by a major oil corporation last week in Port Harcourt indicated that pipeline vandalism has emerged as a huge industrial activity. Now, there are several players involved including escorted barges. Local and international markets have also emerged to serve as convenient receptors and off-takers.

Nigeria is thus said to have lost 22m barrels of crude to oil theft and vandalism and Shell Petroleum Development Company (SPDC) alone is estimated to lose 15,000 barrels every day. Slides shown by SPDC officials in Port Harcourt, Rivers State, last week, indicated that the daily loss may be conservatively put at 11,000 bpd, but inside sources said the figures could be as high as 20,000 bpd in some instances.

Experts put the 22m that the Nigeria National Petroleum Corporation (NNPC) had mentioned as loss in six months at $1.32 billion (at $60 per barrel), and that SPDC may be losing $900,000 or N275m every day to theft and spills.

The loss is said to go beyond revenue. It is also counted in lost time through shut-downs, environmental pollution, human lives, and wiping out of aquatic stocks. There is pollution and soot threatening to poison the food stock and blood streams of humans through leukaemia and skin cancers.

For instance, if pipeline is broken, an oil company has to carry out investigations as stipulated by regulation; supply the boats to go to site to see it; pay for containment; etc. It is said that some chiefs of host communities even ask boys to expand the spill point if it’s not flowing very much in order to point to large scale spill and make bigger claims.

The scale of spill is increasing yearly. Slides show that in 2017, Shell recorded 17 spills; in 2018, it went to 111; 2019 is expected to be even far more.

The company had at some point to replace 1,160 illegal theft points. The oil corporations say the situation is so bad that the moment they pump crude, thieves tap and get supplies even before the oil company.

Investment experts in the oil industry say the scenario gives the Nigeria oil industry a bad business reputation and makes it difficult to win more funds from their international headquarters.

Other countries are also making pitch for funds.

The guys from other countries simply point to the Nigerian situation against Nigerian managers. This is because investors are in it for profit. Shell officials in Port Harcourt cried out thus: “Stop blocking investments into the Niger Delta.”

Due to the scale of attacks, the pipeline teams in oil corporations say they have to meet every day (instead of monthly) to review attacks, showing that it’s very frequent. The degree is able to discourage investors and could make some oil giants to make final decision to quit. Nigerians are being warned not to think it is impossible.

Hurting the economy A very top insider said in Port Harcourt recently that he and those like him feel very sad to repeat appeals to their fellow Niger Deltans only to see upsurge in attacks.

“We keep showing how this act is scaring away investors, hurting the industry and the economy, chasing away jobs and rendering the oil region not conducive for investments. Sometimes we feel like leaving this clime to a faraway country to work even in lesser positions just to have some peace. Most of our colleagues doing PR jobs in their countries can’t understand why we here spend on such subheads as awareness on pipelines. They wonder why any sane person needed to be told not to tamper with pipelines. They don’t understand why we have to vote for funds for scholarships to community people (when there is government in their places to plan for education); they don’t understand a lot of stuff we do here,” the insider said.

Some oil majors said by 1997, they had twice the size of workforce they currently have and they had planned for aggressive expansions. Instead, many oil companies are divesting and rolling back plans.

Some wonder if the Niger Delta region actually is ready for development.

“This can be deduced from things we chase as a people, things we protest for or against, where we direct our protests, etc. You as a message maker begin to feel you are not making any progress,” one said.

One of them pointed to what the minister of the Niger Delta (Godswill Akpabio) said when he assumed office, that the NDDC owes over N2 trillion to contractors. Documents showed that Shell and SNEPCo alone paid in over $2bn in contribution so far to the Commission. Insiders wonder why nobody protests there to ask where the money has gone to. Instead, people keep making trouble asking why oil companies have not provided water, power, roads, schools, healthcare centres, scholarship, etc.

Understanding vansalism Giving insight in PH, an expert from SPDC, John Okoje, said, “The situation is getting worse. They use barges, jerry cans, and trucks; and almost everybody is getting involved. As Shell is busy trying to repair and remediate one, another is busting out.

“In the past15 years, it has developed into organised crime, and all manner of interest groups are getting involved. We seem to be chasing shadows because people are now more desperate. It leads to shut-downs for assessment, etc.”

How they do it “This is how they do it. They use hacksaws, drillers to holes, bombs to blast holes, etc. Shutdown is rampant in both the affected and non-affected areas, and you have to mobilise so many people; from the regulators, community, NGOs, etc for action.

“Thieves connect kilometres of pipes (or galvan-

www.businessday.ng

ised pipelines) to faraway vessels. You may patrol the surface but their pipes are now buried so you won’t detect it. They have developed both local and international markets. There are companies that now run on illegally refined supplies while there are buyers out there at the international market to off-take the Nigerian stolen crude. Tankers supply the local market while vessels service the international routes.

“One type of boat known as ‘Cotonou Boat’ which was used for trading along the coast has now emerged as preferred boat to run illegal crude business. It has a large hull and they pump crude into it and sail off. It is a new economy, an organised crime.

There are altercations sometimes between security agents and escorts of stolen crude.

“Technical skills now abound. The people doing this are not ignorant persons. They are like flies; as you swat them, they come again from all directions.

Some persons drill holes and cause damage on the big pipelines just to cause oil to start spilling. You must shut down. Some cut up the pipe to make iron works. It’s that bad.”

Pipelines of misery Briefings indicate that Shell’s pipeline activities these days are aimed at preventing spills. The company said in the space of just seven years, they have replaced 1300 km out of 4000 km. Studies have shown that 90 per cent of spills is caused by interference.

This is why most industry operators sneer at reminders that oil major should operate with international standard, saying other stakeholders should also operate at such standards. They may mean that regulators and host communities should also use global standards to run the industry and table any grievances, instead of breaking pipelines.

Shell in particular says it uses full transparency in oil spill reporting.

“It’s in our website too. People even use it against us but we will continue. It’s better that way,” it said.

Bodo cleanup This is said to be an example of transparency. “It is now going to phase two and we have been very open and transparent about it. Some 800 youths have been lined up to work with the contractors at the rate of N4000 per day but the youths are demanding for feeding allowance which is not less than N3000 each per day. The demands are flying right and left including the chiefs.”

HYPREP (Hydrocarbon Pollution Remediation Project) is said to be up and running, explaining the $1bn fund. Shell officials said it is not easy to do $1bn worth of work but it may be easy to spend $1bn. It requires many processes. $180m was paid by Shell JV in 2018 and another $180m for 2019 is said

https://www.facebook.com/businessdayng

Injury to environment Another expert at the briefing, Mukaila Ojikutu, poured lamentations: “Our rivers of wealth, health and beauty are crying for mercy against human induced pollution. There are irredeemable consequences and losses. Poverty as the excuse is not true because poverty is not only in Nigeria. 11,000 bpd is equal to about 5,000 workers deprived. Surface water pollution is here, aquatic resources contamination is here, destruction of endangered species and natural habitat are the outcome with destruction of farmlands. Heavy smoke forms a canopy in the sky due to carbonated combustion causing poor visibility for planes.

“Smoke is later washed into the ground to form accumulated bio-forms. Now, strange sicknesses will appear in about 15 years’ time. We have investigated this and submitted technical report on soot.

We are using our pay to buy pain in the market.

Bio-accumulation is real.”

For those putting up poverty as an excuse, the experts want them to remember that the oil region has 13 percent allocation every month, three per cent from every oil producing company to being contributed to the NDDC, they have the Ministry of Niger Delta, Amnesty programme dishing funds to the people, and companies dedicating huge CSR (corporate social responsibility) budgets to the region per year. Investors and other people are said to be getting tired of the poverty excuse.

Effect on people An insider, Trevor Akpomughe, ER manager, corporate lands management, said, “Encroaching on pipeline Right of Way (RoW) is bad. Tell people, tell the government. We use the SSSS formula as approach: security, signage, sensitisation, and surveillance.

These are things we do to contain the situation.”

Igo Weli, Alice Ajie: Pondering and worrying Shell’s external relations division is led by top experts led by two Niger Deltans, Igo Weli (GM) and Alice Ajie (deputy GM). Weli said, “Can someone invest into this kind of scenario? This is a real challenge.

Shell left Gabon. So, leaving any country is not impossible. Investors are not your Nigerian government. They are business people. Toyota is setting up in Ghana but I hope we know that their target is Nigerian market. This is a matter of self pity.”

Ajie chipped in: “The GM is a man of passion and he has talked as a Niger Deltan. We are all touched by the deteriorating scenario. Remember, ask not for whom the bell tolls. It tolls for me. It is our problem.

It’s a tragedy of the moment. This country is bleeding to death from criminality. It’s sad. The heart bleeds.”

Conclusion Newsmen seemed gripped by the sheer force of tragedy revealed to them, not that it is new, but that the danger is looming larger every day. Some wondered if it’s proper for the nation to keep sleeping and slumbering when war seems to have been levied on its economy. Some wondered if the Nigeria National Petroleum Corporation (NNPC), and the Federal Ministry of Petroleum that collect 55 percent of oil proceeds would not consider a national weekly television (and maybe radio) programme of at least one hour each episode in all registered stations to bring in the experts to convey the message exactly the way the newsmen heard it. They said it is needed so that Nigerians can see what exactly is happening, the size and urgency of the threat and demand for action. It would help let Nigerians who still regard the vandals and illegal refiners as heroes to realise that these are enemies to the nation and enemies to everyone.

@Businessdayng

32

Tuesday 08 October 2019

BUSINESS DAY

AVIATION GUIDE

in association with

NAHCO to increase revenue by end of 2019 with diversification process

Turkish Airlines holds Corporate Club Conference at Istanbul

T

Stories by IFEOMA OKEKE

N

igerian Aviation Handling Company Plc (NAHCO) may increase its revenue by the end of 2019 as a result of its diversification process.

NAHCO which realised revenue of nine billion naira last year has disclosed to BusinessDay some of its current activities that will help boost the revenue of the company by the end of 2019.

Some of these activities include the introduction of subsidiaries such as its Mainland Cargo Options (MCO), the NAHCO Free Zone (nfz) and recently, the NAHCO energy and power.

The Mainland Cargo Option (MCO) is the freight forwarding arm of NAHCO with a strategic plan to expand into maritime through the MCO. Prince Saheed Lasisi, the group executive director for business development commercial, NAHCO told BusinessDay that the company is working to make sure its revenue is substantially higher than that of last year.

Speaking on some of its new subsidiaries the company set up to increase revenue, he said, “Most of these subsidiaries are recent initiatives and it takes time for them to grow. NACHO still gets 90 percent of its revenue from NAHCO Plc. We handle about 35 airlines and that is where the chunk of the revenue comes from. Apart from aircraft handling, we also have the cargo handling as well. The cargo businesses are imports and exports.

“These are basically the two major income streams coming into the company. The free zone is also doing very well. The MCO was set up in 2014 and it is growing in leaps and bounds. I am sure that in 2020, we will have achieved doing business in the land and sea.

What are planning to do is to structure the company in such a way that 40 percent of the revenue comes from NAHCO subsidiaries, so

that we can diversify.”

Lasisi explained that in increasing revenue, it is important to bear in mind the economic activities in the country.

“About seven years ago, a lot of people shipped their goods through air because they want their cargo to come in quickly.

For maritime, you wait between six to seven weeks for your goods to arrive, whereas in 48 hours, cargo arrive by air.

“However, as a result of economic downturn, companies began to look at cost control measures. Basically, a lot of the goods that came by air before are now being transported through the sea because a lot of people are trying to save cost.”

He said the economic situation is impacting on the company’s revenue and there is nothing the company can do about this, adding that the economy is a determinant of its revenue.

He however assured that those subsidiaries that were set up will do better than they did last year in terms of revenue and profitability.

“The cargo volumes have reduced be-

cause 30 percent of cargo that used to come in has gone to the seaport. People now import computers and printers through the seaport. Aviation has its own cost which is very high. The recession has caused dwindling of activities on the airside. Even the airlines are affected. An airline was complaining to us recently that they have an aircraft with 100 tonnes capacity but for the past weeks, they have not done up to 60 tonnes.

“Once someone is doing five flights a week and he now reduces to two flights, even the revenue for the government agency will be affected. So, this is a collective problem in the industry and this is the reason why we are diversifying. Part of our strategic plan is also to look at other African countries we hope to render this kind of services to,” the company’s group executive director said.

Lasisi said the transformation objective of the company, which is basically on five points, is very much on course and some of them include the digital transformation, people and culture, amongst others.

urkish Airlines a leading global airline with over 300 aircraft (passenger and cargo) flying to over 300 destinations worldwide is for the fourth time holding its Corporate Club Conference at Istanbul from 07 to 08 October 2019.

During the conference, participants will have the opportunity to hear about the latest trends from highly experienced key note speakers, including Ilker Aycı - Chairman of the Board and the Executive Committee of Turkish Airlines.

The Conference is powered by Global Business Travel Association (GBTA), being one of the leading institutions in corporate travel industry.

As a leading global airline for business travelers, Turkish Airlines offers award-winning services and products to corporate passengers with the Turkish Airlines Corporate Club.

Turkish Airlines Corporate Club was set up to provide time-saving benefits to corporate clients to ensure travel is made easier and more profitable. Companies benefit from exclusive fare discounts, flexible ticketing, exclusive and generous baggage allowance as well as many other pre-boarding benefits including access to the Business Class lounge. Membership is simple for companies to sign up to with no joining fee.

Exclusive fare discounts Turkish Airlines Corporate Club allows corporate passengers to save money on every Turkish Airlines flight booked. Special business fares for Business or Economy Class are available, regardless of the number of tickets purchased each year. With the Turkish Airlines Corporate Club credit card provided by Yapı Kredi, travellers can receive benefits like discounts of up to 10 percent.

Flexibility Turkish Airlines Corporate Club fares allow flexibility to rebook or reroute tickets on all flight routes and dates departing from international destinations to suit passengers’ business needs. This major benefit lets companies save money and respond to ever-changing business requirements.

Dana Air partners 25th Nigerian economic summit NES#25

D

ana Air has announced that it is partnering with the Nigerian Economic Summit Group (NESG) towards the success of the 25th Nigerian Economic Summit holding at the Transcorp Hilton Hotel, Abuja from 7th to 8th October 2019.

The theme for this year’s Summit is “Nigeria 2050: Shifting Gears,” and the focus is to set a new agenda for Nigeria as Nigeria ushers in

the next industrial revolution and mark a critical strategic shift to a competitive private sector economy by 2050.

President Muhammadu Buhari, is expected to declare the 25th Nigerian Economic Summit open.

There will be main plenary sessions, parallel breakout sessions, industry breakfast meetings, the annual Start-up Pitching and Venture Networking session as well as other activities

www.businessday.ng

to mark our Silver Jubilee.

“As an Anniversary Event, NES #25 is unique because it marks a major milestone in our history of productive, robust and impactful public-private dialogues. Therefore, it is not just an opportunity to assess our progress and impact but, even more importantly, to project into the future.

“As airline partner of the 25th Nigerian Economic Summit, Dana Air is providing

https://www.facebook.com/businessdayng

complimentary tickets and a special discount to guests and delegates to facilitate their transportation to the summit in Abuja.

“Dana Air is one of Nigeria’s leading airlines with daily flights from Lagos to Abuja, Port Harcourt, Uyo and Owerri. The airline reputed for its world-class in-flight service, innovative online products and services and unrivaled on time departures,” Kingsley Ezenwa, media and communications manager said.

@Businessdayng

Tuesday 08 October 2019

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

33

34 BUSINESS DAY

Tuesday 08 October 2019

Feature How Delta State, PharmAccess, and others collaborate to revamp healthcare delivery seyijohn salau

C

aroline (not real name) woke up at about 2:40 am with severe lower abdominal pain in the riverine areas of the Polobubo Kingdom, a settlement four hours away by speedboat with 2(100 HP) engines, to the nearest clinic in Warri, Delta State.

She had been having this pain for over a week but this time, it was unbearable. She reviewed what she had eaten so far but remembered this pain started on and off since and could not be caused by food poisoning which could last this long.

She remembered her friend had been discussing the opening of the new clinic with doctors and nurses, but she did not trust this white man’s medicine; as she had been brought up to live on traditional means of sorting herself out. No clinic had been in the settlement for over 13 years, and the building which was to serve as a clinic has since be built, but had never opened. She reached out for the “agbo” she bought the day before, but she could barely move far enough to reach it.

Caroline quickly tapped her husband, who on seeing her condition convinced her to visit the clinic. On getting there, the doctor after asking a few questions requested her last menstrual period.

She remembered she had not seen it for over 3 months and following the elucidation of some signs and other symptoms, made a diagnosis of a ruptured ectopic pregnancy. She was quickly wheeled into the theater and a surgery was promptly carried out to mitigate the burgeoning situation.

However, the real reason Caroline’s life was saved was as a result of the Delta State government health intervention called “Access to Finance Scheme”.

This scheme, designed by the PharmAccess Foundation, in partnership with the Bank of Industry (BOI), is championed by the Delta State Contributory Health Commission aimed at handing over defunct and abandoned health facilities in the rural areas of the state to capable private sector players to manage, utilised to provide qualitative and quantitative healthcare services to drive up enrollments and access in the hard-to-reach and often neglected areas of Delta State.

In addition, the Access to Finance Scheme which is currently facilitating access to health services to over 30, 000 enrollees in the State Health Insurance Scheme,

also includes the adoption of the SafeCare methodology, a quality standard developed by the PharmAccess Foundation, together with COHSASA and JCI and is the only ISQUA accredited standard for resource constrained areas, by all facilities and providers to guarantee a high level of quality standard in the provision of services.

The scheme also provides the opportunity for the providers to access funds at concessionary rates through a global fund supported by contributions from the State Government and the Bank of Industry, partially guaranteed by the Medical Credit Fund (MCF) of the PharmAccess Foundation. The expectation is that the low interest loans would enable the private providers offer services which would be affordable to the Delta State Contributory Health Commission.

To commence a pilot, the State offered 25 facilities that have been previously abandoned to 11 providers to revitalize and manage for a period of 5 years in a PPP arrangement. One of such providers is Toronto Hospital in Anambra State which is managing the facilities in Polobubo Kingdom, which was attended by Caroline.

Emeka Eze, the MD/ CEO of Toronto Hospital, a 100 bed hospital in Anambra State, said “Without this intervention, Caroline would have been dead within minutes of entering the facility from hemorrhaging. We must give kudos to the consortium of the Delta State Government, PharmAccess Foundation and the Bank of Industry for coming up with this wonderful innovation that could be replicated as a means of revitalizing healthcare services in Nigeria”.

The consortium under the initiative has recently approved and disbursed a loan of over N350 million at an interest rate of 10.5% to revitalize health facilities across Delta State, which was done through a comwww.businessday.ng

petitive process by placing adverts in the papers and facilitated by MCF through a thorough screening process.

The loan is expected to be repaid through the capitation and fee for service payments received from the Delta State Contributory Health Commission.

Njide Ndili, the country director of the PharmAccess Foundation, said the foundation primary purpose of initiating the scheme is to make healthcare services available to all. “We are very proud to be partners with the Delta State Government and the Bank of Industry on this laudable scheme which would see many people in the rural areas who have been otherwise undeserved, begin to have access to the same quality of care as seen in the urban areas. This is the very reason the PharmAccess Foundation was set up; to make health markets work”.

While speaking at the recently concluded 62nd National Council on Health, Ben Nkechika, the director general of the Delta State Contributory Health Commission said, “We are very happy to showcase the Access to Finance Scheme as one of the innovations the government has used to increase the penetration of health services delivery in Delta State. The government recognizes the role of the private sector in this regard, understanding that they cannot do it alone. This is why we are considering expanding the number of facilities under this scheme”.

According to Nkechika, the state government has increased the number of primary healthcare centers it is renovating to over 300 fully funded by the state; however, the government still appreciates and acknowledges the role of the private sector in revitalizing more health facilities in response to the growing need of facilities to deliver care as a result of the expanding health insurance coverage of the state’s health commission, https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 08 October 2019

BUSINESS DAY

35

Markets + Finance

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

How $400 million BUA plant set to rot under Usman’s watch

I

n civilise climes the government create an enabling environment for businesses to thrive because companies are pivotal to economic growth, as they produce goods and services while contemporaneously creating employment.

In 2016, United States President Donald Trump, through the approval of congress, reduced corporate taxes, in fulfillment of his campaign promises. That decision saw corporate profit surged, while shareholders were rewarded in form of bumper dividend and share buybacks. The stock exchange rallied and the economic got a boost.

However, the reverse is the case in Nigeria, where government either knowingly or inadvertently stifles businesses with obnoxious laws and outright impulsive actions. Little wonder the vast majority of people are living in penury.

The Nigerian Ports Authority (NPA) has decommissioned Terminal B, operated

by BUA Ports and Terminal, in Rivers State. It claimed the action was taken for security reasons and that BUA Ports reneged in the concession agreement, an allegation that has not been substantiated.

NPA stated that the Terminal was handed over to BUA for use with effect from August 10, 2006, and that a part of the agreement for the concession, the company was required to commence full reconstruction of berths 5-8 within 90 DAYS of hand over of the facility.

The Agency added that as of February 2016, 10 after the handover, the BUA Ports and Terminal had failed to commence the reconstruction as required by the agreement.

The Authority said it issued a default notice dated, 2016 dated February 11, 2016 and another one dated July 27, 2016 on the Terminal operators.

But experts are of the view that NPA chairman, Hajia Hadiza Bala Usman, may be reading from a script, as she’d only visited the Terminal once (in 2016), before she took the decision.

BUA Group had on different occasions written the NPA seeking approval to perform remedial works on the terminal and wondered why the NPA refused to grant approval, but rather hurriedly decommissioned the terminal despite the repair works required for the part of the Jetty in question.

The company also accused the Agency of failing to meet with its obligations regarding the lease agreement and of disregarding the Federal High Court, Lagos Division injunction restraining NPA from terminating or giving effect to the Notice of Termination pending the referral of the issues in dispute to arbitration as provided under the lease Agreement.

BUA said that under the agreement between the parties, NPA has an obligation, among others, to dredge the port and repair the quay apron of the Terminal which responsibility it has failed to perform till date.

But the NPA has failed to carry out any of its own obligations under the Lease Agreement which are necessary and required for any meaningful reconstruction to take place. Neither has it responded to BUA’s several requests for approval to perform remedial action on the berth.

Despite these challenges, BUA had contacted a renowned construction company to carry out the needed repairs at the terminal and thereafter paid the sum of 4.7 million euros. But the construction was impossible because NPA had failed to reply to letters written by BUA for work to commence.

BUA also said the failure of the NPA to provide security for the terminal as required in the lease agreement has given way for nefarious activities of hoodlums and vandals who over a period of time cut the

Hadiza Bala Usman

pipes and steel beams of the berths thereby affecting their stability and consequently making remedial works imperative.

For instance, a notorious criminal was arrested by the Police and charged to court but NPA refused to press charges and, consequently, the criminal was discharged and acquitted.

“It was the failure of the NPA to provide the required security that led to the nefarious activities of hoodlums and vandals who over a period of time cut the pipes and steel beams of the berths

thereby affecting their stability and consequently making remedial works imperative,” said BUA. Hajia Hadiza Bala Usman must be high on something to think that matters like this are resolved on twitter accounts, facebook, instagram and other media. A stakeholder meeting will help resolve the issue without resulting in public theatrics or without stoking public emotions.

By decommissioning the Terminal, government and BUA will lose copious revenue, a double whammy for a country whose economy

‘

It was the failure of the NPA to provide the required security that led to the nefarious activities of hoodlums and vandals who over a period of time cut the pipes and steel beams of the berths thereby affecting their stability and consequently making remedial works imperative

‘

BALA AUGIE

has been growing sluggishly.

The decommissioning of Terminal B will threaten BUA’s newly constructed $400 million dollar flour, pasta and sugar plants in Port-Harcourt; the plant has a capacity of 1.2 million tonnes per annum, making it one of the biggest refineries in the country.

The terminal is right behind the sugar drums, so when the ship berths there, the raw materials will be covered via conveyance belt into the factory, which reduces the cost of transporting raw materials from the Port to the factory.

Tank farm owners and those engage in fish farm business also rely on these Berths are losing money, as oil and gas are transported from ships at the jetties into the drums.

“Crown Flour Mills take their product from BUA Terminal, we have so many customers that bring in fish through our terminal, all of them now are in big problem because the four berths available can only take four ships at a time and when one berthes cargo vessel, the one you saw has been at the port terminal for more than 10 days, which means that that berth cannot take any other ship until this one leaves.”

Hadiza Usman’s hurriedly taken decision is tantamount to crippling a multi dollar investment, shattering the hopes of millions of jobless Nigerian youth, and posterity will never forgive her if she refuse to reverse the draconian decision.

The ongoing dispute between the NPA and BUA Ports and Terminals Limited is gradually having a negative impact on the Nigerian economy.

The contract disagreement, which has gone through a handful of courts, will affect 1000 jobs as it continues to linger, and BUA Group is losing more than $500,000 monthly revenue.

If companies continue to struggle, government will be losing tax revenue, and the latest gross domestic product report released by the Nation-

BD MARKETS + FINANCE Analysts: BALA AUGIE www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

al Bureau of Statistics (NBS) showed the manufacturing sector floundered.

The report showed the economy grew at a slower pace of 1.94 percent in the second quarter (Q2-2019) from the revised first quarter (Q1-2019) print of 2.10 percent, the previous year.

More worrying, manufacturing sector contracted by 0.13 percent from the 0.81 percent from expansion in the first quarter (Q1-2019).

The contraction contradicts evidence from manufacturing PMI data published by the CBN in the period which suggested that activities continued to expand, albeit at a weaker pace.

With over 50 percent of a population of 200 million living below $1.20 a day, government should be creating an enabling environment that will enable manufactures create more jobs.

President Muhammdu Buhars’ led administration is notorious for impulsively enacting law that stifles businesses, and it will recalled that the refusal of the central bank to let the dollar float and the ban on 41 items stoked a severe dollar scarcity that tipped the county into its first recession in 25 years.

Recently, decision to close the county’s border with neighboring countries has brought pang on millions of Nigerians. Companies are unable to ship products in and out of the country, while the price of food has skyrocketed.

Apart from frozen rice and foods, Nigerians may also have to pay premium to buy vegetable oil that are locally manufactured as the smuggled oil that formerly compete with the local brands, hardly find their way into the Nigeria.

Consequently, the price of rice has skyrocketed as one bag of 50kg of imported parboiled rice, which formerly goes for N15,000 while a cartoon , which of Nigerian chicken, which people rarely due to poor quality, now goes for N12,000.

36 BUSINESS DAY

Tuesdat 08 October 2019

news Medic West Africa 2019: Experts to chart course for better healthcare Desmond Okon

H

ealthcare practitioners will gather at the eight edition of the largest healthcare trade event in West Africa - the Medic West Africa Exhibition and Conferences, to engage on the future of healthcare as the event features ‘Leaders in Healthcare Conference.’

The event, which holds between October 9 and 11 at the Eko Hotel Convention Centre, Lagos, will host more than 4,500 healthcare and medical laborator y professionals in association with the Federal Ministry of Health.

It will explore issues relating to the future of healthcare in Nigeria, with the minister of health, Osagie Ehanire, as keynote speaker.

The conference will create a platform for thought-leaders, including government officials and industry principals to engage in interactive sessions on the innovations and opportunities available to the healthcare sector.

In a statement made available to BusinessDay, it was learnt that discussions will also be centred round healthcare leadership and management as well as steps to be taken to enable sustainable healthcare in Nigeria.

Sessions facilitated by notable speakers such as Alex Kodwo Kom Abban, deputy minister of health, Ghana, and Akinola Abayomi, commissioner for health, Lagos, will address the role and responsibilities of the private and public health sector.

Commenting on the conference which is scheduled for the 10th of October, Ryan Sanderson, exhibition director for Medic West Africa, expressed optimism towards a fruitful gathering.

“I am very optimistic that Medic West Africa will yield fruitful discourse and create a channel of communication that will explore the connections between the opportunities and challenges of healthcare development in Nigeria.

Medic West Africa is pleased to contribute by providing a strategic platform with expertise, as this is our own way of enriching West Africa with maximum knowledge.”

Participants of the Leaders in Healthcare Conference can expect to unlock ideas on the steps to address basic health needs and deliver a sound health system in Nigeria as well as implementation tactics, according to Sanderson.

“The panel of esteemed speakers will provide insights on disruptive innovations improving population health and strategies to improve access to healthcare infrastructure funding. Rest assured that Medic West Africa as a trusted platform will give attendees a rich package of knowledge to help with navigating through the opportunities in Nigeria,” he further said.

NAMA boosts upper airways communication in North East corridor IFEOMA OKEKE

I

n line with its resolve to totally eliminate blind spots in the nation’s airspace, the Nigerian Airspace Management Agency (NAMA) has completed the installation of a VSAT station at the Jos airport in Plateau State.

With the installation completed a week ago, the agency has success-

www.businessday.ng

fully integrated the VHF radio into the network in that sector.

Speaking on this development, Fola Akinkuot u , ma na g i n g d i re c t o r of NAMA, said this new installation had greatly improved the upper airways radio communication in the Nor th East sector to the delight of air traffic controllers and pilots alike.

Akinkuotu expressed

optimism that the challenge of radio blind spots in some parts of the nat i o n ’s u p p e r a i r s p a c e would soon be histor y as the ongoing massive deployment of VSAT network and VHF radio systems embarked upon by the agency was yielding positive results.

He noted that the Jos - Obudu corridor, which had experienced radio blind spots over time, had

https://www.facebook.com/businessdayng

to be tackled headlong because of the intense traffic on that axis, even as he commended NAMA engineers for addressing the problem with the installation of the new VSAT terminal.

Akinkuotu said under the ongoing AIS Automation project, the installation of VSAT stations had been completed in Lagos, Abuja, Port Harcourt, NAMA headquar-

@Businessdayng

ters, and Jos, while that of Kano VSAT master station would commence by next week.

He also stressed that the installation of the VSAT stations would be done in 26 airports while the VHF radios would be installed in 14 strategic remote sites to finally eliminate radio blind spots in the upper airways segment of the entire Nigerian airspace.

Tuesday 08 October 2019

BUSINESS DAY

37

news Finance ministry moves to rejig sluggish..

Continued from page 1

Nigeria’s ailing economy a n d a c h i e ve i n c l u s i ve growth.

The fiscal authority said it would focus on enhancing revenue generation, collection and monitoring, accelerating fiscal consolidation by optimising priority capital and recurrent expenditure, and optimising management of both domestic and global fiscal risks.

Other focus areas, the ministry said, are increased coordination of fiscal, macro monetary and trade policies, and integrating annual budgets and medium-term fiscal strategies into medium and long-term national plans.

In a document seen by BusinessDay, the ministry hinged its plans on the 11 priority areas by the Federal Government (FG) which were captured under three broad themes, including accelerating economic and governance reforms, enhanced investment in physical infrastructure, human capital, and optimising investment in physical security and food security.

To enhance revenue generation, the ministry has launched a Steering Committee to identify new sources and enhance existing revenue streams, while improving the coordination and cohesion among agencies in the revenue ecosystem using relevant tools.

It also announced that the reconstituted National Tax Policy Implementation Committee (NTPIC) – under the chairmanship of executive chairman, Federal Inland Revenue Service (FIRS), and the comptroller- general of Nigeria Customs Service – has been directed to produce a single draft Finance Bill 2019 to support the fiscal priorities of Nigeria’s 2020 budget.

Other reforms in the pipeline include enhancing the ease of doing business, particularly for Medium Small and Micro Enterprises (MSMEs), through a reduction in corporate rate for businesses with N25m turnover from 30 percent to 20 percent, reduction of Value Added Tax and corporate tax filing requirement for MSMEs, and a one percent tax rebate for earlybird taxpayers.

To bridge the huge infrastructural deficit, the ministry plans to incentivise investment in infrastructure and revive capital markets growth through targeted tax incentives, encourage multimillion private sector investment in real estate through Real Estate Trusts (REITs), and introduce tax rules to complement existing SEC regulations for securities lending transactions on the Nigerian Stock Exchange.

According to the ministry, the Presidential In-

frastructure Development Fund (PIDF) has expended over N17bn out of N2.5trn targeted for major roads across the country. These include Lagos-Ibadan Expressway, Second-Niger Bridge project, Abuja-Kano Expressway, and Mambilla Hydropower project.

The ministry also said it would through N500bn continue to prioritise the social intervention programme.

On debt management reforms, the finance ministry noted that government is committed to achieving optimal debt balance, noting that the government is on track to shift domestic debt portfolio to long-term maturities while proceeds from the borrowing are being targeted at capital spending priorities.

On the controversial P&ID judgment, the ministry is considering various available options – setting aside an earlier judgment based on proof of fraud by filing fresh actions against the claimant, negotiations and out-of-court settlement.

As part of its priority, the focus would be on increased coordination of Nigeria’s fiscal, macroeconomic, monetary and trade policies, the ministry said.

The ministry would also be integrating annual budgets and Medium-Term Fiscal Strategies into rolling Medium and Long-term National Plans.

It said Nigeria’s 20172020 Economic Recovery and Growth Plans (ERGP) targets investments in critical infrastructure and human capital development as well as enhancing food security, fostering industrialisation, creating jobs and facilitating the ease of doing business.

Key policies include macroeconomic stability and economic diversification, social inclusion and job creation, youth empowerment, and improved human capital development.

The Federal Ministry of Finance, Budget, and National Planning noted it is working with minister of state for budget and national planning to undertake the visioning exercise for long-term vision 2040 plan and prepare Medium-Term Economic Growth Acceleration plan for 2021-2024 as a successor to ERGP. The ministry said it had learned from recent oil price boom and bust and Nigeria’s failure to plan for external shocks which led to the 2016 recession.

It said the government remains committed to executing the ERGP’s priorities and programmes, mindful of economic headwinds and committed to accelerating the ERGP to deliver on its socio-economic and development agenda.

•Continues online at www.businessday.ng www.businessday.ng

L-R: Kayode Olabode, director of sales, Transcorp Hilton Abuja; Nerina Keeley, award panel member, and Valentine Ozigbo, president/CEO, Transcorp, at the Seven Stars Luxury Hospitality and Lifestyle Awards where Transcorp Hilton Abuja received two sectoral leadership awards for Nigeria & Africa and Valentine Ozigbo was named the Hospitality Personality of the Year, at an award ceremony in Greece.

Time running out for reforms, Dangote, Sanusi, others ...

Continued from page 1

cement revolution, said Aliko Dangote, president, Dangote Group.

“Nigeria cannot afford not to be an inclusive economy. Inclusivity must be at the heart of our economic project,” said Dangote, who was represented by Ahmed Mansur, president, Manufacturers Association of Nigeria. Doyin Salami, who heads the Presidential Economic Advisory Council, urged the government to create a path for the private sector to stimulate investment growth.

“We must do bold and audacious things. We cannot get to the table of the giants by doing things in small measure. The private sector must be seen thriving on a defined path with the encouragement of the public sector,” Salami said.

“G o v e r n m e n t m u s t stimulate investment to attract the needed capital that drives growth. We must find private sector elements that are willing to take risks to make huge investments, and be able to trigger the

major accumulation of the capital investments that are required to drive us to that economy of the future,” he said.

At the event, the private sector players agreed that the Nigerian education system is not grooming the youth for the future as it fails to meets the demands of industry.

The Universal Basic Education says Nigeria has 13.5 million out-of-school school children, with share of education budget falling from 9.96 percent in 2012 to 6.96 percent in 2019. Africa’s most populous nation ranks 157 out of 189 in the Human Development Index – measured by education, health and income metrics.

“Our population is a liability already,” said Sanusi Lamido Sanusi, former governor of the Central bank of Nigeria (CBN) and now Emir of Kano.

“Over the years, we have blamed the North for not going to school, but we never asked, who is supposed to build those schools? We have not done that, yet we

Force majeure is power sector players’...

Continued from page 38

tions,” Ogaji told journalists.

BusinessDay checks show that soon after this threat, the Presidency began engagement with the GenCos. In November 2017, shortly after Babatunde Fashola, the then minister of power, works and housing, announced the eligible customer scheme, which allows GenCos to sell power directly to customers, the DisCos issued a force majeure.

The DisCos through the Association of Nigerian Electricity Distribution Companies (ANED), a trade and advocacy group, have threatened force majeure for various reasons.

These reasons have ranged from the actions of their regulator to the inability of the

Federal Government to raise tariffs, and even perceived encroachment on their franchise areas by off-grid operators.

Nigeria’s 27 thermal plants control at least 78 percent of power generation while the hydro plants – Kainji, Jebba and Shiroro – supply at least 21 percent of generation. This structure gives the GenCos leverage to secure concessions from the Federal Government as downing tools could leave over 70 percent of Nigerians without power supply.

DisCos control power distribution infrastructure and shutting down power could leave the nation in crisis.

“The threat of force majeure is being used to force the CBN and the government to play ball,” said an executive in

https://www.facebook.com/businessdayng

blame people for not going to school,” Sanusi said.

He said Northern Nigeria has the highest level of fertility, population and poverty because leaders have failed to educate the people, especially the girl-child.

“Except we stop seeing women and girls as baby factories and begin to see them as human beings with rights against abuse, divorce and right to earn an income, the situation will continue,” he said.

With an average growth of 2 percent, the Nigerian economy is growing sluggishly to meet the 2.6 percent annual population growth. The unemployment rate is 23.1 percent since the third quarter of 2018, while 98 million people have fallen into the extreme poverty trap. The economy seems to be rudderless as the stock markets continue to record huge losses with investors fleeing.

Ibukun Awosika, chairman of First Bank, said the federal and state governments must see the education sector as an emergency one of the power companies.

“It is still the most potent tool.”

But force majeure, a French term which literally means “greater force”, is related to the concept of an act of God, an event of which no party can be held accountable, such as a hurricane or a tornado. Force majeure also encompasses human actions, however, such as armed conflict.

In the US and the UK, force majeure clauses are acceptable but must be more explicit about the events that would trigger the clause. Oftentimes, they are usually unusual occurrence capable of derailing the contract.

Eyo Ekpo, a former director at NERC, when asked about operators’ penchant for threatening to issue force majeure, said the place to check is “their contracts” as operators base @Businessdayng

that must answer questions of where the country wants its future to be.

“Our articulated plan for the future must be planned in stages in such a way that it does not derail our eye from the overall target of the future. We must be careful and ensure that our election cycles and plan from now till 2050 does not disrupt the nationally articulated plan for the future,” Awosika said.

“Where are areas that we want to compete and train our kids for the education of the future? Again, competitive education for the future is key. We must redefine our education for the future and tailor it towards what the industry of the future requires,” she said.

Awosika suggested an emergency plan that will make residual courses in the universities relevant.

“You could convert biological science students to fill the nursing gaps to address concerns of maternal and child health. What of about 2 million teachers’ gap? We could get our graduates to do a programme focusing on education for the future that covers that gap,” she suggested. their actions on these.

According to the contracts governing transactions in the power sector, NBET buys electricity from GenCos through Power Purchase Agreements (PPAs) and sells to the DisCos through Vesting Contracts.

However, force majeure is so loosely interpreted in these contracts that it admits almost anything from thunderstorms to a colourful remark by the regulator.

Ayodele Oni, energy lawyer, had argued that whereas Clause 7.1 of the Performance Agreement defines the term ‘force majeure’ to cover any event beyond the reasonable control of a party thereto, Clauses 7.3 and 7.4, in particular, limit the events that may qualify as force majeure.

•Continues online at www.businessday.ng

38

Tuesday 08 October 2019

BUSINESS DAY

DISCOURSE

Shared responsibility: Building and sustaining a ATEDO N A PETERSIDE, CON

I

consider it a great honour and privilege to have been invited as the Keynote Speaker on the occasion of the Dinner to celebrate the 25th Nigerian Economic Summit here in Abuja. The organisers told me they wanted a speaker who was an active participant at the first Summit held a little over 25 years ago and who is still active today.

When I went back to read the Report of the 1st Nigerian Economic Summit which kicked off on 18 February, 1993, my first reaction was one of humility and thanksgiving to God that I am still here 25 years later; I never realised that so many out of that very first batch of Summiteers had since passed on. May their gentle souls rest in perfect peace.

My second reaction however was one of disappointment that some of the exact same economic issues and problems that plagued Nigeria then are still being debated here 25 years later. I am not claiming that we have not achieved phenomenal progress in certain areas such as telecommunications, commercial and investment banking, Pension reform and other service sector pursuits such as Information Technology, Music, Film, Art and Fashion.

The harsh reality is that whatever gains Nigeria achieved in income per capita over the course of the last two decades are slowly being wiped out, as falling annual per capita incomes have become the norm in every single year since 2015. Macroeconomists measure broad aggregates and the numbers do not lie. The investment and GDP statistics used here were obtained with the assistance of Dr Yemi Kale, who heads the National Bureau of Statistics.

In a nutshell, falling living standards appear to have come to stay in Nigeria and so hoardes of Nigerians continue to join the ranks of the extremely poor year after year, at a time when several African countries are successfully lifting more and more of their own people out of poverty. World Bank data confirms that the African countries who have been most successful (Top ten) at reducing extreme poverty over the course of a 15-year period spanning Year 2000 to 2015 are Tanzania, Chad, Republic of Congo, Burkina Faso, Congo DRC, Ethiopia, Namibia, Mozambique, Rwanda & Uganda.

When the earlier Summits were

President Buhari

being held in the 1990s, some of the most popular comparisons by presenters were those between Nigeria and Malaysia, Indonesia and various other Asian tigers.

Today, we can clearly benefit from case studies on poverty reduction emanating from Africa’s top ten.

The same can be said for education, healthcare and infrastructure where Nigeria does not feature in Africa’s top ten in terms of rapid positive change.

Indeed, Nigeria now leads the world in two appalling statistics: 1) the largest number of school age children out of primary school (10.5m); and 2) total number of persons living in extreme poverty (90m approx.). It was not so in 1993.

There is a frightening and ominous link between these two sets of statistics because children who are ill-equipped in terms of basic primary education are likely to be the most difficult to integrate into a 21st Century economy. Many of them were born into poverty and will remain in poverty unless we do something urgently to rescue them. Even more worrying are the regional disparities that show up when socioeconomic data is disaggregated. For instance, the WAEC May/June 2019 WASSCE results show that 9 out of the top 10 States with the best results are from the South East and SouthSouth zones - Lagos State is the only top 10 entrant from outside these two zones. Conversely, of the bottom 8 States on this same www.businessday.ng

Exam results chart, 5 are from the North West, whilst 3 are from the North East zone.

In the 1990s, rapid economic growth eluded many Sub-Saharan African economies. In 2018, the average GDP growth rate for SubSaharan African economies was 2.4%, but if you exclude the two largest economies (Nigeria and South Africa), who are both laggards, then the GDP growth rate for the rest of Sub-Saharan Africa immediately leaps up to 5%. We therefore no longer need to go to Asia to learn lessons about rapid growth. We only need to look to Ivory Coast and Senegal in West Africa which grew at 7.40% and 7.0% respectively or to Ethiopia and Rwanda in East Africa, which grew by 8.50% and 7.20% respectively in 2018.

The fore-runner of GDP growth is the Investment/GDP ratio. If there are little or no investments today, then there will be little or no growth in a couple of year’s time. The double-digit growth of 2002 came on the back of the very high Investment/GDP ratio of 35% recorded in year 2000, which was the first full year following the restoration of democracy. Thereafter, the long term trend for Nigeria’s Investment/GDP ratio has been a near-continuous downward slide.

By 2012, the Investment to GDP ratio had slid all the way to below 15% and so GDP growth rates were bound to fall sharply after 2013.

As GDP growth rates fizzled out in 2015 and 2016, the Central Bank

https://www.facebook.com/businessdayng

of Nigeria (CBN) compounded the situation by embarking on forex policies which caused investors to both take fright and take flight at the same time. The inevitable outcome was an economic recession.

It was only after CBN succumbed to pressure in early 2017 to allow a Nafex exchange rate, where all business units and individuals could buy and sell forex freely at a market determined exchange rate of N360/$1 approx., that supply bottlenecks slowly disappeared and the economy limped out of a recession. The Nigerian economy is however still largely stagnant and so anaemic GDP growth rates

Godwin Emefiele, CBN governor @Businessdayng

which fall below the approximate 3% population growth rate are not cause for celebration. With high inflation rates in the 11% range, which CBN appears to have accepted as being the norm, investors now fear stagflation.

Compare and contrast this with Ivory Coast and Senegal which held inflation below 2% and grew GDP in excess of 7% in 2018.

Before going into prescriptions it is important to update this audience about the current structure of the Nigerian economy, which is significantly different from what prevailed in 1993 in 5 important areas: 1) Over 50% of our GDP now comes from the Service Sector. CBN appeared to have forgotten this in 2016 when directing banks to allocate 60% of forex to the manufacturing sector that accounted for less than 10% of GDP. CBN also held out the false hope that denial of forex to specific sectors of the economy would somehow incentivise investors in other sectors.

The reality is that draconian actions directed at one group of investors simply make other investors think “so who is next and/or what is next”? A corollary of this proposition is to point out that actions and pronouncements that increase overall Uncertainty and Risk are likely to be counter-productive, if the goal is to boost investment activity generally; 2) Inward diaspora remittances now eclipse the oil and gas sector as the number one source of forex for Nigeria. Again, CBN overlooked this while trying to force these inflows to come in at a stipulated official rate of N200/$1 at a time when the parallel market had galloped beyond N400/$1 in 2016; 3) Our ICT sector’s GDP contribution has since outgrown the oil and gas

Tuesday 08 October 2019

BUSINESS DAY

39

DISCOURSE

a strong economic future for Nigeria sector share of GDP and so it should be heralded and nurtured instead of being attacked by rogue regulators as has become fashionable; 4) The split of aggregate demand between the Private Sector and the Government Sector (all 3 tiers) is now 91.5%/8.5%. Some Nigerians still dream about FG stimulating national aggregate demand through its own expenditure activity alone. Meanwhile, FG’s total 2020 budget expenditures will translate into a paltry sum of $130 or less per Nigerian. How can that possibly transform Nigeria’s economy in a meaningful way?

One of the first areas of consensus in that first economic summit in 1993 was that FG expenditures alone could never transform the Nigerian economy and so by far the most impactful activity that FG could engage in was to create an enabling environment and a level playing field that would stimulate phenomenal private sector investment activity. 25 years later some of our policy makers still sound as if they missed this most basic lesson.

5) In 2018, Nigeria’ Foreign Direct Investment inflows slipped behind Ghana’s for the first time. In terms of FDI flows into Africa, Nigeria slipped into the second tier in 2018. The first tier is now comprised of Egypt, South Africa, Congo, Morocco, Ethiopia, Ghana and Mozambique. Indeed, Mozambique may head this chart in a few years time. They have provided the type of clarity which Nigeria has refused to provide to the Oil and Gas sector from the moment the Oil Minister in the previous administration produced a first draft of a myopic Petroleum Industry Bill.

The Way Forward It is not too late for President Buhari’s Government and our national assembly to borrow a cue from Mozambique and learn how to enact laws that provide clarity and reduce uncertainty for investors in the oil and gas sector and other sectors too.

So, why is Nigeria unable to achieve GDP growth rates of 6% and above which are currently the norm in several Sub-Saharan Africa economies? The obvious answer is that we appear to have frightened most investors away (local and foreign) and they will not be coming back any time soon until we correct the structural dysfunction that frightened them away in the first place.

Investors appear to have concluded that the Nigerian economy is rigged against all except the very well-connected and they are right. By definition, the well-connected investors are few and so our Investment/GDP ratio is likely to remain low until we make it possible for all other investors (Nigerian and foreign) to come back

Asue Ighodalo, chairman, NESG.

and partake in the task of baking a bigger cake on the basis of a level playing field.

In Nigeria of 2019, only the well-connected can expect the following: 1) Security of life and property; 2) Prompt dispensation of Justice; 3) Sanctity of contracts; 4) No harassment from multiple rogue regulators; 5) Access to land via the Land Use Act; 6) Freedom from multiple illegal State and Local Government levies; 7) Provision of good roads and pipe-borne water to their door-step; 8) Access to subsidised financing; and 9) Public sector employment opportunities.

For the youths, the less privileged and others who are not well connected, they dare not expect these 9 things. Instead, they should concentrate on avoiding being the victims of extra-judicial killings and other forms of Police (notably SARS) or Army brutality and if they go into a legitimate business activity, they should get ready to grapple with endless threats and harassment by FIRS, Customs, State Government Tax authorities, SARS, NAFDAC etc.

The bulk of this harassment typically comes from corrupt government officials seeking to line their own pockets through extortion.

Sadly, there appears to be no oversight function and so the excesses of these rogue regulators is largely unchecked, thereby leaving no respite nor protection for their poor victims. There is no justice for the underprivileged in Nigeria and so this exacerbates Income inequality which is already very high, as demonstrated by our Gini Coefficient of 0.4 approx. www.businessday.ng

A new generation of Nigerians (largely youths) have been dealt a terrible hand. A Nigerian Passport gives them few options for taking flight. It is not so with investors.

Many can take flight and have done so. Sadly, most utterances by important public figures give the remaining investors even more cause to worry. We need a paradigm shift away from harassing investors to one of welcoming them sincerely as well as taking actions that boost business confidence, as Morocco and Rwanda do all the time. A global race is on to win the hearts and minds of investors. Nigeria is currently losing that race badly even within Africa.

Reversing this terrible trend is a shared responsibility. A society gets the leaders that it deserves and so I do not blame this Government or past Governments. I blame the elite in general because we shy away from backing truly competent political leaders, as if we fear that we will not succeed in manipulating them or getting them to rig economic outcomes in our favour.

In the meantime, FG has lost fiscal viability because it lacks the courage to trim personnel overheads on account of a bloated headcount in the public sector.

Will 98% of the population continue to suffer so that less than 2% who make up the bloated public sector can maintain their lifestyles? The same FG endorsed a largely unaffordable minimum wage and presses on with “populist” subsidies which are largely cornered by the rich. Government revenues as a percentage of GDP are exceedingly low at 6% approx

https://www.facebook.com/businessdayng

and yet all that the private sector does is resist any attempts to increase indirect taxes or price products such as petrol and electricity on the basis of full cost recovery. Even the recent inevitable decision to introduce toll gates on our roads has been met by private sector resistance.

Following the launch of a new payments-enabled National ID Card it is certainly possible to quantify the annual petrol subsidy, apportion it and pay each Nigerian adult that falls below a minimum income threshold his or her share. This can be executed transparently by the same office for National Social Investment Programmes that currently pays monthly handouts to a lucky few out of the 90 million extremely poor Nigerians. If FG is in the habit of being seen to grant subsidies then we should focus less on getting stubborn people to shed a bad habit. It is far better to get them to replace a bad habit of wasted subsidies with a much better habit of direct payments to the poor via an instrument that the rich cannot corner or access.

There will be no strong economic future for Nigeria that can be built and sustained if the deal is to starve the Government of revenues, whilst blaming the 3 tiers of Government for failing to deliver on their respective mandates. The responsibility that we must share is to encourage FG to get its finances in order and attain both fiscal viability and macroeconomic stability. We must also encourage FG to level the playing field for investors and quit dangling rent-seeking and/

or arbitrage opportunities such as multiple exchange rates, which remain open to abuse.

In 1993, Summiteers and CBN agreed that CBN should pursue a 5% inflation target. At that time US inflation was 3% and so the gap was only 2% p.a. Today, US inflation is 2% and yet CBN appears to be content with keeping inflation high at 10 or 11% p.a., the 9% per annum differential is much too high and is inconsistent with the declared goal of maintaining exchange rate stability.

Nobody should get carried away by our short term reliance on “hot” money inflows to bolster forex reserves on the basis of distorted “carry trades”. CBN should quit expanding its mandate into other questionable areas, if it cannot meet its most basic mandate of containing inflation.

We cannot afford to approach the next 25 years by repeating the errors of the last 25 years. The shared responsibility includes getting the elite to become less insular or less sycophantic and to learn to speak truth to power.

The recently appointed Economic Policy Advisory team is a step in the right direction by FG. Their job will be made a lot easier if this Summit can help establish an elite consensus on the unfinished business that is still holding us back from building and sustaining a strong economic future for Nigeria.

I thank you for your attention.

Being a keynote speech presented at a dinner to celebrate the 25th Nigerian Economic Summit in Abuja, October 7, 2019.

Atedo N A Peterside, CON, is the founder of Stanbic IBTC Bank Plc and the chairman of Anap Business Jets Limited, ART X Collective Limited, Cadbury Nigeria Plc and Endeavor High Impact Entrepreneurship Ltd/Gte. Twitter:- @Atedo Peterside @Businessdayng

40

Tuesday 08 October 2019

BUSINESS DAY

Live @ The STOCK Exchanges Prices for Securities Traded as of Monday 07 October 2019 Company

Market cap(nm)

Price (N)

Change

Trades

Volume

Company

Market cap(nm)

Price (N)

Change

Trades

Volume

PRICES FOR MAIN BOARD SECURITIES (Equities) BANKING ACCESS BANK PLC. 252,371.10 7.10 -1.39 209 7,357,417 UNITED BANK FOR AFRICA PLC 206,906.50 6.05 -1.63 122 3,496,021 ZENITH BANK PLC 565,136.89 18.00 -0.28 341 6,866,512 672 17,719,950 OTHER FINANCIAL INSTITUTIONS FBN HOLDINGS PLC 190,245.05 5.30 -0.94 160 14,393,568 160 14,393,568 832 32,113,518 TELECOMMUNICATIONS SERVICES MTN NIGERIA COMMUNICATIONS PLC 2,646,086.70 130.00 - 38 124,393 38 124,393 38 124,393 BUILDING MATERIALS DANGOTE CEMENT PLC 2,571,412.57 150.90 -0.07 94 1,800,344 LAFARGE AFRICA PLC. 257,724.73 16.00 -1.54 53 574,302 147 2,374,646 147 2,374,646 EXPLORATION AND PRODUCTION SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC 304,225.84 517.00 -6.85 10 62,100 10 62,100 10 62,100 1,027 34,674,657 REAL ESTATE INVESTMENT TRUSTS (REITS) SKYE SHELTER FUND PLC 1,710.00 85.50 - 0 0 UNION HOMES REAL ESTATE INVESTMENT TRUST (REIT) 10,175.81 40.70 - 1 5 UPDC REAL ESTATE INVESTMENT TRUST 13,074.52 4.90 - 1 3,000 2 3,005 2 3,005 OTHER FINANCIAL INSTITUTIONS NIGERIA ENERYGY SECTOR FUND 411.91 552.20 - 0 0 VALUEALLIANCE VALUE FUND 3,312.39 103.20 - 0 0 0 0 0 0 2 3,005 CROP PRODUCTION FTN COCOA PROCESSORS PLC 440.00 0.20 - 0 0 OKOMU OIL PALM PLC. 52,417.35 54.95 - 9 5,402 PRESCO PLC 40,350.00 40.35 - 5 2,050 14 7,452 FISHING/HUNTING/TRAPPING ELLAH LAKES PLC. 8,520.00 4.26 - 0 0 0 0 LIVESTOCK/ANIMAL SPECIALTIES LIVESTOCK FEEDS PLC. 1,290.00 0.43 - 2 4,562 2 4,562 16 12,014 DIVERSIFIED INDUSTRIES A.G. LEVENTIS NIGERIA PLC. 688.30 0.26 - 3 7,315 JOHN HOLT PLC. 214.03 0.55 - 6 9,511 S C O A NIG. PLC. 1,903.99 2.93 - 0 0 TRANSNATIONAL CORPORATION OF NIGERIA PLC 40,647.99 1.00 -0.99 69 17,154,141 U A C N PLC. 20,457.21 7.10 8.40 104 1,774,134 182 18,945,101 182 18,945,101 BUILDING CONSTRUCTION ARBICO PLC. 711.32 4.79 - 0 0 0 0 INFRASTRUCTURE/HEAVY CONSTRUCTION JULIUS BERGER NIG. PLC. 24,486.00 18.55 - 8 34,499 ROADS NIG PLC. 165.00 6.60 - 0 0 8 34,499 REAL ESTATE DEVELOPMENT UACN PROPERTY DEVELOPMENT COMPANY PLC 2,936.19 1.13 - 18 410,598 18 410,598 26 445,097 AUTOMOBILES/AUTO PARTS DN TYRE & RUBBER PLC 954.53 0.20 - 0 0 0 0 BEVERAGES--BREWERS/DISTILLERS CHAMPION BREW. PLC. 9,003.92 1.15 - 7 44,682 GOLDEN GUINEA BREW. PLC. 242.22 0.89 - 0 0 GUINNESS NIG PLC 72,063.59 32.90 - 34 147,550 INTERNATIONAL BREWERIES PLC. 108,307.86 12.60 - 6 12,475 NIGERIAN BREW. PLC. 399,845.10 50.00 -0.70 37 249,165 84 453,872 FOOD PRODUCTS DANGOTE FLOUR MILLS PLC 112,250.00 22.45 0.45 52 750,318 DANGOTE SUGAR REFINERY PLC 126,000.00 10.50 -0.47 60 366,364 FLOUR MILLS NIG. PLC. 61,505.69 15.00 - 62 314,827 HONEYWELL FLOUR MILL PLC 7,850.90 0.99 - 8 108,550 MULTI-TREX INTEGRATED FOODS PLC 1,340.10 0.36 - 0 0 N NIG. FLOUR MILLS PLC. 766.26 4.30 - 1 11,454 NASCON ALLIED INDUSTRIES PLC 35,767.42 13.50 2.27 33 441,427 UNION DICON SALT PLC. 3,321.07 12.15 - 0 0 216 1,992,940 FOOD PRODUCTS--DIVERSIFIED CADBURY NIGERIA PLC. 18,500.29 9.85 -5.74 17 119,677 NESTLE NIGERIA PLC. 974,967.19 1,230.00 -2.03 40 395,265 57 514,942 HOUSEHOLD DURABLES NIGERIAN ENAMELWARE PLC. 1,680.31 22.10 - 0 0 VITAFOAM NIG PLC. 4,878.29 3.90 - 25 361,485 25 361,485 PERSONAL/HOUSEHOLD PRODUCTS P Z CUSSONS NIGERIA PLC. 27,793.34 7.00 - 5 7,607 UNILEVER NIGERIA PLC. 153,391.64 26.70 - 51 23,069 56 30,676 438 3,353,915 BANKING ECOBANK TRANSNATIONAL INCORPORATED 139,456.59 7.60 - 34 89,206 FIDELITY BANK PLC 47,228.92 1.63 -2.40 54 3,221,731 GUARANTY TRUST BANK PLC. 781,397.81 26.55 0.19 192 6,469,487 JAIZ BANK PLC 13,848.20 0.47 2.17 12 1,055,393 STERLING BANK PLC. 56,141.32 1.95 2.63 55 2,680,521 UNION BANK NIG.PLC. 203,845.27 7.00 - 44 592,247 UNITY BANK PLC 7,364.28 0.63 - 4 20,000 WEMA BANK PLC. 24,301.91 0.63 8.62 41 4,991,108 436 19,119,693 INSURANCE CARRIERS, BROKERS AND SERVICES AFRICAN ALLIANCE INSURANCE PLC 4,117.00 0.20 - 0 0 AIICO INSURANCE PLC. 4,712.54 0.68 - 11 230,127 AXAMANSARD INSURANCE PLC 17,535.00 1.67 -1.76 4 340,000 CONSOLIDATED HALLMARK INSURANCE PLC 2,276.40 0.28 - 0 0 CONTINENTAL REINSURANCE PLC 23,546.13 2.27 -0.88 18 1,641,890 CORNERSTONE INSURANCE PLC 5,302.62 0.36 -10.00 8 589,033 GOLDLINK INSURANCE PLC 909.99 0.20 - 0 0 GUINEA INSURANCE PLC. 1,228.00 0.20 - 0 0 487.95 0.38 - 0 0 INTERNATIONAL ENERGY INSURANCE PLC LASACO ASSURANCE PLC. 2,050.56 0.28 - 4 80,641 LAW UNION AND ROCK INS. PLC. 1,890.39 0.44 - 1 25,000 LINKAGE ASSURANCE PLC 4,080.00 0.51 - 0 0 MUTUAL BENEFITS ASSURANCE PLC. 2,234.55 0.20 - 2 2,161,005 NEM INSURANCE PLC 12,145.16 2.30 - 5 11,901 NIGER INSURANCE PLC 1,702.69 0.22 - 2 800 2,637.45 0.49 - 1 1,000 PRESTIGE ASSURANCE PLC REGENCY ASSURANCE PLC 1,333.75 0.20 - 3 1,000,200 SOVEREIGN TRUST INSURANCE PLC 1,668.16 0.20 - 2 400 STACO INSURANCE PLC 4,483.72 0.48 - 0 0 STANDARD ALLIANCE INSURANCE PLC. 2,582.21 0.20 - 0 0 SUNU ASSURANCES NIGERIA PLC. 2,800.00 0.20 - 0 0 UNIC DIVERSIFIED HOLDINGS PLC. 516.46 0.20 - 0 0 UNIVERSAL INSURANCE PLC 3,200.00 0.20 - 0 0 VERITAS KAPITAL ASSURANCE PLC 2,773.33 0.20 - 1 200 WAPIC INSURANCE PLC 4,951.61 0.37 2.78 30 1,648,368 92 7,730,565

www.businessday.ng

MICRO-FINANCE BANKS NPF MICROFINANCE BANK PLC 2,515.30 1.10 - 5 847,319 5 847,319 MORTGAGE CARRIERS, BROKERS AND SERVICES ABBEY MORTGAGE BANK PLC 4,158.00 0.99 - 1 100 ASO SAVINGS AND LOANS PLC 7,370.87 0.50 - 0 0 INFINITY TRUST MORTGAGE BANK PLC 5,796.93 1.39 - 0 0 2,265.95 0.20 - 0 0 RESORT SAVINGS & LOANS PLC UNION HOMES SAVINGS AND LOANS PLC. 2,949.22 3.02 - 0 0 1 100 OTHER FINANCIAL INSTITUTIONS AFRICA PRUDENTIAL PLC 7,740.00 3.87 9.94 44 1,049,605 35,291.19 6.00 - 6 24,026 CUSTODIAN INVESTMENT PLC DEAP CAPITAL MANAGEMENT & TRUST PLC 660.00 0.44 - 0 0 31,684.34 1.60 -1.25 83 55,672,474 FCMB GROUP PLC. ROYAL EXCHANGE PLC. 1,080.53 0.21 - 1 44,649 STANBIC IBTC HOLDINGS PLC 388,041.40 37.05 -2.50 16 113,268 UNITED CAPITAL PLC 12,480.00 2.08 4.00 57 1,175,959 207 58,079,981 741 85,777,658 HEALTHCARE PROVIDERS EKOCORP PLC. 1,680.29 3.37 - 2 2,562 852.75 0.24 - 0 0 UNION DIAGNOSTIC & CLINICAL SERVICES PLC 2 2,562 MEDICAL SUPPLIES MORISON INDUSTRIES PLC. 494.58 0.50 - 2 7,910 2 7,910 PHARMACEUTICALS EVANS MEDICAL PLC. 366.17 0.50 - 0 0 FIDSON HEALTHCARE PLC 7,615.21 3.65 - 23 303,410 GLAXO SMITHKLINE CONSUMER NIG. PLC. 8,490.72 7.10 - 6 11,800 MAY & BAKER NIGERIA PLC. 3,450.47 2.00 - 9 98,425 873.61 0.46 4.55 15 539,377 NEIMETH INTERNATIONAL PHARMACEUTICALS PLC NIGERIA-GERMAN CHEMICALS PLC. 556.71 3.62 - 0 0 PHARMA-DEKO PLC. 325.23 1.50 - 0 0 53 953,012 57 963,484 COMPUTER BASED SYSTEMS COURTEVILLE BUSINESS SOLUTIONS PLC 781.44 0.22 10.00 7 1,092,712 7 1,092,712 COMPUTERS AND PERIPHERALS OMATEK VENTURES PLC 1,470.89 0.50 - 0 0 0 0 IT SERVICES CWG PLC 6,413.06 2.54 - 0 0 NCR (NIGERIA) PLC. 534.60 4.95 - 2 4,796 TRIPPLE GEE AND COMPANY PLC. 292.02 0.59 - 6 8,591 8 13,387 PROCESSING SYSTEMS CHAMS PLC 1,220.98 0.26 8.33 5 2,000,000 E-TRANZACT INTERNATIONAL PLC 9,996.00 2.38 - 0 0 5 2,000,000 TELECOMMUNICATIONS SERVICES AIRTEL AFRICA PLC 1,157,510.66 308.00 - 2 9 2 9 22 3,106,108 BUILDING MATERIALS BERGER PAINTS PLC 2,173.68 7.50 - 9 6,167 CAP PLC 17,885.00 25.55 - 11 11,749 CEMENT CO. OF NORTH.NIG. PLC 199,781.21 15.20 2.70 38 917,691 MEYER PLC. 313.43 0.59 - 0 0 PORTLAND PAINTS & PRODUCTS NIGERIA PLC 1,769.32 2.23 - 0 0 1,156.20 9.40 - 0 0 PREMIER PAINTS PLC. 58 935,607 ELECTRONIC AND ELECTRICAL PRODUCTS AUSTIN LAZ & COMPANY PLC 2,256.91 2.09 - 0 0 CUTIX PLC. 2,818.12 1.60 2.56 27 494,961 27 494,961 PACKAGING/CONTAINERS BETA GLASS PLC. 26,898.49 53.80 - 6 16,800 GREIF NIGERIA PLC 388.02 9.10 - 0 0 6 16,800 AGRO-ALLIED & CHEMICALS NOTORE CHEMICAL IND PLC 100,754.14 62.50 - 0 0 0 0 91 1,447,368 CHEMICALS B.O.C. GASES PLC. 2,547.42 6.12 - 0 0 0 0 METALS ALUMINIUM EXTRUSION IND. PLC. 1,781.64 8.10 - 0 0 0 0 MINING SERVICES MULTIVERSE MINING AND EXPLORATION PLC 852.39 0.20 - 0 0 0 0 PAPER/FOREST PRODUCTS THOMAS WYATT NIG. PLC. 83.60 0.38 - 1 9,362 1 9,362 1 9,362 ENERGY EQUIPMENT AND SERVICES JAPAUL OIL & MARITIME SERVICES PLC 1,252.54 0.20 - 4 77,531 4 77,531 INTEGRATED OIL AND GAS SERVICES OANDO PLC 44,753.08 3.60 -2.70 54 1,094,152 54 1,094,152 PETROLEUM AND PETROLEUM PRODUCTS DISTRIBUTORS 11 PLC 50,483.34 140.00 - 30 27,201 CONOIL PLC 10,686.86 15.40 0.98 11 57,501 ETERNA PLC. 4,108.06 3.15 - 9 28,750 FORTE OIL PLC. 19,276.72 14.80 - 21 68,548 MRS OIL NIGERIA PLC. 5,166.13 16.95 - 2 3,482 TOTAL NIGERIA PLC. 41,829.09 123.20 - 49 56,639 122 242,121 180 1,413,804 ADVERTISING AFROMEDIA PLC 1,820.01 0.41 - 0 0 0 0 AIRLINES MEDVIEW AIRLINE PLC 17,551.17 1.80 - 0 0 0 0 AUTOMOBILE/AUTO PART RETAILERS R T BRISCOE PLC. 294.09 0.25 - 1 23,079 1 23,079 COURIER/FREIGHT/DELIVERY RED STAR EXPRESS PLC 2,387.46 4.05 - 7 17,384 TRANS-NATIONWIDE EXPRESS PLC. 361.01 0.77 - 3 399,888 10 417,272 HOSPITALITY TANTALIZERS PLC 642.33 0.20 - 0 0 0 0 HOTELS/LODGING CAPITAL HOTEL PLC 4,723.78 3.05 - 0 0 IKEJA HOTEL PLC 2,452.98 1.18 - 3 38,000 TOURIST COMPANY OF NIGERIA PLC. 7,862.53 3.50 - 0 0 TRANSCORP HOTELS PLC 41,042.18 5.40 - 0 0 3 38,000 MEDIA/ENTERTAINMENT DAAR COMMUNICATIONS PLC 4,800.00 0.40 - 0 0 0 0 PRINTING/PUBLISHING ACADEMY PRESS PLC. 211.68 0.35 - 0 0 LEARN AFRICA PLC 864.02 1.12 - 9 105,424 STUDIO PRESS (NIG) PLC. 1,183.82 1.99 - 1 6,350 UNIVERSITY PRESS PLC. 496.12 1.15 - 5 18,492 15 130,266 ROAD TRANSPORTATION ASSOCIATED BUS COMPANY PLC 613.35 0.37 8.82 1 176,600 1 176,600

https://www.facebook.com/businessdayng

@Businessdayng

Tuesday 08 October 2019

BUSINESS DAY

www.businessday.ng

https://www.facebook.com/businessdayng

@Businessdayng

41

42 BUSINESS DAY

Tuesday 08 October 2019

news Progressive Governors meet Lawan, Gbajabiamila over Edo Assembly crisis SOLOMON AYADO, Abuja

T

he Progressive Governors’ Forum (PGF) on Monday met with the Senate president, Ahmad Lawan, and speaker of the House of Representatives, Femi Gbajabiamila, to evolve measures to amicably resolve the crisis in the ruling All Progressives Congress (APC) over the leadership tussle in the Edo State House of Assembly.

The meeting between the governors and leadership of the National Assembly commenced at about 2.30pm and lasted for about one hour.

While the governors and senators went into a closed-door session, journalists were driven out of the venue.

Sources say the meeting was necessitated by the crisis in the Edo State House of Assembly and how best the matter can be resolved.

Present at the meeting were governors of Kebbi, Katsina, Ekiti, Kaduna, Yobe, Kano, Borno, Gombe, Niger, Nasarawa, Edo, Ogun and Kwara states, among others.

Speaking before the meeting went into closed door, chairman of the PGF and Kebbi State governor, Abubakar Bagudu, in his brief remark, explained that the meeting became imperative to meet with NASS leadership, congratulate them and proffer a legislative agenda to find best ways on how to properly manage the affairs of the party.

However, the speaker, House

of Representatives, Femi Gbajabiamila, said, “I’m not sure of the Legislative Agenda that the Governor’s Forum are bringing but let me seize this opportunity to say that our legislative agenda would be unveiled on Friday, which we hope to get across to you.

“While addressing the issue of one party and one government, myself and my big brother the Senate President will want to the draw our attention to the issue of the crisis in Bauchi and Edo states. Whilst we were able to successfully resolve the issue in Bauchi State, which is an opposition state, unfortunately, we are unable to resolve that of Edo State, I think this is what we have to look at and prioritise. We should consider how to constitutionally address the issue.

“For those of us on this side, the National Assembly, we are surprised that the exclusive constitutional roles given to us as prescribed in Section 12 of the constitution which is written unambiguously clear was being tested. We are a bit concerned about that. Of course we have three arms of government and on the basis of that, we will be going to court on this matter to resolve not just the judgement but to ensure that any other related issues like that do not come up again.

“The House of Representatives have adopted a theme, “The nation building is a joint task”,that is how we are operating in the National Assembly irrespective of our political party divides. We have resolved to come together when it comes to national issues.

Reps urge public, private organisations to remit contributions to NSITF

... Labour calls for stiffer penalties for offenders James Kwen, Abuja

T

he House of Representatives has urged the Federal, States and Local Governments, their Agencies and Parastatals and private companies to immediately pay all contributions due to the National Social Insurance Trust Fund (NSITF) in order not to jeopardise the objectives of establishing the Fund.

The House calls on all major oil companies, particularly the Nigerian National Petroleum Corporation (NNPC) and its subsidiaries, to expedite action to rectify the breach and pay their backlog of contributions before legal action is taken against them.

It also urges well-meaning Nigerians, especially employers of labour, to pay their contributions to the Fund so that workers can be guaranteed safe landing when they fall.

The House gave this indications Monday at the public hearing of the Ad-hoc Committee Investigating the NonRemittance of Contribution into NSITF by Federal, State, and Local Governments, Parastatals, Public Corporation and Companies.

Speaker of the House, Femi Gbajabiamila, while declaring the public hearing open, said NSITF was created to meet a specific need of providing

adequate compensation for all employees or their dependents, in the event of death, injury, disease, or disability arising from, or in the course of their employment.

Gbajabiamila noted that, it is the employer contributions required by law that allows the fund to operate, and to meet the demands of its mandate and failure to comply with the requirement of law in this matter is an act of sabotage against the interests of the Nigerian worker which is unacceptable.

The Speaker represented by Majority Leader, Ado Doguwa said, as it is evidently the case, government institutions themselves also fail to meet their obligations in this regard which is glaring repudiation of the government’s constitutional obligation to serve the security and welfare of the people.

“The mandate of this committee is therefore simply to identify what factors may be mitigating against full compliance with the requirements of the law in this instance, and to make recommendations thereto on what we in the House of Representatives can do to achieve full compliance, and properly penalize those who refuse to do what is required of them, whether they’re government institutions or private enterprises.

L-R: Olaoluwa Babalola, brand manager, Heineken; Felix Eiremiokhae, CEO, Oracle Experience; Abubakar Jibril, winner, Design Fashion Africa, My Fashion Line, and Mai Atafo, fashion resource, Design Fashion Africa, after Jibril won the Design Fashion Africa, My Fashion Line competition at the finale in Lagos.

Educationists condemn sex for grade scandals in universities … call for stiffer sanctions on erring lecturers going investigation is coninstitutions have been fraught young undercover journalist.

KELECHI EWUZIE

E

ducation professionals have condemned in its entirety the growing cases of sex for grades scandals in Nigerian Universities. They therefore call for stiffer sanctions to be melted out on randy and erring lecturers found guilty of putting the academic profession into dispute, saying this will help curb unwholesome practices in the education sector.

Reacting to the BBC Africa Eye video year-long investigation documenting the sexual harassment behaviour of some lecturers at the University of Lagos and the University of Ghana, educationists and university professors who shared their views with BusinessDay say this action if not checked will greatly undermine the tertiary education system in the country.

They observe that for decades now, Nigeria tertiary

with reported incidents of sexual harassment, academic corruption in the form of cash or sex for grades, otherwise known as ‘sorting.’

Educationists opine that the prevalence of these unwholesome practices by academic staff of universities is threatening the fabrics of Nigeria’s citadel of higher learning.

BBC over the weekend released a 13-minute video, where Boniface Igbenuhue, a lecturer in the Department of European Languages, Faculty of Arts, University of Lagos (UNILAG), was seen and heard in one of the discreetly recorded videos telling an undercover reporter who had disguised as a 17-year-old admission seeker to switch off the light so he could kiss her.

“Everything that we discussed here, be assured that your mother will not hear and anything that happens between me and you, nobody will hear about it,” Boniface told the

“Sex for a grade in its various forms is not only a dead end for standard in tertiary education institutions, but it is now a cancer since it is practised by those who should stamp out such practices. It is happening slowly and it will soon engulf and destroy our entire society,” Maurice Onyemauche, a Lagosbased education analyst, says.

However, the University of Lagos has suspended Boniface Igbeneghu until investigation is completed. In a similar case, Igbeneghu has also been asked to step down from all his church ministerial assignments.

The National Office of the Four Square Gospel Church has issued a statement addressing the general public on why it would not condone such immoral acts by Boniface Igbeneghu.

“We totally dissociate ourselves from the purported conduct of Dr Igbeneghu and promise to take appropriate measure as soon as the on-

cluded,” said the statement signed by Ikechukwu Ugbaja, the national secretary of the denomination.

While it is not far from the truth that some male lecturers in Federal, State and even private Nigerian tertiary institutions take advantage of their positions to sexually exploit their students, reports from 2018 alone show that there were several reported cases of sexual harassment by female students against their lecturers.

Some recent reported cases include: Richard Akindele, a professor at the Obafemi Awolowo University (OAU), Ile-Ife, who found himself in the middle of a sex-for-mark scandal.

An unidentified female student of the University of Lagos equally accused Professor Olusegun Awonusi of the English Department of the institution of always harassing female students each time they go to his office.

Atiku seeks legislation to check sexual harassment in tertiary institutions Iniobong Iwok & INNOCENT UDOH

A

tiku Abubakar, a former vice president of Nigeria, has advocated for a legislation to check the upsurge in sex for grades cases in public tertiary institutions across West Africa.

In a release, Monday, signed by Paul Ibe, his media adviser, which was in response to Monday’s widely circulated video by an undercover BBC investigative journalist, which showed a lecturer at the University of Lagos (UINLAG) demanding sex from the lady, before he could help her secure admission at the institution.

The video had generated reaction across the country,

www.businessday.ng

while authorities of the institution, last night, moved swiftly to suspend the lecturer from the institution.

However, Atiku, who was the People’s Democratic Party (PDP) presidential candidate in the 2019 election, condemned the act, saying that there was the urgent need for an action in order to avoid people taking laws into their hands.

He called for punitive measures to serve as deterrent, while seeking for the establishment of an institution to help victims overcome the psychological effect.

Atiku further advocated the review of mode of communication between lecturers and students, while advocating the

https://www.facebook.com/businessdayng

use of technology in checking and assessing their interaction.

According to Atiku, “The overwhelming outrage, outpouring of examples and outright naming of perpetrators means that unless something is done, and expeditiously too, young people might begin to take the laws into their own hands.

“Moreover, there is a compelling need to focus on helping the victims to also cope with their turmoil - at least one person wanted to kill herself three times.

“Punitive, exemplary measures and swift continuous legislation to stem this ‘epidemic’; going forward, there have to be checks and balances on @Businessdayng

the processes of communication between lecturers and students.

“Away from the dormant, inactive and often unenforced university codes of conducts, we can rely on technology to assist - pre-booked online appointments that show a record of visits on a central system that can also be periodically accessed for auditing can help in raising red flags.

“To this end, the swift suspension and termination of the jobs of scores of lecturers implicated in various sexual harassment misdemeanour at the Ahmadu Bello University, Zaria is worthy of commendation and emulation by other universities,”.

Tuesday 08 October 2019

BUSINESS DAY

43

news

ASSBIFI wants CBN, CIBN to intervene in staff casualisation in banking …only 35% workforce in banks is core staff JOSHUA BASSEY

A

ssociation of Senior Staff of Banks, Insurance and Financial Institutions (ASSBIFI) is seeking the intervention of Central Bank of Nigeria (CBN), Chartered Institute of Bankers of Nigeria (CIBN) and Nigeria Employers’ Consultative Association (NECA) in the growing incidence of casualisation and contract staffing in the nation’s financial sector, especially banking.

This is as industry sources put the figure of casual, contract and outsourced staff in the banking sector at about 65 percent. The implication is that of the total workforce in the nation’s banking sector, only 35 percent are engaged as core staff. There are currently about 32 banks in Nigeria.

President of ASSBIFI, Oyinkan Olasanoye, describes the statistics as not only frightening, but have grave implications for banking, especially given that this category of workers are denied basic rights and “treated shabbily.”

Olasanoye spoke on the occasion of 2019 World Day for Decent Work, Monday, in Lagos, saying this trend needed to be addressed in the interest of banking in Nigeria.

“As we have indicated in the

past, despite awareness by most employees on ILO Conventions that deal with rights of workers, all manner of indecent treatments are still discernable in our various workplaces. While more demands are placed on workers, they simultaneously continue to face threats to decent pay, conditions of work, safety and outright job loss,” she said.

She argued that the intervention of CBN, CIBN, NECA was required, not just to tackle casual/contractor staffing in sector, but also address the issue of industry bargaining agreement which hasn’t been renewed since expiration in 2007, and already causing tension in the banking sector.

Olasanoye, at the event with theme “threats to job security and work-life balance in digitalised work environment –legal perspective, however, acknowledged the role of technology in the delivery of timely banking services.

“Advances in technology are allowing us to work in new ways that weren’t possible in the past without such constraints as location. It has changed where we work, how we work, time of work and who we work with,” she said.

Quadri Olaleye, president of the Trade Union Congress of Nigeria (TUC), in a keynote address, stressed the need to respect workers’ rights and gender equality in workplaces.

InfraCredit appoints Solomon AdegbieQuaynor as INED Hope Moses-Ashike

I

nfraCredit, a ‘AAA’ rated infrastructure credit guarantee institution, backed by the Nigeria Sovereign Investment Authority, GuarantCo (a Private Infrastructure Development Group company), KfW Development Bank and Africa Finance Corporation, has appointed Solomon AdegbieQuaynor as an independent non-executive director (INED) of the company.

Adegbie-Quaynor has been named to the Board’s Credit & New Business and Risk & Capital Committees.

Solomon Adegbie-Quaynor has over 20 years development finance and investment banking experience at the largest global IFI (International Finance Corporation) and top international investment banks (Merrill Lynch, Bear Stearns).

He is an Emerging Markets specialist who is sector agnostic, with significant infrastructure and financial services experience.

He operates as a strategic thinker with innovation and results orientation, and is now translating this into various Senior Advisor roles including: Investment Banking with Rothschild, development finance with IFU of Denmark, infrastructure PE investing with ARM Harith Infrastructure Fund, property development of diplomatic housing across Africa with Verdant Ventures of the US, and

independent IC member for an SME-focused PE Fund (Synergy Capital). Adegbie-Quaynor received his BSc in Applied Physics from Atlanta University Center (US), an MSc in Electrical Engineering from Georgia Institute of Technology, and an MBA with concentration in finance (US) and strategy from JL Kellogg Graduate School of Management, Northwestern University (US).

“I would like to warmly welcome Adegbie-Quaynor to the Board,” commented Uche Orji, Chairman, InfraCredit. “Solomon has an exceptional wealth of experience in infrastructure and development finance that will benefit the Company and drive meaningful value for all shareholders as we continue our journey to grow whilst strengthening our commitment to good corporate governance”.

Chinua Azubike, InfraCredit’s Chief Executive Officer, said, “Adegbie-Quaynor joins InfraCredit at an exciting time and we look forward to benefiting from his insight and expertise as we work to deliver our strategic goal towards transformative growth.”

Solomon Adegbie-Quaynor commented, “I am honoured to join InfraCredit’s Board and collaborate with other Board members and executive management team to contribute to the company’s mission and drive future growth. I look forward to bringing my expertise and experience to InfraCredit as a new Board member.” www.businessday.ng

L-R: Abraham Awe, principal, asset management, CreditVille; Ever Obi, chief risk officer, Zedvance Limited; Chukwuma Nwanze, executive director, finance and strategy, Credit Direct; Ifeoma Onuoha, client advisory, Cordros Asset Management; Sucex Bright, convener, Africa Youth Leadership Economic Summit AYLES, and Joshua Chibueze, co-founder/CMO, Piggy bank, at the BusinessDay Millennia Hangout, themed: Financing opportunities for millennials, in Lagos.

Pic by David Apara

Consumers’ shrinking wallets slow demand for foreign goods BUNMI BAILEY

O

n a Saturday morning, Ibukun Funsho, an undergraduate student, went to her usual vendor who sells body lotions and other beauty products.

She searched for a foreign brand of skin whitening cream. It had been close to two years she last purchased one.

When she could not find it, she asked her vendor, who told her that he stopped selling the product due to falling demand.

This largely shows what is happening in Nigeria’s retail space. Demand for foreign products is slowing as consumers now perceive them as more expensive to purchase, discouraging local merchants from stocking them.

International brand interest in the Nigerian retail space has slowed down as strong enquiries in the formal retail market have not translated into actual

transactions, according to 2019 half-year Nigerian retail report

by Broll Nigeria, one of Africa’s leading commercial property services companies.

“The general consensus amongst a number of these brands is that they require experienced local franchisees to introduce their brands into the market. The delay in the establishment of these global brands in the market suggests that the existing pool of experienced franchise operators are not looking to take on new brands within their portfolios at the moment,” the report said.

The report analysed Lagos and Abuja markets, where most of the country’s retail activity is concentrated.

The dimming interest in foreign brands is due to weak purchasing power and poor ease of doing business in Nigeria, consumer analysts say.

“The big underlining factor here is the presence of so many

brands in the market competing for market share,” said Ayorinde Akinloye, a consumer goods analyst at Lagos-based CSL Stockbrokers.

“Most franchisees prefer to sell what consumers already know and are familiar with.

Besides, some of these global brands are more expensive and belong to the premium end of the market,” Akinloye said.

Data from the National Bureau of Statistics on Gross Domestic Product (GDP) by Income and Expenditure approach at 2010 purchaser’s values show that consumption expenditure of households have been declining at varying paces since it rose by 1.5 percent in 2015. Also, per capita income in Nigeria declined to $2,049 in 2018, from $3,268 in 2014, according to the International Monetary Fund (IMF).

Last year, Nigeria overtook India as the country with the largest number of people living

in extreme poverty, thereby becoming the world poverty capital, according to the Brookings Institution. This year, the number has risen to 91.6 million from 87 million in June 2018.

Every minute, six Nigerians enter the group of extremely poor people, according to the World Poverty Clock.

“The two things responsible for low investment and involvement of global brands in Nigeria are the ease of doing business in Nigeria which is terrible and global investors thinking that despite the large population and potentially large market in Nigeria, the value of dollars in the market is unattractive. People are poor,” Abiola Gbemisola, research analyst at Lagos-based Chapel Hill Denham, said.

In 2018, Nigeria ranked 146 out of 190 countries in the World Bank Ease of Doing Business ranking, dropping by a spot from its 145th position in 2017.

Buhari prescribes home-grown solutions for Nigeria’s economic challenges Tony Ailemen, Abuja

P

resident Muhammadu Buhari on Monday, said Nigeria’s challenge could only be addressed using homegrown solutions The President, while declaring open the 25th Nigerian Economic Summit (NES25) in Abuja, charged both public and private sector leaders to look inward to solve the unique challenges confronting the nation’s socio-economic development.

In an apparent response to criticism of poor engagement with the private sector, the President pledged that his administration would henceforth collaborate with the private sector in designing and implementing developmental projects that will keep Nigeria on track for sustained, inclusive and prosperitydriven growth.

The 2019 Summit of the Nigeria Economic Summit Group has identified key job-creating sectors

such as agriculture, manufacturing, ICT, creative industry and the extractive industry as its main focus, while deliberations will look at “unlocking capital through our financial services sector to actualize the opportunities in these sectors.”

On the focus of this year’s economic summit which is discussing what Nigeria would be in the year 2050 when many studies estimate the country’s population would rise to over 400 million people, the President said: ‘‘As a government, our view is to equip our citizens with the means to seize any opportunities that may arise. ‘‘This means we continue investments in education, health care, infrastructure, security and strengthen and entrench the rule of law.’’

While wishing the 25th NES fruitful, robust and productive deliberations, the President praised the organisers and stakeholders of the Summit for sustaining the platform established since 1993

https://www.facebook.com/businessdayng

to deliberate on key issues on national development.

President Buhari charged the Summit to come up with “productive, inventive and innovative proposals in keeping in mind that Nigeria’s unique challenges can only be solved by made in Nigeria solutions.”

The President harped on the 2019 general elections, adding that “the successful conclusion of the elections and the resort by aggrieved candidates to seek redress in the courts rather than the street was proof that Nigeria‘s ‘‘democracy is maturing.

“The elections have come and gone. Our country, once again, has shown the world that we can choose our leaders in a peaceful and orderly manner. ‘‘Apart from a few pockets of unrest, majority of voters exercised their civic rights without hindrance. ‘‘Furthermore, we also saw an increase in the number of aggrieved candidates and supporters, who took their concerns @Businessdayng

and grievances to the courts as opposed to the streets. This is how it should be. ‘‘Ladies and gentlemen, what this clearly shows is that our democracy is maturing,’’ he said.

Reflecting on the manifesto of the ruling All Progressives Congress (APC) party, the President noted that his administration’s economic policies in the last four years focused on the need to uplift the poor and the disadvantaged and encourage inclusivity. ‘‘During the elections, almost all candidates proposed their vision for the economy and for the country. ‘‘Our party, the APC, put before the country policies that focus on delivering prosperity to all Nigerians through enhancing security; eliminating corrupt practices in public service; supporting sectors that will create jobs; and promoting socially focused interventions to support the poorest and most vulnerable among us.

44 BUSINESS DAY

Tuesday 08 October 2019

news

P&G partners BoI to catalyse SMEs through skilled academy TELIAT SULE

I

L-R: Muhammadu Buhari, lecturer, Bayero University, Kano; Guillaume de Kerdrel, French deputy head of mission; Ketil Karlsen, EU ambassador to Nigeria, and Kayode Ebatamehi, MD, Bluebird Communications, at the European Union Climate Sustainability Event themed ‘Renewable energy for a sustainable future’ at the Dangote Business School in Kano.

Finance Bills to accompany annual budgets going forward Onyinye Nwachukwu, Abuja

N

igeria’s Federal Government annual budgets will now be accompanied by finance bills to ensure expenditure plans are adequately implemented, Zainab Ahmed, minister of finance, budget and national planning, says.

Ahmed said this during her opening speech at the ongoing Nigerian Economic Summit (NES#25), which began Monday in Abuja.

Already, the government has produced a single draft Finance Bill 2019 to support its 2020 budget after reconstituting the National Tax Policy Implementation Committee (NTPIC) to review various tax laws.

“We plan that going forward, the annual budget will always be accompanied by finance bills to enable the realisation of revenue projections,” Ahmed told summiteers.

... as government urges private sector partnership According to Ahmed, this is critical because of the need for a significant push towards mobilising domestic revenues and the prudent management of emerging fiscal risks, which is central to achieving goals under the 11 priority areas of government.

She said the ministry of finance, budget and planning was now focused on five priority areas, including Enhancing Revenue Generation, Collection and Monitoring, particularly through continued implementation of the Strategic Revenue Growth Initiatives (SRGI); ongoing reconciliation and monitoring of revenues by the Presidential Revenue Monitoring and Reconciliation Committee.

Others are the review of current tax laws and development targeted of fiscal policy reforms to coincide with the an-

nual budget cycle as well as the deployment of innovative ICT solutions (such as the Ministry’s Project Lighthouse) aimed at leveraging and mining big data to enhance revenue tracking for informed decision-making.

She said against this backdrop of government aspirations to fund minimum wage, invest in health and education, improve human capital development indices as well as fund capital expenditure to at least 30 percent of Federal budgeted expenditure, that government had proposed 7.5 percent VAT hike.

She said Nigeria’s VAT as a share of GDP had declined from 1 percent in 2010-2013 to 0.8 percent in the last four years - between 2015 and 2018.

“This is significantly below the median of 5 percent of GDP in other comparable African countries.”

She attributed the low VAT-to-GDP to low nominal VAT rate, which at 5 percent was the lowest in the African region - that averages at about 16 percent.

“Also, the efficiency of VAT collection, at 0.2, is well below the African regional average of 0.33,” she explained.

The proposed VAT increase is likely to impact more on consumption by the urban communities and the wealthier sections of the population, than on the poor, she said.

“The Ministry of Finance, Budget and National Planning plans to closely coordinate its fiscal policies with the Central Bank’s current tight monetary policy stance, to ensure that the appropriate outturns are achieved in terms of growth, consumption and inflation,” she said.

Reforms: Edo procurement agency deploys new tools to ease contracting process

STEM Training targets 4,500 students in three Nigerian states

E

FRANK ELEANYA

do State Public Procurement Ag enc y with support from the World Bank has deployed state-specific standard bidding tools and revised its procurement p ro c e d u re s ma nu a l to ease the contracting process in the state.

Recall that at the inauguration of the first Governing Board of the agency in 2014, the agency developed and deployed a procurement procedures manual to provide explanatory note to the state’s procurement law, but was unable to do same for the Standard Bidding Documents.

The state government led by Governor Godwin Obaseki has pursued farreaching reforms in budgeting and open governance, which is strengthened with the deployment of the new tools.

In the circumstance,

the Agency was constrained to adapt the Standard Bidding Documents developed by the Bureau of Public Procurement as a result of the similarities between the state procurement law and federal procurement Act. The development and deployment of the Standard Bidding Tools which is a key reform agenda of the agency was realised through support from the Edo State Employment and Expenditure for Results project (SEEFOR) w ith funding from the World Bank.

Commenting on the development, managing director/CEO of the Agency, Henry Imogiemhe Idogun, expressed gratitude to Edo SEEFOR, World Bank, the independent consultants and the technical staff, who worked assiduously to ensure deployment of the tools. www.businessday.ng

A

total of 4,500 students in Oyo, Rivers and Kano states are expected to participate in a Science, Technology, Engineering and Mathematics (STEM) training being organised by TechQuest STEM Academy in partnership with IHS Towers.

The training is part of an initiative called Mission - T programme developed with the objective of improving ICT education and empowerment in selected and communities across Nigeria. Also benefiting from the training are 60 educators from 45 schools as the students.

In a statement BusinessDay received, TechQuest says the Mission - T programme has been strategically designed to align with IHS Towers’s four sustainability pillars namely ethics, people, environment and education.

“We believe that by empowering our communities and promoting ICT education, we are creating sustainable opportunities for competitiveness

and improved ICT awareness in a digitally-driven world,” said Cima Sholotan, IHS Nigeria corporate social responsibility senior manager.

The programme will be implemented by the TechQuest STEM Academy, a non-profit STEM education provider, which currently supports over 11,000 young people across 12 states in Nigeria. IHS Nigeria will help fund the design, development, and delivery of a practical based ICT curriculum that includes textbooks, workbooks, academic videos, an interactive portal and a mobile app to assist teachers and Mission – T ambassadors in the delivery of STEM education.

According to the director and co-founder of the TechQuest STEM Academy, Charles Emembolu, “We believe that the Mission – T program aligns with the fourth United Nations Sustainable Development Goal (SDG4) by focusing on merging locally designed STEM content and toolkits with government engagement. This is made possible through the support of firms such as IHS Nigeria.”

https://www.facebook.com/businessdayng

n order to ensure small and medium enterprises (SMEs) remain vibrant in Nigeria, through the enhancement of their technical know-how, Procter & Gamble, in partnership with the Ministry of Industry Trade and Investment (FMITI) and the Bank of Industry (BoI), has initiated an SME Academy programme to select small and medium scale businesses in the country.

The training programme, tagged “SME Academy: Optimising People, Processes and Products,” held on October 3, 2019, in Ibadan, the Oyo State capital. It was a follow-up to the agreement made with the Federal Government of Nigeria earlier in the year to leverage FMITI and ensure the growth and increase in capability for SMEs across the country.

In attendance were Adil Farhat, managing director, P&G Nigeria; Kagara Ahmed, regional manager (West), BoI; Pacqueens Irabor, state manager, BoI, Oyo State; Nigeria Employers’ Consultative Association (NECA) and chief executive officers of SMEs from across all the sectors of the Nigerian economy.

The goal of the SME Academy is to find sustainable solutions to unlock the efficiency and performance of these enterprises through advisory and skills development, as these are key constraints to the growth of SMEs in Nigeria. Facilitators sensitised the participants on topical issues such as selling skills, building distribution operations, brand building, automation technologies for SMEs,

competitiveness and standardisation, access to regional and international markets as well as logistics and international operations.

Among its other objectives for the initiative, P&G aims to provide practical guidance designed specifically for highly innovative SMEs with sustainable ambitions that are determined to turn strong, innovation towards total economic activity. The SME sector has become increasingly important to economies around the world, with a World Bank Study estimating their presence to be between 365-445 million in emerging markets. It is also the leading source of employment in Nigeria, amassing over 80% of the region’s workforce.

Adil Farhat, managing director, P&G Nigeria, said the training programme was his firm’s way of deepening SME knowledge with a view of having a vibrant SME sector in the country.

“The development of SMEs through capability building is a demonstration of P&G’s commitment to transforming Nigeria’s entrepreneurship ecosystem. When we decided to impact SMEs in Nigeria with support from the Federal Ministry of Industry, Trade and Investment, we were interested in developing an empowering model that would accommodate as many entities as possible. Our partnership with the BoI is strategic, as they have the capacity and expertise that would accelerate this vision into sustainable realities; which aligns with our goals for this programme,” Farhat, said.

MainOne wins at Datacloud Africa Leadership Awards 2019 SEGUN ADAMS

M

ainOne, West Africa’s leading connectivity and data centre solutions provider and its subsidiary company, MDXi, came out tops at the 2019 edition of Datacloud Africa Leadership Summit and Awards held on September 26, in Accra, Ghana.

MDXi was awarded the “Excellence in Data Centre: Africa” as well as “Africa Cloud Service Provider of the Year”. The awardees were selected by an independent panel of global data centre experts recognised for being world-class data centre and connectivity providers and innovators.

The highly competitive ‘Excellence in Data Centre’ award, honours companies known for excellence in providing regional colocation services in Africa, focusing on the data centres that combine best practice in data centre management and infrastructure, with efficient technologies that lend towards the optimization and security of critical resources. These awards come shortly after the company’s recent announcement of its data centre expansion in Appolonia City-Ghana in 2020, with the Abidjan Data Centre newly launched in October 2019. @Businessdayng

MDXi’s Lekki Data Centre, the largest purpose-built commercial data centre in West Africa, was recognized for its world-class data centre infrastructure designed with a strong focus on high availability, security, and open access connectivity and operational excellence. The 600-rack capacity Uptime’s Tier III Facility Certified data centre is also certified to ISO9001, ISO27001 and PCI-DSS standards, representing compliance to global standard in security management systems to meet the needs of customers worldwide.

The data centre currently provides services to a large customer base made up of local and global businesses where it has provided collocation, cloud services and interconnection of the West African telecoms ecosystem to advance digital transformation across West Africa.

Expressing his pleasure at receiving the awards, Gbenga Adegbiji, general manager, MDXi, states, “We are immensely appreciative of the recognition by the international community for the role we play in the West African digital ecosystem and we reaffirm our unwavering commitment to continued service excellence, by providing reliable colocation and cloud solutions.

Tuesday 08 October 2019

FT

BUSINESS DAY

45

FINANCIAL TIMES

World Business Newspaper JAVIER ESPINOZA IN BRUSSELS

E

U antitrust enforcer Margrethe Vestager will signal a further clampdown on US technology giants this month by imposing an interim order to force chipmaker Broadcom to cease alleged anticompetitive practices even before a full probe into its conduct ends.

In the first use of so-called “interim measures” in nearly two decades, the EU’s competition commissioner, who is set for a second term in the powerful role, will tell the US company to stop imposing terms on clients that stop them buying chips elsewhere. Brussels claims this is an abuse of dominant position.

Broadcom is expected to immediately appeal against the ruling and will fight all the way to the European Court of Justice, people with direct knowledge of the case said.

The company did not immediately respond to requests for comment but in the past it has said it follows competition rules and that the commission’s concerns lack “merit”. The commission declined to comment.

Ms Vestager, who will have enhanced authority as executive vicepresident of the commission, will begin a rare second, five-year term on November 1, assuming she is confirmed at a hearing at the European Parliament on Tuesday. She is expected to be grilled by MEPs on her new dual role as competition enforcer and digital policy supremo.

The use of interim orders suggests that the commission is preparing to be more aggressive in curtailing or preventing “irreparable harm to

EU antitrust chief signals further clampdown on US tech Vestager’s interim order against Broadcom seen as useful tool in fast-moving markets

EU competition commissioner Margrethe Vestager will begin a rare second, five-year term on November 1 © AFP

competition” by agile tech companies.

If it is upheld by the courts in the Broadcom case, EU regulators are expected to use this long-forgotten tool to go after big technology companies such as Google and Facebook following criticism that Brussels has

been too slow to curb irreversible anti-competitive behaviour in a fastmoving digital market.

Established in EU law in 1980, interim measures have not been deployed since 2001, when thresholds were established for their use. Ms Vestager is keen on testing their ef-

fectiveness following a string of cases led by the French regulators in some local antitrust cases.

Alec Burnside, a Brussels-based competition lawyer at international law firm Dechert, said: “[Ms Vestager] has the appetite for tougher enforcement because despite all of

the work over the last five years there is the painful realisation that has not been sufficient to cause Google to change its ways.”

During her first term, Ms Vestager fined Google more than €8bn in three different cases. On Google AdSense, it took nearly seven years for the commission to impose a penalty after opening its investigation.

Mr Burnside added: “The fines, although impressive in numbers, are no more than a cost of doing business just like delivery vans pick up parking tickets. It doesn’t change the way they park.”

One Brussels-based antitrust lawyer called the move a “high-wire act” that would reinforce Ms Vestager’s image as an “American companies basher” and could reignite tensions between the EU and Donald Trump, US president.

Mr Trump has accused Ms Vestager of hating his country “perhaps worse than any person I’ve ever met” following her fines against US companies such as Amazon, Google and Facebook.

The Dane is expected to get even tougher in her crackdown of powerful digital companies as she takes on a new beefed-up role, which will include a new mandate to draw up regulation, as well as enforcing it.

Music labels wary as Apple tries The end of the WeWork boom rattles property markets to bundle subscriptions Landlords to shared office provider make contingency plans for potential vacancies Record companies worry they will lose revenue as iPhone maker looks to create 1 monthly price JUDITH EVANS, PROPERTY CORRESPONDENT ANNA NICOLAOU IN NEW YORK AND PATRICK MCGEE IN SAN FRANCISCO

A

pple’s hopes of creating a super-bundle of media content for one flat monthly fee have run into early opposition, with some record labels nervous about the prospect of offering their music for a lower price.

The iPhone maker has recently approached the big music companies about bundling together Apple Music and Apple’s upcoming television service, but the two sides have not yet discussed a pricing formula, said people familiar with the negotiations. Talks are at an early stage, they added.

While some labels are open to the idea, people at one big record company said they had concerns, and that the industry was growing more wary about its relationship with Apple, which strong-armed labels a decade ago into selling individual songs for $0.99 on iTunes.

In recent years, the success of streaming services such as Spotify and Apple Music has helped a recovery in the music business. But executives fear that margins may be hurt if Apple undercuts the $10 monthly price that Spotify, Apple

Music and others charge.

Apple TV+, a streaming video service, launches on November 1 and will cost $5 a month, in an effort to undercut its rival, Netflix.

Analysts have suggested that Apple would eventually create a super-bundle for the 420m people who subscribed to some Apple service in the past year.

Such a bundle could have several tiers, including apps such as News+, which aggregates magazine and newspaper content for $10 a month, or Arcade, which offers more than 100 games for $5 a month. Last year Apple allowed users to pay for hardware warranties over time with an “AppleCare+” subscription.

In theory, Apple could offer consumers a bundle of Apple Music and Apple TV+ at a notional $13 a month, without compelling music rights holders to offer a discount.

While Apple has to license music rights from the record labels, it owns the rights to content on its video streaming service and does not have to share revenues.

Analysts said the company was more interested in building a huge number of subscribers than in short-term profit. www.businessday.ng

F

rom the Italian Renaissance-style Lord & Taylor building on New York’s Fifth Avenue to the postmodernist landmark One Poultry in London, WeWork has swept up office space at an unprecedented rate since opening its first location in Manhattan less than a decade ago.

But the shared office provider’s breakneck expansion is set for a sudden slowdown, cutting out a significant source of demand in the large urban property markets where it operates.

In the aftermath of the company’s failed IPO, which prompted the demotion of its chief executive Adam Neumann and triggered fears of a cash crunch, there are already signs of problems brewing.

Two landlords of large WeWork sites in London, who asked not to be named, said they would not sign new leases for the foreseeable future and were making contingency plans for their existing WeWork offices in the event of a restructuring.

“It would not be prudent for us to do anything [new] with them until we see how the new management will operate,” one

https://www.facebook.com/businessdayng

landlord said.

Peter Papadakos, a managing director at the research company Green Street Advisors, noted: “We have only seen the benefits from the growth in demand from flexible and co-working operators.

What are still to come are the negative repercussions.”

Last week rating agency Fitch downgraded WeWork’s credit rating to CCC+, a level at which “default is a real possibility”. It said “the risk that the company is unable to restructure itself successfully has increased materially”.

The real estate industry has in recent years embraced WeWork and its rivals. WeWork has 7.7m sq ft of office space in New York City and 4.1m in London, according to data provider CoStar, making it the largest private tenant in both cities. Other key locations include San Francisco, Bangalore and Shanghai.

Much is now at stake for its landlords. They have a total of $47bn in rent due from WeWork across the life of its leases, according to the company’s filings.

Some $2.3bn of lease and other cash obligations fall due in 2020, according to academics at Harvard Business School. @Businessdayng

Two London building sales with WeWork as a tenant have collapsed since its IPO was pulled, although people close to one — the £850m sale of Southbank Place — maintained the group’s problems were not the reason.

In the event of a restructuring that involved WeWork ditching some of its sites, landlords would bring in other flexible office providers to fill vacancies or install their own brands, said agents and landlords.

Mark Dixon, chief executive of the UK-listed shared office group, IWG, said: “We are always in discussions with landlords and those discussions have picked up [since WeWork’s problems] . . . it’s the flight to quality.”

Landlords’ priority would be to avoid flooding the market with space, said two agents working on contingency plans.

Alex Snyder, assistant portfolio manager at CenterSquare Investment Management in Philadelphia, said: “WeWork has structured many of its leases so that they can simply collapse the special purpose entity it’s trapped in and walk away. This vacancy pressure on the market [would] be painful.”

46

Tuesday 08 October 2019

BUSINESS DAY

FT

NATIONAL NEWS

NBA rebukes Houston Rockets boss after Hong Kong praise Backing of protesters angers China, where league has made commercial inroads CHRISTIAN SHEPHERD IN BEIJING, HUDSON LOCKETT IN HONG KONG AND MURAD AHMED IN LONDON

A

tweet by the general manager of the Houston Rockets basketball team supporting the Hong Kong protests has sparked outrage in China, leaving the team and the NBA scrambling to limit the damage in the league’s fastest-growing market.

Daryl Morey posted an image on Twitter — which is blocked in China — with the words “fight for freedom, stand with Hong Kong” on Friday evening, echoing a common refrain of the demonstrators whose four-month standoff with authorities has plunged the city into political crisis.

Mr Morey quickly deleted the tweet and wrote he did not intend “to cause any offence” but that has not stopped the outpouring of anger in the country, with commercial partners quickly cutting their ties with the team.

The Chinese Basketball Association suspended all partnerships with the Rockets, one of the most popular teams in the country, over Mr Morey’s “improper remarks”. That set off similar moves by the NBA’s main distributors in China, state broadcaster CCTV and tech group Tencent.

Shanghai Pudong Development Bank, the Rockets’ main China sponsor, suspended its partnership and sportswear brand Li-Ning cut off all business with the team.

The NBA has aggressively sought to build its presence in China to tap into country’s vast number of diehard basketball fans. Earlier this year, the league signed a five-year extension to its online screening rights deal with Tencent worth $1.5bn, double the amount paid under its previous contract with the Chinese group. More than 490m viewers watched games on Tencent’s platforms last season, nearly triple the number in the previous season.

The NBA distanced itself from Mr Morey’s comment, issuing official statements in English and Chinese. The English apology said it was “regrettable” that Chinese fans had been offended, but added “the values of the league support individuals’ educating themselves and sharing views on matters important to them”.

However, the Chinese statement appeared to condemn Mr Morey’s tweet more strongly, saying the NBA was “extremely disappointed by the inappropriate comment” and that “he has undoubtedly seriously hurt the feelings of Chinese basketball fans”.

The references to “inappropriate” and “hurt feelings” are considered significant, as they were seen to echo language often used by Chinese officials to describe cultural gaffes by

foreign groups.

The NBA’s response failed to assuage the outrage in China but also drew bipartisan criticism in Washington that the league was valuing its commercial goals over American values.

Ted Cruz, the Texas Republican senator, wrote on Twitter that the NBA was “shamefully retreating” in pursuit of “big $$”.

Tom Malinowski, a Democratic congressman, accused Beijing of “using its economic power to censor speech by Americans”, and said the NBA’s response was “shameful and cannot stand”.

Later this week, some of the league’s top executives, including NBA commissioner Adam Silver, are expected to be in China for pre-season matches in Shanghai and Shenzhen. The games will feature LeBron James, one of basketball’s biggest stars, whose Los Angeles Lakers team are due to play the Brooklyn Nets, owned by Joe Tsai, cofounder of Chinese technology group Alibaba Mr Tsai wrote an open letter on Facebook explaining why Mr Morey’s tweet touched upon historical wounds such as the Opium Wars by supporting a “separatist movement.

“Chinese people feel a strong sense of shame and anger because of this history of foreign occupation,” he wrote.

Taobao, Alibaba’s online shopping portal, took down Rockets merchandise on Monday, with a company spokesman citing Mr Tsai’s statement that the issue is “non-negotiable” as one reason, according to Chinese state media.

The Rockets are a favourite among Chinese fans, in part because of the legacy of former star Yao Ming, China’s bestknown player who is now head of China’s basketball association and who spent his entire NBA career with the team.

Mr Morey, who has been the Rockets’ general manager since 2007, is known for his strategic focus on analytics and efficiency.

The approach is known as “Moreyball” in an echo of the “Moneyball” strategy first deployed by the Oakland Athletics baseball team in the early 2000s.

During Mr Morey’s tenure, the Rockets have reached the playoffs nine times and he was named NBA executive of the year in 2018.

A hashtag asking whether Mr Morey would be fired was trending on China’s microblog platform Weibo after China’s state broadcaster released a clip on social media saying that the Rockets risked being “taken off the shelves” in the country.

“Morey, this time you have really broken the rules. When you foul, you must pay the price.

If you fail to change after the foul, then you’ll be sent from the court,” said CCTV news anchor Kang Hui. www.businessday.ng

Donald Trump has filed several lawsuits seeking to stop the release of records from his administration and personal affairs © AP

Judge rejects Trump’s attempt to shield tax returns from prosecutor

US president appeals against decision that rejected his claims to immunity KADHIM SHUBBER IN WASHINGTON

A

federal judge said that Donald Trump’s tax returns could be released to local prosecutors in New York, in a ruling that rejected the president’s sweeping claims of immunity from criminal investigation.

The decision on Monday, which was immediately appealed by Mr Trump’s lawyers, handed a victory to the Manhattan district attorney, Cyrus Vance, a Democrat, who is investigating possible crimes linked to hush money payments made by Mr Trump’s former lawyer, Michael Cohen, during the 2016 election.

An appeals court granted Mr Trump an emergency stay on the enforcement of the subpoena on Monday pending an “expedited review” of the case.

Last month, Mr Vance subpoenaed eight years of personal and corporate tax returns from Mazars, the accounting firm used by Mr

Trump and his company, The Trump Organization.

The president sued to block the release of the returns, adding to a growing list of lawsuits Mr Trump has filed to block scrutiny of his administration and his business affairs. The Department of Justice also sought a temporary block on the subpoenas, noting the “weighty constitutional issues involved”.

The justice department has long held that sitting presidents are immune from federal indictment, but has allowed investigations to proceed nonetheless, most recently in Robert Mueller’s probe of whether Mr Trump obstructed justice. Mr Trump’s attorneys went further in their lawsuit against Mr Vance, arguing the president was immune from any form of criminal investigation, including by state authorities.

In the ruling on Monday, Judge Victor Marrero said that Mr Trump’s argument was, in effect, that “not only the president, but, derivatively, relatives and persons and business

entities associated with him in potentially unlawful private activities, are in fact above the law”.

He called the proposition “repugnant to the nation’s governmental structure and constitutional values”.

A spokeswoman for Mazars, the accounting firm, said: “Mazars USA will respect the legal process and fully comply with its legal obligations.”

The Manhattan district attorney’s office, and attorneys for Mr Trump did not immediately return emails seeking comment.

Mr Trump, who is battling an impeachment inquiry led by Democrats the House of Representatives, expressed his displeasure with the lower court’s decision in a tweet on Monday. “The Radical Left Democrats have failed on all fronts, so now they are pushing local New York City and State Democrat prosecutors to go get President Trump. A thing like this has never happened to any President before. Not even close!”

Brazil tells rich countries to pay up to protect Amazon Environment minister Ricardo Salles calls for $12bn in aid and rejects boycott threat ANNA GROSS AND LESLIE HOOK IN LONDON AND ANDRES SCHIPANI IN RIO DE JANEIRO

R

ich countries should pay billions of dollars to help Brazil protect the Amazon, says the country’s environment minister, who called for more investment and development in the rainforest area.

“We want to attract investment . . . it is necessary to maintain the forest,” Ricardo Salles told the Financial Times. “The opportunity cost [of preserving the forest] must be paid by someone, and when we say someone, means those who have the funds or the necessary sources of finance for that.”

He estimated that $120 per hectare a year would be sufficient

https://www.facebook.com/businessdayng

to pay farmers and other locals not to develop their land — equivalent to $12bn annually if applied across one-fifth of the Amazon, the area that could be legally developed.

The Brazilian government has been on a campaign to restore its image after fires ravaged the Amazon this summer, prompting international condemnation and a threat of boycotts from European governments and asset managers.

This summer Germany and Norway both halted their payments to the Brazilian government’s Amazon Fund, while European investment funds with $16tn in assets threatened to divest from Brazilian bonds and equities if action was not taken by the Brazilian government to prevent deforestation.

But Mr Salles condemned rich countries for attacking Brazil’s @Businessdayng

environmental record while failing to pay the country an amount commensurate with the value of protecting the rainforest.

“Any sort of boycott will only have one consequence, to make things worse,” he said, speaking in London during a European tour.

Since far-right President Jair Bolsonaro took office in January, he has encouraged economic development in the Amazon.

“Development is not contrary to the diminishment of deforestation, quite the opposite,” said Mr Salles.

“We saw the lack of development with the rise of deforestation.”

He said the government was preparing an economic zoning master plan for the Amazon, and he hoped pharmaceutical, cosmetics and food companies would invest more there.

Tuesday 08 October 2019

BUSINESS DAY

47

FINANCIAL TIMES

COMPANIES & MARKETS

@ FINANCIAL TIMES LIMITED

Credit Suisse’s potential damages mount in RMBS cases Swiss bank is one of last to fight lawsuits over crisis-era mortgage-backed securities LINDSAY FORTADO AND ROBERT ARMSTRONG IN NEW YORK

C

redit Suisse’s decision to fight lawsuits over financial crisis-era residential mortgage-backed securities has seen its potential damages almost double, long after most of its main rivals settled their cases.

Even after signing a $5.3bn RMBS settlement with the US Department of Justice in 2017, the Swiss bank faces at least a dozen investor lawsuits over mortgage debt the bank securitised and which plummeted in value during the 2008-09 crisis. An appellate court last month ruled in favour of the bank’s challengers, allowing some of the cases to proceed to trial.

The Swiss bank held $681m in litigation reserves at the end of 2018. Regulatory filings by the bank say it is facing damages in lawsuits that could exceed its reserves by up to $1.4bn.

One case is scheduled to go to trial in January at the New York Supreme Court in Manhattan.

The plaintiffs are three trusts that issued securities backed by 23,900 mortgage loans purchased from a Credit Suisse subsidiary. The trusts claim the bank misrepresented the quality of the mortgage loans by misstating the borrowers’ income, employment and debt levels.

Among the securities owners standing behind the trusts are hedge funds, including Fir Tree, which bought the distressed securities following the crisis. The amount of damages the claimants are seeking — $730m — has roughly doubled since the case was filed because of the 9 per cent annual interest they accrue.

A Credit Suisse spokeswoman said the bank “categorically rejects any suggestion that it defrauded

any investors in RMBS”.

“Our due diligence and investor risk disclosures met or exceeded RMBS industry standards,” she added. Investors losses “were not a result of Credit Suisse misconduct, but rather due to the decline in the housing market and the broader economic downturn”.

Credit Suisse has a reputation among New York trial attorneys as one of the banks most willing to drag out litigation. One lawyer said the bank was likely to be doing so to avoid becoming a target for frivolous lawsuits.

“It’s the scenario they’ve built for themselves,” the lawyer said.

“After deciding not to settle early on, they get to the point where it becomes more worthwhile to fight for the sake of fighting. They’ve doubled down on their gamble . . . they figure, let’s just play it out and maybe we’ll get something good from the court.”

“Their strategy, I don’t think, has worked for them,” the lawyer added.

While Credit Suisse’s US regulatory filings disclose at least 12 open RMBS court actions with investors, the mortgage insurer MBIA, the New Jersey attorney-general and the receivers of several failed banks, other big banks’ reports reflect a less aggressive approach.

Bank of America, which was heavily involved in RMBS issuance before the crisis, does not list any open RMBS actions in its annual filings, and neither does JPMorgan Chase. Citigroup, another major RMBS backer, lists just four open actions, several in the final stages.

Credit Suisse is awaiting a verdict in another RMBS case that went to trial in July in Manhattan, filed by MBIA, which insured the securities. MBIA also claims the Swiss bank defrauded them by lying about the quality of the loans.

Global economic gloom spreads despite bright jobs markets Effects of trade war have moved beyond manufacturing and raised recession fears CHRIS GILES IN LONDON, BRENDAN GREELEY IN WASHINGTON AND TOM HANCOCK IN SHANGHAI

A

lmost two years since Donald Trump fired the opening shots in a global trade war, a manufacturing and investment downturn is weighing on the global economy, frightening business and sending financial markets searching for cover.

The pivotal moment for the global economy can be traced to the January 2018 World Economic Forum in Davos when Mr Trump sent his allies out with the message that trade tariffs were coming and the “US troops are now coming to the ramparts”.

Ever since, the global outlook has deteriorated. World growth of 3.8 per cent in 2017 is expected by the OECD to decline to 2.9 per cent in 2019.

Across the world the story is similar: sectors such as manufacturing, highly exposed to global events, are in or close to recession, while wider economies are propped up by still relatively buoyant labour markets and household spending.

In Europe, a boom of 2017 fell away in 2018 with the industrial sector slowing rapidly, led by Germany. In the latest quarterly data, the sector was falling 2 per cent on an annual basis.

In the US, starting in late 2018, manufacturing activity and business investment began to slow until it declined outright in the second quarter of 2019. The manufacturing index from the US Institute for Supply Management, a survey of executives, dropped steadily over the same period until it contracted in both August and September. www.businessday.ng

Bernard Looney will need to decide which direction to take BP © FT montage / Bloomberg / Reuters

BP’s Bernard Looney takes oil major into energy transition New chief must spell out group’s strategy amid climate-change pressure ANJLI RAVAL IN LONDON

W

hen Bob Dudley became BP’s chief executive in 2010 he faced a political and public backlash in the US after the deadly Gulf of Mexico blowout. He had to bring the energy major back from the brink of collapse and secure its societal licence to operate.

Nearly a decade on, as he hands over a revived company to Bernard Looney, BP’s long-term survival is once again under scrutiny amid pressure to act on climate change — a challenge that the entire oil and gas industry is grappling with.

“Bob steered BP through a difficult time that is unprecedented in the last 30 years. The situation BP faced was unique to the company,” said Jason Gammel, energy analyst at Jefferies. “Now Bernard faces a set of choices that all of its peers also have.”

After managing the Deepwater Horizon disaster, the fractious break-up of the TNK-BP joint venture in Russia and the oil price crash of 2014, Mr Dudley focused on the “dual challenge” of providing the world with more energy while dra-

matically reducing emissions.

However, it is his successor who must spell out what this means for BP’s corporate strategy.

The pressure is mounting. Shareholders are demanding BP take greater action on climate change, Greenpeace activists this year scaled one of its North Sea oil rigs and shut down its London headquarters. BP’s funding of the arts is also under scrutiny.

Yet most investors are still enticed by the dividends BP generates. And while oil companies are becoming social pariahs in Europe, in Africa and Asia, where demand for hydrocarbons is accelerating, they are still embraced.

Mr Looney, a 49-year-old Irishman with a reputation as a strategic thinker, will need to decide which direction to take the energy major as it prepares its next five-year strategy beginning in 2021.

Since claims from the Gulf of Mexico disaster have fallen, BP has a more robust balance sheet and has weighed cash generated from its businesses and divestment proceeds with capital spending, dividends and buybacks. Mr Looney has helped deliver higher production and running projects more

efficiently.

BP reported earnings of $12.7bn in 2018, as high as when oil was trading closer to $100 a barrel, compared with $6.2bn in 2017.

BP has invested in wind farms, solar power, biofuels and lowcarbon start-ups but returns from these businesses do not match its core oil-drilling division.

“Does BP stay as Big Oil or does it become Big Energy — diversifying into power and renewables in a meaningful way. It feels like BP right now is on the fence,” said Ed Crooks at consultancy Wood Mackenzie.

Mr Looney, a BP lifer, was formally selected at a board meeting on Thursday triumphing over chief financial officer Brian Gilvary.

External candidates were considered, but Mr Looney had long been tipped for the post.

Since 2016 he has headed BP’s exploration and production business after operational roles around the world. Identified early on as a rising star, he was made an executive assistant, or “turtle”, to John Browne when he was chief executive, named after the Teenage Mutant Ninja Turtles who were on hand whenever help was needed. He also worked under Tony Hayward.

HSBC to axe up to 10,000 jobs in cost-cutting drive Interim chief Noel Quinn seeks immediate savings from across banking group DAVID CROW

H

SBC has embarked on a cost-cutting drive that threatens up to 10,000 jobs, as its new interim chief executive Noel Quinn seeks to make his mark on the bank.

The plan represents the lender’s most ambitious attempt to rein in costs in years, said two people briefed on it, who said it would result in a substantial reduction in HSBC’s headcount of roughly 238,000.

“We’ve known for years that we need to do something about our cost base, the largest component of which is people — now we are

https://www.facebook.com/businessdayng

finally grasping the nettle,” said one of the people.

“There’s some very hard modelling going on. We are asking why we have so many people in Europe when we’ve got double-digit returns in parts of Asia.”

Any job cuts implemented as part of the latest plan would come on top of 4,700 redundancies that HSBC recently announced amid what it described as “an increasingly complex and challenging global environment” characterised by low interest rates, trade conflicts and Brexit uncertainty.

A large chunk of those job cuts were implemented under a scheme known as “Project Oak”, which @Businessdayng

tried to encourage executives and managers to shrink their teams by offering funding from a central pot of money to cover redundancy payouts.

HSBC declined to comment.

HSBC’s latest cost-cutting drive, which will focus mainly on highpaid roles, comes as global banks make tens of thousands of staff redundant as the industry contends with low or negative interest rates and weak investment banking revenues.

Deutsche Bank in August said it would eliminate 18,000 roles as part of a radical overhaul. Barclays, Société Générale and Citigroup have also announced job cuts this year.

48

Tuesday 08 October 2019

BUSINESS DAY

ANALYSIS

FT

The EU needs to be a power project The emerging world order will increasingly be shaped by might, rather than law GIDEON RACHMAN

I

n Britain and the US, the idea that the EU could aspire to be a superpower is usually treated as either ludicrous or sinister.

So when Guy Verhofstadt, a prominent member of the European Parliament, recently made the case for the EU to be part of an emerging “world order that is based on empires”, there was a predictable backlash. At the Conservative party conference a few days ago, his words, taken from a speech to their anti-Brexit enemies the Liberal Democrats, were cited as evidence of the dangerous imperial ambitions of the EU — and proof that leaving the bloc is the UK’s only safe option.

Mr Verhofstadt can be arrogant.

But, in this case, he also happens to be right. The rise of China and India, and the America First policies of Donald Trump’s US, makes it more important than ever that European countries defend their interests collectively.

The EU once dreamt that the whole world would move towards a law-based system, similar to the EU method. But a world order, shaped by Xi Jinping’s China and Trump’s America, will be based on power rather than rules. The outbreak of a global trade war underlines that small European countries can no longer rely on international rules to protect them.

They need the bulk and heft that

the EU provides.

The former Belgian prime minister’s choice of the word “empire” — with its connotations of conquest — was unfortunate. The EU is an empire by invitation. Nobody is forced to join. And, despite the difficulties of Brexit, any member is free to leave. It would be more accurate to say that the EU can and should aspire to be a superpower — one of four or five major global powers, capable of shaping the world order.

That aspiration is eminently achievable. Indeed, in important respects, it has already been achieved. Last week provided an interesting illustration when the European Court of Justice ruled that individual countries can demand that Facebook take down defamatory content, on a global basis.

The ECJ ruling was made in response to a complaint from an Austrian politician — and prompted an immediate and concerned response from Facebook.

If this had just been a ruling by an Austrian court, the Californian internet giant would have been able to brush it off. But the ECJ has sway over a market of more than 500m people — compared with the 9m in Austria. Facebook’s ambitions for Libra, a digital currency, will also be shaped by rulings made in Brussels. The EU’s decisions — good or bad — change the behaviour of the world’s largest firms, from Silicon Valley to southern China.

UK appeals to EU leaders to engage on Brexit deal Boris Johnson faces a race against time to finalise an agreement by European summit JIM PICKARD IN LONDON

T

he UK on Monday appealed to European leaders to show “greater engagement” with Britain’s proposal for a new Brexit deal, as Boris Johnson struggles to persuade the bloc to enter detailed negotiations.

A Downing Street spokesman admitted there were no immediate plans for face-to-face meetings between the prime minister and his EU counterparts this week.

The statement came as a Scottish court on Monday rejected antiBrexit campaigners’ demands that it force Mr Johnson to abide by a law that requires him to seek a delay to the UK’s departure from the EU if he has not finalised a withdrawal agreement by October 19. Brexit is currently scheduled to take place on October 31.

On Monday, Mr Johnson will hold phone conversations with his counterparts in Denmark, Sweden and Poland.

But it had been expected that Mr Johnson would embark on a tour of European capitals in the run-up to an EU leaders’ summit on October 17-18 where the prime minister was hoping to finalise a new withdrawal agreement.

The European Commission said on Friday that Mr Johnson’s new Brexit proposal did not provide the basis for concluding an agreement. The UK is under pressure to make fresh concessions if detailed negotiations on a deal are to get under way.

The Downing Street spokesman said the EU had seen the publication of Mr Johnson’s proposal last week as a “step forward”, adding there were ongoing talks with the bloc.

“But we need those talks to take place at pace and need greater engagement with the compromises we have put forward,” he said.

David Frost, Mr Johnson’s Brexit negotiator, is due to hold talks in Brussels on Monday with the team of Michel Barnier, his EU counterpart.

Mr Johnson’s proposal seeks to resolve the vexed question of the Irish border that was at the centre of parliament’s rejection of the withdrawal agreement finalised by his predecessor, Theresa May, and the EU. He wants to scrap the so-called backstop in the agreement under which a hard Irish border would be averted by the UK staying in a customs union with the EU, because of concerns it could tie Britain into close ties with the bloc. www.businessday.ng

New York: the high schools admissions test dividing a city Dramatic under-representation of black and Hispanic pupils in elite public high schools has become politically charged SAMI VUKELJ, EILEEN RODRIGUEZ AND JAMES FONTANELLA-KHAN IN NEW YORK

L

ennox Thomas was one of the top students in his middle school in Brooklyn. But despite his high grades, in 2015 and again in 2016 he failed the test to enter one of the city’s nine elite public high schools, which for many low income children in New York have traditionally acted as a gateway to prosperity. “I felt defeated,” says Mr Thomas, “and lost confidence in my academic abilities. I was robbed of receiving the best free education that the city has to offer.”

He was just 13. Shortly afterwards he joined Teens Take Charge, a student-led organisation campaigning for an end to the Specialized High School Admissions Test (SHSAT) which, the group argues, contributes to racial segregation in the city’s schools.

It is an argument that is receiving increased attention: the number of black and Hispanic students attending these schools has plummeted since the 1990s.

It has now also become a political battle in the city pitting Bill de Blasio, the mayor and one-time Democrat presidential hopeful for 2020, against wealthy philanthropists determined to maintain the system.

“I realised that it’s not just me: it’s systemic. There are larger forces at play,” says Mr Thomas, who is black. “Parents who have money can afford to give their kids the best tutoring and as a result their children are going to do better on these standardised tests because they have been preparing for years.”

The specialised high school test in maths and English serves as the sole gatekeeper to eight, out of the nine, of New York City’s tuitionfree elite public high schools.

Around 30,000 students take the test each year, and the 5,000 who score high enough are granted

https://www.facebook.com/businessdayng

access to the best free education available in New York, one that often opens doors to top colleges.

Of the most recent intake — for the 2019/20 academic year — only one in 10 of the students offered a place was black or Hispanic, despite comprising nearly 70 per cent of the public school student population in the city. At Stuyvesant High School, ranked the second best in New York state, only seven out of 895 places were offered to black students. Around 50 per cent of offers to the nine specialised schools were made to Asian students, with white pupils the next largest group.

New York schools are among the most racially segregated in America, according to The Civil Rights Project at UCLA. The situation is blamed on a lack of integration in general across the city, where the poorest neighbourhoods and middle schools tend to have higher numbers of black and Hispanic students.

Advocates of scrapping the test say the New York case is symptomatic of a broader struggle across the US over how to reduce racial segregation and discrimination in schools more than six decades after the Supreme Court ruled to end the separation of students by race in the landmark Brown v Board of Education case in 1954. The test has taken on fresh significance amid rising anti-immigration rhetoric in Donald Trump’s America.

Vivian Sanchez, who moved to the US from the Dominican Republic in 1993, says that her daughter, Valentina, also a top student at a middle school in Queens, a largely immigrant borough of New York, suffered the same fate as Mr Thomas nearly a decade ago.

“The test is not designed for us. It’s not designed for black or Latino people . . . it’s designed to exclude us,” she says.

Mr de Blasio appears to agree.

Last year, the New York City mayor unveiled a plan to scrap the test, triggering a bruising political fight @Businessdayng

with wealthy philanthropists over how to improve the opportunities for the city’s poorest kids.

The frustration expressed by Mr Thomas and Ms Sanchez is felt across the city. More than 75 per cent of black and Hispanic voters are in favour of changing the admissions system, according to a Quinnipiac University poll released in April. In the same survey, more than half of white voters agreed.

The de Blasio plan would see the test replaced with a scheme to admit the top 7 per cent of students — based on their course grades and state test scores — across all public schools. The SHSAT test takes neither factor into account.

If adopted, the overall number of black and Hispanic students at specialised schools would rise from 10 per cent a year to about 45 per cent, according to New York’s independent budget office.

Describing the current situation as a “monumental injustice” on Chalkbeat, an educationfocused website, Mr de Blasio last year said: “A single, high-stakes exam is unfair to students whose families cannot afford, or may not even know about, the availability of test preparation tutors and courses.”

Opponents — including some in the black community — argue that scrapping the test would dilute the academic quality of the specialised schools. A group of wealthy New Yorkers, including the billionaire cosmetics heir Ronald Lauder and former Citigroup chairman Richard Parsons, launched the Education Equity campaign to counter the de Blasio plans. Mr Lauder, who in 1989 ran against Rudy Giuliani in the Republican party’s New York mayoral primary race and is close to members of the Trump administration, wants to keep the test. He argues that if more public money was spent on offering free SHSAT tutoring the schools would be more inclusive.

First and foremost, tell us about AIICO Pension

#NES 25 Startups Pitch: Meet the 10 finalists Page 4

‘2050 Nigeria’ threatened by current insecurity challenges Page 11

Page 8

BUSINESS DAY

Tuesday 08 October 2019

g

www.

In Association with

g

@

g

Buhari prescribes home-grown solutions for Nigeria’s economic challenges Tony Ailemen, Abuja

P

resident Muhammadu Buhari on Monday, said Nigeria’s challenge can only be addressed using home-grown solutions The President, while declaring open the 25th Nigerian Economic Summit (NES25) in Abuja, charged both public and private sector leaders to look inwardly to solve the unique challenges confronting the nation’s socio-economic development.

In an apparent response to criticism of poor engagement with the private sector, the President pledged that his administration will henceforth collaborate with the private sector in designing and implementing developmental projects that will keep Nigeria on track for sustained, inclusive and prosperity driven growth.

The 2019 Summit of the Nigeria Economic Summit Group has identified key job-creating sectors such as agriculture, manufacturing, ICT, creative industry and extractive industry as its main focus, while deliberations will look at “unlock-

Continues on page 2

L-R: Chief Executive Officer Stanbic IBTC Capital, Mr. Funsho Akerele;Chairman Nigerian Economic summit Group, Mr. Asue Ighodalo; and president Muhammadu Buhari during the 25th Nigerian Economic Summit in Abuja... on Monday

BUSINESS

DAY

Nigeria must address revenue mismatches, productivity—Ighodalo Onyinye Nwachukwu, Abuja

A

sue Ighodalo, chairman, Nigerian Economic Summit Group (NESG), said Nigeria must address revenue mismatches and urgently address issues around growth and productivity.

At the 25th edition of the Nigerian Economic Summit, which commenced in Abuja on Monday, he said total revenue receipts for 2018 came in at about N3.5trillion, which was only 48.6 percent of the projected revenue figure for the year, while total debt service stood at about N2.2trillion, and had remained unchanged.

“If this imbalance persists, the availability of funds to drive infrastructure development and other social investment programs will remain challenged.

“As such, there is an urgent need to address not just our perennial revenue expenditure mismatches, but our overall productivity and growth as a nation.”

He said the world is now a place which now uses connected technology, green energy takes over from fossil fuels as a primary energy source, where robotics, artificial intelligence, Block chain, 3-D printing, and new-technologies transform the way we live and Continues on page 2

50

BUSINESS DAY

www.businessday.ng

www.facebook.com/businessdayng

@businessDayNG

@Businessdayng

Tuesday 08 October 2019

NES #25

Nigeria must address revenue mismatches, productivity—Ighodalo Continued from page 1

-L-R: Nasri El’rufai, governor Kaduna State, Kayode Fayemi, governor Ekiti State, Muhammadu Buhari, President, Asue Ighodalo, chairman NESG and Ahmed Zainab, minister of Finance, Budget and National Planning.

Buhari prescribes home-grown solutions for Nigeria’s economic challenges Continued from page 1

ing capital through our financial services sector to actualise the opportunities in these sectors.”

On the focus of this year’s economic summit, which is discussing what Nigeria would be in the year 2050 when many studies estimate the country’s population will rise to over 400 million people, the President said: ‘‘As a government, our view is to equip our citizens with the means to seize any opportunities that may arise. ‘‘This means we continue investments in education, health care, infrastructure, security and strengthen and entrench the rule of law.’’

While wishing the 25th NES fruitful, robust and productive deliberations, the President praised the organisers and stakeholders of the Summit for sustaining the platform established since 1993 to deliberate on key issues on national development.

President Buhari charged the Summit to come up with “productive, inventive and innovative proposals in keeping in mind that Nigeria’s unique challenges can only be solved by made in Nigeria solutions,’” The President harped on the 2019 general elections, adding that “the successful conclusion of the elections and the resort by aggrieved candidates to seek redress in the courts rather than the street was proof that Nigeria‘s ‘democracy is maturing.’ ‘‘The elections have come and gone. Our country, once again, has shown the world that we can choose our leaders in a peaceful and orderly manner. ‘‘Apart from a few pockets of unrest, majority of voters exercised their civic rights without hindrance. ‘‘Furthermore, we also saw an increase in the number of aggrieved candidates, and supporters, who took their concerns and grievances to the courts as

opposed to the streets. This is how it should be. ‘‘Ladies and Gentlemen, what this clearly shows is that our democracy is maturing,’’ he said.

Reflecting on the manifesto of the All Progressives Congress (APC) party, the President noted that his administration’s economic policies in the last four years focused on the need to uplift the poor and the disadvantaged and encourage inclusivity. ‘‘During the elections, almost all candidates proposed their visions for the economy and for the country. ‘‘Our party, the APC, put before the country policies that focus on delivering prosperity to all Nigerians through enhancing security; eliminating corrupt practices in public service; supporting sectors that will create jobs; and promoting socially focused interventions to support the poorest and most vulnerable among us. ‘‘These areas are all interconnected and are equally important in creating a prosperous society for all,’’ he said.

Underscoring the importance of collective prosperity, President Buhari asserted that a prosperous society is one where majority of its citizens have an acceptable standard of living. ‘‘Today, many mistake prosperity with wealth. They are not necessarily the same. ‘‘Experts and analysts explain economic trends by making references to indicators of wealth. ‘‘Wealth, however, in its simplistic form, is money or other assets. In recent years, global events have shown that when a society and its leaders are driven and motivated by these alone, the ultimate outcome is a divided state of severe inequalities. ‘‘But a prosperous society is one where majority of its citizens have an acceptable standard of living and a decent quality of life,’’ he said.

The President used the occasion to affirm that in addressing population growth, security and

corruption matters in developing economies, policies and programmes must focus on promoting inclusivity and collective prosperity. ‘‘Nigeria is a country with close to 200 million people living in 36 states and the FCT. ‘‘A significant proportion of Nigeria’s prosperity today is concentrated in the hands of a few people living primarily in 4 or 5 States and the FCT. Some of the most prosperous Nigerians are here in this room. ‘‘ T h i s l e av e s t h e re ma i n ing 31 States with close to 150 million p e ople in a state of expectancy and hope for better opportunity to thrive. This, in the most basic form, drives the migratory and security trends we are seeing today both in Nigeria and across the region. ‘‘In the recent weeks, I have been to Niger Republic to att e n d t h e E C O WA S s u m m i t ; Japan with fellow African leaders to attend the Tokyo International Conference on African Development ; the United Nations General Assembly in New York and South Africa on a State visit to exchange ideas on the common themes we share as the two largest economies in Africa. ‘‘What was very clear at these meetings, and numerous others I have been privileged to attend over the years is the increased consensus by leaders that to a d d re s s p o pu l at i o n g row t h, security and corruption matters in developing economies, our policies and programmes must focus on promoting inclusivity and collective prosperity. ‘‘This shift implies that the conce pt of having comp e titive free markets that focus on wealth creation alone will be replaced by those that propagate the creation of inclusive markets which provide citizens w ith oppor tunities that w ill lead to peaceful and prosperous lives,’’ he said.

self driven cars become the new normal.

The summit holding under the theme ‘Nigeria 2050, Shifting Gears’, is converging amid concerns of slow and fragile growth, heightening insecurity and a projected population explosion, among other issues.

According to the NESG chairman, the kind of economy the country requires to earn a seat at the table with regional and global giants must therefore be both “deliberate and audacious.

In his welcome statement at the event, Ighodalo hinged his thoughts on the fact that Nigeria’s real GDP growth rates remain below expectations, even though it has improved marginally, He noted Nigeria’s GDP growth rate of about 2 percent in the first half of the year and a decline in headline inflation from 15.1 % to 11 percent.

But the rate of inflationary decline has slowed considerably, largely as a result of food inflation which has remained at 13.2 percent.

“This has resulted in continued erosion of real income of most of our people,” Ighodalo stated at the event well attended by President Buhari, his ministers, governors, government dignitaries and private sector operators,” he said.

The United Nations projects that Nigeria’s population will double by 2050 to about 410million, and will then become the third most populous nation in the world, behind China and India.

“Basically our population is projected to grow by a little over 3 percent per annum,” he Ighodalo said, and “If these projections are true, and it does seem realistic, GDP must grow by at least that much year on year for us to just maintain our current GDP per capita, and this is without accounting for inflation.

“So clearly, we do not have the luxury of time to waist, at current GDP per capita, even at zero inflation on its own and more so, when we factor in wealth discrimination disparities, it’s not a metric, we can have stand still.”

Nigeria’s Inaugural Economic summit commenced in February 1993 out of deep concern to bring the private sector in for the country’s political economic welfare and direction to enable it situate globally.

He said the NESG is convinced that only consistent economic growth underpinned by a competitive private sector led productive economy can move the country towards growth progress.

“That is the world of today, and that world that was described in 2005 and is now here.

Aside the global shift that which demands attention, Nigeria is also changing internally. “Despite rising poverty rates, our population growth continues at a trajectory that should be a cause for concern and calls for decisive policy measures.”

By 2050, majority of the country’s projected 410m people will be under the age of 35.

“We therefore need to confront

our realities and craft a new National agenda that will reactively and urgently drive inclusive double digit growth and development over the next three decades.

He said it sounds daunting, but it is not impossible, but warned that that it is never done by accidents but through strategic plans.

“If we plan to just survive or maintain our current trajectory, we would have sacrificed the future of the one of the world’s largest inhabitants on the altar of inertia.

“But if we plan to thrive and excel in this new emerging world, we can work to restore glory to our country and lead this continent to a place of relevance in tomorrow’s economy.

He also cited Singapore, South Korea, and China all of which have undergone radical transformation and shown that is possible.

“Destinies can and do change, all it takes is concerted effort, the urgency of now, and the will to change,” the NESG chair stressed.

He said the theme of this year’s summit ’Nigeria 2050, Shifting Gears’ is deliberately set against this background, with the focus of setting a new agenda, tailored to Nigeria and defin8g the path we must collectively thread as we usher in the fourth industrial revolution.

“We must ramp up speed from where we are, and cannot go from one to five without a few shifts, but we must ramp up quickly and decisively, with the urgency of a driver who recognizes that he is already setting off late for an appointment.

“We must choose the fastest, not the most cynic routes and navigate it with great care, but also with great speed.

“We have a lot of work to do and we are committed to moving to do this work,” he further said.

He called for a new direction for a country that is devoid of finger pointing, name calling, or armchair qualifications— a path filled with empathy for our fellow citizens.

He emphasised the commitment from the private sector, that with an enabling environment, to ensure more capital is dedicated to economic initiatives and cutting edge technologies to speed our journey to becoming a 21st economy with a seat at the table among giants.

Let us not be deterred or lazy, he advocated.

He also pledged that the NESG, which convenes the annual event in partnership with government, holds a mandate to champion the development of Nigeria to a private sector led economy, that s globally competitive and sustainable.

Ighodalo told the summit that through the platform, there have been dialogues which led to a shift in the economy, from state control to free enterprise, even though an increasing participation of the private sector to improve lives is still desired.

Enumerating several feats through past Economic Summits, he recalled that at NES#1, the foreign exchange decree and indigenisation was promoted which opened the door to foreign direct investments flows into the country with huge impact on jobs and wealth creation.

Tuesday 08 October 2019

www.businessday.ng

www.facebook.com/businessdayng

@businessDayNG

@Businessdayng

BUSINESS DAY

51

52

BUSINESS DAY

www.businessday.ng

www.facebook.com/businessdayng

@businessDayNG

@Businessdayng

Tuesay 08 October 2019

NES #25

#NES 25 Startups Pitch: Meet the 10 finalists

T

Agriple - Vincent Okeke

Notitia - Aniegbe Joel

crafts innovative medical solutions for thriving communities. It invented “Crib A’glow” unit - a solar-powered foldable phototherapy c r i b f o r t h e t re at m e nt o f newborn jaundice – for use in hospitals and health centres in both urban and rural communities.

AfriNET Power Tech Solutions : a renewable energy company that has developed a solar energy solution called ‘Inverterless’. The solution is entirely on DC and it gives a great boost to energy efficiency campaigns; with the use of energy saving appliances for households and workplaces.

Doctoora E-Health Ltd: a health tech startup providing healthcare professionals with medical facility rentals for their private practice.

Doctoora also runs an online marketplace where consume r s ca n s e a rc h a n d b o o k for healthcare professionals within the Doctoora network.

GatePass: helps residents of estates, neighbourhoods and multi-family communities manage day-to-day interactions including bill payments, visitor management and communication comfortably from their mobile phones.

Loystar: a retail and loyalty platform designed to help micro, small and medium business sell and drive repeat sales in their business.

Gricd Ser vices Limited: builds IoT-enabled, active cooling devices that are used in the storage and transportation of temperature-sensitive commodity. The flagship product, the Frij, is a smart active cooling device used in the transportation and storage of temperature-sensitive commodities Green Axis: a social Enterprise that promotes environmental sustainability, socio economic development and community health. It focuses on improving the

Tiny Hearts Foundation - Virtue Oboro

”

he Nigerian Economic Summit Group (NESG) and Africa’s most agile company, Sterling bank, will today announce top three winners of the #NES 25 Startups Pitching Event during the closing plenary of the 25th Nigerian Economic Summit meeting.

The top three will get 5 million, 3 million and 2 million in grants, resp e ctively. A 1 million audience choice prize will also be awarded to one of the finalists.

Almost 700 entries were received from early stage startups interested in pitching their ventures, but 10 f i n a l i s t s e m e r g e d f ro m a rigorous selection process.

The 10 finalists pitched their businesses to venture capitalists and investors on Sunday, 6th October 2019 at the Transcorp Hilton Abuja.

Remarkably, 40 percent of the companies that made the final list have women in leadership positions; while 60 percent were tech focused with 50 percent software enabled pitches. Entries were received from sectors that include Food and Agriculture, Tech, Health, Waste/Environment, Industry/Manufacturing and Energy.

Ventures that made it to the finals are Agriple, Notitia, Phaheem Pharmaceuticals Limited, Tiny Hearts Technology, AfriNET Power Tech Solutions, Doctoora E-Health Ltd, GatePass, Loystar, Gricd Services Limited and Green Axis. They are all early-stage startups registered in Nigeria and have been doing business for no more than five years.

Meet the ventures Agriple: an online platform developed to directly connect farmers with consumers and off-takers to reduce farm to fork time, increase wealth, and reduce post-harvest loss.

Notitia : a digital health startup, focused on developing intelligent solutions to address the paucity of health data in emerging markets around the world.

Phaheem Pharmaceuticals Limited: a business venture and enterprise, with the aim of promoting improved healthcare delivery in Nigeria. The product named Phaheem Plate is used to convert footfall to electricity.

Tiny Hearts Technology: a technology company that

The NESG introduced a Start-ups Pitching Event as part of the annual Nigerian Economic Summit (NES). It aims to help start-ups get the funds they need to grow their business...

Loystar - Ayo Dawodu

access to waste management service, poor waste disposal culture which is very popular amongst the underser ved communities. Green axis uses a low cost sustainable model alongside a technological approach to tackle the problem.

About Startups Pitching Event In 2017, the NESG introduced a Start-ups Pitching Event as part of the annual Nigerian Economic Summit (NES). It aims to help startups get the funds they need to grow their business and, in some cases, mentorship and professional advisory services, among others.

Consecutively in 2018 and 2019, Sterling Bank powered the NES Startups Pitching Events to provide innovators and entrepreneurs from all over Nigeria with opportunity to pitch their start-ups, collaborate and interact with individuals and organisations interested in promoting entrepreneurship.

Tuesday 08 October 2019

www.businessday.ng

www.facebook.com/businessdayng

@businessDayNG

@Businessdayng

BUSINESS DAY

53

54

BUSINESS DAY

www.businessday.ng

www.facebook.com/businessdayng

@businessDayNG

@Businessdayng

Tuesay 08 October 2019

NES #25 What type of education does Nigeria need?

KELECHI EWUZIE

N

igeria must rethink and overhaul its education system to prepare the population for the future.

Analysts say there is a mismatch between the town and gown, meaning that the schools are not meeting the industry needs.

More so, science, technology and mathematics (STEM), which are hallmarks of industrial economies, are not being taken too seriously in Nigeria, with many applicants for university exams preferring arts to the sciences.

Juliet Anammah, CEO of Jumia Nigeria, said it is important for schools to begin to train students in skills needed by industries.

Analysts further say that for the Nigeria education sector to effectively play in the Fourth Industrial Revolution, robust infrastructure, consistent policies, and investment in easy access to digital technology are keys to enhancing knowledge, skills and competencies.

Fourth Industrial Revolution is all about the rapid proliferation of technologies that will have broad and deep impact on the future of learning, workforce and other aspects of life.

Florence Obi, former deputy vice-chancellor, University of Calabar, Cross River State, told BusinessDay that to tackle the challenges confronting the education system, managers of the education space need to establish a national quality assurance and monitoring system.

Obi observed that the quality of senior secondary products has implications for entrants into the universities, polytechnics and colleges of education. “The acerbic comments and complaints about quality of products from secondary schools by higher education practitioners will be diminished if there is a National Quality Assurance and Monitoring System that can synchronise minimum standards across the system,” she said.

The elements making up the system will be the Inspectorate Service at the State and Federal levels, NUC, NBTE, and NCCE. The statutory quality assurance functions of the different agencies will not be thinned down by this arrangement and the strength of the arrangement will be in the component elements learning from one another and collaborating in monitoring,

system-wide, rather than in individual cocoons of their sub-sector, she explained.

Other challenges facing the nation’s education sector especially higher institutions of learning in Nigeria include the absence of infrastructure on campus for learning and an industrial backbone for internships.

“Unfortunately, the industrial backbone has been very weak and the entire

economy has been run as one big consumer market, dominated by imports from all over the world, especially China. As such, there are no outlets to practice these theories. Secondly, the institutions themselves need to be upgraded, both for the human ware as well as the soft and hardware, to enable the students study in the 21st Century” said Oyewusi Ibidapo Obe, professor of

Systems Engineering, educational administrator and former vice chancellor of the University of Lagos.

Access to university education has been challenged due to limited carrying capacity. One way of dealing with this is to embark on massive upgrading of physical facilities in existing universities to take at least additional 1,000 students per year. This will involve more

classrooms, hostels, laboratories, workshops, libraries and offices.

In this light, staff recruitment is to be undertaken in the quantity and quality to match the annual growth in student enrolment. With successful scaling of NUC due diligence on the expanded facilities and increased human resources, carrying capacity is increased to 1000.

Isaac Adeyemi, former

vice chancellor, Bells University, Otta Ogun State, told BusinessDay that the growth potential of education in Nigeria especially the tertiary level is stifled by inability to faithfully implement national policy provisions.

Adeyemi observed that this failure in policy implementation has resulted in products from the school system at all levels coming out in poor state.

Tuesday 08 October 2019

www.businessday.ng

www.facebook.com/businessdayng

@businessDayNG

@Businessdayng

BUSINESS DAY

55

56

BUSINESS DAY

www.businessday.ng

www.facebook.com/businessdayng

@businessDayNG

@Businessdayng

Tuesday 08 October 2019

NES #25

First and foremost, tell us about AIICO Pension

W

reforms. This is a new and challenging frontier and we look forward to exploring this space.

e are a licensed pension fund administrator primarily set up to manage Retirement Savings Accounts (RSAs) and corporate pension plans in Nigeria. We pride ourselves in our ability to offer competitive returns whilst not losing sight our objective to ensure safety of funds. We have been doing this for 13 years and with each year we have gotten better at what we do, this is evident in the quality of our service delivery and competitiveness of our investment return within the industry.

You have been in existence for 13 years. How have you been able to survive the Nigerian environment all these years?

Funding of pension funds

Olubankole Ekundayo, Head, Strategic Planning and Corporate Communications.

”

What makes pension products unique and why should Nigerians buy from you, rather than your competitors’?

Pension products are very unique because delayed gratification is at the core of every pension product offering. In Nigeria as in many countries of the world delayed gratification is not a concept that is easily grasped but to benefit from your pension plan you must be disciplined enough to make some savings today to ensure you have a stable income stream at retirement.

Currently in the Nigerian pension industry, the retirement savings products are homogenous with all Pension Fund Administrators (PFAs) offering the same products however we are able to distinguish ourselves by the quality of our service.

At AIICO Pension our vision is “To be the most efficient customer centric PFA in the country”, we strive to be efficient in every area of our operations to ensure we create a positive customer experience at every touch point. For us, customer centricity means putting the customer at the center of everything that we do in every area of our business by doing this we are able to align our corporate goals with what our customer wants.

Comparing Nigeria’s pensions industry with African peers, is the country making progress?

In PWC’s Africa Asset Management 2020 report, Nigeria is ranked 3rd largest in Africa in terms of Assets Under Management (AUM) trailing behind Egypt and South Africa. The growth of the Nigerian pension industry has been phenomenal over the years and going by our large population and the coverage rate there is a huge potential for us.

Despite this growth though, if we compute total pension fund assets as a percentage of GDP, Nigeria’s is below 7% which is a far cry from Kenya at 12.7%. What this means is that we also have a lot of growth opportunities ahead of us.

Despite this growth though, if we compute total pension fund assets as a percentage of GDP, Nigeria’s is below 7% which is a far cry from Kenya at 12.7%.

What this means is that we also have a lot of growth opportunities ahead of us

has a direct relationship with economic growth, and in the last 13 years we have had our share of positives and negatives. As stated earlier the idea of delayed gratification is a hard sell for most Nigerians and this as well as inability to fund pension accounts by employers have been the greatest hurdles faced in the industry.

We have survived these years by initially focusing on the sectors of the economy whose workforce by law are compelled to comply with the Pension Reform Act 2014 with employers who are willing and able to ensure pension accounts are funded timely, it has gotten a bit tougher now as that space has become saturated and PFAs now need find creative ways to ensure accounts are opened by employers in other sectors of the economy. With the introduction of the Micro Pension Plan earlier this year, a new market has been opened for employees of companies with less than 3 employees and self-employed individuals to also benefit from the pension

Are state gover nments making progress in the contributory pension scheme?

A lot of states have made considerable progress, but a sizeable number still either do not have the capacity to fund their pension plans or have not enacted their state pension laws.

Tell us some of the postreform challenges the industry has faced since the Pension Reform Act of 2004.

The primary challenge is compliance and funding. There is also the need for a lot of education especially in the informal sector to ensure everyone understands that they need a pension plan.

What should Nigeria do to grow the pensions industry?

Local governments, State governments and the Federal government employ a large number of people and their sustained participation in the funding of pension account is very critical to stimulate growth of pension funds. Also as stated earlier, the state of our economy has a direct relationship to the growth of pension assets, a strong and stable economy will go a long way to boost growth in the pension industry.

Tuesday 08 October 2019

www.businessday.ng

www.facebook.com/businessdayng

@businessDayNG

@Businessdayng

BUSINESS DAY

57

58

BUSINESS DAY

www.businessday.ng

www.facebook.com/businessdayng

@businessDayNG

@Businessdayng

Tuesday 08 October 2019

NES #25

KOHLER SDMO: Providing energy solutions for Nigerians

O

ver the past 50 years, a t

KOHLER SDMO, we have been striving to provide the best possible energy solutions for all our customers throughout the world. Right at the most isolated locations, our presence is unobstructive but effective.

KO H L E R S D M O is not only satisfied with designing and manufacturing systems but also guaranteed availability

and reliability whate v e r t h e c i rc u m stances is whenever the location.

Although KOHLER SDMO is a benchmark company for major installations.

It is also a brand that signifies quality local service supporting every generating set sold from the smallest to the most powerful.

Clarke Energy was established 1989 in UK as engine service company and Acquired by Kohler company in 2017 with international

operations in more than 27 countries (including USA, Australia, India, several European, African and Asian countries) with ISO accreditation : 9001 Quality , 14001 Env i ro n m e n t , O HSAS 18001 – Health & Sa f e t y , Qu e e n ’s Award for International Trade 2014.

KO H L E R i s o n e of America’s oldest and largest private companies and a history of close to 100 years. A global leader in manufacturer of engines

with the corporate Headquarters in Wisconsin USA with over 33,000+ employees worldwide with 50+ manufacturing plants in 17 countries.

Standard generating sets from t h e KO H L E R-S D M O Po w e r P ro d ucts range provide all your electricity requirements between 15kVA and 4,200 kVA. Designed for industrial users and cover a wide field of applications and offer a vast range

of options and retro f i t t i n g t o f u l l y meet the requirements of all configurations. The y provide, as needed, back-up power or a continuous electricity supply. In highly sensitive sectors, the solutions guarantee continuity of electricity supply to counter any outage or instability affecting the mains supply.

The Niger ia assembly plant is the first of its type by Clarke Energy Nigeria.

Delegates and partcipants at the 25th Nigerian Economic Summit with the theme “Nigeria 2050: Shifting Gears” in Abuja

L-R: Ibukun Awosika, chairman First Bank Limited, Jerome Pasquier, ambassador Embassy of France and Pascal Furth, head of regional economic Nigeria-Ghana Embassy of France.

L-R, Mohammed Hayatudeen, former chairman NESG with Doyin Salami, chairman Economic Advisory Council.

L-R: Oba Otudeko, chairman Honeywell Group with Adebayo Adeniyi, minister of Industry, Trade and Investment.

L-R: Abdul Samad Isyaku Rabiu, Abdulrahman Abdulrazaki governor Kwara State, Itua Ighodalo, pastor Trinity House and Asue Ighodalo, chairman NESG.

Tuesday 08 October 2019

www.businessday.ng

www.facebook.com/businessdayng

@businessDayNG

@Businessdayng

BUSINESS DAY

59

NES #25 ‘2050 Nigeria’ threatened by current insecurity challenges Stella Enenche, Abuja

A

cross the six geopolitical zones of the country, operatives are b att l i ng w i t h challenges of insecurity, which constitutes threat to the peace and stability of the nation.

With cases of insurgency in the North-east, kidnapping/banditry in the North-west, and parts of North-central, which are also contending with herders/farmers conflict, which is also present in the Southeast, as well as oil theft in the South-south and parts of South-west, the military and other security agencies deploy human and material resources towards fighting these crimes.

This development, no doubt, takes a toll on the economy of the nation, as resources meant for infrastructural development, are channeled into procurement of equipment and other hardware, to fight crime and criminality.

Apart from the huge funds needed to fight insecurity, it suffices to say that a chunk of national resources is being spent daily for the

President Muhammadu Buhari

welfare of an estimated 2 million internally displaced people, from the insurgency in the North East.

Penultimate week,the Chief of Defence Staff, CDS, General Gabriel Olonisakin, had disclosed that the military was conducting operations across the zones of the country.

“We have made signifi-

cant progress in containing numerous security challenges that confront the nation in all the 6 geo-political zones of the country ranging from the terrorism/insurgency in the NE, armed banditry kidnapping in the NW and NC to oil theft and associated criminalities in the SW, SE and 35. Indeed, the military is deployed in all the 6 geo-

Vice President Yemi Osinbajo

politlcal zones providing support to the Police, which is the main agency for Internal Security”, Olonisakin had stated.

Findings revealed that the Federal Government had undertaken a continuous increase in budgetary allocations to the ministry of Interior, and the ministry of Defence.

For instance, while the 2018 budget stood at N9.1 trillion, the ministr y of interior got N577bn while N576bn was allocated to the Ministry of Defence.

Clearly, the two securityrelated ministries had higher allocations than Ministry of Education (N542bn;) Health (N356bn); Transportation, (N267bn;) and

Agriculture, (N203bn).

By this development, it is clear that critical sectors with direct impact on the economy, are made to suffer inadequate funding, owing to the urgent need to fight terrorism and other violent crimes threatening the sovereignty of Nigeria.

A public affairs analyst, who asked not to be named, identified “bad governance” as being at the centre of insecurity in the country.

According to him : “There is no denying the fact that much of what would have been voted towards human capital development, is being deployed to the security sector, to fight all manner of crimes besetting our country.

“I tell you something: no country expects meaningful economic growth, when the propensity of its citizens to consume, is higher than the propensity to save.

“Until there is good governance, occasioned by even distribution of resources, meaningful social intervention schemes and the like, poverty and and other negative indicators may continue to stultify development in Nigeria” he said.

Need to address unemployment, illiquidity to increase mortgage access CHUKA UROKO

T

he underlining principle of mortgage in Nigeria and any other country in the world is that a loan seeker must have a regular flow of income, which presupposes that such a person must be in paid employment or be self-employed.

Having a job is, therefore, critical in accessing mortgage. But in Nigeria, many people, especially young Nigerians are not employed.

Indeed, youth unemployment in the country is a major social challenge in the country and the level is quite high.

At 23.1 per cent in the third quarter (Q3) of 2018, up from 18.8 per cent in Q3 2017, Nigeria has one of the highest unemployment rates in the world and the figures put out by Nigeria Bureau of Statistics (NBS) in its Q3 2018 report confirm this.

The report explains that “Of the 20.9 million persons classified as unemployed as at Q3 2018, 11.1 million did some form of work but for too few hours a week (under 20 hours) to be officially

classified as employed while 9.7 million did absolutely nothing.

“Of the 9.7 million unemployed that did absolutely nothing as at Q3 2018, 90.1 percent of them or 8.77 million were reported to be unemployed and doing nothing because they were first time job seekers and have never worked before”.

Apart from clarity of process, accessibility and affordability are major constraints that have denied many aspirational young and old Nigerians the opportunity of either building or buying homes. Mortgage is not accessible because many people, as pointed out above, are out of job.

Adeniyi Akinlusi, CEO, Trustbond Mortgage Bank, puts it straight that, though the ability of the banks to provide money for mortgage has changed on account of credit challenges in the financial system, mortgage affordability or the fundamentals for lending have not changed.

Technically speaking, there is no mortgage of any form in Nigeria. This is because the interest rate charged is no different from the commercial rate. Mort-

gage lenders still anchor their loans on good jobs that attract fat monthly salary, meaning that a mortgage loan seeker is still expected to be somebody in a good job or private business with an assured, fat and regular income stream.

Though there is a new mortgage law other wise called uniform underwriting standard for the informal sector, it remains to be seen how impactful the new law has been on mortgage lending and homeownership.

The income of some of these informal sector operators can hardly be measured and, so, can hardly be controlled in a formal way.

As against the six percent interest rate and repayment tenor of between 25 and 30 years, depending on the borrower’s age, mortgage lenders in this country charge between 17 percent and 22 percent interest rate on mortgage loans with a repayment tenor as short as 12-24 months. The tenor also depends on the level of risk associated with either the loan or the borrower or both.

Because of this, the everwidening housing demandsupply gap can easily be blamed on the commercial

interest rate charged on mortgage loans which makes such loans unaffordable to home loan seekers.

The mortgage industry does not operate in isolation of the economy. Certainly, as an integral part of the economy, it has to be affected by the economic crisis in the country today. A good number of people who were in employment before now don’t have jobs again because of the downturn in the economy.

In spite of this, mortgage operators insist that the fundamentals for lending have not changed, which means that if somebody has a good job with a financial institution or a multinational company, and the pay package is high enough for him to afford a mortgage, the economic crisis has not changed that affordability.

The past few years have seen quite a number of mortgage products aimed at enabling subscribers own their own homes, but these products are yet to help reduce existing housing gap by increasing housing stock.

The reason is simple. The products, like the mortgage loans, are unaffordable by

those who need them and, according to mortgage operators, those mortgage products are not the ones that will make any impact on housing.

“The mortgage products that we have today are commercial mortgages which the investor wants to recover his money from. It is just like someone else who has invested in any other venture.

He has to recover his money because he borrows from the same place like you”, an operator who did not want to be named, noted.

Mortgage products can make impact on housing only when there is government intervention and, anywhere else in the world, there is government intervention to make mortgage affordable to everybody, no matter the income level.

As obtains in other societies, mortgage could be used to move the economy from being import-dependent to a producing and exporting country and Akinlusi says mortgage institutions need long term loans for housing finance. When there are enough funds to lend to property developers and to home seekers, the entire economy will be stimulated.

By the time there are enough funds in the hands of mortgage institutions for long term loans to property developers, there will be a lot of property construction activities and when these happen, a lot of other activities will be generated and the economy will be better for it.

Engineers, architects, bricklayers, casual labourers and even food vendors will be automatically engaged by a single development in one corner of the city, and it is unimaginable what is possible when there are many of such developments going on at various parts of the country. The long term effect is the development of industries and factories that produce building materials such as cement, rods, roofing materials, wooden materials etc.

Ultimately, this will impact on the wider economy and your guess is as good as mine as to what follows when people have enough capital at their disposal. Definitely, investment is the next line of thought and, depending on the prevailing business environment and government policies, people will invest in many asset classes including real estate.

60

BUSINESS DAY

www.businessday.ng

www.facebook.com/businessdayng

@businessDayNG

@Businessdayng

Tuesday 08 October 2019

Tuesday 08 October 2019

BUSINESS DAY

Live @ The Exchanges Market Statistics as at Monday 07 October 2019

Top Gainers/Losers as at Monday 07 October 2019 LOSERS

GAINERS Company

61

Company

Opening

Closing

Change

SEPLAT

N555

N517

-38

0.4

NESTLE

N1255.5

N1230

-25.5

0.35

STANBIC

N38

N37.05

-0.95

N10.45

N9.85

-0.6

N50.35

N50

-0.35

Opening

Closing

Change

UACN

N6.55

N7.1

0.55

CCNN

N14.8

N15.2

AFRIPRUD

N3.52

N3.87

NASCON

N13.2

N13.5

0.3

CADBURY

CONOIL

N15.25

N15.4

0.15

NB

ASI (Points) DEALS (Numbers) VOLUME (Numbers) VALUE (N billion) MARKET CAP (N Trn)

26,866.41 2,854.00 151,714,943.00 1.504

Global market indicators FTSE 100 Index 7,197.88GBP +42.50+0.59%

Nikkei 225 21,375.25JPY -34.95-0.16%

S&P 500 Index 2,948.73USD -3.28-0.11%

Deutsche Boerse AG German Stock Index DAX 12,097.43EUR +84.62+0.70%

Generic 1st ‘DM’ Future 26,487.00USD -38.00-0.14%

Shanghai Stock Exchange Composite Index 2,905.19CNY -26.98-0.92%

13.078

Seplat, Nestle, 15 others cause stock market to close in red

...Investors lose N59bn Stories by Iheanyi Nwachukwu

N

igerian equities market opened this week on a negative note following record negatives seen in Seplat, Nestle and 15 other stocks as against 16 gainers.

Investors lost N59billion at the close of trading session on Monday October 7, 2019.

The Nigerian Stock Exchange (NSE) All Share Index (ASI) decreased by 0.45percent, while the Year-to-Date (Ytd) return stood at -14.52percent.

Seplat Petroleum Development Company Plc decreased from an open price of N555 to N517, after losing N38 or 6.85percent, followed by Nestle Nigeria Plc

which dipped from N1255.5 to N1230, after losing N25.5 or 2.03percent. UAC Nigeria Plc recorded the highest gain after it share price moved up from N6.55 to N7.1, adding 5 5 k o b o o r 8 . 4 0 p e rc e nt, while Cement Company of Northern Nigeria Plc rose from N14.8 to N15.2, adding 40kobo or 2.70percent.

T h e A l l S h a re I n d e x closed at 26,866.41 points as against the preceding day close of 26,987.45 points while Market Capitalisation closed at N13.078 trillion against preceding day close of N13.137 trillion.

The volume of stocks traded increased by 9.24percent, from 138.88million to 151.71million, while the total value of stocks traded increased by 45.56percent from N1.033 billion to N1.504

billion in 2,854 deals.

The Financial Services

T

“Hence both the Issuing Houses and Solicitors who sign up on such filing take up all attendant liability should the documentation be thereafter found to be incomplete or deficient.

“These procedural changes which are being implemented in stages commenced with the Checklist Review on July 1, 2019 and is expected to run for six months to enable the Commission assess both the capacity and preparedness of Financial Advisers and Solicitors in Particular, whilst t h e ‘ D e e m e d Ap p rov a l ’ regime is expected to commence in Januar y 2, 2020,” he said.

He noted that the capital market has in recent times faced a number of challenges which has militated against its rapid growth and impacted not just on the economy at large but on the work of the operators.

“The need for a market that lives up to its role of catalysing economic growth www.businessday.ng

exchanged for N571million, followed by Conglomerates

with 18.945 million shares traded for N29 million.

L-R: Isyaku Tilde, acting executive commissioner operations, Securities and Exchange Commission, SEC; Chuka Eseka, group managing director, Vetiva Capital Management Limited, and Benjamin Obidegwu, president, Capital Market Solicitors Association, during meeting with all Issuing House, Capital Market Solicitors and Trustees on the introduction of checklist review process for fixed income in Lagos

SEC says checklist review to reduce time to market, promote efficiency

he Securities and Exchange Commission (SEC) has said that the introduction of checklist review process for the capital market will make the system more competitive, reduce cost, promote efficiency, transparency and accountability.

Acting Executive Commissioner Operations, SEC, Isyaku Tilde stated this at the weekend at the engagement session with Association of Issuing Houses, Trustees and Solicitors on the commencement of checklist review.

Tilde noted that whilst this process would drastically reduce time-to-market, it places a huge responsibility on Issuing Houses to ensure that its documentation and filing is flawless, that is that all relevant disclosures are made and all necessary documents filed as there would be no prior review for completeness or deficiency.

sector led Monday’s activity chart with 117.8 million shares

by facilitating development cannot be over emphasised, and this informs the various initiatives being pursued under the Capital Market 10 years master plan as well as other ancillary initiatives which seeks to amongst others increase the depth and breadth of the market; make for a more competitive market, reduce cost, promote efficiency, transparency and accountability - all under a collaborative regulatory and oversight regime.

“These vision, coupled with the Federal G ov e r n m e n t ’s d r i v e o n ease of doing business led to engagements with your good selves and other key st a keh o l d e rs w h i c h ha s resulted in the change of preexisting review processes and procedures for debt issuances, to deal with issues of application processing turn-around-time and ensure a highly efficient time-to-market regime,” Tilde said.

ASHON to review strategies for multiple income stream

A

s the Association of Securities Dealing Houses of Nigeria (ASHON) prepares for its 10th Annual General Meeting (AGM), there are s t ro n g i n d i c a t i o n s t h a t options for multiple income streams for members in the wake of inclement operating environment may top one of the issues on the agenda.

Operations of most stockbroking firms in Nigeria have been largely hampered by macroeconomic instability, low purchasing power of investors, antii nv e s t m e nt g ov e r n m e nt policies and investor apathy among others.

The 10th AGM, scheduled for Thursday, October 17, at the LCFE Trading Floor, at UAC House, is coming on the heels of many initiatives being put together by the trade association to enable its members remain in business irrespective of the nature of operating environment.

Fe e l e r s f ro m A S H O N at the weekend indicated

https://www.facebook.com/businessdayng

that ASHON’s Chairman, Patrick Ezeagu is expected to brief members on some new developments in the financial market that can provide multiple income streams for the members.

Ma r k e t w a t c h e r s a t t h e weekend were quick to point out that ASHON might be considering a relationship with the newly approved FMDQ Securities Exchange as a new platform where its members can execute transaction. They also noted that Ezeagu would update ASHON’s members on the Lagos Commodities and Futures Exchange (LCFE) which has secured approval from the S e cur ities and Exchange Commission (SEC) to become operational.

Ezeagu is also expected to touch on some new developments in the financial market that can provide multiple income streams for the members.

Ma r k e t w a t c h e r s a t t h e weekend were quick to point out that ASHON might be @Businessdayng

considering a relationship with the newly approved FMDQ Securities Exchange as a new platform where its members can execute transaction. They also noted that Ezeagu would update ASHON’s members on the Lagos Commodities and Futures Exchange (LCFE) which has secured approval from the Securities and Exchange Commission (SEC) to become operational.

Ezeagu is scheduled to brief the members on the success of the last Capital Market Summit. The summit was believed to be one of t h e b e s t i n re c e nt t i m e by quality of participants and issues discussed and encourage members to suggest strategies to ensure success of the future one.

The meeting will unfold the results of election into the ASHON’s Governing Board and discuss other statutory issues associated with an AGM and other activities performed during the review period.

leaderSHIP

BUSINESS DAY Tuesday 08 October 2019 www.businessday.ng

CEO in Focus

Banjo Obaleye: Defying odds to drive growth in a struggling mortgage industry ENDURANCE OKAFOR

W

ith over 20 years of experience in commercial and mortgage banking, Olabanjo Obaleye, managing director and chief executive officer of Infinity Trust Mortgage Bank Plc, one of Nigeria’s leading national Primary Mor tgage Institutions, i s a s e a s o n e d b a n k e r, cha r te re d a c c ou nt a nt, mortgage and real estate development expert and corporate strategist.

Obaleye joined Infinity Trust Mortgage Bank Plc (formerly known as Infinity Trust Savings and Loans Limited) 15 years ago as acting general manager.

At the time he joined the bank, it was at the brink of collapse having received a notice from the Central Bank of Nigeria to wind down operations within 30 days due to its high negative balance sheet.

Undeterred by the difficult situation he met on ground, Obaleye immediately took the bull by the horns by developing and implementing several far-reaching “gamechanging strategies” which helped to steer the collapsing bank back to profitability within a short period. Sequel to this uncommon feat, he w a s ma d e s u b s t a nt i v e MD/CEO of the bank in 2006.

Obaleye began his b a n k i n g c a re e r i n A f ribank Nigeria Plc (now Skye Bank), in 1991, and later moved to the defunct Midas Bank where he worked in the operations department, rising to the position of operation manager before he left in 2003.

Obaleye’s eye for detail and quest for efficient service delivery, combined with good leadership quality ensured a fraudfree and near-zero errorfree operations for the three years and six months he worked in Midas Bank.

He also worked as an operations personnel at Societe Bancaire Niger ia Limited, from where he resigned in 2004 to join Infinity Trust.

Since taking over as the MD/CE O of Infin-

Olabanjo Obaleye ity Trust Mortgage Bank, the bank has recorded an unprecedented turnaround resulting in the bank being listed on the Nigerian Stock Exchange (NSE) in 2013, becoming a National Mortgage Bank in 2014. Currently, Infinity Mortgage Bank has equity shareholding in the Nigeria Mortgage Refinance Company (NMRC).

The bank posted what analysts have described as an impressive halfyear performance at the end of June 2019. The lender’s profit advanced to its highest level in seven years since 2013, driven by a surge in interest income.

Figures from its halfyear earnings scorecard, showed a profit after tax increased to N211 million between January and June 2019, indicating a 50 percent increase over N141 million realized within the same period of the previous year.

Analysis of the company’s bottom-line figures between 2013 and 2019, revealed that profit surged 219 percent from N66 mil-

lion to N211 million, within the seven years, with compound profit growth rate settling at 18 percent.

Fees & commission income realized by the bank nearly doubled its N27 million figure for 2018, settling at N53 million in half-year 2019, buoyed by a spike in credit-related fees & commission.

Credit-related fees & commission, which accounted for 68 percent in total fees & commission income, jumped 125 percent from N15 million to N36 million. With the commission on turnover, f a c i l i t i e s ma nag e m e nt fees & other commission grew 67 percent, 71 percent, and 46 percent respectively.

Obaleye’s uncompromising knack for excellence and his result-oriented management and leadership style have led to the significant increase in the bank’s shareholders’ funds from less than N50 million in 2003, to over N5.84billion in halfyear 2019. Also, the bank has maintained an un-

broken record in terms of consistency in dividend payments to shareholders for twelve years running.

Under the leadership of Obaleye, Infinity Trust Mortgage Bank has been able to withstand the industry’s challenging operating environments and even recording relatively giant strides.

Since 2016 when the National Bureau of Statistics (NBS) started collating data for the Nigerian property sector, the real estate has continually been in contraction mode. After exiting recession in Q1 2019, the first growth from its negative mode, the real estate sector in the second quarter of this year turned back to contraction to post -3.84 percent growth in the second quarter of 2019.

According to the Association of Housing Corporation of Nigeria (AHCN), an umbrella organization for all federal and state housing agencies, more than 90 percent of new homes that are built in the country utilise funds from personal savings.

The low purchasing power of Nigerians whose incomes were eroded by the country’s five-quarter recession is a major factor responsible for challenges in the real estate sector.

Africa’s most populous nation was in 2018 crowned the poverty capital of the world by the World Poverty Clock.

In a country where over 80 million people live on less than $2 in a day, acquiring a property is hardly a priority, even though shelter is one of the basic needs of man.

With a deficit of more than 17 million housing units, Nigeria has a mortgage industry that is less attractive to many of the country’s population owing to the high cost of servicing the loans.

With single-digit interest rates in some other countries, the mortgage industr y contr ibutes a significant amount to economic growth and development. This is however not the case in Nigeria as the roaring inflation rate and the attendant high mor tgage rate has not only dampened housing demand but has eroded developers’ investment appetite.

Africa’s largest economy has one of the world’s lowest mortgages to Gross Domestic Product (GDP) rate at 0.6 percent. This lags Ghana’s 2 percent, South Africa’s 30 percent and crawls after the U.S and UK rates of 60 percent and 70 percent respectively.

Under the leadership of Obaleye, Infinity Trust Mortgage Bank has made considerable efforts on policy advocacy, intending to ensure that the Nigerian mortgage industry becomes competitive with its peers.

The government seems to have been listening as the regulators are planning on new policies that address the issues that brought about the housing gap.

Obaleye’s passion for excellence and an untiring quest for unsurpassed value-added service delivery has won accolades for him and his bank both locally and internationally.

Specifically, in 2015, he was listed among top Nigerian Chief Executives in the Financial Services

and Insurance Industry in the international compendium which chronicles the most influential leaders and players in the country’s financial sector.

Also, the Global Credit Rating (GCR), Africa’s number one credit rating agency, affirmed Infinity Trust Mortgage Bank Plc ’s BB+ credit rating with a positive outlook in the long term and A3 with a positive outlook in the short term.

This was in recognition of the bank’s improved competitive capacity, enhanced brand perception resulting from its transformation from a private limited liability company to a public company and the subsequent upgrade of its license to a National Primary Mortgage Bank.

Under Obaleye’s leade r s h i p, I n f i n i t y T r u s t Mortgage Bank has moved from a rented office to its own ultra-modern fourstorey Corporate Headquarters located in Abuja’s busiest banking District in Garki. Currently, the bank has two branches in Abuja, and a branch in Lagos and Nassarawa states respectively.

Obaleye holds a B.Sc degree in Management and Accounting from Obafemi Awolowo University, Ile-Ife, and Masters in Business Administration (Financial Management) from the University of Abuja. He is a fellow of the Institute o f C h a r t e re d A c c o u n tants of Nigeria (ICAN), Nigeria Institute of Manag e m e nt ( N I M) , Cha rtered Institute of Taxation of Nigeria (CITN), and Institute of Credit Administration.

He recently bagged a D o c t o rat e i n Bu s i n e s s A d m i n i s t ra t i o n ( D B A ) with a specialization in Mortgage Finance from the prestigious Walden University, USA. An alumnus of Wharton Business School, Philadelphia, USA, Obaleye has attended many high profile seminars, symposia, training workshops, conferences, and courses locally and internationally. He has also delivered thought-provoking papers in diverse fields of human endeavour, spanning banking and finance, mortgage and real estate, leadership, human capital development, corporate strategy and business process re-engineering.

Widely travelled, Banjo (as he is fondly called), is an ardent lover and player of golf.

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.